What type of contract is characterized by one party drafting the terms and the other accepting them as-is?

A contract of adhesion is defined as a type of agreement where one party creates the terms and the other party has little to no ability to negotiate those terms. This typically happens in standardized contracts, often used in insurance or consumer agreements, where one party (the drafter) presents the contract and the other party simply accepts it as it is. The key feature of a contract of adhesion is the imbalance of power in the negotiation process, leaving the accepting party with the option to either accept all terms or reject the contract entirely.

In this context, understanding the nature of contracts of adhesion is crucial for recognizing how they can affect the rights and obligations of the parties involved. It's important to note that while the accepting party does not have the ability to negotiate, these contracts must still adhere to legal standards to ensure they are not unconscionable or unfair to the consenting party.