485BPOS 1 d138946d485bpos.htm BOA FPVUL BOA FPVUL
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-6
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 File No. 033-42180
Pre-Effective Amendment No. □
Post-Effective Amendment No. 46 ☑
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 File No. 811-05311
Amendment No. 71 ☑
(Check appropriate box or boxes.)
Nationwide VLI Separate Account-2
(Exact Name of Registrant)
Nationwide Life Insurance Company
(Name of Depositor)
One Nationwide Plaza, Columbus, Ohio 43215
(Address of Depositor's Principal Executive Offices) (Zip Code)
(614) 249-7111
Depositor's Telephone Number, including Area Code
Mark Howard, Executive Vice President, Chief Legal and Governance Officer,
One Nationwide Plaza, Columbus, Ohio 43215
(Name and Address of Agent for Service)
May 1, 2016
Approximate Date of Proposed Public Offering
It is proposed that this filing will become effective (check appropriate box)
□ immediately upon filing pursuant to paragraph (b)
☑ on May 1, 2016 pursuant to paragraph (b)
□ 60 days after filing pursuant to paragraph (a)(1)
□ on (date) pursuant to paragraph (a)(1)
If appropriate, check the following box:
□ this post-effective amendment designates a new effective date for a previously filed post-effective amendment.

 

The Best of America® FPVUL
Individual Flexible Premium Variable Universal Life Insurance Policies
Issued by
Nationwide Life Insurance Company
through its
Nationwide VLI Separate Account-2
The date of this prospectus is May 1, 2016.
This prospectus contains basic information about the policies that should be understood before investing. Read this prospectus carefully and keep it for future reference.
Variable life insurance policies are complex products with unique benefits and advantages. There are costs and charges associated with these benefits and advantages - costs and charges that are different, or do not exist at all within other life insurance products. With help from financial consultants and advisors, purchasers are encouraged to compare and contrast the costs and benefits of the policy described in this prospectus against those of other life insurance products, especially other variable life insurance products offered by Nationwide and its affiliates. Nationwide offers a wide array of products, many with different charges, benefit features, and underlying investment options. This process of comparison and analysis should aid in determining whether the purchase of the policy described in this prospectus is consistent with the purchaser’s life insurance objectives, risk tolerance, investment time horizon, marital status, tax situation, and other personal characteristics and needs.
To obtain additional information, including free copies of prospectuses for the underlying mutual funds or a copy of the Statement of Additional Information, or to make service or transaction requests, contact Nationwide using any of the methods described in Contacting the Service Center.
These securities have not been approved or disapproved by the SEC nor has the SEC passed upon the accuracy or adequacy of the prospectus. Any representation to the contrary is a criminal offense.
This prospectus is not an offering in any jurisdiction where such offering may not lawfully be made. Not all Riders, terms, conditions, benefits, programs, features, and investment options are available or approved for use in every state. Contact Nationwide to review a copy of the policy and any Riders or endorsements. This prospectus contains all material rights and features of the policy.
The policy is NOT: insured by the Federal Deposit Insurance Corporation; a bank deposit; available in every state; or insured or endorsed by a bank or any federal government agency.
The policy may decrease in value to the point of being valueless because of poor Investment Experience.
The purpose of this policy is to provide life insurance protection for the beneficiary named by the policy owner. If the purchaser’s primary need is not life insurance protection, then purchasing this policy may not be in the best interest of the purchaser. Nationwide makes no claim that the policy is in any way similar or comparable to a systematic investment plan of a mutual fund.
If this policy is being purchased to replace existing life insurance, the purchaser should carefully consider the benefits, features, and costs of this policy versus those of the policy being replaced.
Nationwide offers a variety of variable universal life policies. Despite offering substantially similar features and investment options, certain policies may have lower overall charges than others including the policy described herein. These differences in charges may be attributable to differences in sales and related expenses incurred in one distribution channel versus another.
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In Summary: Policy Benefits
Death Benefit
The primary benefit of this policy is life insurance coverage. Nationwide will pay the Death Benefit Proceeds upon the Insured's death if the Insured dies while the policy is In Force. The policy is In Force when: the policy has been issued; the Insured is living; the policy has not been surrendered for its Cash Surrender Value; and the policy has not Lapsed.
Death Benefit Options
Note: The Death Benefit will be the greater of the amount produced by the death benefit option in effect on the date of the Insured's death or the Minimum Required Death Benefit, see The Minimum Required Death Benefit.
Death Benefit Option 1: The Death Benefit will be the greater of the Total Specified Amount or the applicable percentage of Cash Value. The amount of the Death Benefit Proceeds will ordinarily not change for several years to reflect Investment Experience and may not change at all. If Investment Experience is favorable, the amount of the Death Benefit Proceeds may increase.
Death Benefit Option 2: The Death Benefit will be the greater of the Total Specified Amount plus the Cash Value as of the date of death or the applicable percentage of Cash Value, and will vary directly with Investment Experience.
Benefit Payout
Policy Proceeds will be paid out in a lump sum.
Coverage Flexibility
Subject to conditions, the policy owner may choose to:
• change the death benefit option;
• increase or decrease the Base Policy Specified Amount and/or Rider Specified Amount;
• change beneficiaries; and
• change ownership of the policy.
Access to Cash Value
Subject to conditions, the policy owner may:
• take a policy loan, see Policy Loans.
• take a partial surrender, see Partial Surrender.
• surrender the policy for its Cash Surrender Value at any time while the policy is In Force, see Full Surrender.
Premium Flexibility
The policy owner will select a Premium payment plan for the policy at the time of application. Within limits, the policy owner may vary the frequency and amount of Premium payments, see Premium Payments and Unfavorable Investment Experience.
Investment Options
Net Premium may be allocated among fixed and/or variable investment options available in the policy.
The policy currently offers a fixed investment option which will earn interest daily, see Fixed Account.
The variable investment options offered under the policy correspond to mutual funds designed to be the underlying investment options of variable insurance products. Nationwide VLI Separate Account-2 contains one Sub-Account for each of the underlying mutual funds offered in the policy.
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Transfer Requests
Policy owners may request to transfer allocations between available investment options of the policy (i.e., the Fixed Account and Sub-Accounts). Requests to transfer allocations between policy investment options will be processed in the Valuation Period they are received at the Service Center as long as the request is in good order. Requests that are not in good order may be delayed or returned, see Contacting the Service Center. Transfer requests may be subject to policies and procedures intended to reduce the potentially detrimental impact that disruptive trading has on Sub-Account Investment Experience, see Transfers Among and Between Policy Investment Options.
Taxes
Earnings on the policy are generally not taxable to the policy owner, unless withdrawn from the policy. This is known as tax deferral. In addition, beneficiaries generally will not have to include Death Benefit Proceeds as taxable income, see Taxes.
Unlike other variable insurance products Nationwide offers, Individual Flexible Premium Variable Universal Life Insurance Policies do not require distributions to be made before the Insured's death, see Taxes.
Assignment
Policy owners may assign the policy as collateral for a loan or another obligation while the policy is In Force, see Assigning the Policy.
Examination Right
For a limited time, the policy owner may cancel the policy and receive a refund, see Right To Cancel (Examination Right).
Riders
The policy owner may purchase one or more of the Riders listed below, subject to availability in the state where the policy is issued. There may be additional charges assessed for elected Riders and Rider charges may vary based upon the individual characteristics of the Insured. Operation and benefits of the Riders described in this prospectus may vary by the state where the policy is issued.
• Accidental Death Benefit Rider
• Base Insured Term Rider
• Change of Insured Rider
• Children's Insurance Rider
• Guaranteed Minimum Death Benefit Rider
• Spouse Life Insurance Rider
• Waiver of Monthly Deductions Rider
In Summary: Policy Risks
State Variations
Due to variations in state law, many features of the policy described in this prospectus may be different or may not be available at all depending on the state in which the policy is issued.
Possible variations include, but are not limited to, Rider terms and availability, availability of certain investment options, free look rights, policy exchange rights, policy Lapse and/or reinstatement requirements, and the duration of suicide and incontestability periods. Variations due to state law are subject to change without notice at any time. To review a copy of the policy and any Riders or endorsements for the state in which the policy will be issued, the policy owner can contact the Service Center, see Contacting the Service Center.
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Risk of Increase in Current Fees and Charges
Nationwide may change policy and/or Rider charges and rates under the policy at any time. Changes in policy and/or Rider charges and rates will vary based upon changes in Nationwide's future expectations related to items such as company investment earnings, mortality experience, persistency experience, expenses, including reinsurance expenses, and taxes. Nationwide will provide advance notice of any increase in policy and/or Rider charges.
If a change in the charges or rates causes an increase to the policy and/or Rider charges, the policy's Cash Value could decrease. If a change in the charges or rates causes a decrease to the policy and/or Rider charges, the policy's Cash Value could increase. Policy and Rider charges will not exceed the maximum charges shown in the fee tables, see In Summary: Fee Tables and Standard Policy Charges.
Improper Use
Variable universal life insurance is not suitable as an investment vehicle for short-term savings. It is designed for long-term financial planning. Policy owners accessing the Cash Value in the early policy years could incur potentially substantial surrender charges.
Unfavorable Investment Experience
The Sub-Accounts may generate unfavorable Investment Experience. Poor Investment Experience and the deduction of policy and Sub-Account charges may lower the policy’s Cash Value potentially resulting in a Lapse of insurance coverage.
Note: The policy owner selects the Premium amount and frequency shown in the policy illustration to show Nationwide how much Premium the policy owner intends to pay and when. Illustrated Premium and hypothetical rates of return are not guaranteed. Investment Experience varies over time, is rarely the same year-over-year, and may be negative. Because the policy is a variable universal life insurance policy with the potential for unfavorable Investment Experience, including extended periods of significant stock market decline, additional Premium may be required to meet a policy owner's goals and/or to prevent the policy from Lapsing. Generally, variable universal life insurance is considered a long-term investment. Policy owners should weigh the investment risk and costs associated with the policy against their objectives, time horizon, risk tolerance, and ability to pay additional Premium if necessary.
Adverse Tax Consequences
Existing federal tax laws that benefit this policy may change at any time. These changes could alter the favorable federal income tax treatment the policy enjoys, such as the deferral of taxation on the gains in the policy's Cash Value and the exclusion of the Death Benefit Proceeds from the taxable income of the policy's beneficiary. Partial and full surrenders from the policy may be subject to taxes. The income tax treatment of the surrender of Cash Value is different in the event the policy is treated as a modified endowment contract under the Code. Generally, tax treatment of modified endowment contracts is less favorable when compared to a life insurance policy that is not a modified endowment contract. For example, distributions and loans from modified endowment contracts may currently be taxed as ordinary income and not a return of investment, see Taxes.
The proceeds of a life insurance policy are includible in the gross estate of the Insured for federal income tax purposes if either (a) the proceeds are payable to the executor of the estate of the Insured, or (b) the Insured, at any time within three years prior to his or her death, possessed any incident of ownership in the policy. For this purpose, the Treasury Regulations provide that the term "incident of ownership" is to be construed very broadly, and includes any right that the Insured may have with respect to the economic benefits in the policy. Consult a qualified tax advisor on all tax matters involving the policy described herein.
Fixed Account Transfer Restrictions and Limitations
In addition to the Sub-Accounts available under the policy, Net Premium can be allocated to the Fixed Account. Prior to the policy's Maturity Date, the policy owner may make transfers involving the Fixed Account subject to transfer restrictions, without penalty or adjustment. These transfers will be in dollars and Nationwide may limit the frequency and dollar amount of transfers involving the Fixed Account. See Fixed Account Transfers for details about restrictions that apply to transfers to and from the Fixed Account.
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Sub-Account Limitations
Frequent trading among the Sub-Accounts may dilute the value of Accumulation Units, cause the Sub-Account to incur higher transaction costs, and interfere with the Sub-Accounts' ability to pursue their stated investment objectives. This could result in less favorable Investment Experience and a lower Cash Value. Some mutual funds held by the Sub-Accounts assess a short-term trading fee in order to minimize the potentially adverse effects of short-term trading on the mutual fund. Nationwide has instituted procedures to minimize disruptive transfers. While Nationwide expects these procedures to reduce the adverse effect of disruptive transfers, it cannot ensure that it has eliminated these risks.
Sub-Account Investment Risk
A comprehensive discussion of the risks of each underlying mutual fund may be found in the mutual fund’s prospectus. Read each mutual fund's prospectus before investing. Free copies of each mutual fund's prospectus may be obtained by contacting the Service Center.
Risk of Policy Lapse
Cash Value can be reduced by Investment Experience, policy loans, partial surrenders and the deduction of policy charges. Whenever Cash Value is insufficient to cover the policy’s charges, the policy is at risk of Lapse; the policy could terminate without value and insurance coverage would cease.
Limitation of Access To Cash Value
A policy owner can access Cash Value through loans and partial surrenders, subject to limitations. Limitations include the amount and frequency of the loan or partial surrender, see Policy Loans and Surrenders. Once a loan or surrender is taken, Cash Value will be reduced by the amount of the policy loan and/or the partial surrender and any associated charges.
In Summary: Fee Tables
The following tables describe the fees and expenses assessed under the policy. The rates in these tables may be rounded up to the nearest one-hundredth decimal. These tables should be read in conjunction with the corresponding section of this prospectus that describes the fee or expense in more detail. All charges deducted from the policy's Cash Value are taken proportionally from the Sub-Accounts and the Fixed Account except where noted.
The first table describes the fees and expenses that a policy owner will pay at the time the policy owner buys the policy, surrenders the policy, or transfers Cash Value between investment options.
Transaction Fees
Charge When Charge Is Deducted Amount Deducted
Sales Load1 Upon making a Premium payment Maximum
$25 from each $1,000 of Premium 		Current
$25 from each $1,000 of Premium
Premium Taxes1 Upon making a Premium payment $35 per $1,000 of Premium
Surrender Charges2 †
Representative – An age 35 male; non-tobacco preferred; Base Policy Specified Amount and Total Specified Amount of $250,000; Death Benefit Option 1 		Upon surrender or policy Lapse Minimum
$357 		Maximum
$19,298 		Representative
$1,704
From the Policy's available Cash Value
Illustration Charge3 Upon requesting an illustration Maximum
$25 		Current
$0
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Transaction Fees
Charge When Charge Is Deducted Amount Deducted
Partial Surrender Fee Upon a partial surrender Maximum
the lesser of $25 or 2% of the surrendered amount 		Current
$0
Short-Term Trading Fee4 Upon transfer of Sub-Account value out of a Sub-Account within 60 days after allocation to that Sub-Account 1% of the amount transferred from the Sub-Account within 60 days of allocation to that Sub-Account
† This charge will vary based upon the individual characteristics of the Insured. Representative charges shown in the table may not be representative of the charge that a particular policy owner will pay. Policy owners can request an illustration of specific costs and/or see the Policy Data Pages for information about specific charges of the policy.
1 The maximum Sales Load and the Premium Taxes charge (collectively "Premium Load") represent the maximums that may be charged in any policy year, see Premium Load. Currently, the sales load is reduced to $5 per $1,000 of Premium payment on any portion of the annual Premium in excess of the break point Premium, as shown on the Policy Data Page.
2 The charge calculations shown assume an aggregate first year Premium in excess of the surrender target premium. The surrender target premium is an assumed Premium payment amount used in calculating the surrender charge. The surrender charge is based on the lesser of the surrender target premium and the Premiums paid in the first year from the Policy Date. The surrender target premium varies by: the Insured's sex; age (when the policy was issued); underwriting class and the Base Policy Specified Amount (and any increases). The maximum Surrender Charge calculation assumes: a female age 18; non-tobacco; Base Policy Specified Amount and Total Specified Amount $500,000; Death Benefit Option 1; and a full surrender occurring in the first year from the Policy Date. The minimum charge calculation assumes: a male age 75 or older; tobacco; Base Policy Specified Amount and Total Specified Amount $500,000; Death Benefit Option 1; and a full surrender occurring in the first year from the Policy Date.
3 The policy owner will be expected to pay the Illustration Charge at the time of the request. This charge will not be deducted from Cash Value.
4 Short-term trading fees are only assessed in connection with Sub-Accounts that correspond to underlying mutual funds that assess a short-term trading fee to the variable account, see Short-Term Trading Fees.
The next table describes the fees and expenses that a policy owner will pay periodically while the policy is In Force, not including mutual fund operating expenses.
Periodic Charges
Charge When Charge Is Deducted Amount Deducted From Cash Values
Cost Of Insurance Charge†
Representative - An age 35 male; non-tobacco preferred; Bae Policy Specified Amount and Total Specified Amount of $250,000; Death Benefit Option 1 		Monthly Minimum
$.05 		Maximum
$83.33 		Representative
$0.11
Per $1,000 of Net Amount At Risk -
From the Policy's available Cash Value
Flat Extra Charge1 Monthly Maximum
$2.08 per $1,000 of Net Amount At Risk
for each Flat Extra assessed
Mortality And Expense Risk Charge2 Daily based on annualized rate Maximum
$8.00 per $1,000 of Cash Value
allocated to Sub-Accounts
Proportionately from the Sub-Accounts
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Periodic Charges
Charge When Charge Is Deducted Amount Deducted From Cash Values
Administrative Charge3 Monthly Maximum
$25 		Current
$12.50
From the Policy's available Cash Value
Increase Charge4 Monthly Maximum
$0.17 per $1,000 of Base Policy Specified Amount increase
From the Policy's available Cash Value
Policy Loan Interest5 Annually Current and Maximum:
$60 per $1,000 of outstanding policy loan
† This charge will vary based upon the individual characteristics of the Insured. Representative charges shown in the table may not be representative of the charge that a particular policy owner will pay. Policy owners can request an illustration of specific costs and/or see the Policy Data Pages for information about specific charges of the policy.
1 The Flat Extra Charge is only applicable if certain factors result in an Insured having a Substandard Rating. Under no circumstance will the assessment of a Flat Extra Charge result in the Cost of Insurance Charge exceeding the maximum Cost of Insurance Charge, see Cost of Insurance.
2 After the ninth policy year, the Mortality and Expense Risk Charge continues to be $8.00 per $1,000 of variable Cash Value on the first $25,000 of Cash Value, but only $5.00 per $1,000 on additional variable Cash Value. For policies issued in New York, the charge is reduced regardless of the Cash Value.
3 After the first policy year the monthly maximum Administrative Charge is $7.50, and the current amount deducted on a monthly basis is $5.
4 The increase charge will be deducted upon a request to increase the Base Policy Specified Amount and on a monthly basis for 12 months after the increase.
5 Interest is charged on the amount of an outstanding loan, but interest is also credited on amounts in the policy loan account, see Policy Loans. During years two through 14 from the Policy Date, the current interest crediting rate is 5.1%. Thereafter, the current interest crediting rate is 6.0% per annum for all loans (guaranteed minimum of 4.0%).
The next table describes the fees and expenses associated with Riders that a policy owner will pay periodically while the policy is In Force, not including mutual fund operating expenses.
Periodic Charges For Riders
Charge When Optional Charge Is Deducted Amount Deducted From Cash Value
Accidental Death Benefit Rider†
Representative - An age 35 male; non-tobacco preferred; Accidental Death Benefit of $100,000 		Monthly Minimum
$0.05 		Maximum
$0.75 		Representative
$0.06
Per $1,000 of Accidental Death Benefit -
From the Policy's available Cash Value
Base Insured Term Rider†
Representative - An age 35 male; non-tobacco preferred; Base Policy Specified Amount $250,000; and Additional Death Benefit $250,000 		Monthly Minimum
$0.02 		Maximum
$83.33 		Representative
$0.03
Per $1,000 of additional protection -
From the Policy's available Cash Value
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Periodic Charges For Riders
Charge When Optional Charge Is Deducted Amount Deducted From Cash Value
Children's Insurance Rider Monthly Maximum
$0.43 Per $1,000 of Children’s Insurance Rider Specified Amount
From the Policy's available Cash Value
Guaranteed Minimum Death Benefit Rider1 Monthly Maximum
$0.01 Per $1,000 of Guaranteed Minimum Death Benefit Rider Specified Amount
From the Policy's available Cash Value
Spouse Life Insurance Rider†
Representative Spouse - An age 35 female; non-tobacco; Spouse Life Insurance Rider Specified Amount $100,000 		Monthly Minimum
$0.10 		Maximum
$10.23 		Representative
$0.15
Per $1,000 of Spouse Death Benefit -
From the Policy's available Cash Value
Waiver of Monthly Deductions Rider†
Representative - An age 35 male; non-tobacco preferred; Total Specified Amount $250,000; and Death Benefit Option 1 		Monthly Minimum
$85 		Maximum
$855 		Representative
$85
Per $1,000 of Deduction Waiver Benefit -
From the Policy's available Cash Value
† This charge will vary based upon the individual characteristics of the Insured. Representative charges shown in the table may not be representative of the charge that a particular policy owner will pay. Policy owners can request an illustration of specific costs and/or see the Policy Data Pages for information about specific charges of the policy.
1 The charge for this Rider is not assessed during the first three policy years.
The next table shows the minimum and maximum total operating expenses, as of December 31, 2015, charged by the underlying mutual funds that a policy owner may periodically pay while the policy is In Force. More detail concerning each mutual fund's fees and expenses is contained in the mutual fund's prospectus.
Total Annual Mutual Fund Operating Expenses  
    Minimum   Maximum  
Total Annual Mutual Fund Operating Expenses
(expenses that are deducted from the mutual fund assets, including management fees, distribution (12b-1) fees, and other expenses) 		  0.13%   3.08%  
Policy Investment Options
Policy owners designate how Net Premium payments are allocated among the Sub-Accounts and/or the Fixed Account. Allocation instructions must be in whole percentages and the sum of the allocations must equal 100%.
Fixed Account
Nationwide's obligations under the Fixed Account are backed by assets of its general account. The general account contains all of Nationwide's assets other than those in this and other Nationwide separate accounts and is used to support Nationwide's annuity and insurance obligations.
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Subject to applicable law, Nationwide has sole discretion over the investment of assets of the general account and policy owners do not share in the investment experience of, or have any preferential claim on, those assets. Nationwide bears the full investment risk for all amounts allocated to the Fixed Account.
Because of exemptive and exclusionary provisions, interests in the Fixed Account have not been and will not be registered under the Securities Act of 1933 and the general account has not been registered as an investment company under the Investment Company Act of 1940. Accordingly, neither the general account nor any interests therein are subject to the provisions of these acts. Nationwide has been advised that the staff of the SEC has not reviewed the disclosure in this prospectus relating to the Fixed Account. Disclosure regarding the Fixed Account, however, is subject to certain generally-applicable provisions of the federal securities laws relating to accuracy and completeness of statements made in prospectuses.
Minimum Guaranteed Interest Rate
Nationwide guarantees that Cash Value allocated to the Fixed Account will accrue interest daily at an effective annual rate that Nationwide determines without regard to the actual investment experience of the general account. Interest crediting rates are set at the beginning of each calendar quarter but are subject to change at any time. Nationwide will credit any interest in excess of the guaranteed interest crediting rate at its sole discretion. Nationwide may not credit any interest in excess of the guaranteed interest crediting rate and different rates may apply to different Premium allocations or exchanges.
Currently, the Fixed Account is the only fixed investment option available under the policy. In the future, Nationwide may offer one or more additional fixed accounts with characteristics that differ from those of the current option, but is under no obligation to do so. The effective annual rate Nationwide declares for the Fixed Account will never be less than 4%.
Interest Crediting Risks and Lapse
The policy owner assumes the risk that the actual credited interest rate may not exceed the guaranteed interest crediting rate. Premiums applied to the policy at different times may receive different interest crediting rates. The interest crediting rate may also vary for new Premium versus Sub-Account transfers. Interest credited to the Fixed Account may be insufficient to pay the policy's charges. Additional Premium payments may be required over the life of the policy to prevent it from Lapsing.
Nationwide Claims-Paying Ability
Guaranteed benefits or interest crediting associated with the Fixed Account is a general account obligation of Nationwide. Therefore, any guaranteed benefit, interest crediting, and the policy owner's right to receive payment, is subject to Nationwide’s claims-paying ability and may be subordinate to other claims on the general account in the event Nationwide becomes insolvent.
Restrictions on Transfers to and from the Fixed Account
Prior to the policy's Maturity Date, the policy owner may make transfers involving the Fixed Account. These transfers will be in dollars. Nationwide may impose limits on the dollar amount, percentage of Cash Value, number, and/or frequency of transfers involving the Fixed Account, see Fixed Account Transfers for details about restrictions that apply to transfers to and from the Fixed Account.
Variable Investment Options
The variable investment options available under the policy are Sub-Accounts that correspond to mutual funds that are registered with the SEC. The mutual funds' registration with the SEC does not involve the SEC's supervision of the management or investment practices or policies of the mutual funds. The mutual funds are designed primarily as investments for variable annuity contracts and variable life insurance policies issued by insurance companies.
Each Sub-Account's assets are held separately from the assets of the other Sub-Accounts. The result is that each Sub-Account operates independently of the other Sub-Accounts so the income or losses of one Sub-Account will not affect the Investment Experience of any other Sub-Account.
