Final answer:
The cash value of an annuity will be paid to the annuitant's estate (Option B) if the annuity owner dies during the accumulation period without naming a beneficiary.
Step-by-step explanation:
If an annuity owner dies during the accumulation period without naming a beneficiary, the cash value of the annuity contract will generally be paid to the annuitant's estate. This statement is based on a typical policy and legal practice where the proceeds of such financial products are handled in accordance with estate laws when a beneficiary is not designated.
During the accumulation phase of an annuity, a policyholder makes payments into an account, which accrues interest over time. The cash value in this account could exceed the premiums paid. In such a case, should the policyholder (annuitant) die, this accumulated cash value becomes an asset of the estate and is distributed according to the deceased's will or, if no will exists, according to state intestacy laws.
This means that the correct response to the given scenario is that the cash value will be paid to the annuitant's estate. State governments do not receive the cash value, premium values are not the only amounts considered, and benefits are not automatically forfeited. These contravene most regulations governing annuity contracts and the principles of estate distribution. Therefore, the correct answer is Option B: The cash value will be paid to the annuitant's estate.