Free Look Period
The free look period is a mandatory time frame (typically 10-30 days) after receiving an insurance policy during which the policyholder can cancel for a full refund of premiums paid, no questions asked.
Exam Tip
Free look = 10-30 days to cancel for FULL refund. Starts at DELIVERY, not purchase. Seniors often get longer periods.
What is the Free Look Period?
The free look period is a consumer protection provision that gives policyholders time to review their new insurance policy and cancel it for a full premium refund if they're not satisfied. This applies to most life insurance and annuity contracts.
Free Look Period by Product Type
| Product | Typical Free Look |
|---|---|
| Life Insurance | 10-30 days |
| Annuities | 10-30 days |
| Long-Term Care | 30 days |
| Medicare Supplement | 30 days |
| Health Insurance | 10-30 days |
Note: State laws vary; some require longer periods for seniors
How the Free Look Period Works
| Step | What Happens |
|---|---|
| 1 | Policy is delivered to the policyholder |
| 2 | Free look period begins (clock starts) |
| 3 | Policyholder reviews the contract |
| 4 | If cancelled during free look: FULL refund |
| 5 | If kept: Policy remains in force |
Key Features
| Feature | Description |
|---|---|
| Full Refund | 100% of premiums returned |
| No Penalty | No surrender charges apply |
| No Questions | Don't need to give a reason |
| Starts at Delivery | Clock begins when policy is received |
Why Free Look Periods Exist
- Consumer Protection: Allows review without pressure
- Informed Decision: Time to read and understand the policy
- Cooling Off: Reduces pressure from sales tactics
- Comparison Shopping: Can compare with other products
What "Delivery" Means
The free look period starts when the policy is delivered, which means:
- In person: When handed to policyholder
- By mail: When received (not when mailed)
- Electronically: When accessed or downloaded
Senior Protections
Many states extend free look periods for seniors (often 65+):
- May extend to 30 days
- Applies to annuities and life insurance
- Some states require up to 60 days for certain products
Important Notes
- Free look applies to NEW policies, not renewals
- Agent commissions are typically clawed back if cancelled
- Death benefit coverage is usually in effect during free look
- Some products may have longer state-mandated periods
Study This Term In
Related Terms
Premium (Insurance)
InsuranceAn insurance premium is the amount paid by the policyholder to the insurance company for coverage, typically paid monthly, quarterly, or annually.
Grace Period
InsuranceA grace period is a set time after the premium due date during which a policy remains in force even if the premium hasn't been paid, typically 30-31 days for life insurance.
Annuity
InsuranceAn annuity is an insurance contract that provides a stream of income payments, typically for retirement, in exchange for an initial lump sum or series of payments.