Underlying mutual funds in the separate account are NOT publicly traded mutual funds. They are only available as investment options in variable life insurance policies or variable annuity contracts issued by life insurance companies, or in some cases, through participation in certain qualified pension or retirement plans.
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The investment advisors of the underlying mutual funds may manage publicly traded mutual funds with similar names and investment objectives. However, the underlying mutual funds are NOT directly related to any publicly traded mutual fund. Policy owners should not compare the performance of a publicly traded fund with the performance of underlying mutual funds participating in the separate account. The performance of the underlying mutual funds could differ substantially from that of any publicly traded funds.
The particular underlying mutual funds available under the policy may change from time to time. Specifically, underlying mutual funds or underlying mutual fund share classes that are currently available may be removed or closed off to future investment. New underlying mutual funds or new share classes of currently available underlying mutual funds may be added. In the case of new share class additions, future allocations may be limited to the new share classes. The policy owner will receive notice of any such changes that effect the policy. Not all underlying mutual funds may be available in every state.
Some underlying mutual funds may assess short-term trading fees. The separate account will collect the short-term trading fee at the time of the transfer by reducing the amount transferred. All short-term trading fees collected are remitted to the underlying mutual fund, see Short-Term Trading Fees and Appendix A: Sub-Account Information.
In the future, additional underlying mutual funds managed by certain financial institutions, brokerage firms, or their affiliates may be added to the separate account. These additional underlying mutual funds may be offered exclusively to purchasing customers of the particular financial institution or brokerage firm, or through other exclusive distribution arrangements.
The Sub-Accounts available through this policy invest in underlying mutual funds of the companies listed below. For a complete list of the available Sub-Accounts, see Appendix A: Sub-Account Information. For more information on the underlying mutual funds, refer to the prospectus for the mutual fund. To obtain free copies of prospectuses for the underlying mutual funds, policy owners can contact Nationwide using any of the methods described in Contacting the Service Center.
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• AllianceBernstein Variable Products Series Fund, Inc.
• American Century Variable Portfolios II, Inc.
• American Century Variable Portfolios, Inc.
• BlackRock Variable Series Funds, Inc.
• Delaware VIP Trust
• Deutsche Variable Series II
• Dimensional
• Dreyfus
• Dreyfus Investment Portfolios
• Dreyfus Variable Investment Fund
• Federated Insurance Series
• Fidelity Variable Insurance Products Fund
• Franklin Templeton Variable Insurance Products Trust
• Goldman Sachs Variable Insurance Trust
• Guggenheim Variable Fund
• Invesco
• Ivy Funds Variable Insurance Portfolios
• Janus Aspen Series
• Lord Abbett Series Fund, Inc.
• MFS® Variable Insurance Trust
• MFS® Variable Insurance Trust II
• Nationwide Variable Insurance Trust
• Neuberger Berman Advisers Management Trust
• Northern Lights Variable Trust
• Oppenheimer Variable Account Funds
• PIMCO Variable Insurance Trust
• Putnam Variable Trust
• T. Rowe Price Equity Series, Inc.
• The Universal Institutional Funds, Inc.
• VanEck VIP Trust
• Wells Fargo Variable Trust
Valuation of Accumulation Units
Nationwide accounts for the value of a policy owner's interest in the Sub-Accounts by using Accumulation Units. The value of each Accumulation Unit varies daily based on the Investment Experience of the underlying mutual fund in which the Sub-Account invests. Nationwide uses each underlying mutual fund's Net Asset Value (NAV) to calculate the daily Accumulation Unit value for the corresponding Sub-Account. Note, however, that the Accumulation Unit value will not equal the underlying mutual fund's NAV. This daily Accumulation Unit valuation process is referred to as "pricing" the Accumulation Units, see How Sub-Account Investment Experience is Determined.
Accumulation Units are priced as of the New York Stock Exchange's (NYSE) close of business, normally 4:00 p.m. EST, on each day that it is open. Nationwide will price Accumulation Units on each day that the NYSE is open for business. Any transactions received after the close of the NYSE will be priced as of the next Valuation Period. Nationwide will not price Accumulation Units on these recognized holidays:
• New Year's Day
• Martin Luther King, Jr. Day
• Presidents' Day
• Good Friday
• Memorial Day
• Independence Day
• Labor Day
• Thanksgiving
• Christmas
 
 
In addition, Nationwide will not price Accumulation Units if:
(1) trading on the NYSE is restricted;
(2) an emergency exists making disposal or valuation of securities held in the separate account impracticable; or
(3) the SEC, by order, permits a suspension or postponement for the protection of security holders.
SEC rules and regulations govern when the conditions described in items (1) and (2) exist.
How Sub-Account Investment Experience is Determined
Sub-Account allocations are accounted for in Accumulation Units. A policy owner's interest in the Sub-Accounts is represented by the number of Accumulation Units owned by the policy owner. The number of Accumulation Units associated with a given Sub-Account allocation is determined by dividing the dollar amount allocated to the Sub-Account
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by the Accumulation Unit value for the Sub-Account. The number of Sub-Account Accumulation Units owned by a policy owner will not change except when Accumulation Units are redeemed to process a requested surrender, transfer, loan, or to take policy charges, or when additional Accumulation Units are purchased with Premium and loan repayments.
Initially, Nationwide sets the Accumulation Unit value at $10 for each Sub-Account. Thereafter, the daily value of Accumulation Units in a Sub-Account will vary depending on the Investment Experience of the underlying mutual fund in which the Sub-Account invests. Nationwide accounts for these performance fluctuations by using a "net investment factor," as described below, in the daily Sub-Account valuation calculations. Changes in the net investment factor may not be directly proportional to changes in the NAV of the mutual fund shares.
Nationwide determines the net investment factor for each Sub-Account on each Valuation Period by dividing (a) by (b) and then subtracting (c) where:
(a) is the sum of:
• the NAV per share of the mutual fund held in the Sub-Account as of the end of the current Valuation Period; and
• the per share amount of any dividend or income distributions made by the mutual fund held in the Sub-Account (if the date of the dividend or income distribution occurs during the current Valuation Period); plus or minus
• a per share charge or credit for any taxes reserved for as a result of the Sub-Account's investment operations if changes to the law result in a modification to the tax treatment of the separate account; and
(b) is the NAV per share of the mutual fund held in the Sub-Account determined as of the end of the immediately preceding Valuation Period; and
(c) is a factor representing the daily mortality and expense risk charge.
Nationwide determines the Sub-Account’s Accumulation Unit value at the end of each Valuation Period. The Accumulation Unit value for any Valuation Period is determined by multiplying the Accumulation Unit value as of the prior Valuation Period by the net investment factor for the Sub-Account for the current Valuation Period.
Transfers Among and Between the Policy Investment Options
Sub-Account Transfers
Policy owners may request transfers to or from the Sub-Accounts once per Valuation Period, subject to the terms and conditions described in this prospectus and the prospectuses of the underlying mutual funds. Transfers will be implemented by redeeming Accumulation Units from the Sub-Account(s) indicated by the policy owner and using the redemption proceeds to purchase Accumulation Units in another Sub-Account(s) as directed by the policy owner. The net result is that the policy owner's Cash Value will not change (except due to standard market fluctuations), but the number and allocation of Accumulation Units within the policy will change.
Neither the policies nor the mutual funds are designed to support active trading strategies that require frequent movement between or among Sub-Accounts (sometimes referred to as "market-timing" or "short-term trading"). A policy owner who intends to use an active trading strategy should consult his/her registered representative and request information on other Nationwide policies that offer mutual funds that are designed specifically to support active trading strategies.
Nationwide discourages (and will take action to deter) short-term trading in this policy because the frequent movement between or among Sub-Accounts may negatively impact other investors in the policy. Short-term trading can result in:
• the dilution of the value of the investors' interests in the mutual fund;
• mutual fund managers taking actions that negatively impact performance (i.e., keeping a larger portion of the mutual fund assets in cash or liquidating investments prematurely in order to support redemption requests); and/or
• increased administrative costs due to frequent purchases and redemptions.
To protect investors in this policy from the negative impact of these practices, Nationwide has implemented, or reserves the right to implement, several processes and/or restrictions aimed at eliminating the negative impact of active trading strategies. Nationwide cannot guarantee that attempts to deter active trading strategies will be successful.
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If Nationwide is unable to deter active trading strategies, the performance of the Sub-Accounts that are actively traded may be adversely impacted. Policy owners remaining in the affected Sub-Account will bear any resulting increased costs.
Short-Term Trading Fees
Some underlying mutual funds assess a short-term trading fee in connection with transfers from a Sub-Account that occur within 60 days after the date of the allocation to the Sub-Account. The fee is assessed against the amount transferred and is paid to the underlying mutual fund. These fees compensate the mutual fund for any negative impact on fund performance resulting from short-term trading. Some underlying mutual funds may refer to short-term trading fees as "redemption fees." See Appendix A: Sub-Account Information for a complete list of available underlying mutual funds, including those that assess short-term trading fees.
U.S. Mail Restrictions
Nationwide monitors transfer activity in order to identify those who may be engaged in harmful trading practices. Transaction reports are produced and examined. Generally, a policy may appear on these reports if the policy owner (or a third party acting on their behalf) engages in a certain number of "transfer events" in a given period. A "transfer event" is any transfer, or combination of transfers, occurring in a given Valuation Period. For example, if a policy owner executes multiple transfers involving 10 Sub-Accounts in one Valuation Period, this counts as one transfer event. A single transfer occurring in a given Valuation Period that involves only two Sub-Accounts (or one Sub-Account if the transfer is made to or from a fixed investment option) will also count as one transfer event.
As a result of this monitoring process, Nationwide may restrict the form in which transfer requests will be accepted. In general, Nationwide will adhere to the following guidelines:
Trading Behavior Nationwide's Response
Six or more transfer events in one calendar quarter Nationwide will mail a letter to the policy owner notifying them that:
(1) they have been identified as engaging in harmful trading practices; and
(2) if their transfer events exceed 11 in two consecutive calendar quarters or 20 in one calendar year, the policy owner will be limited to submitting transfer requests via U.S. mail.
More than 11 transfer events in two consecutive calendar quarters
OR
More than 20 transfer events in one calendar year 		Nationwide will automatically limit the policy owner to submitting transfer requests via U.S. mail.
For purposes of Nationwide's transfer policy, U.S. mail includes standard U.S. mail, expedited U.S. mail, and expedited delivery via private carrier.
Each January 1st, Nationwide will start the monitoring anew, so that each policy starts with zero transfer events each January 1. See, however, the Other Restrictions provision below.
Managers of Multiple Policies
Some investment advisors/representatives manage the assets of multiple Nationwide policies pursuant to trading authority granted or conveyed by multiple policy owners. These multi-policy advisors will be required by Nationwide to submit all transfer requests via U.S. mail.
Other Restrictions
Nationwide reserves the right to refuse or limit transfer requests, or take any other action it deems necessary, in order to protect policy owners and beneficiaries from the negative investment results that may result from short-term trading or other harmful investment practices employed by some policy owners (or third parties acting on their behalf). In particular, trading strategies designed to avoid or take advantage of Nationwide's monitoring procedures (and other measures aimed at curbing harmful trading practices) that are nevertheless determined by Nationwide to constitute harmful trading practices, may be restricted.
Any restrictions that Nationwide implements will be applied consistently and uniformly. The policy owner will be notified if a transfer request is rejected. If a short-term trading fee is assessed, the policy owner will receive a confirmation notice.
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Underlying Mutual Fund Restrictions and Prohibitions
Pursuant to regulations adopted by the SEC, Nationwide is required to enter into written agreements with the underlying mutual funds which allow the underlying mutual funds to:
(1) request the taxpayer identification number, international taxpayer identification number, or other government issued identifier of any policy owner;
(2) request the amounts and dates of any purchase, redemption, transfer, or exchange request ("transaction information"); and
(3) instruct Nationwide to restrict or prohibit further purchases or exchanges by policy owners that violate policies established by the underlying mutual fund (whose policies may be more restrictive than Nationwide’s policies).
Nationwide is required to provide such transaction information to the underlying mutual funds upon their request. In addition, Nationwide is required to restrict or prohibit further purchases or requests to exchange into an underlying mutual fund upon instruction from the underlying mutual fund. Nationwide and any affected policy owner may not have advance notice of such instructions from an underlying mutual fund to restrict or prohibit further purchases or requests to exchange into an underlying mutual fund. If an underlying mutual fund refuses to accept a purchase or request to exchange into the underlying mutual fund, Nationwide will keep any affected policy owner in their current underlying mutual fund allocation.
Fixed Account Transfers
Prior to the policy's Maturity Date, the policy owner may make transfers involving the Fixed Account. These transfers will be in dollars. Nationwide may impose limits on the dollar amount, percentage of Cash Value, number, and/or frequency of transfers involving the Fixed Account. Contact the Service Center for information regarding restrictions in effect for the Fixed Account at the time of a Premium payment or transfer request.
Transfers to and/or from the Fixed Account may be restricted as follows:
• Transfers to and/or from may be prohibited during the first policy year
• Only one transfer to and/or from may be permitted every 12 months
Transfers to the Fixed Account may be restricted as follows:
• Transfers to that exceed 25% of the value allocated to the Sub-Accounts (as of the end of the prior Valuation Period) may not be permitted
• Transfers to that would result in the Fixed Account value exceeding 30% of the total Cash Value may not be permitted.
Transfers from the Fixed Account may be restricted as follows:
• Transfers from, of more than 25% of the Fixed Account value in any policy year (as of the end of the previous policy year), may not be permitted.
Amounts transferred to the Fixed Account may be credited interest at different rates, see Fixed Account. Transfers from the Fixed Account will be on a last-in, first-out basis (LIFO). Any restrictions that Nationwide implements will be applied consistently and uniformly.
Contacting the Service Center
All inquiries, paperwork, information requests, service requests, and transaction requests should be made to the Service Center:
• by telephone at 1-800-848-6331 (TDD 1-800-238-3035)
• by mail to Nationwide Life Insurance Company, P.O. Box 182835, Columbus, Ohio 43218-2835
• by fax at 1-888-634-4472
• by Internet at www.nationwide.com.
Nationwide reserves the right to restrict or remove the ability to submit service requests via Internet, phone, or fax upon written notice.
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Not all methods of communication are available for all types of requests. To determine which methods are permitted for a particular request, refer to the specific transaction provision in this prospectus, or call the Service Center. Requests submitted by means other than described in this prospectus could be returned or delayed.
Service and transaction requests will generally be processed in the Valuation Period they are received at the Service Center as long as the request is in good order, see Valuation of Accumulation Units. Good order generally means that all necessary information to process the request is complete and in a form acceptable to Nationwide. If a request is not in good order, Nationwide will take reasonable actions to obtain the information necessary to process the request. Requests that are not in good order may be delayed or returned. Nationwide reserves the right to process any transaction request sent to a location other than the Service Center in the Valuation Period it is received at the Service Center. On any day the post office is closed, Nationwide is unable to retrieve service and transaction requests that are submitted by mail. This will result in a delay of the delivery of those requests to the Service Center.
Nationwide may be required to provide information about a specific policy to government regulators. If mandated under applicable law, Nationwide may be required to reject a Premium payment and to refuse to process transaction requests for transfers, surrenders, loans, and/or Death Benefit Proceeds until instructed otherwise by the appropriate regulator.
Nationwide will use reasonable procedures to confirm that instructions are genuine and Nationwide will not be liable for following instructions that it reasonably determined to be genuine. Nationwide may record telephone requests. Telephone and computer systems may not always be available. Any telephone system or computer can experience outages or slowdowns for a variety of reasons. The outages or slowdowns could prevent or delay processing. Although Nationwide has taken precautions to support heavy use, it is still possible to incur an outage or delay. To avoid technical difficulties, submit transaction requests by mail.
The Policy
General Information
The policy is a legal contract. It will comprise and be evidenced by: a written contract; any Riders; any endorsements; the Policy Data Pages; and the application, including any supplemental application. The benefits described in the policy and this prospectus, including any optional Riders or modifications in coverage, may be subject to Nationwide’s underwriting and approval. In addition to the terms and conditions of the policy, policy owner rights are governed by this prospectus and protected by federal securities laws and regulations. Nationwide will consider the statements made in the application as representations, and will rely on them as being true and complete. However, Nationwide will not void the policy or deny a claim unless a statement is a material misrepresentation. If a policy owner makes an error or misstatement on the application, Nationwide will adjust the Death Benefit and Cash Value accordingly.
To determine the adjusted Death Benefit, the Net Amount At Risk at the time of the Insured's death is multiplied by the ratio of the monthly cost of insurance applied at the true age in the policy month of death and the monthly cost of insurance that should have been applied at the true age in the policy month of death. This adjusted amount will be added to reflect the true age to the Cash Value of the policy at the Insured's death. The Cash Value will be adjusted to reflect the cost of insurance charges on the correct age from the Policy Date.
Due to state law variations, the terms, benefits, programs and Riders described in this prospectus may vary or may not be available depending on the state in which the policy is issued. Possible state law variations include, but are not limited to, Rider terms, availability of certain investment options, free look rights, policy exchange rights, policy Lapse and/or reinstatement requirements, and surrender charge, suicide, and incontestability durations. This prospectus describes all the material features of the policy. State variations are subject to change without notice at any time. To review a copy of the policy and any Riders or endorsements for the state in which the policy will be issued, contact the Service Center.
Any modification or waiver of Nationwide’s rights or requirements under the policy must be in writing and signed by Nationwide’s president or corporate secretary. No agent may bind Nationwide by making any promise not contained in the policy.
Nationwide may modify the policy, its operations, or the separate account’s operations to meet the requirements of any law or regulation issued by a government agency to which the policy, Nationwide, or the separate account is subject. Nationwide may modify the policy to assure that it continues to qualify as a life insurance policy under federal tax laws. Nationwide will notify policy owners of all modifications and will make appropriate endorsements to the policy.
The policy is nonparticipating, meaning that Nationwide will not be contributing any operating profits or surplus earnings toward the policy Proceeds.
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To the extent permitted by law, policy benefits are not subject to any legal process on the part of a third-party for the payment of any claim, and no right or benefit will be subject to the claims of creditors (except as may be provided by assignment).
It is important to remember that the portion of any amounts allocated to Nationwide’s general account and any guaranteed benefits Nationwide may provide under the policy exceeding the value of amounts held in the separate account are subject to Nationwide’s claims paying ability.
Any money Nationwide pays, or that is paid to Nationwide, must be in the currency of the United States of America.
In order to comply with the USA Patriot Act and rules promulgated thereunder, Nationwide has implemented procedures designed to prevent policies described in this prospectus from being used to facilitate money laundering or the financing of terrorist activities.
Nationwide’s businesses are highly dependent upon its computer systems and those of its business partners. This makes Nationwide potentially susceptible to operational and information security risks resulting from a cyber-attack. These risks include direct risks, such as theft, misuse, corruption and destruction of data maintained by Nationwide, and indirect risks, such as denial of service attacks on service provider websites and other operational disruptions that impede Nationwide’s ability to electronically interact with service providers. Cyber-attacks affecting Nationwide, the underlying mutual funds, intermediaries, and other service providers may adversely affect Nationwide and Policy Values. In connection with any such cyber-attacks, Nationwide and/or its service providers and intermediaries may be subject to regulatory fines and financial losses and/or reputational damage. Cyber security risks may also impact the issuers of securities in which the underlying mutual funds invest, which may cause the underlying mutual funds to lose value. Although Nationwide undertakes substantial efforts to protect its computer systems from cyber-attacks, including internal processes and technological defenses that are preventative or detective, and other controls designed to provide multiple layers of security assurance, there can be no guarantee that Nationwide, its service providers, or the underlying mutual funds will avoid losses affecting the policy due to cyber-attacks or information security breaches in the future.
In the event that Policy Values are adversely affected as a result of the failure of Nationwide’s cyber-security controls, Nationwide will take reasonable steps to restore Policy Values to the levels that they would have been had the cyber-attack not occurred. Nationwide will not, however, be responsible for any adverse impact to Policy Values that result from the policy owner or its designee’s negligent acts or failure to use reasonably appropriate safeguards to protect against cyber-attacks.
Policy Owner and Beneficiaries
Policy Owner
The policy belongs to the owner named in the application or as a result of a valid assignment. The policy owner may name a contingent owner who will become the policy owner if the policy owner dies before Proceeds become payable. Otherwise, ownership will pass to the policy owner's estate, if the policy owner is not the Insured.
Policy Owner Rights
The policy owner may exercise all policy rights in accordance with policy terms while the policy is In Force, subject to Nationwide’s approval. These rights include, but are not limited to, the following:
• changing the policy owner, contingent owner, and beneficiary;
• assigning, exchanging, and/or converting the policy;
• requesting transfers, policy loans, and partial surrenders or a complete surrender; and
• changing insurance coverage such as death benefit option changes, adding or removing Riders, and/or increasing or decreasing the Total Specified Amount.
These rights are explained in greater detail throughout this prospectus.
Subject to Nationwide’s approval, the policy owner may name a different policy owner or contingent owner while the policy is In Force by submitting a written request to the Service Center. Any such change request will become effective as of the date signed, however, it will not affect any payment made or action taken before the change is received and recorded by Nationwide. There may be adverse tax consequences to changing parties of the policy.
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Beneficiaries
The principal right of a beneficiary is to receive the Death Benefit Proceeds if the Insured dies while the policy is In Force. While the policy is In Force, a policy owner may name more than one beneficiary, designate primary and contingent beneficiaries, change or add beneficiaries, and/or direct Nationwide to distribute the Proceeds other than as described below.
If a primary beneficiary dies before the Insured, Nationwide will pay the Death Benefit Proceeds to the surviving primary beneficiaries. Unless specified otherwise by the policy owner, Nationwide will pay multiple primary beneficiaries in equal shares. A contingent beneficiary will become the primary beneficiary if all primary beneficiaries die before the Insured and before any Proceeds become payable. A policy owner may name more than one contingent beneficiary. Unless specified otherwise by the policy owner, Nationwide will also pay multiple contingent beneficiaries in equal shares. If no named beneficiary survives the Insured, the Proceeds will be paid to the policy owner or the policy owner's estate.
Requests to change or add beneficiaries must be submitted in writing to the Service Center. Nationwide may require that the policy owner send the policy for endorsement before the change is recorded. Any such change request will become effective as of the date signed, however, it will not affect any payment made or action taken before the change is received and recorded by Nationwide.
To Purchase
The policy is available for Insureds between the ages of 0 and 80. To purchase the policy, prospective purchasers must submit a completed application and the required initial Premium payment.
Nationwide must receive evidence of insurability that satisfies its underwriting standards (this may require a medical examination) before it will issue a policy. Nationwide can provide prospective purchasers with the details of its underwriting standards upon request. Nationwide reserves the right to reject any application for any reason permitted by law. Additionally, Nationwide reserves the right to modify its underwriting standards on a prospective basis for newly issued policies at any time.
The minimum initial Base Policy Specified Amount in most states is $50,000. Nationwide reserves the right to modify the minimum Base Policy Specified Amount on a prospective basis for newly issued policies at any time.
Coverage
Nationwide will issue the policy only if the underwriting process has been completed, the application is approved, and the proposed Insured is alive and in the same condition of health as described in the application. However, full insurance coverage will take effect only after the minimum initial Premium is paid. Monthly charges are deducted from the policy’s Cash Value beginning on the Policy Date.
Coverage Effective Date
Insurance coverage will begin and be In Force on the Policy Date shown on the Policy Data Page. For a change in the Base Policy Specified Amount and/or Rider Specified Amount, the effective date will be on the next monthly anniversary from the Policy Date after Nationwide approves the request. It will end upon the Insured's death, once the Proceeds are paid or when the policy matures. Coverage will also end if the policy Lapses.
Temporary Insurance Coverage
Temporary Insurance Coverage
Temporary insurance coverage (of an amount equal to the Total Specified Amount, up to $1,000,000) may be available for no charge before full insurance coverage takes effect. Prospective purchasers must submit a temporary insurance agreement and make an initial Premium payment. The amount of this initial Premium payment will depend on the initial Total Specified Amount, choice of death benefit option, and any Riders elected. Temporary insurance coverage will remain In Force for no more than 60 days from the date of the temporary insurance agreement. If full coverage is denied, the temporary insurance coverage will terminate five days from the date Nationwide mails a termination notice (accompanied by a refund equal to the Premium payment made). If full coverage is approved, the temporary insurance coverage will terminate on the date that full insurance coverage takes effect. Allocation of the initial Net Premium will be determined by the right to examine law of the state in which the policy is issued.
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Right To Cancel (Examination Right)
Under state law a policy owner may, for a limited time, cancel the policy and receive a refund (commonly referred to as the "free look" period). The length of the free look period depends on state law and may vary depending on whether the policy was purchased to replace another policy. The minimum "free look" period is 10 days.
In order to cancel the policy during the free look period, a policy owner must submit a written cancellation request and return the policy either to the sales representative or to the Service Center. Nationwide will honor free look cancellation requests received by the last day of the free look period (if returned by US mail, the request must be post-marked by the last day of the free look period).
Free look cancellation requests received after the close of business on the date the free look period expires will not be canceled free of charge. If the policy is canceled, Nationwide will treat the policy as if it was never issued.
