The Technical Term is "Non-Qualified". Any IRA/401k/403b/Pension money is "Qualified". That is an IRS Term.
And YES! There is a 10% Age Based Penalty on Withdrawals or Loans from Non-Qualified Annuities when the Owner is under age 59 & 1/2. Anyone who says otherwise has not taken the time to read an illustration fully.
The reason for this, is because a Non-Qualified Annuity is Tax-Deferred. That is a benefit the IRS gives annuity owners for saving for retirement... but the trade off is you must wait until retirement.
If an IMO ever tells you otherwise, have them send you a Non-Qualified Illustration. Read it. And then show them the line that explains the age based IRS tax penalty for Non-Qualified Annuities.
