Free Look Period

What is a 'Free Look Period'

A free look period is a period where a new insurance policy owner is able to terminate the contract without penalties such as surrender charges. A free look period often lasts for 10 or more days (depending on the insurer), allowing the contract holder to decide whether or not to keep it; if he or she is not satisfied, the contract purchaser can receive a full refund for it.

BREAKING DOWN 'Free Look Period'

During the free look period, the purchaser can continue to ask the insurer questions regarding the contract in order to better understand the policy. If refunded, the amount given back may equate to the value of the account at cancellation or to the amount of purchase payments, depending on the state.

RELATED TERMS
  1. Surrender Rights

    A right to cancel an annuity or life insurance contract in exchange ...
  2. Continuous Contract

    A reinsurance contract that does not have a fixed contract end ...
  3. Contract Holder

    An individual or organization who owns the rights to a debt or ...
  4. Surrender Fee

    A charge levied against an investor for the early withdrawal ...
  5. Traditional Whole Life Policy

    A type of life insurance contract that provides for insurance ...
  6. Surrender Charge

    A fee levied on a life insurance policyholder upon cancellation ...
Related Articles
  1. Personal Finance

    Understanding Your Insurance Contract

    Learn how to read one of the most important documents you own.
  2. Personal Finance

    Understanding Cash Surrender Value

    The amount of money an insurance company pays the owner of an insurance policy if the policy is voluntarily surrendered prior to the event that is insured
  3. Personal Finance

    Exploring Advanced Insurance Contract Fundamentals

    Understanding your contract can help you protect our family's financial security.
  4. Financial Advisor

    Divorce and Annuities: What Clients Need to Know

    Divorce can be the most financially devastating event in a person’s life. Here’s what your clients need to know about handling annuities in a divorce case.
  5. Personal Finance

    Converting An IRA Annuity To A Roth: Know The Rules

    We look at the past and current legislation that governs IRA annuity conversions.
  6. Personal Finance

    IRS Refund Lost? Here's What to Do

    Don't panic. There are a number of reasons your refund might be delayed – and solutions for each.
  7. Financial Advisor

    How to Avoid Overpriced Annuities

    The key to not paying excessive fees for annuities is understanding how they work. Here's what you need to know.
  8. Personal Finance

    An Introduction To Life Settlements

    A life settlement is the trading of a life insurance policy under specific circumstances. Learn what it's all about.
  9. Financial Advisor

    Advising FAs: Explaining Life Insurance to a Client

    Life insurance was initially designed to protect the income of families, particularly young families in the wealth accumulation phase, in the event of the head of household's death.
  10. Retirement

    Life Insurance: How To Get the Most Out Of Your Policy

    There are many benefits to owning a life insurance policy - if you get the right one for you.
RELATED FAQS
  1. What is a tax-free 1035 Exchange?

  2. Can your insurance company cancel your policy without notice?

    Learn about your rights as an insured when it comes to your insurance policy being canceled, including how to access your ... Read Answer >>
  3. How can a futures trader exit a position prior to expiration?

    A futures contract is an agreement to buy or sell a commodity at a pre-determined price and quantity at a future date in ... Read Answer >>
  4. What is the difference between forward and futures contracts?

    Fundamentally, forward and futures contracts have the same function: both types of contracts allow people to buy or sell ... Read Answer >>
  5. How do I get a split tax refund?

    You don't have to receive your tax refund in a lump sum. Learn the options you have for splitting the money the IRS owes ... Read Answer >>
  6. What is term insurance?

    Term insurance is a type of life insurance policy that provides coverage for a certain period of time, or a specified "term" ... Read Answer >>
Trading Center