For simple websites, this should not be a problem as other web development companies will assist you to move at no cost. However if your website contains software programs or makes use of a database on the server, there can be issues regarding portability and ownership of the software. Your web developer should look after this for you, but they may arrange it so that you pay this annual charge. Doing so helps them to reduce the price that they quote to you. Typical charge IR 100 per year.
Some servers are host to too many websites and are overloaded.
Either way, at times of even moderate demand you website will appear to perform very badly. These attract users of high bandwidth, such as pornos, and response times can be very bad. Look for guaranteed uptimes, or at least a responsible attitude to downtime. Does the website hosting company have a security policy that ensures that passwords cannot be stolen or guessed. Passwords should not be sent to you by email because email is insecure.