This article explains how to use app passwords to sign in to Outlook.com. App passwords provide additional security when you access Outlook remotely via IMAP or POP.
How to Create an App Password for Microsoft Outlook Email | Office 365
Here's how to create app passwords to access Outlook.com, even when you have two-step verification turned on.
Select your name or avatar in the top navigation bar of Outlook.com, then select My Microsoft account.
Scroll down and select Update under the Security section.