Can't select "iCloud" as default account for Contacts (iPhone iOS 10)

I've read all the help questions I can find and I still can't figure this one out.

My contacts aren't syncing between my iPhone (iOS 10) and MacBook Pro (macOS Sierra). When I try and search for a contact on my MacBook, I can't find it, even though I can find it in my phone.

Under Settings --> iCloud --> Contacts, it's definitely toggled to "on".

Under Settings --> Contacts --> Default Account, I can only choose between "myname@gmail.com" and "On My iPhone". I don't have "iCloud" as an option to select at all.

Help!