Last reviewed: 1 October 2026
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The free-look refund: how three states word it
The short answer: a free-look period lets you return a new policy or annuity and get money back, but how much, and how long you have, depends on the product and the state. North Carolina's Department of Insurance, in an FAQ about life insurance, describes it as a window after delivery to return the policy "for a full refund of premium," with a 10-day minimum on new policies and 20 days on replacements.[1] Iowa's rule says the premium is promptly refunded, but for a variable product the amount follows the policy language.[2] Texas's annuity rule (28 TAC section 4.2311) sets a 15-day window in certain cases and defines the refund for variable annuities differently.[3] Our main free-look guide explains the right itself; this page looks at the refund.
Why it matters
"Free look" is not one national rule. Each state sets its own window and its own refund wording, and a product that mixes insurance with investments can be treated differently from a plain policy. The three states below show how far the wording can differ. This page does not cover every state and is not advice about whether to keep or return a policy.
Sources
This guide draws on North Carolina's Department of Insurance FAQ about life insurance (an explanatory page, not a rule), the Iowa Administrative Code rule on the right to return a life insurance policy or annuity as published by the Iowa Legislature, and the Texas annuity free-look rule. The Texas rule is now 28 Texas Administrative Code section 4.2311; the Texas Department of Insurance moved it from section 3.9711 when it renumbered a group of Chapter 3 rules into a new Chapter 4 effective 1 September 2023.[4] The Texas text used here is the Legal Information Institute compilation of section 4.2311, which shows it was last adopted in the Texas Register in January 2024;[3] the Department's 2010 adoption document for the original rule is background only.[5] Rules change, so check your own state's current text and your contract. Iowa's rule points to separate chapters on replacements and variable life, which this guide does not cover.[2]
Three states, three wordings
| State and product | Window | What is refunded |
|---|---|---|
| North Carolina (Department of Insurance FAQ about life insurance, not a rule) | The FAQ describes a minimum of 10 days on new policies and 20 days on replacement policies, after delivery[1] | "A full refund of premium" (FAQ wording)[1] |
| Iowa (rule): individual life insurance policy or annuity | Within ten days after receipt; for a replacement, the length follows Iowa's replacement chapter[2] | Premium paid is promptly refunded and the policy voided; for a variable product, the amount follows the policy language[2] |
| Texas (28 TAC s. 4.2311, formerly s. 3.9711): annuity contracts under the annuity disclosure rules | At least 15 calendar days if the buyer's guide and disclosure document were not provided at or before the application; starts on the day the consumer receives the contract[3] | Return "without penalty"; for variable or modified guaranteed annuities, the cash surrender value plus any fees or charges deducted from premiums or imposed under the contract[3] |
Where you send it, and when the clock starts
Iowa's rule says the policyowner may return the policy or annuity to the insurer's home office, its branch office, or the producer through whom it was purchased.[2] Texas's rule says the free-look period begins on the date the consumer receives the annuity contract and runs at the same time as any other free-look period required under Texas law, and that notice of the free-look period must be on or attached to the cover page of the delivered contract.[3] North Carolina's FAQ measures the window from policy delivery.[1] In each case the clock runs from receipt or delivery, not from the day you applied.
Why "refund" does not always mean "premium"
For a plain policy, the wording in North Carolina and Iowa returns the premium. For a variable product, the wording in Iowa (the amount follows the policy language) and Texas (cash surrender value plus fees and charges) is not simply "the premium you paid."[2][3] The amount for any particular contract is set by the contract and the state's rule, and is not stated here. Our guide to variable annuities and variable life explains why those products are treated as both insurance and securities.
Who the rule may not cover
Texas's rule says its refund and free-look requirements do not apply if the prospective owner is an accredited investor as defined in Regulation D of the Securities and Exchange Commission.[3] The Department's 2010 adoption document explains its reasons for that exception.[5] Iowa's rule points replacements to its replacement chapter rather than setting the length itself.[2] See the replacement notice and churning and twisting for the replacement context.
What you can check in your own contract
- The start date: the contract's free-look page should say when the window begins and how many days it lasts.
- The method: how the insurer says to cancel, and where to send the request.
- The amount: what the contract and your state's rule say you get back, particularly for a variable product.
- The paperwork: whether the buyer's guide and disclosure document were given at or before the application (Texas's annuity rule turns on this).[3]
- Replacement: whether the transaction replaced an existing contract, since the window can be longer.[1]
If you are unsure, ask your state's insurance department. Our standard summarizes the free-look right in general terms; your state's own rule and your contract control.
What this page does not cover
It covers three states only, and only what their rules and the regulator's page say. It does not cover other states, long-term care free-look rules (see the LTC guide), or the tax consequences of returning a contract. It is not legal, tax or financial advice.
When we will update this page
We re-read this page when any of the three rules or pages cited here changes. If something here is out of date, tell us; corrections are dated on the page.
References
- [1] North Carolina Department of Insurance, "FAQs About Life Insurance", read 1 October 2026 — www.ncdoi.gov/consumers/life-insurance/faqs-about-life-insurance
- [2] Iowa Administrative Code, rule 191—15.9, "Right to return a life insurance policy or annuity (free look)" (Iowa Legislature, official PDF), read 1 October 2026 — www.legis.iowa.gov/docs/iac/rule/191.15.9.pdf
- [3] 28 Texas Administrative Code section 4.2311, "Free Look Period" (formerly section 3.9711), compiled text, Legal Information Institute, Cornell Law School, read 1 October 2026 — www.law.cornell.edu/regulations/texas/28-Tex-Admin-Code-SS-4-2311
- [4] Texas Department of Insurance, rule-transfer notice moving 28 TAC Chapter 3 subchapters to Chapter 4 effective 1 September 2023 (section 3.9711 to section 4.2311), read 1 October 2026 — www.tdi.texas.gov/rules/2023/documents/ch4lnatransfer.pdf
- [5] Texas Department of Insurance, adopted sections, Title 28 Part I Chapter 3 Subchapter PP (annuity disclosures), 2010 adoption document (background only), read 1 October 2026 — tdi.texas.gov/rules/2010/documents/11-0120.pdf
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