DONE and FIXED after 3 weeks!
First it is NOT outlook stopping you so DO NOT change any setting.
I, in Australia am using Telstra as provider, so:
I went to my Telstra Webmail, since I couldn't reach my mail from my Microsoft outlook 2019, in my Webmail I changed my password and waited for approval from My provider: Telstra. (You go to accounts there you should be able to Change password.)
You will need to Re-log in with your New password in your Webmail
After logged in webmail when in your email box go to Settings in Settings go to Accounts, in Accounts go to Manage passwords and or App-Specific Passwords, there click Revoke all.
Now go back to outlook 2019/21/... and change your password to the new one, and Voila.
I made a mistake 3 weeks ago to delete my account, couldn't reset it and lost all my contacts!? so this way you keep everything the same.
Hope it works for you I did try everything else, contacted Microsoft 4 times and my provider 6 times and finally the last tech guy from my provider showed me the way.