Investing Assets & Markets Annuities What Is an Annuity Free Look Period? "Free Look" Period Explained By Stan Garrison Haithcock Stan Garrison Haithcock Stan Haithcock is a national annuity expert who serves as a consumer advocate on annuities. He has more than 25 years of experience in the financial services industry, with many of them spent as an investment advisor on Wall Street. Currently, Stan educates consumers about annuities through his platform, "Stan The Annuity Man." He has written several annuity owner's manuals, as well as a book, "The Annuity Stanifesto." learn about our editorial policies Updated on June 16, 2022 Reviewed by David Kindness Fact checked by Lakshna Mehta In This Article View All In This Article Definition and Example How the Free Look Period Works What It Means for Your Retirement Photo: RobinRoper / Getty Images Definition The free look period is a set time during which purchasers of annuities can walk away from the transaction penalty-free, with no reason required. Each state sets the length of the period. The free look period gives you a period where you can walk away from buying an annuity penalty-free, with no reason required. Each state sets the length of the period. Definition and Example of a Free Look Period The free look period for an annuity is a period after the purchase in which you can cancel it without facing any penalties. Free look periods usually last at least 10 days after purchase, depending on state law. The free look provision is designed to give prospective annuity customers a way to protect themselves from predatory sales practices. In the past, agents were paid commissions for selling annuities. That led them to adopt sales practices that were not in the best interests of their clients. States began regulating annuity sales in 2003, and regulations have been evolving. Nearly half of states have implemented or plan to implement the National Association of Insurance Commissioners' Best Interest Rule, which requires agents to act in their clients' best interests. How the Free Look Period Works The free look period starts when the annuity policy is delivered to you. Some carriers require you to sign an actual delivery receipt, but the clock starts as soon as you get the policy. Days counted are calendar days—not business days—so Saturday and Sunday are included. When the policy is delivered, it's best to call the carrier to verify how the annuity works and to confirm any promises made during the sales process. Don’t call the sales agent; call the annuity company directly. The company’s toll-free number will be on the policy, so if you find out that the guarantees don’t match the sales pitch, you can enact the free look policy right on that call. The best part about the free look provision is that you do not have to explain why you want a full refund. You never have to speak with the sales agent. There might be a form to sign (depending on the carrier), but the customer service people at the carrier may not try to talk you out of it. As long as you follow the time-frame rules, you will get your money back. Note The National Conference of Insurance Guaranty Funds (NCIGF) provides links to each state's insurance guaranty association and can also offer a detailed contact list. The annuity-free look provision is the consumer’s friend and can bring you peace of mind. It is possible to be up-sold into an annuity you don't need. Think of it as your "get out of an annuity-free" card. It gives you time to continue shopping or have a lawyer or financial adviser review your contract. The free look period follows the state guidelines outlined in the following table. State Requirements for Free Look Periods State Free Look Period Requirements Alabama 15 days in some circumstances; 30 days for replacement contracts Alaska 10 days for new policies; 30 days if you need a replacement contract Arizona 10 days standard; 30 days if you're 65 years old or older Arkansas 10 days in some circumstances California 10 days standard; 30 days if you're 62 or older Colorado None required by law Connecticut 10 days Delaware 10 to 15 days Florida 14 days standard; 21 days if you're 60 or older Georgia 10 days Hawaii 10 days standard; 15 days in some circumstances Idaho 20 days Illinois 10 days Indiana 10 days Iowa 10 days standard; 15 days in some circumstances Kansas 10 days Kentucky 10 days standard; 30 days if you need a replacement contract Louisiana 10 days Maine 15 days in some circumstances Maryland 10 days Massachusetts 20 days Michigan 10 days minimum Minnesota 10 days with a new policy; 30 days if you need a replacement policy Mississippi None required by law Missouri 10 days Montana 15 days in some circumstances Nebraska 10 days Nevada 10 days with a new policy; 30 days if you need a replacement policy New Hampshire 10 days New Jersey 10 days New Mexico 15 days in some circumstances New York 10 to 30 days North Carolina 10 days standard; 15 days in some circumstances North Dakota 20 days Ohio 10 days standard; 15 days in some circustances; 30 days if you need a replacement policy Oklahoma 20 days Oregon 30 days for replacement policies Pennsylvania 10 days Rhode Island 20 days South Carolina 10 days standard; 20 days if you need a replacement; 30 days if you're solicited and accept the policy South Dakota 10 days Tennessee 10 days Texas 20 days standard; 30 days if you need a replacement contract Utah 10 days standard; 30 days if you need a replacement contract Vermont None required by law, but 10 days is standard Virginia 10 days if you need a replacement contract; no requirement by law for new contracts Washington 10 days with a requirement to issue a refund within 30 days West Virginia 10 days minimum Wisconsin 30 days if you need a replacement contract; no requirement by law for new contract Wyoming 30 days if you need a replacement contract; no requirement by law for new contract What It Means for Your Retirement Many people experience buyer's remorse after purchasing a financial product. An annuity is a significant financial commitment. It is an excellent retirement solution for some people; for others, it might not be the best solution—the free look period is your state government's way of giving you time to think about it and ensuring that you're not being taken advantage of by commission-driven sales tactics. Key Takeaways The free look provision gives annuity buyers a chance to back out with no penalty.It generally extends from 10 to 30 days, depending on your state's laws.You're not required to give a reason, to get your money back.The provision is a counterbalance to sometimes aggressive annuity sales tactics. Was this page helpful? Thanks for your feedback! Tell us why! Other Submit Sources The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy. Investor.gov. "Updated Investor Bulletin: Variable Annuities." Insurance Retirement Institute. "States Continue to Adopt NAIC Best Interest Model Regulation." Annuity.org. "Free Look Period." Related Articles Best Watch Insurance Providers for 2024 What Is the Free Look Period for Life Insurance? How Do Annuity Agent Commissions Work? How To Cancel Life Insurance What Happens If Your Insurance Company Files Bankruptcy? Annuities: Advantages and Disadvantages What Is an Individual Retirement Annuity? What Is a Surrender Charge? What Is an Annuity? Annuity Sales in Banks Can I Buy an Annuity Direct? Agent Qualifications to Sell Annuities When Are Annuities a Good Investment? What Is a Qualified Annuity? What to Know Before You Buy an Immediate Annuity SPIA Structure: Life With Death Benefit Newsletter Sign Up By clicking “Accept All Cookies”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. Cookies Settings Accept All Cookies