The 'offer and acceptance' principle in insurance refers to:

The 'offer and acceptance' principle is a fundamental concept in contract law that is particularly relevant in insurance agreements. In this context, the application or premium quotation represents an offer from the insurance applicant to enter into a contract with the insurer. When an individual applies for insurance and submits relevant details, they are essentially proposing the terms under which they wish to be insured—this is the 'offer.'

Once the insurer reviews the application and either provides a premium quotation or issues a policy in response, this constitutes acceptance of the offer. The key aspect of this principle is that there must be a clear indication of acceptance from the insurer for a binding contract to exist. It's also important to note that the acceptance must match the terms of the offer for the contract to be valid, which does not necessarily involve additional negotiation.

The other provided options highlight different aspects of the insurance process but do not directly capture the essence of the 'offer and acceptance' principle as it relates to the initiation of a contract through the applicant's submission of an application or premium quotation.