"Cash out" is ambiguous:

1.  "Cash out" as in withdraw your $ and move it to a different account somewhere else.

2.  "Cash out" as in reallocate from equities to cash/bonds or equivalent within the same account.

1.  = there certainly could be penalties.

2.  = there should be no penalties; just move all or some of your equity position(s) to cash/equivalent...that's what they are there for:  to dampen market swings at the cost of return. One technique would be to use any relief rallies we get to convert a partial amount to cash.
The other thing to consider, which you mentioned is your financial position/security:  if you don't need the money in the 403(b) in the long run (i.e. other sources of $ are sufficient) then you might consider letting it ride.  The whole idea behind capital preservation and risk management is to assume a level of risk that, if/when the worst happens, you will still have enough remaining to live on.

By way of example, I had stops in place to lock in profits nearly all of my positions; I hated (and continue to hate) getting stopped out positions, some of which I've held for decades, but I'm not about to throw profits away let along turning winning positions into losing positions.
IOW my account automatically shifted from equities to cash.

As for "locking in losses":

1.  Look at the value of your account:  guess what?  The losses are already included in the total; you own the losses whether you hold or sell.

2.  Some simple "avoid losses at all costs" (pun of sorts) math:  you have a position worth $9k.  It loses 1/3 of its value and is now worth $6k.  You hold on to your position (with a $3k loss) hoping it will someday get back to even (or better).  In order to do so, it will have to gain 50%...which likely will never happen or if it ever does, it will take a long time.

IOW better to cut losses and reallocate rather than letting them run (you let profits run; losses are cut).

Additionally, while I am the last one on the board to try and time the market, sometimes reality gets your attention by slapping you in the face:  ever the eternal optimist, I still see dark days ahead.