Switching iPhone Backup to iCloud - Smaller size than storage

Hi - I've changed my 6s backup to iCloud and when I checked to see if it was working, I was surprised to see that the size of the backup was smaller than the total items being backup. Most specifically, my photos. I've read about this issue in many places, and it seems like the common comment is that the backup does not include a photo library that is already stored on iCloud. The option to store my iPhone's photo library on iCloud is *not* selected (nor is the photo stream), so I'm confused if my images and videos are actually saved elsewhere. This is kind of timely since I'm getting a new iPhone and I need to verify if everything is getting backed up before I trade it in. Thanks for any constructive insights.