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If the password you use to access Office 365 changes for any reason, you must also update the password setting on your mobile devices (for example, mobile phones or tablets) and any desktop e-mail programs (for example, Apple Mail, Mozilla Thunderbird, Microsoft Outlook, or Windows Live Mail). Updating your password settings in multiple places may seem like extra work, but this requirement helps keep your information secure.
Put another way, whenever your password changes “in the cloud”, any devices that were set up using your “old” password will immediately stop being able to send or receive e-mail, or synchronize any information with your Office 365 account.
Examples of when your password could change.
The good news is that there are some simple steps you can take to help maintain connectivity/synchronization on your mobile device and desktop email programs.
Step 1: Regularly change your Office 365 password to prevent it from expiring without you being aware of it.
Step 2: Always update the password setting on your mobile phone and on your desktop e-mail programs every time your Office 365 password changes.
Check out all the details in this linked Wiki article.