Within seven days of a free look cancellation request, Nationwide will refund the amount prescribed by state law. The amount Nationwide refunds will be Cash Value or, in certain states, the greater of the initial Premium payment or the policy's Cash Value.
Allocation of Net Premium During Free Look Period
Where state law requires the return of initial Premium for free look cancellations, Nationwide will allocate initial Net Premium to the Fixed Account as instructed. Nationwide will allocate initial Net Premium allocated to the Sub-Accounts to the available money market Sub-Account until the free look period expires. At the expiration of the free look period, Nationwide will transfer the amount held in the money market Sub-Account to the requested Sub-Accounts based on the allocation instructions in effect at the time of the transfer.
Where state law requires the return of Cash Value, Nationwide will allocate all of the initial Net Premium to the designated Sub-Accounts and Fixed Account based upon the allocation instructions in effect at the time, .
To Change Coverage
After the first policy year, the policy owner may request to change the Total Specified Amount. To change the Total Specified Amount, the policy owner must submit a written request to the Service Center. Changes to the Total Specified Amount will become effective on the next monthly policy anniversary after Nationwide approves the request unless the policy owner requests and Nationwide approves a different date. However, no change will take effect unless the Cash Surrender Value would be sufficient to keep the policy In Force for at least three months. Nationwide may limit the number of Total Specified Amount changes to one increase and one decrease each policy year. Changes to the Total Specified Amount will typically alter the Death Benefit.
Increases
To increase the Total Specified Amount, the policy owner must provide satisfactory evidence of insurability. The Insured must be Attained Age 80 or younger at the time of the request. Any request to increase the Total Specified Amount must be at least $10,000. An increase in the Total Specified Amount may cause an increase in the Net Amount At Risk. Because the Cost of Insurance Charge is based on the Net Amount At Risk, and because there will be a separate cost of insurance rate for the increase, this will usually cause the policy's Cost of Insurance Charge to increase. An additional Surrender Charge schedule will also apply whenever the Base Policy Specified Amount is increased. An increase in the Base Policy Specified Amount and/or Rider Specified Amount may cause an increase to the amount of subsequent Premium payments needed to keep the policy from Lapsing, see Lapse.
Decreases
The policy owner may request to decrease the Total Specified Amount. Nationwide applies Total Specified Amount decreases to the most recent Base Policy Specified Amount and/or Rider Specified Amount increase and continues applying the decrease backwards while still maintaining the original Total Specified Amount. Nationwide will deny any request to reduce the Base Policy Specified Amount below the minimum Base Policy Specified Amount shown on the Policy Data Page. Nationwide will also deny any request that would disqualify the policy as a contract for life insurance.
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Premium Payments
The policy does not require a scheduled payment of Premium to keep it In Force. The policy will remain in effect as long as the conditions that cause the policy to Lapse do not exist, see Unfavorable Investment Experience. Upon request, we will furnish Premium receipts.
Subsequent Premium payments will be allocated according to the allocation instructions in effect at the time the Premium is received.
Initial Premium
The amount of initial Premium will depend on the initial Total Specified Amount of insurance, the death benefit option, and any Riders elected. Generally, the higher the required initial Total Specified Amount, the higher the initial Premium will be. Similarly, because Death Benefit Option 2 provides for a potentially greater Death Benefit than Death Benefit Option 1, Death Benefit Option 2 may require a higher amount of initial Premium. Also, the age, health, and activities of the Insured will affect Nationwide’s determination of the risk of issuing the policy. In general, the greater this risk, the higher the initial Premium required.
Whether Nationwide will issue full insurance coverage depends on the Insured meeting all underwriting requirements, payment of the initial Premium, and delivery of the policy while the Insured is alive. Nationwide will not delay delivery of the policy to increase the likelihood that the Insured is not still living. Depending on the outcome of the underwriting process, more or less Premium may be necessary to issue the policy. If Nationwide does not issue the policy, the Premium payment will be returned within two business days.
The policy owner may pay the initial Premium to the Service Center or to an authorized representative. The initial Premium payment must be at least $50, equal to the minimum monthly Premium. The initial Premium payment will not be applied to the policy until the underwriting process is complete. Allocation of initial Net Premium will be determined by the right to examine law of the state or territory where the policy is issued, see Right to Cancel (Examination Right).
Subsequent Premiums
The policy owner may make additional Premium payments at any time while the policy is In Force, subject to the following:
• During the first three policy years, the total Premium payments, less any outstanding Indebtedness, less any partial surrender fee, must be greater than or equal to the minimum Premium requirement in order to guarantee that the policy will remain In Force.
• After the first three policy years, each Premium payment must be at least equal to the minimum monthly Premium.
• Nationwide may require satisfactory evidence of insurability before accepting any additional Premium payment that results in an increase in the policy's Net Amount At Risk.
• Nationwide will refund Premium payments that exceed the applicable premium limit established by the IRS to qualify the policy as a contract for life insurance.
• Nationwide may require that outstanding Indebtedness be repaid prior to accepting any additional Premium payments, see Lapse.
• Nationwide will send scheduled Premium payment reminder notices to you according to the Premium payment method shown on the Policy Data Page. Subsequent Premium payments must be sent to the Service Center, see Contacting the Service Center.
Cash Value
Nationwide will determine the Cash Value at least monthly. Cash Value will fluctuate daily and there is no guaranteed Cash Value. At the end of any given Valuation Period, the Cash Value is equal to the sum of:
• the value of the Accumulation Units allocated to the Sub-Accounts, see Valuation of Accumulation Units;
• amounts allocated to the Fixed Account, including credited interest; and
• amounts allocated to the policy loan account (only if a loan was taken), including credited interest, see Policy Loans.
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Surrenders and policy charges and deductions will reduce the Cash Value of the policy. If Cash Value is a factor in calculating a benefit associated with the policy, such as the Death Benefit or a benefit associated with an elected Rider, the value of that benefit will also fluctuate, including being reduced due to surrenders and policy charge deductions. If the policy is surrendered or Lapses, the Cash Value will be reduced by the amount of any Indebtedness.
On any date during the policy year, the Cash Value equals the Cash Value on the preceding Valuation Period, plus any Net Premium applied since the previous Valuation Period, minus any policy charges, plus or minus any investment results, and minus any partial surrenders.
To Exchange
The policy owner has an exchange right under the policy. At any time within the first 24 months of coverage from the Policy Date, the policy owner may surrender this policy and use the Cash Surrender Value to purchase a new policy on the Insured's life without evidence of insurability. After the first 24 months of coverage, a policy owner may still surrender the policy and use the Cash Surrender Value to purchase a new policy on the Insured's life. However, issuance of the new policy will depend on the Insured providing satisfactory evidence of insurability.
The new policy may be one of Nationwide’s available fixed benefit life insurance policies. The death benefit on the new policy may not be greater than the Death Benefit on this policy immediately prior to the exchange date. The new policy will have the same Total Specified Amount, Policy Date, and issue age. Nationwide will base Premium payments on the rates in effect for the same sex, Attained Age, and underwriting class of the Insured on the exchange date, unless otherwise required by state law. A policy owner may transfer Indebtedness to the new policy.
Exchange requests must be made on Nationwide forms and submitted to the Service Center. The policy must be In Force and not in a Grace Period. The policy owner must pay a Surrender Charge if applicable and surrender the policy to Nationwide. The policy owner must pay any money due on the exchange (any amount needed to ensure that the Cash Surrender Value of the new policy is the same as the Cash Surrender Value of this policy). The policy owner may request that any excess of the Cash Surrender Value of this policy over the Cash Surrender Value of the new policy be paid to the policy owner. The exchange may have adverse tax consequences. The new policy will take effect on the exchange date only if the Insured is alive. This policy will terminate when the new policy takes effect.
To Terminate (Surrender)
There are several ways that the policy can terminate. The policy will automatically terminate when the Insured dies, the policy matures, or the Grace Period ends. The policy will also terminate if it is fully surrendered.
Terminating the policy may result in adverse tax consequences.
Generally, if the policy has a Cash Surrender Value in excess of the Premiums paid, upon surrender the excess will be included in the policy owner’s income for federal tax purposes, see Taxes. The Cash Surrender Value will be reduced by outstanding Indebtedness, see Policy Loans.
To Assign
The policy owner may assign any or all rights under the policy while it is In Force, subject to Nationwide’s approval. The beneficiary's interest will be subject to the person or entity to which the policy owner assigned rights. Assignments must be in writing on a form satisfactory to Nationwide. Assignments will become effective on the date signed, unless otherwise specified by the policy owner, and are subject to any payments or actions taken by Nationwide before it is received and recorded at the Service Center. Nationwide is not responsible for the sufficiency or validity of any assignment. Assignments will be subject to any Indebtedness, policy liens, garnishments, court orders, and any previous assignments.
Reminders, Reports and Illustrations
Nationwide will send scheduled Premium payment reminders and transaction confirmations to policy owners upon request. Nationwide will also send semi-annual and annual statements that show:
• the Total Specified Amount;
• minimum monthly Premiums;
• Premiums paid;
• all charges since the last report;
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• the current Cash Value;
• the Cash Surrender Value; and
• Indebtedness.
Confirmations of individual financial transactions, such as transfers, partial Surrenders, and loans are generated and mailed automatically. Copies may be obtained by contacting the Service Center. Alternatively, policy owners may receive information faster and reduce the amount of mail received by signing up for the eDelivery program. Go to www.nationwide.com/login to change document delivery preferences.
Nationwide will send these reminders and reports to the address provided on the application unless directed otherwise. At any time after the first policy year, policy owners may ask for an illustration of future benefits and values under the policy, see Illustration Charge.
IMPORTANT NOTICE REGARDING DELIVERY
OF SECURITY HOLDER DOCUMENTS
When multiple copies of the same disclosure document(s), such as prospectuses, supplements, proxy statements and semi-annual and annual reports are required to be mailed to multiple policy owners in the same household, Nationwide will mail only one copy of each document, unless notified otherwise by the policy owner(s). Household delivery will continue for the life of the policies. A policy owner can revoke their consent to household delivery and reinstitute individual delivery by contacting the Service Center. Individual delivery will resume within 30 days after receiving such notification.
Standard Policy Charges
Deductions for charges are taken from Premium payments and/or the Cash Value, as applicable, to compensate Nationwide for the services and benefits provided, the costs and expenses incurred, and the risks assumed. Certain expenses may be recovered utilizing more than one charge. Nationwide may generate a profit from any of the charges assessed under the policy.
Monthly charges are deducted from Cash Value beginning on the Policy Date. Charges are taken proportionally from the Sub-Accounts and the Fixed Account, except for the Mortality and Expense Risk Charge which is only deducted proportionally from the Sub-Accounts. Charges taken against allocations to the Sub-Accounts are assessed by redeeming Accumulation Units. The number of Accumulation Units redeemed is determined by dividing the dollar amount of the charge by the Accumulation Unit value for the Sub-Account. Nationwide does not deduct policy charges or Rider charges from the Cash Value attributable to the policy loan account. For a complete description of how interest is credited and charged, see Policy Loans.
Policy and Rider charges reflect costs and risks associated with issuing the policy and Rider(s). Certain charges will vary based upon the individual characteristics of the Insured. The Insured is assigned to an underwriting class based upon his/her age, sex (if not unisex classified), smoker status, type of evidence of insurability, and insurability status. The policy owner can request an illustration of specific costs and/or see the Policy’s Data Pages for information about specific charges of their policy.
Nationwide may change policy and/or Rider charges and rates under the policy at any time. Changes in policy and/or Rider charges and rates will vary by changes in future expectations for factors including, but not limited to, Nationwide’s investment earnings, mortality experience, persistency experience, expenses, including reinsurance expenses, and taxes. Changes to policy and/or Rider charges and rates will be on a uniform basis for Insured's of the same Issue Age, sex, rate class, rate type, any Substandard Rating, Base Policy Specified Amount and Spouse Life Insurance Rider Specified Amount (if applicable) whose policies have been In Force for the same length of time. If a change in the charges or rates causes an increase to the policy and/or Rider charges, the policy's Cash Value could decrease. If a change in the charges or rates causes a decrease to the policy and/or Rider charges, the policy's Cash Value could increase. Any changes will be determined in accordance with state law. Policy and Rider charges will never exceed the maximum charges shown in the fee tables, see In Summary: Fee Tables.
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Premium Load
Premium Load is comprised of the Sales Load and Premium Taxes. It will vary by policy based on the amount of Premium paid. It is deducted from each Premium payment to partially reimburse Nationwide for sales expenses and Premium taxes, and other expenses, including acquisition costs. The Premium Load also provides revenue to compensate Nationwide for assuming risks associated with the policy, and revenue that may be a profit.
Sales Load
The sales load portion of the Premium Load Charge is guaranteed not to exceed $25 per $1,000 of Premium and covers sales expenses. Currently, this charge is equal to $25 per $1,000 of Premium up to the break point Premium, and $5 per $1,000 of Premium in excess of the break point Premium. The break point Premium is shown in the Policy Data Page. Sales load is assessed each time a Premium payment is submitted.
Premium Taxes
Premium Taxes (as part of the Premium Load) are deducted from each Premium payment to reimburse Nationwide for state and local premium taxes (at the estimated rate of 2.25%) and for federal premium taxes (at the estimated rate of 1.25%). The current (and guaranteed maximum) Premium Tax is $35 per $1,000 of Premium. This amount is not the actual amount of the tax liability Nationwide incurs. It is an estimated amount. If the actual tax liability is more or less, Nationwide will not adjust the charge retroactively.
Short-Term Trading Fees
Some mutual funds offered under the policy may assess (or reserve the right to assess) a short-term trading fee (sometimes called "redemption fee" by the mutual fund) in connection with transfers from a Sub-Account that occur within 60 days after the date of allocation to the Sub-Account.
Short-Term Trading Fees are intended to compensate the mutual fund (and policy owners with interests allocated in the Sub-Account) for the negative impact on mutual fund performance that may result from frequent, short-term trading strategies. Short-Term Trading Fees are not intended to affect the large majority of policy owners not engaged in such strategies.
Any Short-Term Trading Fee assessed by any mutual fund available in conjunction with the policy will equal 1% of the amount determined to be engaged in short-term trading. Short-Term Trading Fees will only apply to those Sub-Accounts corresponding to mutual funds that charge such fees (see the mutual fund's prospectus). Any Short-Term Trading Fees paid are retained by the mutual fund and are part of the mutual fund's assets. Policy owners are responsible for monitoring the length of time allocations are held in any particular Sub-Account. Nationwide will not provide advance notice of the assessment of any applicable Short-Term Trading Fee.
For a complete list of the Sub-Accounts that assess (or reserve the right to assess) a Short-Term Trading Fee, see Appendix A: Sub-Account Information.
If a Short-Term Trading Fee is assessed, the mutual fund will charge the separate account 1% of the amount determined to be engaged in short-term trading. The separate account will then pass the Short-Term Trading Fee on to the specific policy owner that engaged in short-term trading by deducting an amount equal to the Short-Term Trading Fee from that policy owner's Sub-Account value. All such fees will be remitted to the mutual fund; none of the fee proceeds will be retained by Nationwide or the separate account.
When multiple allocations are made to a Sub-Account that is subject to Short-Term Trading Fees, transfers out of that Sub-Account will be considered to be made on a first in/first out (FIFO) basis for purposes of determining Short-Term Trading Fees. In other words, Accumulation Units held the longest time will be treated as being transferred first, and Accumulation Units held for the shortest time will be treated as being transferred last.
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Some transactions are not subject to Short-Term Trading Fees, including:
• scheduled and systematic transfers, such as those associated with dollar cost averaging programs and asset rebalancing programs (if available);
• policy loans;
• full or partial surrenders; or
• payment of the Proceeds.
New share classes of certain currently available mutual funds may be added as investment options under the policy. These new share classes may require the assessment of Short-Term Trading Fees. When these new share classes are added, new Premiums and transfers to the Sub-Accounts in question may be limited to the new share class.
Illustration Charge
Illustration Charges are not deducted from Premium payments or Cash Value; rather they are paid at the time of an illustration request. Nationwide currently waives the Illustration Charge. The charge is intended to compensate Nationwide for the administrative costs of generating illustrations. Nationwide may elect in the future to assess an Illustration Charge. It will not exceed $25 per illustration requested.
Partial Surrender Fee
The policy owner may request a partial surrender after the first year from the Policy Date while the policy is In Force. The charge for a partial surrender compensates Nationwide for the administrative costs in calculating and generating the surrender amount. The maximum fee is the lesser of $25 or 2% of the dollar amount of the partial surrender. However, currently, there is no charge for a partial surrender. The Cash Value available for a partial surrender is subject to any Indebtedness.
Surrender Charge
A surrender charge will apply if the policy is surrendered during the first nine years from the Policy Date, Lapsed, or a decrease in the Base Policy Specified Amount is requested. Surrender charges compensate Nationwide for policy underwriting and sales expenses. The charge will be deducted the policy’s Cash Value. The surrender charge is reduced by any partial surrender charge actually paid on previous decreases in the Base Policy Specified Amount.
The following tables illustrate the maximum initial surrender charge per $1,000 of initial Base Policy Specified Amount for policies which are issued on a standard basis, see Appendix C: Illustrations of Surrender Charges.
Initial Base Policy Specified Amount $50,000-$99,999
Issue Age   Male Non-Tobacco   Female Non-Tobacco   Male Standard   Female Standard
25   $ 7.776   $ 7.521   $ 8.369   $ 7.818
35   $ 8.817   $ 8.398   $ 9.811   $ 8.891
45   $12.191   $11.396   $13.887   $12.169
55   $15.636   $14.011   $18.415   $15.116
65   $22.295   $19.086   $26.577   $20.641
Initial Base Policy Specified Amount $100,000 or More
Issue Age   Male Non-Tobacco   Female Non-Tobacco   Male Standard   Female Standard
25   $ 5.776   $ 5.521   $ 6.369   $ 5.818
35   $ 6.817   $ 6.398   $ 7.811   $ 6.891
45   $ 9.691   $ 8.896   $11.387   $ 9.669
55   $13.136   $11.511   $15.915   $12.616
65   $21.295   $18.086   $25.577   $19.641
Special guaranteed maximum surrender charges apply in Pennsylvania, see Appendix C: Illustrations of Surrender Charges. Ask for an illustration or see the Policy Data Page for more information.
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The surrender charge amount decreases over time and Nationwide will deduct the surrender charge based on the following schedule:
Policy year calculated from the Policy Date or
effective date of Base Policy Specified Amount increase: 		  Surrender Charge as a Percentage
of Initial Surrender Charge
0
   100%
1
   100%
2
   90%
3
   80%
4
   70%
5
   60%
6
   50%
7
   40%
8
   30%
9 and After
   0%
There are two components to the surrender charge: the underwriting component and the sales component. The underwriting component is based upon the Insured’s age when the policy is issued and covers costs associated with underwriting. The sales expense component, which is based on and varies by the Insured’s sex, age when the policy is issued, and underwriting class, covers sales expenses including processing applications, conducting medical exams, determining insurability (and the Insured’s underwriting class), and establishing policy records. Additional information can be found in the Statement of Additional Information which can be requested, free of charge, by contacting the Service Center.
Nationwide will waive the surrender charge if the policy is surrendered in exchange for a plan of permanent fixed life insurance offered by Nationwide, subject to the following:
• the exchange and waiver may be subject to new, satisfactory evidence of insurability and Nationwide’s underwriting approval; and
• the Waiver of Monthly Deductions Rider has not been invoked.
Nationwide may impose a new surrender charge on the policy received in the exchange.
Cost of Insurance Charge
A Cost of Insurance Charge is deducted proportionally from Sub-Account and Fixed Account allocations on the Policy Date and on each monthly anniversary of the Policy Date. The charge is intended to cover Nationwide’s expenses associated with providing expected mortality benefits and assuming certain risks associated with the policy, and to cover other expenses, including acquisition costs, and state and federal taxes. Nationwide may also profit from this charge.
The Cost of Insurance Charge is the product of the Net Amount At Risk and the cost of insurance rate. The cost of insurance rate will vary by the Insured's sex; age; underwriting class, any Substandard Ratings, how long the policy has been In Force, and the Base Policy Specified Amount and Spouse Life Insurance Rider Specified Amount (if applicable). The cost of insurance rate is based on Nationwide’s expectations as to future mortality and expense experience, investment earnings, persistency, and taxes.
There will be a separate cost of insurance rate for the initial Base Policy Specified Amount and any Base Policy Specified Amount increase. The cost of insurance rate(s) will never be greater than what is shown on the Policy Data Pages.
Flat Extras and Substandard Ratings
Nationwide may inquire about the occupation and activities of the Insured through the underwriting process. If the activities or occupation of the Insured cause an increased health or accident risk, it may result in the Insured receiving a Substandard Rating. If this is the case, Nationwide may add an additional component to the Cost of Insurance Charge called a "Flat Extra Charge." The Flat Extra Charge accounts for the increased risk of providing life insurance when one or more of these factors apply to the Insured. The Flat Extra Charge is a component of the total Cost of Insurance Charge, so if applied it will be deducted from Cash Value on the Policy Date and the monthly anniversary of the Policy Date. The monthly Flat Extra Charge is between $0.00 and $2.08 per $1,000 of the Net Amount At Risk. If a Flat Extra Charge is applied, it is shown in the Policy Data Pages. In no event will the Flat Extra Charge result in the Cost of Insurance Charge exceeding the maximum charge shown in In Summary: Fee Tables.
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Nationwide will uniformly apply a change in any cost of insurance rate for Insureds of the same age, sex, underwriting class, Substandard Ratings, and Base Policy Specified Amount and Spouse Life Insurance Rider Specified Amount (if applicable), if the policies have been In Force for the same length of time. If a change in the cost of insurance rates causes an increase to a policy’s Cost of Insurance Charge, the policy's Cash Value could decrease. If a change in the cost of insurance rates causes a decrease to the policy’s Cost of Insurance Charge, the policy's Cash Value could increase.
There will be a separate cost of insurance rate for the initial Base Policy Specified Amount and any Base Policy Specified Amount increase. An increase in the Base Policy Specified Amount may cause an increase in the Net Amount At Risk. Because the Cost of Insurance Charge is based on the Net Amount At Risk, and because there will be a separate cost of insurance rate for the increase, this will usually cause the policy's Cost of Insurance Charge to increase. An increase in the Base Policy Specified Amount may require larger or additional Premium payments in order to avoid Lapsing the Policy.
The rate class of an Insured may affect the cost of insurance rate. Nationwide currently places Insureds into both standard rate classes and substandard rate classes that involve a higher mortality risk. In an otherwise identical policy, an Insured in the standard rate class will have a lower cost of insurance than an Insured in a rate class with higher mortality risks. Nationwide may also issue certain policies on a "non medical" basis to certain categories of individuals. Due to the underwriting criteria established for policies issued on a non medical basis, actual rates will be higher than the current cost of insurance rates being charged that are medically underwritten.
Mortality and Expense Risk Charge
The charge will vary by policy based on the amount of Cash Value allocated to the Sub-Accounts and the length of time the policy has been In Force. The charge compensates Nationwide for assuming the risk associated with mortality and expense risk costs. The mortality risk is that the Insured will not live as long as expected. The expense risk is that the costs of issuing and administering the policy will be more than expected. This charge is in addition to any charges assessed by the mutual funds underlying the Sub-Accounts.
Though the maximum guaranteed mortality and expense risk charge is higher, currently, this charge is deducted on a daily basis according to the following schedule. During the first through ninth year from the Policy Date, the annualized charge is $8.00 per $1,000 of Cash Value. After the ninth year, this annualized charge is $8.00 per $1,000 on the first $25,000 of Cash Value and $5.00 per $1,000 of additional Cash Value.
Administrative Charge
An administrative charge is deducted proportionally from the policy's Sub-Account and Fixed Account allocations on the Policy Date and each monthly anniversary of the Policy Date. The charge reimburses Nationwide for the costs of maintaining the policy, including accounting and record-keeping. The charge is currently $12.50 per month through the first year from the Policy Date, and $5 per month after the first year from the Policy Date. The maximum guaranteed charge is $25 per month through the first year from the Policy Date, and $7.50 per month after the first year from the Policy Date.
Increase Charge
The increase charge is deducted from the Cash Value when the policy owner requests an increase in the Base Policy Specified Amount. It is used to cover the cost of underwriting the requested increase and processing and distribution expenses related to the increase.
The increase charge is comprised of two components: underwriting and administration; and sales. The underwriting and administration component is equal to $1.50 per year per $1,000 of increase. The sales component is equal to $0.54 per year per $1,000 of increase. Together, the maximum charge totals $2.04 per year ($0.17 per month).
Mutual Fund Operating Expenses
In addition to the policy charges, there are also charges associated with the mutual funds in which the Sub-Accounts invest. Policy owners do not pay these charges directly, but these charges do affect the value of the assets allocated to the Sub-Accounts because these charges are reflected in the underlying mutual fund prices that Nationwide subsequently uses to value Sub-Account units. The underlying mutual funds' prospectuses contain additional information about these charges. Policy owners may contact the Service Center to receive, free of charge, copies of the prospectuses for any of the underlying mutual funds available under the policy.
