mitch18, your math is flawed. As the account cash balance approaches zero, the ratio of the actuarial value of the rider plus the cash value to the cash value approaches infinity, not zero, and infinity is greater than 120%. Once the cash balance goes to zero, the FMV of the IRA will be based solely on the actuarial value of the rider and that's the amount on which the RMD will be based.
Another way to state this is that the FMV will always be cash balance plus actuarial value of the rider if the actuarial value of the rider is more the 20% of the cash balance. A nonzero actuarial value will always be more than 20% of zero.
