What characterizes a contract of adhesion?

A contract of adhesion is characterized by its nature of being drafted by one party, typically the one that has more power or is in a stronger negotiating position, leaving the other party with little to no ability to negotiate the terms. This means that the terms are usually set in a standardized form.

In such contracts, one party essentially takes the lead in creating the agreement and the other party must "adhere" to these pre-determined terms if they wish to enter into the contract. This can be commonly seen in insurance policies and consumer contracts, where the drafting party (often the insurer or service provider) defines the terms, and the other party (the insured or consumer) either accepts or rejects the terms without any significant power to alter them.

The other characteristics provided in the options describe different contract dynamics. The idea of mutual negotiation or consent for modification does not apply here because in a contract of adhesion, the non-drafting party does not have the leverage to negotiate. The enforceability under arbitration isn't unique to contracts of adhesion, as various types of contracts can include arbitration clauses, and it’s not a defining characteristic of adhesion contracts.