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Reduction of Charges
The policy may be purchased by individuals, corporations, and other entities. Nationwide may reduce or eliminate certain charges (Sales Load, Surrender Charge, administrative charges, Cost of Insurance Charge, or other charges) where the size or nature of the group allows Nationwide to realize savings with respect to sales, underwriting, administrative, or other costs. Where prohibited by state law, Nationwide will not reduce charges associated with the policy.
Nationwide determines the eligibility and the amount of any reduction by examining a number of factors, including: the number of policies owned with different insureds; the total premium Nationwide expects to receive; the total cash value of commonly owned policies; the nature of the relationship among individual insureds; the purpose for which the policies are being purchased; the length of time Nationwide expects the individual policies to be in force; and any other circumstances which are rationally related to the expected reduction in expenses.
Nationwide may lower commissions to the selling broker-dealer and/or increase charge back of commissions paid for policies sold with reduced or eliminated charges. Policy owners should consult with a registered representative about reductions available and, where appropriate, obtain an illustration demonstrating the impact of any reduced charges on the policy.
Nationwide may change both the extent and the nature of the charge reductions. Any charge reductions will be applied in a way that is not unfairly discriminatory to policy owners and will reflect the differences in costs of services provided.
Entities considering purchasing the policy should note that in 1983, the U.S. Supreme Court held in Arizona Governing Committee v. Norris that certain annuity benefits provided by employers' retirement and fringe benefit programs may not vary between men and women on the basis of sex. The policies are based upon actuarial tables that distinguish between men and women unless the purchaser is an entity and requests non-sex distinct tables be used for underwriting. The policies generally provide different benefits to men and women of the same age. Accordingly, employers and employee organizations should consider, in consultation with legal counsel, the impact of Norris on any employment related insurance or benefit program before purchasing the policy.
A Note on Charges
During a policy's early years, the expenses Nationwide incurs in distributing and establishing the policy exceed the deductions. Nevertheless, Nationwide expects to make a profit over time because variable life insurance is intended to be a long-term financial investment. Accordingly, Nationwide has designed the policy with features and investment options that it believes support and encourage long-term ownership.
Nationwide makes many assumptions and accounts for many economic and financial factors when establishing the policy's fees and charges. The following is a discussion of some of the factors that are relevant to the policy's pricing structure.
Distribution, Promotional, and Sales Expenses
Distribution, promotional, and sales expenses include amounts paid to broker-dealer firms as commissions, expense allowances, and marketing allowances. Nationwide refers to these expenses collectively as "total compensation."
Nationwide has the ability to customize the total compensation package of its broker-dealer firms. Nationwide may vary the form of compensation paid or the amounts paid as commission, expense allowance, or marketing allowance; however, the total premium based compensation will not exceed the maximum (99% of first year premium and no more than 4% of any excess and renewal premium). Commission may also be paid as an asset-based amount instead of a premium based amount. If an asset-based commission is paid, it will not exceed 0.45% of the non-loaned Cash Value per year.
Marketing allowance is based on a firm’s ability and demonstrated willingness to promote and market Nationwide’s products. How any marketing allowance is spent is determined by the firm, but generally will be used to finance firm activities that may contribute to the promotion and marketing of Nationwide’s products.
The actual amount and/or forms of total compensation paid depend on factors such as the level of premiums Nationwide receives from respective broker-dealer firms and the scope of services the firms provide. Some broker-dealer firms may not receive maximum total compensation.
Individual registered representatives typically receive a portion of the commissions/total compensation paid, depending on their arrangement with their broker-dealer firm. Policy owners should consult the registered representative to know the exact compensation arrangement associated with this policy.
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Information on Underlying Mutual Fund Service Fee Payments
Nationwide's Relationship with the Underlying Mutual Funds
The underlying mutual funds incur expenses each time they sell, administer, or redeem their shares. The separate account aggregates policy owner purchase, redemption, and transfer requests and submits net or aggregated purchase/redemption requests to each underlying mutual fund daily. The separate account (not the policy owners) is the underlying mutual fund shareholder. When the separate account aggregates transactions, the underlying mutual fund does not incur the expense of processing individual transactions it would normally incur if it sold its shares directly to the public. Nationwide incurs these expenses instead.
Nationwide also incurs the distribution costs of selling the policy (as discussed above), which benefit the underlying mutual funds by providing policy owners with Sub-Account options that correspond to the underlying mutual funds.
An investment advisor or subadvisor of an underlying mutual fund or its affiliates may provide Nationwide or its affiliates with wholesaling services that assist in the distribution of the policy and may pay Nationwide or its affiliates to participate in educational and/or marketing activities. These activities may provide the advisor or subadvisor (or their affiliates) with increased exposure to persons involved in the distribution of the policy.
Types of Payments Nationwide Receives
In light of the above, the underlying mutual funds or their affiliates make certain payments to Nationwide or its affiliates (the "payments"). The amount of these payments is typically based on a percentage of assets invested in the underlying mutual funds attributable to the policies and other variable policies Nationwide and its affiliates issue, but in some cases may involve a flat fee. These payments are made for various purposes, including payments for the services provided and expenses incurred by the Nationwide companies in promoting, marketing and administering the policies and underlying funds. Nationwide may realize a profit on the payments received.
Nationwide or its affiliates receive the following types of payments:
• Underlying mutual fund 12b-1 fees, which are deducted from underlying mutual fund assets;
• Sub-transfer agent fees or fees pursuant to administrative service plans adopted by the underlying mutual fund, which may be deducted from underlying mutual fund assets; and
• Payments by an underlying mutual fund's advisor or subadvisor (or its affiliates). Such payments may be derived, in whole or in part, from the advisory fee, which is deducted from underlying mutual fund assets and is reflected in mutual fund charges.
Furthermore, Nationwide benefits from assets invested in affiliated underlying mutual funds (i.e., Nationwide Variable Insurance Trust) because these affiliates receive compensation from the underlying mutual funds for investment advisory, administrative, transfer agency, distribution, and/or other services provided. Overall, Nationwide may receive more revenue with respect to affiliated underlying mutual funds than unaffiliated underlying mutual funds.
Nationwide took into consideration the anticipated mutual fund service fee payments from the underlying mutual funds when it determined the charges imposed under the policies (apart from fees and expenses imposed by the underlying mutual funds). Without these mutual fund service fee payments, Nationwide would have imposed higher charges under the policy.
Amount of Payments Nationwide Receives
For the year ended December 31, 2015, the underlying mutual fund service fee payments Nationwide and its affiliates received from the underlying mutual funds did not exceed 0.75% (as a percentage of the average daily net assets invested in the underlying mutual funds) offered through the policy or other variable policies that Nationwide and its affiliates issued. Payments from investment advisors or subadvisors to participate in educational and/or marketing activities have not been taken into account in this percentage.
Most underlying mutual funds or their affiliates have agreed to make payments to Nationwide or its affiliates, although the applicable percentages may vary from underlying mutual fund to underlying mutual fund and some may not make any payments at all. Because the amount of the actual payments Nationwide or its affiliates receive depends on the assets of the underlying mutual funds attributable to the policy, Nationwide and its affiliates may receive higher payments from underlying mutual funds with lower percentages (but greater assets) than from underlying mutual funds that have higher percentages (but fewer assets).
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For policies owned by an employer sponsored retirement plan subject to ERISA, upon a plan trustee’s request, Nationwide will provide a best estimate of plan-specific, aggregate data regarding the amount of underlying mutual fund service fee payments Nationwide received in connection with the plan’s investments either for the previous calendar year or plan year, if the plan year is not the same as a calendar year.
Identification of Underlying Mutual Funds
Nationwide may consider several criteria when identifying the underlying mutual funds, including some or all of the following: investment objectives, investment process, investment performance, risk characteristics, investment capabilities, experience and resources, investment consistency, and fund expenses. Nationwide also considers whether the underlying mutual fund's advisor or subadvisor is an affiliate or whether the underlying mutual fund, its advisor, its subadvisor(s), or an affiliate will make mutual fund service fee payments to Nationwide or its affiliates.
There may be underlying mutual funds with lower fees and expenses, as well as other variable policies that offer underlying mutual funds with lower fees and expenses. Policy owners should consider all of the fees and charges of the policy in relation to its features. Higher policy fees and charges and underlying mutual fund fees and expenses have a direct effect on the policy’s investment performance.
Policy Riders and Rider Charges
Policy owners may purchase one or more of the policy’s Riders. There may be additional charges assessed for elected Riders, see In Summary: Fee Tables. The availability, operation, and benefits of the Riders may vary by the state where the policy is issued.
Rider charges are assessed starting on the Policy Date and each monthly anniversary of the Policy Date by taking deductions from the Cash Value. If a Rider is elected after the Policy Date, Rider charges will begin to be deducted on the first monthly anniversary after Nationwide approves the request unless the policy owner requests and Nationwide approves a different date.
Rider charges compensate Nationwide for the services and benefits provided, the costs and expenses incurred, and the risks assumed by Nationwide associated with offering the Riders. Nationwide may generate a profit from any of the Rider charges.
The maximum and minimum/current Rider charges are stated in the Fee Tables, see In Summary: Fee Tables.
Note: The charge and/or benefits received under certain Riders may be treated as a distribution from the policy for income tax purposes, see Periodic Withdrawals, Non-Periodic Withdrawals in Taxes, and Policy Loans.
Accidental Death Benefit Rider
Subject to Nationwide’s underwriting approval, this Rider may be elected at any time. The Rider pays a benefit, in addition to the Death Benefit, to the named beneficiary upon the Insured's accidental death. The benefit continues until the Insured reaches Attained Age 70. The policy owner will be charged for this Rider: so long as the policy remains In Force and the Rider's term has not expired; until the benefit has been paid or until the policy owner terminates the Rider in writing at the Service Center.
The charge for this benefit is deducted from the policy's Cash Value, therefore this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value. Otherwise, the benefit of this Rider and the Death Benefit are independent of one another.
Accidental Death Benefit Rider Charge
The charge for this Rider compensates Nationwide for providing coverage in the event of the Insured's accidental death, meaning the Insured's death as a result of bodily injury caused by external, violent and accidental means from a cause other than a risk not assumed. The charge is the product of the Accidental Death Benefit Rider Specified Amount and the accidental death benefit cost of insurance rate. The accidental death benefit cost of insurance rate is based on Nationwide’s expectations as to the likelihood of the Insured's accidental death. The accidental death benefit cost of insurance rate will vary by the Insured's sex, Attained Age, underwriting class and any Substandard Ratings.
Base Insured Term Rider
Subject to Nationwide’s underwriting approval, this Rider is available when the policy is In Force. The benefit is term life insurance on the Insured, in addition to the Death Benefit, payable to the beneficiary upon the Insured's death.
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The benefit amount varies monthly and is based on the elected death benefit option. The policy owner may renew coverage annually until the Insured reaches Attained Age 95, when this Rider's term expires. Because the charge for this benefit is deducted from the policy's Cash Value, purchasing this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value.
Before deciding whether to purchase the Rider it is important to know that when this Rider is purchased, the compensation received by the registered representative and his or her firm is less than when compared to purchasing insurance coverage under the base policy. As a result of this compensation reduction, the charges assessed for the cost of insurance under the Rider will be lower for a significant period of time. There are instances where the Rider may require lower Premium to maintain the total death benefit over the life of the policy or may require higher Premium when compared to not purchasing the Rider at all. When the Rider is purchased, the Maturity Date for coverage under the Rider may not be extended (resulting in a loss of coverage at maturity).
Base Insured Term Rider Charge
The charge for this Rider compensates Nationwide for providing term life insurance on the Insured. The charge is the product of the Rider Specified Amount and the additional protection cost of insurance rate. The additional protection cost of insurance rate is based on an expectation as to the Insured's mortality. The additional protection cost of insurance rate will vary by: the Insured's sex; Attained Age; underwriting class; any Substandard Ratings; and the Rider Specified Amount.
Change of Insured Rider
The Rider is only available in connection with policies issued to corporate entities or in other business contexts where the primary purpose is to provide protection or benefits to employees. The Rider is not available to individuals outside of these limited business purposes. The benefit associated with the Change of Insured Rider is that the policy owner may designate a new Insured at any time after the Policy Date, subject to insurability and the conditions below. If this Rider is invoked, the policy charges after the change will be based on the underwriting classification and characteristics of the new Insured.
The amount of insurance coverage after the change date will be the Total Specified Amount shown on the application to change the Insured provided that (1) the policy continues to qualify as life insurance under the Code, and (2) such Total Specified Amount equals or exceeds the minimum Total Specified Amount shown on the Policy Data Pages. Coverage of the new Insured will become effective on the change date. Coverage of the previous Insured will terminate on the day before the change date. The change date is the first monthly anniversary on or next following the date the change of Insured conditions are met. The Policy Date will not change.
Change of Insured conditions:
(1) At the time of the change, the new Insured must have the same business relationship to the policy owner as did the previous Insured.
(2) The new Insured may be required to submit satisfactory evidence of insurability.
(3) The new Insured must satisfy Nationwide’s underwriting requirements.
(4) The policy must be In Force and not be in a Grace Period at the time of the change.
(5) The new Insured must have been at least age 18 on the Policy Date.
(6) The policy owner must make written application to change the Insured to the Service Center.
Federal income tax consequences may result from a change in insured. For federal income tax purposes the substitution of a new insured is treated as an exchange of the policy for another life insurance policy. Because the new insured is not the same as the insured that was substituted, the tax free treatment for policy exchanges under Code Section 1035 may not be available because the requirement that the insured under the policy relate to the same individual would not be met; consequently, the excess Cash Surrender Value over the investment in the policy would be taxable as ordinary income. The foregoing is not comprehensive and cannot replace personalized advice provided by a competent tax professional. The policy owner should seek competent tax advice regarding the tax treatment of the policy when contemplating a change of insured.
Change of Insured Rider Charge
There is no charge associated with the Change of Insured Rider.
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Children's Term Insurance Rider
Subject to underwriting approval, a policy owner may purchase term life insurance on the Insured's children at any time while the policy is In Force. If an insured child dies while the policy is In Force and before the Maturity Date, the policy pays a benefit to the named beneficiary. The insurance coverage for each insured child will continue (as long as the policy is In Force) until the earlier of: (1) the policy anniversary on or next following the date the Insured's child turns age 22; or (2) the policy anniversary on which the Insured would have reached Attained Age 65. Subject to certain conditions specified in the Rider, the Rider may be converted into a policy on the life of the insured child without evidence of insurability. The Rider will be effective until the Rider's term expires, until the benefit is paid, or until the Rider is terminated by written request to the Service Center.
Children’s Term Insurance Rider Charge
A monthly Children's Term Insurance Rider Charge will be deducted if this Rider is elected. The Children’s Term Insurance Rider Charge compensates Nationwide for providing term insurance on the lives of each Insured child. The Rider charge will be assessed as long as the policy is In Force and the Rider is in effect. The Rider charge will be the same, even if the number of children covered under the Rider changes. Nationwide may decline a request to add another child based on underwriting standards.
Guaranteed Minimum Death Benefit Rider
This Rider is only available at application and has no loan value or Cash Surrender Value. The purpose of this Rider is to keep the death benefit In Force and to prevent the policy from Lapsing. The benefit is a death benefit payable to the beneficiary, less any Indebtedness and any withdrawals.
Guaranteed Minimum Death Benefit Rider Charge
There is no charge for this Rider during the first three policy years. In the first month of the third Policy year, this charge will begin and after the third Policy year, this Rider ensures that the base policy will remain In Force even if the Cash Surrender Value is zero or less, as long as: 1) the Rider is In Force; 2) the Insured is alive; and 3) the annual Guaranteed Minimum Death Benefit Rider Minimum Premium requirement has been met. The annual Rider Minimum Premium is shown on the Policy Data Page and is based on the issue age, sex, Total Specified Amount, death benefit option and underwriting class of the Insured.
On each policy anniversary, Nationwide will determine if the Rider Minimum Premium requirement has been met. This requirement shall be met if the sum of all previous Premium payments under the policy, less any partial withdrawals and existing policy Indebtedness is greater than or equal to the sum of the annual Rider Minimum Premiums for the previous policy years. If this requirement is met, the policy is guaranteed to remain In Force during the next policy year, provided there are no new loans or partial withdrawals. If this requirement is not met, Nationwide will notify the policy owner of the Premium payments required in order to continue benefits under this Rider. A Grace Period of 61 days will be provided and if the required Premiums are not received during this Grace Period, the Rider will terminate without value. During this Grace Period, the Rider charge will still apply. During any policy year when benefits are being paid under the Waiver of Monthly Deduction Rider, the annual Rider Minimum Premium that policy year will be equal to zero.
Spouse Life Insurance Rider
The benefit associated with the Spouse Life Insurance Rider is a death benefit payable upon the death of the spouse named on the application ("Insured Spouse") to the designated beneficiary. If no beneficiary is designated, the benefit is payable to the Insured.
This Rider may be purchased at any time while the policy is In Force, subject to underwriting approval and the following age restrictions:
• the Insured must be between Attained Age 21 and 59 (this Rider is no longer available on or after the policy anniversary on which the Insured reaches Attained Age 59); and
• the Insured Spouse must be between Attained Age 18 and 69 at the time this Rider is elected.
This Rider will terminate on the earliest of: the policy anniversary on which the Insured Spouse reaches Attained Age 70, the date the Rider is converted to a new policy, the date the policy matures, or until the Rider or policy is terminated by written request to the Service Center.
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This Rider has a conversion right. The Insured Spouse may exchange this Rider's benefit for a level premium, level benefit, permanent plan of whole life insurance, subject to limitations.
Spouse Life Insurance Rider Charge
A monthly Rider charge is deducted if this Rider is elected. The Spouse Life Insurance Rider Charge compensates Nationwide for providing term insurance on the life of the Insured Spouse. The Rider charge is the product of the Spouse Life Insurance Rider's Specified Amount and the Insured Spouse life insurance cost of insurance rate. The Insured Spouse life insurance cost of insurance rate is based on Nationwide’s expectations as to the mortality of the Insured Spouse. The Insured Spouse life insurance cost of insurance rate will vary by the Insured Spouse's sex, Attained Age, underwriting class, any Substandard Ratings, and the Spouse Life Insurance Rider's Specified Amount.
The Spouse Life Insurance Rider Charge will be deducted proportionally from the Sub-Account and Fixed Account allocations. Because the Spouse Life Insurance Rider Charge is deducted from Cash Value, purchasing this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value. Decreases in the Base Policy Specified Amount may result in a corresponding decrease in the Spouse Life Insurance Rider's Specified Amount.
Waiver of Monthly Deductions Rider
Subject to Nationwide’s underwriting approval, this Rider can be elected at any time so long as the policy is In Force and it is before the Policy Date on or following the date the Insured reaches age 59.
Rider Benefit
The benefit associated with this Rider is a waiver of the policy's monthly deductions if the Insured becomes totally disabled, as defined in the Rider, for at least six consecutive months. No benefit is available if total disability results from a risk not assumed; risks not assumed may vary by state. Contact the Service Center to obtain a copy of the Waiver of Monthly Deductions Rider applicable to the policy.
Disability During the First Three Years from the Policy Date
If the Insured becomes totally disabled for six consecutive months within the first three years from the Policy Date, the benefit is a credit to the policy in an amount necessary to keep the policy In Force as opposed to a waiver of the monthly deductions. The Cash Value will increase by the amount in which the minimum monthly premium exceeds the monthly deductions, just as if the minimum monthly premium had been paid.
Disability Following the First Three Years from the Policy Date
If the Insured becomes totally disabled for six consecutive months any time after the first three years from the Policy Date, the benefit is a waiver of the policy's monthly deductions. For example, if the policy owner becomes totally disabled for six consecutive months two years and eight months from the Policy Date, for the first four months, the benefit would be a credit equal to the amount necessary to keep the policy In Force. After that, the Rider's benefit becomes a waiver of the policy's monthly charges.
Following the third year from the Policy Date, the Rider's benefit alone may not be sufficient to keep the policy from Lapsing. The policy owner may need to make additional premium payments to prevent Lapse. However, while the Rider's benefit is being paid, it will cost less on a monthly basis to keep the policy In Force.
Benefit Duration
The benefit duration depends on the Insured's age when total disability begins. Before age 60, the benefit continues for as long as the Insured is totally disabled (even if that disability extends past when the Insured reaches age 65). Between ages 60 and 63, the benefit continues until the Insured turns age 65. From age 63, the benefit lasts only for two years.
Waiver of Monthly Deductions Rider Charge
The charge for this Rider compensates Nationwide for the risks assumed in crediting and/or waiving policy charges during the Insured's total disability. The charge is the product of the amount of periodic charges deducted from the policy on a monthly basis (excluding the cost for this Rider) and the deduction waiver cost rate. The deduction waiver cost rate is based on Nationwide’s expectations as to the likelihood of the Insured's total disability for six consecutive months. The deduction waiver cost rate varies by the Insured's sex, Attained Age, underwriting class, and any Substandard Ratings.
The charge for this Rider is deducted proportionately from the Sub-Account and Fixed Account allocations; therefore, purchasing this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value.
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Policy Owner Services
Dollar Cost Averaging
Dollar cost averaging is an investment strategy designed to reduce the investment risks associated with market fluctuations and promote a more stable Cash Value and Death Benefit over time. A policy owner may elect to participate in the dollar cost averaging program at the time of application or at a later date by submitting an election form to the Service Center. An election to participate in the program that is submitted after application will be effective at the end of the Valuation Period coinciding with the date requested or, if that date has passed or no date is specified, at the end of the Valuation Period during which the request was received, or the end of the free look period, whichever is later.
There is no charge for dollar cost averaging and dollar cost averaging transfers do not count as transfer events. Dollar cost averaging transfers will continue to be processed until there is no more value left in the originating investment option(s) or until a policy owner instructs Nationwide to terminate the service. Policy owners may direct Nationwide to automatically transfer specific amounts from the Fixed Account and the:
• Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class I
• Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I
• Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I
to any other Sub-Account. Certain Sub-Accounts may or may not be available depending on when the policy was purchased, see Appendix A: Sub-Account Information for details on Sub-Account availability. Transfers from the Fixed Account must be no more than 1/30th of the Fixed Account value at the time the program is elected.
Nationwide does not assure the success of these strategies and cannot guarantee that dollar cost averaging will result in a profit or protect against a loss. A policy owner should carefully consider his or her financial ability to continue these programs over a long enough period of time to purchase Accumulation Units when their value is low, as well as when their value is high. Nationwide may modify, suspend, or discontinue these programs at any time. Nationwide will notify policy owners in writing 30 days before doing so.
Automated Income Monitor
Automated Income Monitor is an optional systematic partial surrender and/or policy loan program that may be elected at any time, at no additional cost. This program is only available to policies that are not modified endowment contracts.
Automated Income Monitor programs are intended for policy owners who wish to take an income stream of scheduled payments from the Cash Value of the policy. The income stream is generated via partial surrenders until the policy cost basis is depleted, then through policy loans. Taking partial surrenders and/or policy loans may result in adverse tax consequences, will reduce policy values and therefore limit the ability to accumulate Cash Value, and may increase the likelihood the policy will Lapse. Before requesting the Automated Income Monitor program, policy owners should consult with financial and tax advisors.
At the time of application for a program, Nationwide will provide policy owners with an illustration of the proposed income stream and impacts to the Cash Value, Cash Surrender Value, and Death Benefit. Policy owners must submit this illustration along with an application when electing an Automated Income Monitor program. Programs will commence at the beginning of the next monthly anniversary after Nationwide receives the election form and illustration. On each policy anniversary thereafter Nationwide will provide an updated In Force illustration to assist policy owners in determining whether to continue, modify, or discontinue an elected program. Policy owners may request modification or termination of a program at any time by written request to the Service Center.
A policy owner’s program will be based on the policy's Cash Surrender Value at the time of election and each succeeding policy anniversary, and on the following elections:
(1) Payment type:
(a) Fixed Amount: If a policy owner elected payments of a fixed amount, the amount received will not vary with policy Investment Experience; however, the length of time the elected payment amount can be sustained will vary based on the illustration assumptions below and the policy's Investment Experience; or
(b) Fixed Duration: If a policy owner elected payments for a fixed duration, the amount received during the first year will be based on the illustration assumptions below. After the first year, the amount will vary based on the illustration assumptions and policy Investment Experience to maintain the elected duration.
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(2) Illustration assumptions:
(a) an assumed variable rate of return specified by the policy owner from the available options stated in the election form;
(b) minimum Cash Surrender Value targeted by the policy owner to have remaining on the policy's Maturity Date, or other date specified by the policy owner. This dollar amount is used to calculate available income. It is not guaranteed to be the Cash Surrender Value on the specified date;
(c) a policy owner may also request a change of death benefit option, or a decrease in Base Policy Specified Amount to be effective in conjunction with commencing a program or to occur at a future date; and
(d) payment frequency: monthly; quarterly; semi-annually; or annually. Payments on a monthly basis are made by direct deposit (electronic funds transfer) only.
Generally, higher variable rate of return assumptions, a lower target Cash Surrender Value, and Death Benefit Option 1, will result in larger projected payments or longer projected durations. However, larger payments or longer duration may increase the likelihood the policy will Lapse.
Note: Policy owners are responsible for monitoring the policy to prevent Lapse. Nationwide will provide annual In Force illustrations based on current Cash Surrender Values and the elected illustration assumptions to assist policy owners with preventing Lapse. Policy owners may request modification or termination of a program at any time by written request to the Service Center.
