What is the ruling on seeking refuge with Allah (Al-Isti'adha)?

The majority of scholars hold that seeking refuge (isti'adha) before recitation in prayer is sunnah (recommended). This is supported by Allah's saying: (So when you recite the Qur’an, [first] seek refuge in Allah from Satan, the expelled [from His mercy]) [An-Nahl: 98], and by the hadith of Abu Sa'id (may Allah be pleased with him) that when the Messenger of Allah (peace be upon him) stood for prayer, he would begin by saying: "I seek refuge in Allah, the All-Hearing, the All-Knowing, from Satan, the expelled, from his 'hamz' (insanity/strangulation), his 'nafkh' (arrogance), and his 'nafth' (evil poetry/magic)."

Its form is to say: "A'udhu billahi minash-shaytanir-rajeem" (I seek refuge in Allah from Satan, the expelled) or "A'udhu billahis-samee'il-'aleemi minash-shaytanir-rajeem" (I seek refuge in Allah, the All-Hearing, the All-Knowing, from Satan, the expelled). It should be said silently, not audibly. As for outside of prayer, there is no disagreement on its permissibility for anyone who wishes to recite, due to the generality of the verse.