What does the non-forfeiture value of an annuity represent?

The non-forfeiture value of an annuity represents the cash value account amount that is payable upon surrender of the annuity. This value is critical for policyholders because it provides a guaranteed return of a portion of their investment if they decide to terminate the contract before it matures or before annuitization occurs.

Annuities may accumulate value over time, and this accumulated value can often be accessed by the policyholder if they choose to surrender the annuity. It's designed to protect the policyholder's investment to some extent, ensuring that they do not lose all their contributions if they need to exit the contract early.

In contrast, other options such as the total investment required to purchase an annuity, locked-in interest rates for future payments, or tax implications of early withdrawals do not accurately describe the essence of the non-forfeiture value. The non-forfeiture provision is specifically concerned with the cash value available when the policy is surrendered.