Automated Income Monitor programs are subject to the following additional conditions:
(1) To prevent adverse tax consequences, a policy owner can authorize Nationwide to make scheduled payments via policy loan when:
(a) the policy's cost basis is reduced to zero;
(b) a partial surrender within the first 15 policy years would be a taxable event;
(c) or to prevent the policy from becoming a MEC, see Taxes.
  Note: Partial surrenders and policy loans taken under the Automated Income Monitor program are subject to the same terms and conditions as other partial surrenders and policy loans, see Partial Surrender and Policy Loans.
(2) While a program is in effect, no Premium payment reminder notices will be sent; however, Premium payments will be accepted.
(3) Programs will terminate on the earliest of the following:
(a) Nationwide’s receipt at the Service Center of a written request to terminate participation;
(b) at the time the policy enters a Grace Period or terminates for any reason;
(c) at the time of a requested partial surrender or policy loan outside the program;
(d) upon a change of policy owner;
(e) for income based on a fixed duration, the end of the period the policy owner specified at the time of election;
(f) on any policy anniversary when the current Cash Surrender Value is less than or equal to the target Cash Surrender Value assumption the policy owner specified;
(g) at any time the scheduled partial surrender or policy loan would cause the policy to fail to qualify as life insurance under Section 7702 of the Code; or
(h) the policy's Maturity Date.
Nationwide will notify policy owners upon termination of an Automated Income Monitor program. In addition, Nationwide may modify, suspend, or discontinue Automated Income Monitor programs at any time. Nationwide will notify policy owners in writing 30 days before doing so.
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Policy Loans
After the expiration of the free look period and while the policy is In Force, a policy owner may take a policy loan. A policy loan will be effective as of the date Nationwide receives the policy owner's written request at the Service Center. Nationwide reserves the right to require written requests to be submitted on current Nationwide forms. Notwithstanding anything to the contrary set forth in this prospectus, Nationwide currently accepts requests submitted via telephone, subject to dollar amount limitations and payment and other restrictions to prevent fraud. Nationwide reserves the right to discontinue acceptance of telephonic requests at any time upon written notice. Contact the Service Center for current limitations and restrictions.
Taking a policy loan may increase the risk of Lapse and may result in adverse tax consequences. Unpaid loan interest charges accrue daily at a compounded annual interest rate and can cause the policy's Indebtedness to grow significantly. The policy owner should request an illustration demonstrating the impact of a policy loan on the policy's Cash Value, Cash Surrender Value, and Death Benefit Proceeds.
Loan Amount
The minimum loan amount is $200. At the time of a loan request, policy Indebtedness cannot exceed 90% of the Cash Value less any Surrender Charge, less interest due on the next policy anniversary. Nationwide pays the policy loan to the policy owner with assets from its general account. Nationwide then uses the policy's Cash Value as collateral for the loan as described below.
Collateral and the Policy Loan Account
As collateral for the policy loan, Nationwide deducts an amount equal to the policy loan from the policy's Cash Value. Collateral amounts are transferred from the Cash Value to the policy loan account (which is part of Nationwide's general account). Because the policy loan account does not participate in the Investment Experience of the Sub-Accounts, policy loans can permanently affect the Death Benefit Proceeds and the Cash Value of the policy, even if repaid. The policy loan account may be subject to Nationwide's creditors in the event of insolvency.
Amounts transferred from the policy's Cash Value equal to the policy loan account are deducted from the Sub-Accounts in the same proportion as the Sub-Account allocations, unless the policy owner has instructed otherwise. Nationwide will only transfer amounts from the Fixed Account if the loan amount exceeds 90% of the Cash Value allocated to the Sub-Accounts.
The policy owner will earn interest on the collateral held in the policy loan account. Interest will accrue daily at no less than the guaranteed minimum rate stated on the Policy Data Pages. The interest earned on the policy loan account may be different than the rate earned on Cash Value allocated to the Fixed Account.
Interest Charged
Nationwide charges interest against policy Indebtedness. Indebtedness is the total amount of all outstanding policy loans, including principal and compounded interest due. The maximum interest rate Nationwide may charge against Indebtedness is 6.00% per annum, see In Summary: Fee Tables for current interest charged rates. Rates may change and may vary by policy year. Policy loan interest charges may provide revenue for risk charges and profit.
If policy loan interest is not paid when due, policy Indebtedness will continue to compound at the interest rate in effect, see When Interest is Charged and Credited below. If not paid when due, Nationwide will deduct an amount equal to the unpaid interest from the policy's Cash Value and add it to the policy loan account causing the original policy loan amount (now, "Indebtedness") to increase by the amount of the unpaid interest charged. Amounts deducted from the policy's Cash Value as unpaid interest charges will be deducted from the Sub-Accounts and the Fixed Account in the same manner as a new loan.
Note: Over time, unpaid loan interest charges can cause the policy's Indebtedness to be significant. In some cases, policy Indebtedness may be significant enough to cause the policy to Lapse. In general, it is advantageous to repay Indebtedness and at a minimum, the interest charged on Indebtedness, at least annually.
Indebtedness is considered a part of the policy's Cash Value, therefore, upon a full surrender, Lapse, or maturity, the amount received in the original loan request(s), plus unpaid loan interest charged is considered "received" under the Code and may result in adverse tax consequences, see Surrender, Lapse, Maturity in Taxes.
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When Interest is Charged and Credited
Interest charged against Indebtedness accrues daily. Interest earned on collateral also accrues daily. Nationwide will deduct interest charged on Indebtedness from the policy's Cash Value, and credit interest earned on collateral to the Cash Value:
• Annually, at the end of a policy year;
• At the time a new loan is requested;
• When a loan repayment is made;
• Upon the Insured's death;
• Upon policy Lapse and/or;
• Upon a full surrender of the policy.
In most cases, the interest earned on collateral and credited to the Cash Value will be less and in some cases, significantly less, than the interest charged against the Cash Value.
Repayment
The policy owner may repay all or part of policy Indebtedness at any time while the policy is In Force. The minimum loan repayment amount, if any, is stated in the policy. The policy owner should contact the Service Center to obtain loan pay-off amounts.
Note: Interest earned on collateral is not deducted from Indebtedness to calculate loan pay off amounts. If a loan repayment is made, the policy owner's Cash Value is credited with interest earned on collateral and the amount of the loan repayment is deducted from the policy's Indebtedness.
Nationwide will treat any payments made as Premium payments, unless the policy owner specifies that the payment should be applied against the policy's Indebtedness. It may be beneficial for the policy owner to repay Indebtedness before making additional Premium payments because Premium Load charges are deducted from Premium payments but not from loan repayments.
If the policy owner makes a loan repayment, it will be applied to the Sub-Accounts and the Fixed Account in accordance with the allocation instructions in effect at the time the payment is received, unless the policy owner indicates otherwise.
Repaying Indebtedness will cause the Death Benefit and net Cash Surrender Value to increase accordingly.
Lapse
The policy is at risk of Lapsing when the Cash Surrender Value is insufficient to cover the policy’s monthly deductions, see Unfavorable Investment Experience. Before any policy Lapse, there is a Grace Period during which the policy owner can take action to prevent the Lapse. Subject to certain conditions, the policy owner may reinstate a policy that has Lapsed.
Grace Period
The policy owner will receive notice when the Grace Period begins. The notice will state an amount of Premium required to avoid Lapse that is equal to four times the current monthly deductions. If this Premium amount is not paid within 61 days, the policy and all Riders will Lapse. The Grace Period will not alter the operation of the policy or the payment of Proceeds.
The policies will not Lapse during the first three policy years provided that on each monthly anniversary date 1) is greater than or equal to 2), where:
1) is the sum of all Premiums paid to date minus any Indebtedness, minus any partial surrenders; and
2) is the sum of monthly Premiums required since the Policy Date, including the monthly minimum Premium for the current monthly anniversary date.
If 1) is less than 2) and the Cash Surrender Value is less than zero, a Grace Period of 61 days from the monthly anniversary day will be allowed for the payment of sufficient Premium to satisfy the minimum Premium requirement. If sufficient Premium is not paid by the end of the Grace Period, the policy will Lapse without value. In any event, the policy will not Lapse as long as there is a positive Cash Surrender Value.
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Beginning with the fourth policy year, if the Cash Surrender Value on a monthly anniversary day is not sufficient to cover the current policy charges, a Grace Period of 61 days from the monthly anniversary day will be allowed for the payment of sufficient Premium to cover the current policy charges due, plus an amount equal to three times the current monthly deduction.
Reinstatement
The policy owner may reinstate a Lapsed policy by:
• Submitting a written request at any time within three years after the end of the Grace Period and prior to the Maturity Date; and
• Providing further satisfactory evidence of insurability that Nationwide may require; and
❍ Paying an amount of Premium equal to the minimum monthly Premiums missed since the beginning of the Grace Period, if the policy terminated in the first three policy years; or
❍ Paying sufficient Premium to cover all policy charges that were due and unpaid during the Grace Period if the policy terminated in the fourth or later policy year; and
• Paying sufficient Premium to keep the policy In Force for three months from the date of reinstatement; and
• Paying or reinstating any Indebtedness against the policy which existed at the end of the Grace Period.
The policy owner may also reinstate coverage under certain Riders subject to satisfactory evidence of insurability.
The effective date of a reinstated policy, including any Riders, will be the monthly anniversary date on or next following the date the application for reinstatement is approved. If the policy is reinstated, the Cash Value on the date of reinstatement will be set equal to the lesser of:
• The Cash Value at the end of the Grace Period; or
• The surrender charge for the year from the Policy Date in which the policy was reinstated.
Nationwide will add any Premiums or loan repayments made to reinstate the policy. The allocations to the Sub-Accounts in effect at the start of the Grace Period will be reinstated, unless the policy owner instructs otherwise.
Surrenders
Full Surrender
The policy may be surrendered for the Cash Surrender Value at any time while it is In Force. A surrender will be effective as of the date Nationwide receives the policy owner’s written surrender request at the Service Center. Nationwide reserves the right to require written requests to be submitted on current Nationwide forms. Notwithstanding anything to the contrary set forth in this prospectus, Nationwide currently accepts requests submitted via telephone, subject to dollar amount limitations and payment and other restrictions to prevent fraud. Nationwide reserves the right to discontinue acceptance of telephonic requests at any time upon written notice. Contact the Service Center for current limitations and restrictions. Nationwide may also require the policy owner to return the policy. Nationwide may postpone payment of that portion of the Cash Surrender Value attributable to the Fixed Account for up to six months.
Policy Restoration after a Full Surrender
Prior to the Insured's death, Nationwide will permit restoration of a surrendered policy pursuant to established procedures to meet the requirements of state insurance law regarding the replacement of life insurance (i.e., use of the Proceeds from a surrendered policy to purchase a new policy). Restored policies will be treated as if they were never surrendered for all purposes, including Investment Experience, interest, and deduction of charges, see Policy Restoration Procedure in the Statement of Additional Information.
Partial Surrender
The policy owner may request a partial surrender of the policy's Cash Surrender Value at any time after it has been In Force for one year from the Policy Date. Currently, there is no charge for partial surrenders. Partial surrenders are permitted if they satisfy the following requirements:
(1) The minimum amount of any partial surrender is $500;
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(2) Partial surrenders may not reduce the Base Policy Specified Amount to less than $50,000;
(3) After a partial surrender, the Cash Surrender Value is greater than $500 or an amount equal to three times the current monthly deduction if higher;
(4) Maximum total partial surrenders in any policy year are limited to 10% of the total net Premium payments applied to the policy. Currently, this requirement is waived beginning in the 15th year if the Cash Surrender Value is $10,000 or more after the withdrawal; and
(5) After the partial surrender, the policy continues to qualify as life insurance under Section 7702 of the Code.
Notwithstanding anything to the contrary set forth in this prospectus, Nationwide currently accepts requests submitted via telephone, subject to dollar amount limitations and payment and other restrictions to prevent fraud. Nationwide reserves the right to discontinue acceptance of telephonic requests at any time upon written notice. Contact the Service Center for current limitations and restrictions.
When a partial surrender is made, the Cash Value will be reduced by the amount of the partial surrender. Under Death Benefit Option 1, the Base Policy Specified Amount is reduced by the amount of the partial surrender, unless the Death Benefit is based on the applicable percentage of Cash Value. In that case, a partial surrender will decrease the Base Policy Specified Amount proportionally based on the applicable percentage of Cash Value by the amount the partial surrender exceeds the difference between the Death Benefit and Base Policy Specified Amount.
If a policy owner takes a partial surrender, Nationwide will surrender Accumulation Units proportionally from the Sub-Accounts equal to the amount of the partial surrender. If there is insufficient value in the Sub-Accounts, Nationwide will surrender amounts from the Fixed Account.
Partial surrenders may be subject to income tax penalties. They could also cause the policy to become a "modified endowment contract" under the Code, which could change the income tax treatment of any distribution from the policy, see Periodic Withdrawals, Non-Periodic Withdrawals, and Loans.
Reduction of Base Policy Specified Amount on a Partial Surrender
Nationwide will reduce the Cash Value of the policy by the amount of any partial surrender in the same proportion as how Cash Value is allocated among the Sub-Accounts. Nationwide will only reduce the Cash Value attributable to the Fixed Account when allocations in the Sub-Accounts are insufficient to cover the amount of the partial surrender.
Nationwide may reduce the Base Policy Specified Amount to ensure that the Net Amount At Risk does not increase due to a partial surrender. Because the policy’s Net Amount At Risk is the same before and after the reduction, a partial surrender by itself does not alter the policy's cost of insurance. The policy's charges going forward will be based on a new Base Policy Specified Amount that will change the calculation of those charges. Depending on changes in variables such as the Cash Value, these charges may increase or decrease after the reduction in Base Policy Specified Amount.
Any reduction to the Base Policy Specified Amount will be made in the following order:
• against the most recent increase in the Base Policy Specified Amount;
• against the next most recent increases in the Base Policy Specified Amount in succession; and
• against the Base Policy Specified Amount under the original application.
The Death Benefit
Calculation of the Death Benefit
The Death Benefit will be calculated when Nationwide has received (at the Service Center) all information required to process the claim for Death Benefit Proceeds, including, but not limited to, proof that the Insured has died and any other information Nationwide may reasonably require. The Death Benefit may be subject to an adjustment if an error or misstatement was made upon application, or if the Insured dies by suicide.
While the policy is In Force, the Death Benefit will never be less than the Base Policy Specified Amount. The Death Benefit will depend on the death benefit option elected, certain Riders, and the tax test elected as discussed in greater detail below. The Death Benefit may vary with the Cash Value of the policy, which is affected by Investment Experience, Indebtedness, and any due and unpaid monthly deductions that accrued during a Grace Period.
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Death Benefit Options
Policy owners have a choice of one of two available death benefit options under the policy. If a death benefit option is not selected, Nationwide will issue the policy with Death Benefit Option 1. Not all death benefit options are available in all states.
Death Benefit Option 1: The Death Benefit will be the greater of the Total Specified Amount or the applicable percentage of Cash Value. The amount of the Death Benefit Proceeds will ordinarily not change for several years to reflect Investment Experience and may not change at all. If Investment Experience is favorable, the amount of the Death Benefit Proceeds may increase.
Death Benefit Option 2: The Death Benefit will be the greater of the Total Specified Amount plus the Cash Value as of the date of death or the applicable percentage of Cash Value, and will vary directly with Investment Experience.
In connection with both death benefit options, the term "applicable percentage" means:
(1) 250% when the Insured is Attained Age 40 or less at the beginning of a policy year; and
(2) When the Insured is above Attained Age 40, the percentage shown in the "Applicable Percentage of Cash Value Table".
Applicable Percentage of Cash Value Table
Attained
Age 		  Percentage of
Cash Value
0-40   250%
41   243%
42   236%
43   229%
44   222%
45   215%
46   209%
47   203%
48   197%
49   191%
50   185%
51   178%
52   171%
53   164%
54   157%
55   150%
56   146%
57   142%
58   138%
Attained
Age 		  Percentage of
Cash Value
59   134%
60   130%
61   128%
62   126%
63   124%
64   122%
65   120%
66   119%
67   118%
68   117%
69   116%
70   115%
71   113%
72   111%
73   109%
74   107%
75   105%
76   105%
77   105%
Attained
Age 		  Percentage of
Cash Value
78   105%
79   105%
80   105%
81   105%
82   105%
83   105%
84   105%
85   105%
86   105%
87   105%
88   105%
89   105%
90   105%
91   104%
92   103%
93   102%
94   101%
95   101%
The Minimum Required Death Benefit
The policy has a Minimum Required Death Benefit. The Minimum Required Death Benefit is the lowest Death Benefit that will qualify the policy as life insurance under Section 7702 of the Code.
The tax tests for life insurance generally require that the policy have a significant element of life insurance and not be primarily an investment vehicle. At the time the policy is issued, the policy owner irrevocably elects one of the following tests to qualify the policy as life insurance under Section 7702 of the Code:
• the cash value accumulation test; or
• the guideline premium/cash value corridor test.
If a specific test is not elected, Nationwide will issue the policy with the guideline premium/cash value corridor test.
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Cash Value Accumulation Test
The cash value accumulation test determines the Minimum Required Death Benefit by multiplying the Cash Value by a percentage calculated as described in the Code. The percentages depend upon the Insured's age, sex, and underwriting classification. Under the cash value accumulation test, there is no limit to the amount that may be paid in Premiums as long as there is sufficient Death Benefit in relation to the Cash Value at all times.
Guideline Premium/Cash Value Corridor Test
The guideline premium/cash value corridor test determines the Minimum Required Death Benefit by comparing the Death Benefit to an applicable percentage of the Cash Value. These percentages are set out in the Code, but the percentage varies only by the Attained Age of the Insured.
In deciding which test to elect for the policy, consider the following:
• The cash value accumulation test generally allows flexibility to pay more Premium, subject to Nationwide's approval of any increase in the policy's Net Amount At Risk that would result from higher Premium payments. Premium payments under the guideline premium/cash value corridor test are limited by Section 7702 of the Code.
• Generally, the guideline premium/cash value corridor test produces a higher Death Benefit in the early years of the policy while the cash value accumulation test produces a higher Death Benefit in the policy's later years.
• Monthly cost of insurance charges that vary with the amount of the Death Benefit may be greater during the years when the elected test produces a higher Death Benefit.
Regardless of which test is elected, Nationwide will monitor compliance to ensure that the policy meets the statutory definition of life insurance under the Code. As a result, the Proceeds payable under a policy should be excludable from gross income of the beneficiary for federal income tax purposes. Nationwide may refuse additional Premium payments or return Premium payments so that the policy continues to meet the Code's definition of life insurance. Consult a qualified tax advisor on all tax matters involving the policy.
Changes in the Death Benefit Option
After the first policy year, a policy owner may elect to change the death benefit option from either Death Benefit Option 1 to Death Benefit Option 2, or from Death Benefit Option 2 to Death Benefit Option 1. Nationwide will permit only one change of death benefit option per policy year. The effective date of a change will be the monthly anniversary of the Policy Date following the date Nationwide approves the change.
For any change in the death benefit option to become effective, the Cash Surrender Value after the change must be sufficient to keep the policy In Force for at least three months.
Upon effecting a death benefit option change, the Total Specified Amount may be changed (either increased or decreased) so that the Net Amount At Risk remains the same before and after the change on the date of the change. Because the policy's Net Amount At Risk remains the same before and after the change, changing the death benefit option and preserving the Net Amount At Risk by itself does not alter the policy charges. The policy charges going forward will be based on the adjusted Total Specified Amount. Depending on changes in factors such as fluctuations in the policy's Cash Value, these charges may increase or decrease after the death benefit option change.
The policy owner should request an illustration demonstrating the impact of a change in the policy's death benefit option.
Nationwide will refuse a death benefit option change that would reduce the Total Specified Amount to a level where the Premium already paid would exceed any premium limitations under the Code.
Where the policy owner has selected the guideline premium/cash value corridor test, a change in death benefit option will not be permitted if it results in the total Premium paid exceeding any premium limitations under Section 7702 of the Code.
Incontestability
Nationwide will not contest payment of the Death Benefit based on the initial Total Specified Amount after the policy has been In Force during the Insured's lifetime for two years from the Policy Date, and, in some states, within two years from a reinstatement date. For any change in Total Specified Amount requiring evidence of insurability, Nationwide will not contest payment of the Death Benefit based on such increase after it has been In Force during the Insured's lifetime for two years from its effective date, and, in some states, within two years from a subsequent reinstatement date. The incontestability period in some states may be less than two years.
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Suicide
If the Insured dies by suicide within two years from the Policy Date, and, in some states, within two years of a reinstatement date, Nationwide will pay no more than the sum of the Premiums paid, less any Indebtedness, and less any partial surrenders. Similarly, if the Insured dies by suicide within two years from the date an application for an increase in the Total Specified Amount was accepted by Nationwide, and, in some states, within two years from a subsequent reinstatement date, Nationwide will pay no more than the Death Benefit Proceeds associated with insurance that has been In Force for at least two years from the Policy Date, plus the Cost of Insurance Charges associated with any increase in Total Specified Amount that has been In Force for a shorter period. The suicide period in some states may be less than two years.
Proceeds Upon Maturity
If the policy is In Force on the Maturity Date we will pay the Proceeds to the Policy Owner.
Normally, the Proceeds will be paid within seven days after receipt of the policy owner’s written request for payment of Proceeds at the Service Center. Nationwide may postpone payment of the Proceeds on the days that it is unable to price Accumulation Units, see Valuation of Accumulation Units. The Proceeds will equal the policy's Cash Value minus any Indebtedness. The policy is terminated once the Proceeds are paid.
Extending Coverage Beyond the Maturity Date
Nationwide may offer to extend coverage beyond the Maturity Date to coincide with the Insured's death, after which Nationwide will pay the Proceeds to the beneficiary. During this time, the policy owner will still be able to request partial surrenders. The extension of coverage beyond the Maturity Date will be for the policy Cash Value. If the policy owner elects to extend coverage beyond the Maturity Date, the policy will be endorsed so that:
(1) no changes to the Base Policy Specified Amount will be allowed;
(2) no additional Premium payments will be allowed;
(3) 100% of the Cash Value will be transferred to the fixed account;
(4) your policy's Death Benefit will become the Cash Value, irrespective of your previous death benefit option choice;
(5) no additional monthly periodic charges will be deducted; and
(6) loan interest will continue to be charged on Indebtedness.
The primary purpose of the coverage extension is to continue the life insurance coverage and avoid current income taxes on any earnings in excess of your cost basis if the maturity Proceeds are taken (see, "Surrendering the Policy; Maturity").
Assuming no Indebtedness on the Maturity Date and no partial surrenders or loans are taken after the Maturity Date, the Proceeds after the Maturity Date coverage extension will equal or exceed the Proceeds at maturity. However, because the loan interest rate charged may be greater than loan interest credited, if you have an outstanding loan on or after the Maturity Date, Proceeds after the Maturity Date may be less than the proceeds at maturity.
Coverage beyond the Maturity Date will not be extended when the policy would fail the definition of life insurance under the Code (see "The Death Benefit").
Treatment of Unclaimed Property
Every state has unclaimed property laws which generally declare life insurance policies to be abandoned after a period of inactivity of three to five years from the policy Maturity Date or the date Nationwide becomes informed that a Death Benefit is due and payable. For example, if the payment of a Death Benefit has been triggered, but, if after a thorough search, Nationwide is still unable to locate the beneficiary of the Death Benefit, or the beneficiary does not come forward to claim the Death Benefit in a timely manner, the Death Benefit will be surrendered and placed in a non-interest bearing account. While in the non-interest bearing account, Nationwide will continue to perform due diligence required by state law. Once the state mandated period has expired, Nationwide will escheat the Death Benefit to the abandoned property division or unclaimed property office of the state in which the beneficiary or the policy owner last resided, as shown on
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Nationwide’s books and records, or to Ohio, Nationwide’s state of domicile. If a claim is subsequently made, the state is obligated to pay any such amount (without interest) to the designated recipient upon presentation of proper documentation.
To prevent escheatment, it is important to update beneficiary designations - including complete names, complete addresses, phone numbers, and social security numbers - as they change. Such updates should be sent to the Service Center.
Taxes
The tax treatment of life insurance policies under the Internal Revenue Code ("Code") is complex and the tax treatment of the policy will depend on the policy owner's particular circumstances. The policy owner should seek competent tax advice regarding the tax treatment of the policy given their situation. The following discussion provides a general overview of the Code's provisions relating to certain common life insurance policy transactions. Some of the items discussed below may not be applicable to the life insurance policy described herein. It is not and cannot be comprehensive, and it cannot replace personalized advice provided by a competent tax professional.
Types of Taxes
Federal Income Tax
Generally, the United States assesses a tax on income, which is broadly defined to include all items of income from whatever source, unless specifically excluded. Certain expenditures can reduce income for tax purposes and correspondingly the amount of tax payable. These expenditures are called deductions. While there are many more income tax concepts under the Code, the concepts of "income" and "deduction" are the most fundamental to the federal income tax treatment that pertains to this policy.
