The annuity surrender period is the amount of time you must wait before being able to sell your annuity without attracting a surrender penalty. It is normally between 6 and 8 years after the purchase of the annuity but can be over 10 years. Surrender periods are included in most annuities as a way to protect insurance brokers who rely on commission to make a profit. In most cases, the surrender penalty is a percentage amount of the current annuity value. This is usually on a sliding scale, reducing by a percentage point every year. For example, the penalty might be 6% on year 1, 5% on year 2, 4% on year 3 and so on. A 10% IRS early withdrawal penalty will also apply—in addition to any surrender penalties—if you withdraw funds before you reach 59½ years' old, regardless of how long you have held the policy. You are usually permitted to withdraw up to 10% of your annuity fund, penalty free, in any one year. Surrender penalties will then only apply to the remainder of the money you are withdrawing.