Federal Transfer Tax
In addition to the income tax, the United States also assesses a tax on some or all of the value of certain transfers of property made by gift while a person is living (the federal gift tax), and by bequest or otherwise at the time of a person's death (the federal estate tax).
The federal gift tax is imposed on the value of the property (including cash) transferred by gift. Each donor is allowed to exclude an amount per recipient from the value of present interest gifts. In addition, each donor is allowed a credit against the tax on five million dollars in lifetime gifts (calculated after taking into account the applicable exclusion amount). An unlimited marital deduction may be available for certain lifetime gifts made by the donor to the donor's spouse.
For 2011 and 2012, an estate of less than $5,000,000 (inclusive of certain pre-death gifts) will not incur a federal estate tax liability. Also, the American Taxpayer Relief Act ("ATRA") enacted on January 1, 2013, permanently provides for a maximum federal estate tax rate of 40% with an annually inflation adjusted $5 million exemption for estates of persons dying after December 31, 2012.
Under current law, an unlimited marital deduction is available for federal estate tax purposes for certain amounts that pass to the surviving spouse.
If the transfer is made to someone two or more generations younger than the transferor, the transfer may be subject to the federal generation-skipping transfer tax ("GSTT"). The GSTT provisions generally apply to the same transfers that are subject to estate or gift taxes. The GSTT is imposed at a flat rate equal to the maximum estate tax rate subject to any applicable exemptions. As with the estate tax, the GSTT tax has been repealed for 2010; however, ATRA permanently provides for a GSTT tax rate of 40% with an annually inflation adjusted $5 million exemption.
State and Local Taxes
State and local estate, inheritance, income and other tax consequences of ownership or receipt of policy proceeds depend on the circumstances of each policy owner or beneficiary. While these taxes may or may not be substantial in every policy owner's case, state by state differences of these taxes preclude a useful description of them in this prospectus.
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Buying the Policy
Federal Income Tax
Generally, the Code treats life insurance premiums as a nondeductible expense for income tax purposes.
Federal Transfer Tax
Generally, the Code treats the payment of premiums on a life insurance policy as a gift when the premium payment benefits someone else (such as when premium payments are paid by someone other than the policy owner). Gifts are not generally included in the recipient's taxable income. If the policy owner (whether or not they are the insured) transfers ownership of the policy to another person, the transfer may be subject to a federal gift tax.
Investment Gain in the Policy
The income tax treatment of changes in the policy's cash value depends on whether the policy is "life insurance" under the Code. If the policy meets the definition of life insurance, then the increase in the policy's cash value is not included in the policy owner's taxable income for federal income tax purposes unless it is distributed to the policy owner before the death of the insured.
To qualify as life insurance, the policy must meet certain tests set out in Section 7702 of the Code. Nationwide will monitor the policy's compliance with Code Section 7702, and take whatever steps are necessary to stay in compliance.
Diversification
In addition to meeting the tests required under Section 7702, Section 817(h) of the Code requires that the investments of the separate account be adequately diversified. Regulations under Code Section 817(h) provide that a variable life policy that fails to satisfy the diversification standards will not be treated as life insurance unless such failure was inadvertent, is corrected, and the policy owner or the issuer pays an amount to the IRS. If the failure to diversify is not corrected, the income and gain in the policy would be treated as taxable ordinary income for federal income tax purposes.
Nationwide will also monitor compliance with Code Section 817(h) and the regulations applicable to Section 817(h) and, to the extent necessary, take appropriate action to remain in compliance.
Representatives of the IRS have informally suggested, from time to time, that the number of underlying investment options available or the number of transfer opportunities available under a variable insurance product may be relevant in determining whether the product qualifies for the desired tax treatment. In 2003, the IRS issued formal guidance, in Revenue Ruling 2003-91, that indicates that if the number of underlying investment options available in a variable insurance product does not exceed 20, the number of underlying investment options alone would not cause the policy to not qualify for the desired tax treatment. The IRS has also indicated that exceeding 20 underlying investment options may be considered a factor, along with other factors including the number of transfer opportunities available under the policy, when determining whether the policy qualifies for the desired tax treatment. The revenue ruling did not indicate the number of underlying investment options, if any, that would cause the policy to not provide the desired tax treatment. Should the U.S. Secretary of the Treasury issue additional rules or regulations limiting: the number of underlying investment options, transfers between underlying investment options, exchanges of underlying investment options or changes in the investment objectives of underlying investment options such that the policy would no longer qualify as life insurance under Section 7702 of the Code, Nationwide will take whatever steps are available to remain in compliance.
Based on the above, the policy should be treated as life insurance for federal income tax purposes.
Periodic Withdrawals, Non-Periodic Withdrawals and Loans
The tax treatment described in this section applies to withdrawals and loans, premiums Nationwide accepts but then returns to meet the Code's definition of life insurance, and amounts used to pay the premium on any rider to the policy.
The income tax treatment of distributions of cash from the policy depends on whether the policy is also a "modified endowment contract" under the Code. Generally, the income tax consequences of owning a life insurance policy that is not a modified endowment contract are more advantageous than the tax consequences of owning a life insurance policy that is a modified endowment contract.
The policies offered by this prospectus may or may not be issued as modified endowment contracts. If a policy is issued as a modified endowment contract, it will always be a modified endowment contract; a policy that is not issued as a modified endowment contract can become a modified endowment contract due to subsequent transactions with respect to
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the policy, such as payment of additional premiums. If the policy is not issued as a modified endowment contract, Nationwide will monitor it and advise the policy owner if the payment of a premium, or other transaction, may cause the policy to become a modified endowment contract. It is only with the policy owner's written authorization that Nationwide will permit the policy to become a modified endowment policy. Otherwise, Nationwide will reject the requested action or refund any Premium paid in excess of the modified endowment limits.
Depending on the policy owner's circumstances, the use of the cash value of the policy to pay for the cost of any rider added to the base policy, could be treated as a distribution, and would be subject to the rules described below. Policy owners should seek competent tax advice regarding the tax treatment of the addition of any rider to the policy, based on the policy owner's individual facts and circumstances.
In general, interest the policy owner pays on a loan from a policy will not be deductable. Also, if a loan from a policy that is not a modified endowment contract is outstanding when the policy is canceled or lapses, the amount of the outstanding indebtedness will be added to the amount distributed and will be taxed accordingly. Before taking a policy loan, the policy owner should consult a tax advisor as to the tax consequences.
When the Policy is Life Insurance that is a Modified Endowment Contract
Section 7702A of the Code defines modified endowment contracts as those life insurance policies issued or materially changed on or after June 21, 1988 on which the total premiums paid during the first 7 years exceed the amount that would have been paid if the policy provided for paid up benefits after 7 level annual premiums. Under certain conditions, a policy may become a modified endowment contract, or may become subject to a new 7 year testing period as a result of a "material change" or a "reduction in benefits" as defined by Section 7702A(c) of the Code.
All modified endowment contracts issued to the same owner by the same company during a single calendar year are required to be aggregated and treated as a single policy for purposes of determining the amount that is includible in income when a distribution occurs.
The Code provides special rules for the taxation of surrenders, partial surrenders, loans, collateral assignments, and other pre-death distributions from modified endowment contracts. Under these special rules, such transactions are taxable to the extent that at the time of the transaction the cash value of the policy exceeds the 'investment in the contract' (generally, the net Premiums paid for the policy). In addition, a 10% tax penalty generally applies to the taxable portion of such distributions unless the policy owner is over age 59½ or disabled, or the distribution is part of a series of substantially equal periodic payments as defined in the Code.
When the Policy is Life Insurance that is NOT a Modified Endowment Contract
If the policy is not issued as a modified endowment contract, Nationwide will monitor premiums paid and will notify the policy owner when the policy is in jeopardy of becoming a modified endowment contract.
Distributions from life insurance policies that are not modified endowment contracts generally are treated as being first from the investment in the contract, and then from the income in the policy. Because premium payments are generally nondeductible, distributions not in excess of investment in the contract are generally not includible in income; instead, they reduce the owner's investment in the contract.
However, if a policy is not a modified endowment contract, a cash distribution during the first 15 years after a policy is issued that causes a reduction in death benefits may still be fully or partially taxable to the policy owner pursuant to Section 7702(f)(7) of the Code. The policy owner should carefully consider this potential tax ramification and seek further information before requesting any changes in the terms of the policy.
In addition, unlike a modified endowment contract, a loan from a life insurance policy that is not a modified endowment contract is not taxable when made, although it can be treated as a distribution if it is forgiven during the owner's lifetime. Distributions from policies that are not modified endowment contracts are not subject to the 10% early distribution penalty tax.
Surrender, Lapse, Maturity
A full surrender, cancellation of the policy by lapse, or the maturity of the policy on its maturity date may have adverse income tax consequences. If the amount received (or are deemed received upon maturity) plus total policy indebtedness exceeds the investment in the contract, then the excess generally will be treated as taxable ordinary income, regardless of whether or not the policy is a modified endowment contract. In certain circumstances, for example when the policy indebtedness is very large, the amount of tax could exceed the amount distributed to the policy owner at surrender.
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The purpose of the maturity date extension feature is to permit the policy to continue to be treated as life insurance for tax purposes. Although Nationwide believes that the extension provision will cause the policy to continue to be treated as life insurance after the initially scheduled maturity date, that result is not certain due to a lack of specificity in the guidance on the issue. The policy owner should consult with a qualified tax advisor regarding the possible adverse tax consequences that could result from an extension of the scheduled maturity date.
Additional Medicare Tax
Effective January 1, 2013, Section 1411 of the Code imposes a surtax of 3.8% on certain net investment income received by individuals and certain trusts and estates. The surtax is imposed on the lesser of (a) net investment income or (b) the excess of the modified adjusted gross income over a threshold amount. For individuals, the threshold amount is $250,000 (married filing jointly); $125,000 (married filing separately); or $200,000 (single, or head of household (with qualifying person, or qualifying widow(er) with dependent child)). The threshold for an estate or trust that is subject to the surtax is generally equal to the dollar amount at which the highest tax bracket under section 1(e) begins for the taxable year; for 2016, that amount is $12,400.
Modified adjusted gross income is equal to adjusted gross income with several modifications; the policy owner should consult with a tax advisor regarding how to determine the policy owner's modified adjusted gross income for purposes of determining the applicability of the surtax.
Net investment income includes, but is not limited to, interest, dividends, capital gains, rent and royalty income, and income from nonqualified annuities; and may include taxable distributions from, and gain from the sale or surrenders of, life insurance policies.
Net investment income does not include, among other things, distributions from certain qualified plans (such as IRAs, Roth IRAs, and plans described in Internal Revenue Code Sections 401(a), 401(k), 403(a), 403(b) or 457(b)); however, such distributions, to the extent that they are includible in income for federal income tax purposes are includible in modified adjusted gross income.
Sale of a Life Insurance Policy
If a life insurance policy is sold for a gain, all or a portion of the gain will be treated as ordinary income. In Revenue Ruling 2009-13, the IRS concluded that the amount of gain realized from the sale of a life insurance policy is equal to the amount received (which can include relief from, or assumption of debt) over the owner's basis in the policy. The portion of the gain that is equal to the excess of the cash surrender value over the investment in the policy would be treated as ordinary income; any additional gain would be short or long-term capital gain, depending on the holding period. The ruling also concluded that the owner's basis in the policy that is used to calculate the gain resulting from the sale of the life insurance policy is the investment in the policy reduced by the cost of insurance previously paid out of the cash value. Consequently, a sale may result in more gain than a surrender for the same amount.
Exchanging the Policy for Another Life Insurance Policy
Generally, policy owners will be taxed on amounts received in excess of premium payments when the policy is surrendered in full. If, however, the policy is exchanged for another life insurance policy, modified endowment contract, or annuity contract, the transaction will not be taxed on the excess amount if the exchange meets the requirements of Code Section 1035. To meet Section 1035 requirements, the insured named in the policy must be the insured for the new policy. Generally, the new policy or contract will be treated as having the same issue date and tax basis as the old policy or contract.
If the policy or contract is subject to a policy indebtedness that is discharged as part of the exchange transaction, the discharge of the indebtedness may be taxable. Policy owners should consult with their personal tax or legal advisors in structuring any policy exchange transaction.
Federal Income Taxation of Death Benefits
Death of Insured
The death benefit is generally excludable from the beneficiary's gross income under Section 101 of the Code by reason of the insured’s death. However, if the policy had been transferred to a new policy owner for valuable consideration (e.g., through a sale of the policy), a portion of the death benefit may be includible in the beneficiary's gross income when it is paid.
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The payout option selected by the policy's beneficiary may affect how the payments received by the beneficiary are taxed. Under the various payout options, the amount payable to the beneficiary may include earnings on the death benefit, which will be taxable as ordinary income. For example, if the beneficiary elects to receive interest only, then the entire amount of the interest payment will be taxable to the beneficiary; if a periodic payment (whether for a fixed period or for life) is selected, then a portion of each payment will be taxable interest income, and a portion will be treated as the nontaxable payment of the death benefit. The policy's beneficiaries should consult with their tax advisors to determine the tax consequences of electing a payout option, based on their individual circumstances.
Accelerated Death Benefits
The death benefit under a life insurance policy may be distributed at a time earlier than the death of the insured, and all or a portion of the distribution may still be excludable from gross income under Section 101 of the Code.
Terminal Illness
The death benefit under a life insurance policy may be distributed when the insured is considered a "terminally ill individual" as that term is defined under Section 101 of the Code. In this situation the distribution is treated as paid by reason of death of the insured and will generally be excluded from the beneficiary’s gross income, see Terminal Illness.
Federal Transfer (Estate, Gift and Generation Skipping Transfer) Taxes
When the insured dies, the death benefit will generally be included in the insured's federal gross estate if: (1) the proceeds were payable to or for the benefit of the insured's estate; or (2) the insured held any "incident of ownership" in the policy at death or at any time within three years of death. An incident of ownership, in general, is any right in the policy that may be exercised by the policy owner, such as the right to borrow on the policy or the right to name a new beneficiary.
If the beneficiary is two or more generations younger than the insured, the death benefit may be subject to the GSTT. Pursuant to regulations issued by the U.S. Secretary of the Treasury, Nationwide may be required to withhold a portion of the proceeds and pay them directly to the IRS as the GSTT payment.
If the policy owner is not the insured or a beneficiary, payment of the death benefit to the beneficiary will be treated as a gift to the beneficiary from the policy owner.
Special Considerations for Corporations
Special federal income tax considerations for life insurance policies owned by employers
Sections 101(j) and 6039I of the Code provide special rules regarding the tax treatment of death benefits that are payable under life insurance policies owned by the employer of the insured. These provisions are generally effective for life insurance policies issued after August 17, 2006. If a life insurance policy was issued on or before August 17, 2006, but materially modified after that date, it will be treated as having been issued after that date for purposes of Section 101(j). Policies issued after August 17, 2006 pursuant to a Section 1035 exchange generally are excluded from the operation of these provisions, provided that the policy received in the exchange does not have a material increase in death benefit or other material change with respect to the old policy.
Section 101(j) provides the general rule that, with respect to an employer-owned life insurance policy, the amount of death benefit payable directly or indirectly to the employer that may be excluded from income cannot exceed the sum of premiums and other payments paid by the policy owner for the policy. Consequently, under this general rule, the entire death benefit, less the cost to the policy owner, will be taxable. Although Section 101(j) is not clear, if lifetime distributions from the policy are made as a nontaxable return of premium, it appears that the reduction would apply for Section 101(j) purposes and reduce the amount of premiums for this purpose.
There are two exceptions to this general rule of taxability, provided that statutory notice, consent, and information requirements are satisfied. First, if proper notice and consent are given and received, and if the insured was an employee at any time during the 12-month period before the insured's death, then Section 101(j) would not apply.
Second, if proper notice and consent are given and received and, at the time that the policy is issued, the insured is either a director, a "highly compensated employee" (within the meaning of Section 414(q) of the Code without regard to paragraph (1)(B)(ii) thereof), or a "highly compensated individual" (within the meaning of Section 105(h)(5), except "35%" is substituted for "25%" in paragraph (C) thereof), then Section 101(j) would not apply.
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Code Section 6039I requires any policy owner of an employer-owned policy to file an annual return showing (a) the number of employees of the policy owner, (b) the number of such employees insured under employee-owned policies at the end of the year, (c) the total amount of insurance in force with respect to those policies at the end of the year, (d) the name, address, taxpayer identification number and type of business of the policy owner, and (e) that the policy owner has a valid consent for each insured (or, if all consents are not obtained, the number of insured employees for whom such consent was not obtained). Proper recordkeeping is also required by this section.
It is the employer's responsibility to (a) provide the proper notice to each insured, (b) obtain the proper consent from each insured, (c) inform each insured in writing that the employer-owner will be the beneficiary of any proceeds payable upon the death of the insured, and (d) file the annual return required by Section 6039I. If the employer-owner fails to provide the necessary notice and information, or fails to obtain the necessary consent, the death benefit will be taxable when received. If the employer-owner fails to file a properly completed return under Section 6039I, a penalty may apply.
Limitation on interest and other business deductions
Section 264 of the Code imposes a number of limitations on the interest and other business deductions that may otherwise be available to businesses that own life insurance policies. In addition, the premium paid by a business for a life insurance policy is not deductible as a business expense or otherwise if the business is directly or indirectly a beneficiary of the policy.
For purposes of the alternative minimum tax ("AMT") that may be imposed on corporations, the death benefit from a life insurance policy, even though excluded from gross income for normal tax purposes, is included in "adjusted current earnings" for AMT purposes. In addition, although increases to the cash surrender value of a life insurance policy are generally excluded from gross income for normal income tax purposes, such increases are included in adjusted current earnings for income tax purposes.
Due to the complexity of these rules, and because they are affected by the policy owner's facts and circumstances, the policy owner should consult with legal and tax counsel and other competent advisors regarding these matters.
Federal appellate and trial courts have examined the economic substance of transactions involving life insurance policies owned by corporations. These cases involved relatively large loans against the policy's cash value as well as tax deductions for the interest paid on the policy loans by the corporate policy owner to the insurance company. Under the particular factual circumstances in these cases, the courts determined that the corporate policy owners should not have taken tax deductions for the interest paid. Accordingly, the court determined that the corporations should have paid taxes on the amounts deducted. Corporations should consider, in consultation with tax advisors familiar with these matters, the impact of these decisions on the corporation's intended use of the policy.
Business Uses of the Policy
The life insurance policy may be used in various arrangements, including nonqualified deferred compensation or salary continuance plans, split dollar insurance plans, executive bonus plans, retiree medical benefit plans, and others. The tax consequences of these plans may vary depending on the particular facts and circumstances of each individual arrangement. Therefore, if the policy owner is contemplating using the policy in any arrangement the value of which depends in part on its tax consequences, the policy owner should be sure to consult a tax advisor as to tax attributes of the arrangement.
Non-Resident Aliens and Other Persons Who are Not Citizens of the United States
Special income tax laws and rules apply to non-resident aliens of the United States including certain withholding requirements with respect to pre-death distributions from the policy. In addition, foreign law may impose additional taxes on the policy, the death benefit, or other distributions and/or ownership of the policy.
In addition, special gift, estate and GSTT laws and rules may apply to non-resident aliens, and to transfers to persons who are not citizens of the United States, including limitations on the marital deduction if the surviving or donee spouse is not a citizen of the United States.
If the policy owner is a non-resident alien, or a resident alien, or if any of the policy's beneficiaries (including the policy owner's spouse) are not citizens of the United States, the policy owner should confer with a competent tax advisor with respect to the tax treatment of this policy.
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If the policy owner, the insured, the beneficiary, or other person receiving any benefit or interest in or from the policy, are not both a resident and citizen of the United States, there may be a tax imposed by a foreign country that is in addition to any tax imposed by the United States. The foreign law (including regulations, rulings, treaties with the United States, and case law) may change and impose additional or increased taxes on the policy, payment of the death benefit, or other distributions and/or ownership of the policy.
FATCA
Under Sections 1471 through 1474 of the Internal Revenue Code (commonly referred to as FATCA), distributions from a policy to a foreign financial institution or to a nonfinancial foreign entity, each as described by FATCA, may be subject to United States tax withholding at a flat rate equal to 30% of the taxable amount of the distribution, irrespective of the status of any beneficial owner of the policy or of the distribution. Nationwide may require you to provide certain information or documentation (e.g., Form W-9 or Form W-8BEN) to determine its withholding requirements under FATCA.
Withholding and Tax Reporting
Distribution of taxable income from a life insurance policy, including a life insurance policy that is a modified endowment contract, is subject to federal income tax withholding. Generally, the recipient may elect not to have the withholding taken from the distribution. Nationwide will withhold income tax unless the policy owner advises Nationwide, in writing, of their request not to withhold. If the policy owner requests that taxes not be withheld, or if the taxes withheld are insufficient, the policy owner may be liable for payment of an estimated tax.
A policy owner is not permitted to waive withholding if the payee does not provide Nationwide with a taxpayer identification number; or if Nationwide receives notice from the Internal Revenue Service that the taxpayer identification number furnished by the payee is incorrect. In that instance, a distribution will be subject to withholding rates established by Section 3405 of the Code and will be applied against the amount of income that is distributed.
However, interest earned on a death benefit may be subject to mandatory back-up withholding. Mandatory backup withholding means that Nationwide is required to withhold taxes on income earned at the rate established by Section 3406 of the Code. Mandatory backup withholding may arise if Nationwide has not been provided a taxpayer identification number, or if the IRS notifies Nationwide that back-up withholding is required.
In certain employer-sponsored life insurance arrangements, participants may be required to report for income tax purposes, one or more of the following:
• the value each year of the life insurance protection provided;
• an amount equal to any employer-paid Premiums;
• some or all of the amount by which the current value exceeds the employer's interest in the policy; and/or
• interest that is deemed to have been forgiven on a loan that Nationwide deems to have been made by the employer.
Participants in an employer-sponsored plan relating to this policy should consult with the sponsor or the administrator of the plan, and/or with their personal tax or legal advisor to determine the tax consequences, if any, of their employer-sponsored life insurance arrangements.
Taxes and the Value of the Policy
For federal income tax purposes, a separate account is not a separate entity from the company. Thus, the tax status of the separate account is not distinct from our status as a life insurance company. Investment income and realized capital gains on the assets of the separate account are reinvested and taken into account in determining the value of Accumulation Units. As a result, such investment income and realized capital gains are automatically applied to increase reserves under the policies.
At present, Nationwide does not expect to incur any federal income tax liability that would be chargeable to the Accumulation Units. Based upon these expectations, no charge is being made against the policy's Accumulation Units for federal income taxes. If, however, Nationwide determines that taxes may be incurred, Nationwide reserves the right to assess a charge for these taxes.
Nationwide may also incur state and local taxes (in addition to those described in the discussion of the Premium Taxes) in several states. At present, these taxes are not significant. If they increase, however, charges for such taxes may be made that would decrease the value of the policy's Accumulation Units.
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Tax Changes
The foregoing is a general discussion of various tax matters pertaining to life insurance policies. It is based on our understanding of federal tax laws as currently interpreted by the IRS, is general and is not intended as tax advice. The policy owner should consult their independent legal, tax and/or financial advisor.
The Code has been subjected to numerous amendments and changes, and it is reasonable to believe that it will continue to be revised. The United States Congress has, in the past, considered numerous legislative proposals that, if enacted, could change the tax treatment of life insurance policies. For example the "FY 2013, Budget of the United States Government" includes a proposal which, if enacted, would affect the treatment of corporate owned life insurance policies by limiting the availability of certain interest deductions for companies that purchase those policies. No proposed statutory language has been released yet, so the specifics of the proposal cannot be addressed herein. Such a proposal, if enacted, could have an adverse tax impact on the ownership of life insurance by or for the benefit of business entities. It is reasonable to believe that such proposals, and future proposals, may be enacted into law. The U.S. Treasury Department may amend existing regulations, issue new regulations, or adopt new interpretations of existing law that may differ from its current positions on these matters. In addition, current state law (which is not discussed herein) and future amendments to state law may affect the tax consequences of the policy.
Any or all of the foregoing may change from time to time without any notice, and the tax consequences arising out of a policy may be changed retroactively. There is no way of predicting if, when, or to what extent any such change may take place. Nationwide make no representation as to the likelihood of the continuation of these current laws, interpretations, and policies.
Nationwide Life Insurance Company
Nationwide, the depositor, is a stock life insurance company organized under Ohio law in March 1929, with its home office at One Nationwide Plaza, Columbus, Ohio 43215. Nationwide is a provider of life insurance, annuities, and retirement products. It is admitted to do business in all states, the District of Columbia, Guam, the U.S. Virgin Islands, and Puerto Rico.
Nationwide is a member of the Nationwide group of companies. Nationwide Mutual Insurance Company and Nationwide Mutual Fire Insurance Company (the "Companies") are the ultimate controlling persons of the Nationwide group of companies. The Companies were organized under Ohio law in December 1925 and 1933 respectively. The Companies engage in a general insurance and reinsurance business, except life insurance.
Nationwide VLI Separate Account-2
Organization, Registration, and Operation
Nationwide VLI Separate Account-2 is a separate account established under Ohio law. Nationwide owns the assets in this account and is obligated to pay all benefits under the policies. Nationwide may use the separate account to support other variable life insurance policies that it issues. The separate account is registered with the SEC as a unit investment trust under the Investment Company Act of 1940 ("1940 Act") and qualifies as a "separate account" within the meaning of federal securities laws. For purposes of federal securities laws, the separate account is, and will remain, fully funded at all times. This registration does not involve the SEC's supervision of the separate account's management or investment practices or policies.
The separate account is divided into Sub-Accounts that invest in shares of the underlying mutual funds. Nationwide buys and sells the mutual fund shares at their respective NAV. Any dividends and distributions from a mutual fund are reinvested at NAV in shares of that mutual fund.
Income, gains, and losses, whether or not realized, from the assets in the separate account will be credited to, or charged against, the separate account without regard to Nationwide's other income, gains, or losses. Income, gains, and losses credited to, or charged against, a Sub-Account reflect the Sub-Account's own Investment Experience and not the investment experience of Nationwide's other assets. The separate account's assets are held separately from Nationwide’s other assets and are not part of Nationwide’s general account. Nationwide may not use the separate account's assets to pay any of its liabilities other than those arising from the policies. Nationwide will hold assets in the separate account equal to its liabilities. The separate account may include other Sub-Accounts that are not available under the policies, and are not discussed in this prospectus.
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Nationwide does not guarantee any money placed in this separate account. The value of each Sub-Account will increase or decrease, depending on the Investment Experience of the corresponding mutual fund. A policy owner could lose some or all of their money.
Addition, Deletion, or Substitution of Mutual Funds
Where permitted by applicable law, Nationwide reserves the right to:
• remove, close, combine, or add Sub-Accounts and make new Sub-Accounts available;
• substitute shares of another mutual fund, which may have different fees and expenses, for shares of an existing mutual fund;
• transfer assets supporting the policies from one Sub-Account to another, or from one separate account to another;
• combine the separate account with other separate accounts, and/or create new separate accounts;
• deregister the separate account under the 1940 Act, or operate the separate account or any Sub-Account as a management investment company under the 1940 Act or as any other form permitted by law; and
• modify the policy provisions to reflect changes in the Sub-Accounts and the separate account to comply with applicable law.
Nationwide reserves the right to make other structural and operational changes affecting this separate account.
Nationwide will provide notice of any of the changes above. Also, to the extent required by law, Nationwide will obtain the required orders, approvals, and/or regulatory clearance from the appropriate government agencies (such as the various insurance regulators or the SEC). Also, to the extent required by state law, Nationwide will accept an irrevocable election from the policy owner to transfer 100% of the policy's Cash Value to the Fixed Account if received within 60 days after the date the policy owner received notification of a material change in the investment policy of the separate account.
Substitution of Securities
Nationwide may substitute, eliminate, or combine shares of another underlying mutual fund for shares already purchased or to be purchased in the future if either of the following occurs:
(1) shares of a current underlying mutual fund are no longer available for investment; or
(2) further investment in an underlying mutual fund is inappropriate.
No substitution of shares may take place without the prior approval of the SEC. All affected policy owners will be notified in the event there is a substitution, elimination, or combination of shares.
The substitute mutual fund may have different fees and expenses. Substitution may be made with respect to existing investments or the investment of future Premium, or both. Nationwide may close Sub-Accounts to allocations of Premiums or policy value, or both, at any time in its sole discretion. The mutual funds, which sell their shares to the Sub-Accounts pursuant to participation agreements, also may terminate these agreements and discontinue offering their shares to the Sub-Accounts.
Deregistration of the Separate Account
Nationwide may deregister Nationwide VLI Separate Account-2 under the 1940 Act in the event the separate account meets an exemption from registration under the 1940 Act, if there are no shareholders in the separate account or for any other purpose approved by the SEC.
All policy owners will be notified in the event Nationwide deregisters Nationwide VLI Separate Account-2.
Voting Rights
Although the separate account owns the mutual fund shares, policy owners are the beneficial owner of those shares. When a matter involving a mutual fund is subject to shareholder vote, unless there is a change in existing law, Nationwide will vote the separate account's shares only as instructed by policy owners.
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When a shareholder vote occurs, a policy owner will have the right to instruct Nationwide how to vote. The weight of each vote is based on the number of mutual fund shares that corresponds to the amount of Cash Value a policy has allocated to that mutual fund's Sub-Account (as of a date set by the mutual fund). Nationwide will vote shares for which no instructions are received in the same proportion as those that are received. What this means is that when only a small number of policy owners vote, each vote has a greater impact on, and may control the outcome of the vote.
Material Conflicts
The underlying mutual funds may be offered through separate accounts of other insurance companies, as well as through other separate accounts of Nationwide. Nationwide does not anticipate any disadvantages to this. However, it is possible that a conflict may arise between the interests of the variable account and one or more of the other separate accounts in which these underlying mutual funds participate.
Material conflicts may occur due to a change in law affecting the operations of variable life insurance policies and variable annuity contracts, or differences in the voting instructions of the policy owners and those of other companies. If a material conflict occurs, Nationwide will take whatever steps are necessary to protect policy owners and variable annuity payees, including withdrawal of the variable account from participation in the underlying mutual fund(s) involved in the conflict.
Legal Proceedings
Nationwide Life Insurance Company
Nationwide Financial Services, Inc. (NFS, or collectively with its subsidiaries, "the Company") was formed in November 1996. NFS is the holding company for Nationwide Life Insurance Company (NLIC), Nationwide Life and Annuity Insurance Company (NLAIC) and other companies that comprise the life insurance and retirement savings operations of the Nationwide group of companies (Nationwide). This group includes Nationwide Financial Network (NFN), an affiliated distribution network that markets directly to its customer base. NFS is incorporated in Delaware and maintains its principal executive offices in Columbus, Ohio.
The Company is subject to legal and regulatory proceedings in the ordinary course of its business. The Company's legal and regulatory matters include proceedings specific to the Company and other proceedings generally applicable to business practices in the industries in which the Company operates. These matters are subject to many uncertainties, and given their complexity and scope, their outcomes cannot be predicted. Regulatory proceedings could also affect the outcome of one or more of the Company's litigation matters. Furthermore, it is often not possible to determine the ultimate outcomes of the pending regulatory investigations and legal proceedings or to provide reasonable ranges of potential losses with any degree of certainty. Some matters, including certain of those referred to below, are in very preliminary stages, and the Company does not have sufficient information to make an assessment of the plaintiffs' claims for liability or damages. In some of the cases seeking to be certified as class actions, the court has not yet decided whether a class will be certified or (in the event of certification) the size of the class and class period. In many of the cases, the plaintiffs are seeking undefined amounts of damages or other relief, including punitive damages and equitable remedies, which are difficult to quantify and cannot be defined based on the information currently available. The Company believes, however, that based on currently known information, the ultimate outcome of all pending legal and regulatory matters is not likely to have a material adverse effect on the Company's condensed consolidated financial position. Nonetheless, given the large or indeterminate amounts sought in certain of these matters and the inherent unpredictability of litigation, it is possible that such outcomes could materially affect the Company's condensed consolidated financial position or results of operations in a particular quarter or annual period.
The various businesses conducted by the Company are subject to oversight by numerous federal and state regulatory entities, including but not limited to the Securities and Exchange Commission, the Financial Industry Regulatory Authority, the Department of Labor, the Internal Revenue Service, the Federal Reserve Bank and state insurance authorities. Such regulatory entities may, in the normal course, be engaged in general or targeted inquiries, examinations and investigations of the Company and/or its affiliates. The financial services industry has been the subject of increasing scrutiny in connection with a broad spectrum of regulatory issues; with respect to all such scrutiny directed at the Company and/or its affiliates, the Company is cooperating with regulators. The Company will cooperate with Nationwide Mutual Insurance Company (NMIC) insofar as any inquiry, examination or investigation encompasses NMIC’s operations.
On August 15, 2001, NFS and NLIC were named in a lawsuit filed in the United States District Court for the District of Connecticut entitled Lou Haddock, as trustee of the Flyte Tool & Die, Incorporated Deferred Compensation Plan, et al v. Nationwide Financial Services, Inc. and Nationwide Life Insurance Company. On November 18, 2009, the plaintiffs filed a
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sixth amended complaint amending the list of named plaintiffs and claiming to represent a class of qualified retirement plan trustees under the Employee Retirement Income Security Act of 1974 (ERISA) that purchased variable annuities from NLIC. The plaintiffs allege that they invested ERISA plan assets in their variable annuity contracts and that NLIC and NFS breached ERISA fiduciary duties by allegedly accepting service payments from certain mutual funds. The complaint seeks damages in an amount equivalent to some or all of the payments allegedly received by NFS and NLIC, other unspecified relief for restitution, declaratory and injunctive relief, and attorneys fees. On November 6, 2009, the Court granted the plaintiffs motion for class certification. On October 21, 2010, the District Court dismissed NFS from the lawsuit. On February 6, 2012, the Second Circuit Court of Appeals vacated the November 6, 2009 order granting class certification and remanded the case back to the District Court for further consideration. On September 6, 2013, the District Court granted the plaintiffs motion for class certification. On December 11, 2014, the plaintiffs filed a 7th Amended Complaint adding another sub class of defendants that held trust platform products. On December 11, 2014, plaintiff filed a motion for preliminary approval of settlement. On January 5, 2015, the Court signed the Order Preliminarily Approving Settlement and Approving Form and Manner of Notice. On March 31, 2015, the Court held a Fairness Hearing. On April 9, 2015, the Court entered the Final Order and Consent Judgment. The Company has paid the loss amount. In November 2015, the settlement administrator mailed settlement checks to class members.
Nationwide Investment Services Corporation
The general distributor, NISC, is not engaged in any litigation of any material nature.
Financial Statements
The Statement of Additional Information ("SAI") contains the financial statements of Nationwide VLI Separate Account-2 and the consolidated financial statements of Nationwide Life Insurance Company and subsidiaries (the Company). Policy owners may obtain a copy of the SAI FREE OF CHARGE by contacting the Service Center. Please consider the consolidated financial statements of the Company only as bearing on Nationwide’s ability to meet the obligations under the policy. Policy owners should not consider the consolidated financial statements of the Company as affecting the investment performance of the assets of the separate account.
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Appendix A: Sub-Account Information
Below is a list of the available Sub-Accounts and information about the corresponding underlying mutual funds in which they invest. The underlying mutual funds in which the Sub-Accounts invest are designed primarily as investments for variable annuity contracts and variable life insurance policies issued by insurance companies. There is no guarantee that the investment objectives will be met.
Please refer to the prospectus for each underlying mutual fund for more detailed information.
   
Designations Key:
STTF: The underlying mutual fund corresponding to this Sub-Account assesses (or reserves the right to assess) a short-term trading fee, see Short-Term Trading Fees.
FF: The underlying mutual fund corresponding to this Sub-Account primarily invests in other mutual funds. Therefore, a proportionate share of the fees and expenses of any acquired funds are indirectly borne by investors. As a result, investors in this Sub-Account may incur higher charges than if the assets were invested in an underlying mutual fund that does not invest in other mutual funds. Refer to the prospectus for this underlying mutual fund for more information.
VOL: This underlying mutual fund uses a volatility management strategy to reduce a policy owner’s exposure to equity investments when equity markets are volatile which may limit investment losses in a down market. However, use of such a strategy may also limit the growth of the policy’s Cash Value. Allocation to this type of investment option may result in foregone investment gains that could otherwise be realized by investing in riskier investment options.
AllianceBernstein Variable Products Series Fund, Inc. - AB VPS Dynamic Asset Allocation Portfolio: Class A
This Sub-Account is only available in policies issued before May 1, 2014
Investment Advisor: AllianceBernstein L.P.
Investment Objective: To maximize total return consistent with the Adviser’s determination of reasonable risk.
AllianceBernstein Variable Products Series Fund, Inc. - AB VPS Growth and Income Portfolio: Class A
This Sub-Account is only available in policies issued before May 1, 2004
Investment Advisor: AllianceBernstein L.P.
Investment Objective: Long-term growth of capital.
AllianceBernstein Variable Products Series Fund, Inc. - AB VPS Small/Mid Cap Value Portfolio: Class A
Investment Advisor: AllianceBernstein L.P.
Investment Objective: Long-term growth of capital.
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II
Investment Advisor: American Century Investment Management, Inc.
Investment Objective: Long-term total return using a strategy that seeks to protect against U.S. inflation.
American Century Variable Portfolios, Inc. - American Century VP Balanced Fund: Class I
This Sub-Account is only available in policies issued before May 1, 2003
Investment Advisor: American Century Investment Management, Inc.
Investment Objective: Long-term capital growth and income.
American Century Variable Portfolios, Inc. - American Century VP Income & Growth Fund: Class I
This Sub-Account is only available in policies issued before May 1, 2004
Investment Advisor: American Century Investment Management, Inc.
Investment Objective: Capital growth by investing in common stocks. Income is a secondary objective.
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class I
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: American Century Investment Management, Inc.
Investment Objective: Long-term capital growth with income as a secondary objective.
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class II
Investment Advisor: BlackRock Advisors, LLC
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: Seek high total investment return.
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Delaware VIP Trust - Delaware VIP Small Cap Value Series: Service Class
Investment Advisor: Delaware Management Company, Inc.
Investment Objective: The fund seeks capital appreciation.
Deutsche Variable Series II - Deutsche Global Income Builder VIP: Class A
Investment Advisor: Deutsche Investment Management Americas Inc.
Investment Objective: The fund seeks to maximize income while maintaining prospects for capital appreciation.
Dimensional - DFA Inflation-Protected Securities Portfolio
Investment Advisor: Dimensional Fund Advisors LP
Investment Objective: To provide inflation protection and earn current income consistent with inflation-protected securities.
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: The Dreyfus Corporation
Investment Objective: To match performance of the S&P SmallCap 600 Index®.
Dreyfus Socially Responsible Growth Fund, Inc. (The): Initial Shares
This Sub-Account is only available in policies issued before May 1, 2003
Investment Advisor: The Dreyfus Corporation
Investment Objective: Capital growth with current income as a secondary goal.
Dreyfus Stock Index Fund, Inc.: Initial Shares
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: The Dreyfus Corporation
Investment Objective: To match performance of the S&P 500.
Dreyfus Variable Investment Fund - Appreciation Portfolio: Initial Shares
This Sub-Account is only available in policies issued before May 1, 2016
Investment Advisor: The Dreyfus Corporation
Sub-advisor: Fayez Sarofim & Co.
Investment Objective: The fund seeks long-term capital growth consistent with the preservation of capital. Its secondary goal is current income.
Dreyfus Variable Investment Fund - Growth and Income Portfolio: Initial Shares
This Sub-Account is only available in policies issued before May 1, 2003
Investment Advisor: The Dreyfus Corporation
Investment Objective: Long-term capital growth, current income and growth of income consistent with reasonable investment risk.
Dreyfus Variable Investment Fund - Opportunistic Small Cap Portfolio: Initial Shares
This Sub-Account is only available in policies issued before May 1, 2004
Investment Advisor: The Dreyfus Corporation
Investment Objective: The fund seeks capital growth.
Federated Insurance Series - Federated Managed Tail Risk Fund II: Primary Shares
This Sub-Account is only available in policies issued before May 1, 2004
Investment Advisor: Federated Global Investment Management Corp.
Sub-advisor: Federated Global Investment Management Corp., Federated Investment Management Company, Federated Equity Management Company of Pennsylvania
Investment Objective: To create an allocation mix which will maximize return while capturing the benefits of asset class diversification in periods of market volatility.
Federated Insurance Series - Federated Quality Bond Fund II: Primary Shares
Investment Advisor: Federated Investment Management Company
Investment Objective: Current income.
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Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Strategic Advisers Inc. Boston MA
Sub-advisor: FMR Co., Inc., Fidelity Research & Analysis Company
Investment Objective: High total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.
Designation: FF
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Strategic Advisers Inc. Boston MA
Sub-advisor: FMR Co., Inc., Fidelity Research & Analysis Company
Investment Objective: High total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.
Designation: FF
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Strategic Advisers Inc. Boston MA
Sub-advisor: FMR Co., Inc., Fidelity Research & Analysis Company
Investment Objective: High total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.
Designation: FF
Fidelity Variable Insurance Products Fund - VIP Asset Manager Portfolio: Initial Class
This Sub-Account is only available in policies issued before May 1, 2003
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Management & Research (U.K.) Inc., Fidelity Research & Analysis Company, Fidelity Investments Money Management, Inc., Fidelity Investments Japan Limited, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited
Investment Objective: High total return.
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Research & Analysis Company
Investment Objective: Capital appreciation.
Designation: STTF
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Initial Class
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Management & Research (U.K.) Inc., Fidelity Research & Analysis Company, Fidelity Investments Japan Limited, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited
Investment Objective: Reasonable income.
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Initial Class
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Management & Research (U.K.) Inc., Fidelity Research & Analysis Company, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited, Fidelity Investments Japan Limited
Investment Objective: Capital appreciation.
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Fidelity Variable Insurance Products Fund - VIP High Income Portfolio: Initial Class
This Sub-Account is no longer available to receive transfers or new premium payments effective May 1, 2015
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Research & Analysis Company, Fidelity Investments Japan Limited, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited
Investment Objective: High level of current income while also considering growth of capital.
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: Fidelity Investments Money Management, Inc., Fidelity Research & Analysis Company, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited
Investment Objective: High level of current income.
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Management & Research (U.K.) Inc., Fidelity Research & Analysis Company, Fidelity Investments Japan Limited, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited
Investment Objective: Long-term growth of capital.
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Initial Class
This Sub-Account is no longer available to receive transfers or new premium payments effective May 1, 2005
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: Fidelity Research & Analysis Company
Investment Objective: Long-term capital growth.
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Management & Research (U.K.) Inc., Fidelity Research & Analysis Company, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited, Fidelity Investments Japan Limited
Investment Objective: Long-term capital growth.
Fidelity Variable Insurance Products Fund - VIP Value Strategies Portfolio: Service Class
This Sub-Account is only available in policies issued before May 1, 2006
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Management & Research (U.K.) Inc., Fidelity Research & Analysis Company, Fidelity Investments Japan Limited, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited
Investment Objective: Capital appreciation.
Franklin Templeton Variable Insurance Products Trust - Franklin Founding Funds Allocation VIP Fund: Class 2
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Franklin Templeton Services, LLC
Investment Objective: Capital appreciation with income as a secondary goal.
Designation: FF
Franklin Templeton Variable Insurance Products Trust - Franklin Income VIP Fund: Class 2
Investment Advisor: Franklin Advisers, Inc.
Investment Objective: Maximum income while maintaining prospects for capital appreciation.
Franklin Templeton Variable Insurance Products Trust - Franklin Rising Dividends VIP Fund: Class 1
This Sub-Account is only available in policies issued before May 1, 2006
Investment Advisor: Franklin Advisory Services, LLC
Investment Objective: Long-term capital appreciation, with preservation of capital as an important consideration.
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Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value VIP Fund: Class 1
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Franklin Advisory Services, LLC
Investment Objective: Long-term total return.
Franklin Templeton Variable Insurance Products Trust - Templeton Developing Markets VIP Fund: Class 2
This Sub-Account is only available in policies issued before April 30, 2014
Investment Advisor: Templeton Asset Management, Ltd.
Investment Objective: Long-term capital appreciation.
Franklin Templeton Variable Insurance Products Trust - Templeton Foreign VIP Fund: Class 1
This Sub-Account is no longer available to receive transfers or new premium payments effective May 1, 2005
Investment Advisor: Templeton Investment Counsel, LLC
Investment Objective: Long-term capital growth.
Franklin Templeton Variable Insurance Products Trust - Templeton Foreign VIP Fund: Class 2
This Sub-Account is only available in policies issued before April 30, 2014
Investment Advisor: Templeton Investment Counsel, LLC
Investment Objective: Long-term capital growth.
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond VIP Fund: Class 2
Investment Advisor: Franklin Advisers, Inc.
Investment Objective: High current income, consistent with preservation of capital, with capital appreciation as a secondary consideration.
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Trends Allocation Fund: Service Shares
This Sub-Account is only available in policies issued before May 1, 2014
Investment Advisor: Goldman Sachs Asset Management, L.P.
Investment Objective: Seeks to achieve investment results that approximate the performance of the GS Global Markets Navigator Index (the "Index").
Guggenheim Variable Fund - Multi-Hedge Strategies
Investment Advisor: Guggenheim Investments
Investment Objective: Capital appreciation consistent with the return and risk characteristics of the hedge fund universe and, secondarily, to achieve these returns with low correlation to and less volatility than equity indices.
Invesco - Invesco V.I. American Franchise Fund: Series I Shares
This Sub-Account is only available in policies issued before May 1, 2012
Investment Advisor: Invesco Advisers, Inc.
Investment Objective: Seeks capital growth.
Invesco - Invesco V.I. Balanced-Risk Allocation Fund: Series I Shares
Investment Advisor: Invesco Advisers, Inc.
Investment Objective: Total return with a low to moderate correlation to traditional financial market indices.
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series I Shares
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Invesco Advisers, Inc.
Investment Objective: Long-term growth of capital.
Invesco - Invesco V.I. Mid Cap Growth Fund: Series I Shares
This Sub-Account is only available in policies issued before May 1, 2012
Investment Advisor: Invesco Advisers, Inc.
Investment Objective: Capital growth.
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Ivy Funds Variable Insurance Portfolios - Asset Strategy
Investment Advisor: Waddell & Reed Investment Management Company
Investment Objective: To seek to provide total return.
Ivy Funds Variable Insurance Portfolios - High Income
Investment Advisor: Waddell & Reed Investment Management Company
Investment Objective: To seek to provide total return through a combination of high current income and capital appreciation.
Ivy Funds Variable Insurance Portfolios - Mid Cap Growth
This Sub-Account is only available in policies issued before May 1, 2014
Investment Advisor: Waddell & Reed Investment Management Company
Investment Objective: To seek to provide growth of capital.
Janus Aspen Series - Balanced Portfolio: Service Shares
This Sub-Account is only available in policies issued before May 1, 2004
Investment Advisor: Janus Capital Management LLC
Investment Objective: Long-term capital growth, consistent with preservation of capital and balanced by current income.
Janus Aspen Series - Forty Portfolio: Service Shares
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Janus Capital Management LLC
Investment Objective: Long-term growth of capital.
Janus Aspen Series - Global Technology Portfolio: Service Shares
Investment Advisor: Janus Capital Management LLC
Investment Objective: Long-term growth of capital.
Janus Aspen Series - Overseas Portfolio: Service Shares
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Janus Capital Management LLC
Investment Objective: Long-term growth of capital.
Lord Abbett Series Fund, Inc. - Total Return Portfolio: Class VC
Investment Advisor: Lord, Abbett & Co. LLC
Investment Objective: The Fund’s investment objective is to seek income and capital appreciation to produce a high total return.
MFS® Variable Insurance Trust - MFS New Discovery Series: Initial Class
Investment Advisor: Massachusetts Financial Services Company
Investment Objective: To seek capital appreciation.
MFS® Variable Insurance Trust - MFS Value Series: Initial Class
Investment Advisor: Massachusetts Financial Services Company
Investment Objective: To seek capital appreciation.
MFS® Variable Insurance Trust II - MFS Massachusetts Investors Growth Stock Portfolio: Initial Class
This Sub-Account is only available in policies issued before March 27, 2015
Investment Advisor: Massachusetts Financial Services Company
Investment Objective: To seek capital appreciation.
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: American Century Investment Management, Inc.
Investment Objective: The Fund seeks capital appreciation, and secondarily current income.
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Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II
Investment Advisor: Capital Research and Management Company
Investment Objective: The fund seeks to provide high total return (including income and capital gains) consistent with preservation of capital over the long term.
Designation: FF
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Capital Research and Management Company
Investment Objective: The Fund seeks to maximize an investors level of current income and preserve the investor's capital.
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II
Investment Advisor: Capital Research and Management Company
Investment Objective: The Fund is designed for investors seeking capital appreciation through stocks.
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II
This Sub-Account is only available in policies issued before May 1, 2014
Investment Advisor: Capital Research and Management Company
Investment Objective: The Fund is designed for investors seeking capital appreciation principally through investment in stocks.
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Capital Research and Management Company
Investment Objective: The fund seeks to achieve long-term growth of capital and income.
Designation: FF
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Federated Investment Management Company
Investment Objective: The Fund seeks to provide high current income.
Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Invesco Advisers, Inc.
Investment Objective: The Fund’s investment objective is to seek capital growth and income through investments in equity securities, including common stocks, preferred stocks, and convertible securities.
Nationwide Variable Insurance Trust - Loring Ward NVIT Capital Appreciation Fund: Class P
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: LWI Financial Inc.
Investment Objective: To provide growth of capital, and secondarily current income.
Designation: FF
Nationwide Variable Insurance Trust - Loring Ward NVIT Moderate Fund: Class P
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: LWI Financial Inc.
Investment Objective: Seeks a high level of total return consistent with a moderate level of risk.
Designation: FF
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class I
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Neuberger Berman Management LLC
Investment Objective: The fund seeks long-term capital growth.
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Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Neuberger Berman Management LLC
Investment Objective: The Fund seeks long-term growth of capital by investing primarily in securities of companies that meet the fund's financial criteria and social policy.
Nationwide Variable Insurance Trust - NVIT Bond Index Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: The Fund seeks to match the performance of the Barclays U.S. Aggregate Bond Index ("Aggregate Bond Index") as closely as possible before the deduction of Fund expenses.
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Aggressive Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Aggressive Fund seeks maximum growth of capital consistent with a more aggressive level of risk as compared to other Cardinal Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Fund seeks a high level of total return through investment in both equity and fixed income securities.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Capital Appreciation Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Fund seeks growth of capital, but also seeks income consistent with a less aggressive level of risk as compared to other Cardinal Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Fund seeks a high level of total return consistent with a conservative level of risk as compared to other Cardinal Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Managed Growth & Income Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Nationwide Asset Management, LLC
Investment Objective: Seeks a high level of total return through investment in both equity and fixed-income securities, consistent with preservation of capital
Designation: FF, VOL
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Managed Growth Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Nationwide Asset Management, LLC
Investment Objective: Seeks growth primarily and investment income secondarily.
Designation: FF, VOL
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Fund seeks a high level of total return consistent with a moderate level of risk as compared to other Cardinal Funds.
Designation: FF
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Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Aggressive Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Fund seeks growth of capital, but also seeks income consistent with a moderately aggressive level of risk as compared to other Cardinal Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The fund seeks a high level of total return consistent with a moderately conservative level of risk.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Nationwide Asset Management, LLC
Investment Objective: The Fund seeks a high level of current income consistent with preserving capital.
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Neuberger Berman Fixed Income LLC
Investment Objective: The fund seeks long-term total return consistent with reasonable risk.
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Lazard Asset Management, LLC and Standard Life Investments
Investment Objective: The Fund seeks long-term capital growth by investing primarily in equity securities of companies located in emerging market countries.
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Nationwide Asset Management, LLC
Investment Objective: The fund seeks as high level of income as is consistent with the preserving of capital.
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class I
This Sub-Account is only available in policies issued before April 26, 2014
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Lazard Asset Management LLC
Investment Objective: The Fund seeks long-term capital growth by investing primarily in equity securities of companies in Europe, Australasia, the Far East and other regions, including developing countries.
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: The Fund seeks to match the performance of the Morgan Stanley Capital International Europe, Australasia and Far East Index ("MSCI EAFE® Index") as closely as possible before the deduction of Fund expenses.
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class II
This Sub-Account is only available in policies issued before April 26, 2014
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: The Fund seeks to match the performance of the Morgan Stanley Capital International Europe, Australasia and Far East Index ("MSCI EAFE® Index") as closely as possible before the deduction of Fund expenses.
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Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Aggressive Fund seeks maximum growth of capital consistent with a more aggressive level of risk as compared to other Investor Destinations Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Balanced Fund seeks a high level of total return through investment in both equity and fixed-income securities.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Capital Appreciation Fund seeks growth of capital, but also seeks income consistent with a less aggressive level of risk as compared to other NVIT Investor Destinations Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Conservative Fund seeks a high level of total return consistent with a conservative level of risk as compared to other Investor Destinations Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Managed Growth & Income Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Nationwide Asset Management, LLC
Investment Objective: Seeks a high level of total return through investment in both equity and fixed-income securities, consistent with preservation of capital.
Designation: FF, VOL
Nationwide Variable Insurance Trust - NVIT Investor Destinations Managed Growth Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Nationwide Asset Management, LLC
Investment Objective: Seeks growth primarily and investment income secondarily.
Designation: FF, VOL
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Moderate Fund seeks a high level of total return consistent with a moderate level of risk as compared to other Investor Destinations Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Moderately Aggressive Fund seeks growth of capital, but also seeks income consistent with a moderately aggressive level of risk as compared to other Investor Destinations Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Moderately Conservative Fund seeks a high level of total return consistent with a moderately conservative level of risk.
Designation: FF
63

 

Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Boston Advisors, LLC
Investment Objective: The Fund seeks long-term capital growth.
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: The Fund seeks capital appreciation.
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Federated Investment Management Company
Investment Objective: The Fund seeks as high a level of current income as is consistent with preserving capital and maintaining liquidity.
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Logan Circle Partners, L.P.
Investment Objective: The Fund seeks to provide above average total return over a market cycle of three to five years.
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Invesco Advisers, Inc. and American Century Investment Management, Inc.
Investment Objective: The Fund seeks long-term capital growth.
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class I
This Sub-Account is no longer available to receive transfers or new premium payments effective May 1, 2005
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Dimensional Fund Advisors LP; JPMorgan Investment Management Inc.
Investment Objective: The Fund seeks long-term capital appreciation.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Massachusetts Financial Services Company; Smith Asset Management Group; and Winslow Capital Management, LLC
Investment Objective: The fund seeks long-term capital growth.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Massachusetts Financial Services Company; Wellington Management Company, LLP; The Boston Company Asset Management, LLC
Investment Objective: The fund seeks long-term capital growth.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Neuberger Berman Management LLC; Wells Capital Management, Inc.
Investment Objective: The fund seeks long-term capital growth.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: American Century Investment Management, Inc.; Thompson, Siegel & Walmsley LLC; WEDGE Capital Management L.L.P.
Investment Objective: The fund seeks long-term capital appreciation.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: OppenheimerFunds, Inc.; Wellington Management Company, LLP
Investment Objective: The Fund seeks capital growth.
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Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Epoch Investment Partners, Inc.; JPMorgan Investment Management Inc.
Investment Objective: The Fund seeks capital appreciation.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Jacobs Levy Equity Management, Morgan Stanley Investment Management Inc; OppenheimerFunds, Inc.; Putnam Investment Management, LLC
Investment Objective: The Fund seeks capital appreciation.
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: HighMark Capital Management, Inc.
Investment Objective: The Fund seeks total return through a flexible combination of capital appreciation and current income.
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Brookfield Investment Management, Inc.
Investment Objective: The Fund seeks current income and long-term capital appreciation.
Nationwide Variable Insurance Trust - NVIT S&P 500® Index Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: Long-term capital appreciation.
Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Nationwide Asset Management, LLC
Investment Objective: The Fund seeks to provide a high level of current income while preserving capital and minimizing fluctuations in share value.
Nationwide Variable Insurance Trust - NVIT Small Cap Index Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: The Fund seeks to match the performance of the Russell 2000® Index.
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class I
This Sub-Account is only available in policies issued before May 1, 2014
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Templeton Investment Counsel, LLC
Investment Objective: The Fund seeks to maximize total return consisting of capital appreciation and/or current income.
Neuberger Berman Advisers Management Trust - AMT Mid-Cap Growth Portfolio: S Class Shares
Investment Advisor: Neuberger Berman Management LLC
Sub-advisor: Neuberger Berman, LLC
Investment Objective: The Fund seeks growth of capital.
Neuberger Berman Advisers Management Trust - AMT Short Duration Bond Portfolio: I Class Shares
This Sub-Account is only available in policies issued before May 1, 2012
Investment Advisor: Neuberger Berman Management LLC
Sub-advisor: Neuberger Berman Fixed Income LLC
Investment Objective: Highest available current income consistent with liquidity and low risk to principal; total return is a secondary goal.
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Neuberger Berman Advisers Management Trust - AMT Socially Responsive Portfolio: I Class Shares
This Sub-Account is only available in policies issued before May 1, 2008
Investment Advisor: Neuberger Berman Management LLC
Sub-advisor: Neuberger Berman, LLC
Investment Objective: Long-term growth by investing primarily in securities of companies that meet financial criteria and social policy.
Northern Lights Variable Trust - TOPS Managed Risk Balanced ETF Portfolio: Class 3
Investment Advisor: ValMark Advisers, Inc.
Sub-advisor: Milliman, Inc.
Investment Objective: Seeks to provide income and capital appreciation with less volatility than the fixed income and equity markets.
Designation: FF, VOL
Northern Lights Variable Trust - TOPS Managed Risk Growth ETF Portfolio: Class 3
Investment Advisor: ValMark Advisers, Inc.
Sub-advisor: Milliman, Inc.
Investment Objective: Seeks capital appreciation with less volatility than the equity markets.
Designation: FF, VOL
Northern Lights Variable Trust - TOPS Managed Risk Moderate Growth ETF Portfolio: Class 3
Investment Advisor: ValMark Advisers, Inc.
Sub-advisor: Milliman, Inc.
Investment Objective: Seeks capital appreciation with less volatility than the equity markets.
Designation: FF, VOL
Oppenheimer Variable Account Funds - Oppenheimer Conservative Balanced Fund/VA: Non-Service Shares
This Sub-Account is only available in policies issued before May 1, 2003
Investment Advisor: OFI Global Asset Management, Inc.
Sub-advisor: OppenheimerFunds, Inc.
Investment Objective: The Fund seeks capital appreciation.
Oppenheimer Variable Account Funds - Oppenheimer Core Bond Fund/VA: Non-Service Shares
This Sub-Account is only available in policies issued before May 1, 2003
Investment Advisor: OFI Global Asset Management, Inc.
Sub-advisor: OppenheimerFunds, Inc.
Investment Objective: The Fund seeks total return.
Oppenheimer Variable Account Funds - Oppenheimer Discovery Mid Cap Growth Fund/VA: Non-Service Shares
This Sub-Account is only available in policies issued before May 1, 2003
Investment Advisor: OFI Global Asset Management, Inc.
Sub-advisor: OppenheimerFunds, Inc.
Investment Objective: Capital appreciation.
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Non-Service Shares
Investment Advisor: OFI Global Asset Management, Inc.
Sub-advisor: OppenheimerFunds, Inc.
Investment Objective: The Fund seeks capital appreciation.
Oppenheimer Variable Account Funds - Oppenheimer Global Strategic Income Fund/VA: Non-Service Shares
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: OFI Global Asset Management, Inc.
Sub-advisor: OppenheimerFunds, Inc.
Investment Objective: The Fund seeks total return.
Oppenheimer Variable Account Funds - Oppenheimer International Growth Fund/VA: Non-Service Shares
Investment Advisor: OFI Global Asset Management, Inc.
Sub-advisor: OppenheimerFunds, Inc.
Investment Objective: The Fund seeks capital appreciation.
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Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Non-Service Shares
Investment Advisor: OFI Global Asset Management, Inc.
Sub-advisor: OppenheimerFunds, Inc.
Investment Objective: The Fund seeks capital appreciation.
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Non-Service Shares
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: OFI Global Asset Management, Inc.
Sub-advisor: OppenheimerFunds, Inc.
Investment Objective: Capital appreciation.
PIMCO Variable Insurance Trust - All Asset Portfolio: Administrative Class
Investment Advisor: Pacific Investment Management Company LLC
Sub-advisor: Research Affiliates
Investment Objective: Seeks maximum real return consistent with preservation of capital and prudent investment management. The portfolio seeks to achieve its investment objective by investing under normal circumstances substantially all of its assets in Institutional Class Shares of the Underlying PIMCO Funds
Designation: FF
PIMCO Variable Insurance Trust - CommodityRealReturn® Strategy Portfolio: Administrative Class
Investment Advisor: Pacific Investment Management Company LLC
Investment Objective: The Portfolio seeks maximum real return, consistent with prudent investment management.
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Administrative Class
Investment Advisor: Pacific Investment Management Company LLC
Investment Objective: The Portfolio seeks maximum total return consistent with preservation of capital and prudent investment management.
PIMCO Variable Insurance Trust - Low Duration Portfolio: Administrative Class
Investment Advisor: Pacific Investment Management Company LLC
Investment Objective: The Portfolio seeks maximum total return, consistent with preservation of capital and prudent investment management.
PIMCO Variable Insurance Trust - Total Return Portfolio: Administrative Class
Investment Advisor: Pacific Investment Management Company LLC
Investment Objective: The Portfolio seeks maximum total return consistent with preservation of capital and prudent investment management.
Putnam Variable Trust - Putnam VT Growth & Income Fund: Class IB
This Sub-Account is only available in policies issued before May 1, 2005
Investment Advisor: Putnam Investment Management, LLC
Sub-advisor: Putnam Investments Limited
Investment Objective: Capital growth and current income.
Putnam Variable Trust - Putnam VT International Equity Fund: Class IB
This Sub-Account is only available in policies issued before May 1, 2004
Investment Advisor: Putnam Investment Management, LLC
Sub-advisor: Putnam Investments Limited and The Putnam Advisory Company, LLC
Investment Objective: Capital appreciation.
Putnam Variable Trust - Putnam VT Voyager Fund: Class IB
This Sub-Account is only available in policies issued before May 1, 2005
Investment Advisor: Putnam Investment Management, LLC
Sub-advisor: Putnam Investments Limited
Investment Objective: Capital appreciation.
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T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II
Investment Advisor: T. Rowe Price Associates, Inc.
Investment Objective: Long-term capital appreciation.
The Universal Institutional Funds, Inc. - Core Plus Fixed Income Portfolio: Class I
This Sub-Account is only available in policies issued before May 1, 2009
Investment Advisor: Morgan Stanley Investment Management Inc.
Investment Objective: Above-average total return over a market cycle of three to five years by investing primarily in a diversified portfolio of fixed income securities.
The Universal Institutional Funds, Inc. - Emerging Markets Debt Portfolio: Class I
This Sub-Account is only available in policies issued before May 1, 2004
Investment Advisor: Morgan Stanley Investment Management Inc.
Investment Objective: High total return by investing primarily in fixed income securities of government and government-related issuers and, to a lesser extent, of corporate issuers in emerging market countries.
VanEck VIP Trust - VanEck VIP Emerging Markets Fund: Initial Class
This Sub-Account is only available in policies issued before May 1, 2002
Investment Advisor: Van Eck Associates Corporation
Investment Objective: Long-term capital appreciation by investing primarily in equity securities in emerging markets around the world.
VanEck VIP Trust - VanEck VIP Global Hard Assets Fund: Initial Class
Investment Advisor: Van Eck Associates Corporation
Investment Objective: Long-term capital appreciation by investing primarily in hard asset securities. Income is a secondary consideration.
VanEck VIP Trust - VanEck VIP Unconstrained Emerging Markets Bond Fund: Initial Class
This Sub-Account is only available in policies issued before May 1, 2002
Investment Advisor: Van Eck Associates Corporation
Investment Objective: High total return – income plus capital appreciation – by investing globally, primarily in a variety of debt securities.
Wells Fargo Variable Trust - VT Small Cap Growth Fund: Class 2 (formerly, Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2)
This Sub-Account is only available in policies issued before May 1, 2013
Investment Advisor: Wells Fargo Funds Management, LLC
Sub-advisor: Wells Fargo Asset Management
Investment Objective: Seeks long-term capital appreciation.
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Appendix B: Definitions
Accumulation Unit – The measure of an investment in, or share of, a Sub-Account. Accumulation Unit values are initially set at $10 for each Sub-Account.
Attained Age – A person's Issue Age plus the number of full years since the Policy Date.
Base Policy Specified Amount – The amount of insurance coverage selected under the base policy, excluding any Rider Specified Amount.
Cash Surrender Value – The Cash Value minus Indebtedness and any surrender charge.
Cash Value – The total of amounts allocated to the Sub-Accounts, the policy loan account, and the Fixed Account.
Code – The Internal Revenue Code of 1986, as amended.
Death Benefit – The amount paid upon the Insured's death, before the deduction of any Indebtedness or due and unpaid policy charges.
Fixed Account – An investment option that is funded by Nationwide's general account.
Grace Period – A 61-day period after which the Policy will Lapse if sufficient payments are not made to prevent Lapse.
In Force – Any time during which benefits are payable under the policy and any elected Rider(s).
Indebtedness – The total amount of all outstanding policy loans, including principal and interest due.
Insured – The person whose life is insured under the policy, and whose death triggers payment of the Death Benefit.
Investment Experience – The market performance of a mutual fund/Sub-Account.
Issue Age – A person's age based on their last birthday on or before the Policy Date.
Lapse – The policy terminates without value.
Maturity Date – The policy anniversary on which the Insured reaches 100.
Minimum Required Death Benefit – The lowest Death Benefit that will qualify the policy as life insurance under the Code.
Nationwide – Nationwide Life Insurance Company, us, we, or our.
Net Amount At Risk – The policy's base Death Benefit minus the policy's Cash Value.
Net Asset Value (NAV) – The price of each share of a mutual fund in which a Sub-Account invests. NAV is calculated by subtracting the mutual fund's liabilities from its total assets, and dividing that figure by the number of shares outstanding. Nationwide uses NAV to calculate the value of Accumulation Units. NAV does not reflect deductions made for charges taken from the Sub-Accounts.
Policy Data Page(s) – The Policy Data Page(s) contains more detailed information about the policy, some of which is unique to the policy owner, the beneficiary, and the Insured.
Policy Date – The date the policy takes effect as shown on the Policy Data Page. Policy years, months, and anniversaries are measured from this date.
Policy owner or Owner – The person or entity named as the owner on the application, or the person or entity assigned ownership rights.
Policy Proceeds or Proceeds – Policy Proceeds may constitute the Death Benefit, or the amount payable if the policy matures or is surrendered, adjusted to account for any unpaid charges, Indebtedness and Rider benefits.
Premium – Amount(s) paid to purchase and maintain the policy.
Rider – An optional benefit purchased under the policy. Rider availability and Rider terms may vary depending on the state in which the policy was issued.
Rider Specified Amount – The portion of the Total Specified Amount attributable to the Base Insured Term Rider.
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SEC – The Securities and Exchange Commission.
Service Center – The department of Nationwide responsible for receiving all service and transaction requests relating to the policy. For service and transaction requests submitted other than by telephone (including fax requests), the Service Center is Nationwide's mail and document processing facility. For service and transaction requests communicated by telephone, the Service Center is Nationwide’s operations processing facility, see Contacting the Service Center.
Sub-Account(s) – The mechanism used to account for allocations of Net Premium and Cash Value among the policy's variable investment options.
Substandard Rating – An underwriting classification based on medical and/or non-medical factors used to determine what to charge for life insurance based on characteristics of the Insured beyond traditional factors for standard risks, which include age, sex, and smoking habits of the Insured. Substandard Ratings are shown in the Policy Data Pages as rate class multiples (medical factors) and/or monthly flat extras (medical and/or non-medical factors). The higher the rate class multiple or monthly flat extra, the greater the risk assessed and the higher the cost of coverage.
Total Specified Amount – The sum of the Base Policy Specified Amount and the Rider Specified Amount, if applicable.
Valuation Period – The period during which Nationwide determines the change in the value of the Sub-Accounts. One Valuation Period ends and another begins with the close of trading on the NYSE.
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Appendix C: Illustrations of Surrender Charges
Example 1. A female non-tobacco user, age 45, purchases a policy with a Base Policy Specified Amount of $50,000 and a scheduled Premium of $750. She now wishes to surrender the policy during the first policy year. By using the "Initial Surrender Charge" table reproduced below (also see "Surrender Charges"), the total surrender charge per thousand, multiplied by the Base Policy Specified Amount expressed in thousands, equals the total surrender charge of $569.80 ($11.396 x 50=569.80).
Example 2. A male non-tobacco user, age 35, purchases a policy with a Base Policy Specified Amount and a Total Specified Amount of $100,000 and a scheduled Premium of $1,100. He now wants to surrender the policy in the sixth policy year. The total initial surrender charge is calculated using the method illustrated above. (Surrender charge per 1,000=6.817 x 100 for a total of $681.70 maximum initial surrender charge). Because the fifth policy year has been completed, the maximum initial surrender charge is reduced by multiplying it by the applicable percentage factor from the "Reductions to Surrender Charges" table below. (Also see "Reductions to Surrender Charges"). In this case, $681.70 x 60%=$409.02, which is the amount we deduct as a total surrender charge.
The following tables illustrate the maximum initial surrender charge per $1,000 of initial Base Policy Specified Amount for policies that are issued on a standard basis:
Initial Base Policy Specified Amount $50,000-$99,999
Issue Age   Male
Non-Tobacco 		  Female
Non-Tobacco 		  Male
Standard 		  Female
Standard
25
   $ 7.776   $ 7.521   $ 8.369   $ 7.818
35
   $ 8.817   $ 8.398   $ 9.811   $ 8.891
45
   $12.191   $11.396   $13.887   $12.169
55
   $15.636   $14.011   $18.415   $15.116
65
   $22.295   $19.086   $26.577   $20.641
Initial Base Policy Specified Amount $100,000 or More
Issue Age   Male
Non-Tobacco 		  Female
Non-Tobacco 		  Male
Standard 		  Female
Standard
25
   $ 5.776   $ 5.521   $ 6.369   $ 5.818
35
   $ 6.817   $ 6.398   $ 7.811   $ 6.891
45
   $ 9.691   $ 8.896   $11.387   $ 9.669
55
   $13.136   $11.511   $15.915   $12.616
65
   $21.295   $18.086   $25.577   $19.641
Reductions to Surrender Charges
Completed Policy Years   Surrender Charge
as a % of Initial
Surrender Charges 		  Completed
Policy Years 		  Surrender Charge
as a % of Initial
Surrender Charges
0
   100%   5   60%
1
   100%   6   50%
2
   90%   7   40%
3
   80%   8   30%
4
   70%   9+   0%
The illustrations of current values in this prospectus are the same for Pennsylvania. However, the illustrations of guaranteed values in this prospectus do not reflect guaranteed maximum surrender charges which are spread out over 14 years. If this policy is issued in Pennsylvania, please contact our Service Center for an illustration.
The current surrender charges are the same for all states. However, in Pennsylvania, the guaranteed maximum surrender charges are spread out over 14 years. The guaranteed maximum surrender charges in subsequent years in Pennsylvania are reduced in the following manner:
Completed Policy Years   Surrender Charge
as a % of Initial
Surrender Charges 		  Completed
Policy Years 		  Surrender Charge
as a % of Initial
Surrender Charges 		  Completed
Policy Years 		  Surrender Charge
as a % of Initial
Surrender Charges
0
   100%   5   60%   10   20%
1
   100%   6   50%   11   15%
71

 

Completed Policy Years   Surrender Charge
as a % of Initial
Surrender Charges 		  Completed
Policy Years 		  Surrender Charge
as a % of Initial
Surrender Charges 		  Completed
Policy Years 		  Surrender Charge
as a % of Initial
Surrender Charges
2
   90%   7   40%   12   10%
3
   80%   8   30%   13   5%
4
   70%   9   25%   14+   0%
The illustrations of current values in this prospectus are the same for Pennsylvania. However, the illustrations of guaranteed values in this prospectus do not reflect guaranteed maximum surrender charges which are spread out over 14 years. If this policy is issued in Pennsylvania, please contact our Service Center for an illustration.
72

 

Outside back cover page
To learn more about the policy, the policy owner should read the Statement of Additional Information (the "SAI") dated the same date as this prospectus. For a free copy of the SAI, to receive personalized illustrations of Death Benefits, Net Cash Surrender Values, and Policy Account Values, and to request other information about the policy contact the Service Center:
• by telephone at 1-800-848-6331
• by mail to Nationwide Life Insurance Company
P.O. Box 182835
Columbus, OH 43218-2835
The SAI has been filed with the SEC and is incorporated by reference into this prospectus. The SEC maintains an Internet website (http://www.sec.gov) that contains the SAI and other information about Nationwide Life Insurance Company and the policy. Information about Nationwide Life Insurance Company and the policy (including the SAI) may also be reviewed and copied at the SEC's Public Reference Room in Washington, DC, or may be obtained, upon payment of a duplicating fee, by writing the Public Reference Section of the SEC, 100 F Street NE, Washington, DC 20549. Additional information on the operation of the Public Reference Room may be obtained by calling the SEC at (202) 551-8090.
Investment Company Act of 1940 Registration File No. 811-05311
Securities Act of 1933 Registration File No. 033-42180

Nationwide VLI Separate Account-2
(Registrant)
Nationwide Life Insurance Company
(Depositor)
Service Center
P.O. Box 182835
Columbus, OH 43218-2835
1-800-848-6331
TDD: 1-800-238-3035
STATEMENT OF ADDITIONAL INFORMATION
Individual Flexible Premium Variable Universal Life Insurance Policies
This Statement of Additional Information ("SAI") contains additional information regarding Individual Flexible Premium Variable Universal Life Insurance Policies offered by Nationwide Life Insurance Company ("Nationwide"). This SAI is not a prospectus and should be read together with the policy prospectus dated May 1, 2016 and the prospectuses for the mutual funds. The prospectus is incorporated by reference in this SAI. Copies may be obtained FREE OF CHARGE by writing or calling the Service Center. Capitalized terms in this SAI correspond to terms defined in the prospectus.
The date of this Statement of Additional Information is May 1, 2016.
TABLE OF CONTENTS

 


General Information and History
Nationwide VLI Separate Account-2 (the "Variable Account") is a separate investment account of Nationwide Life Insurance Company ("Nationwide"). Nationwide is a stock life insurance company organized under the laws of the State of Ohio in March 1929 with its Home Office at One Nationwide Plaza, Columbus, Ohio 43215. Nationwide provides life insurance, annuities and retirement products. Nationwide is admitted to do business in all states, the District of Columbia, Guam, the U.S. Virgin Islands, and Puerto Rico. Nationwide is a member of the Nationwide group of companies and all of its common stock is owned by Nationwide Financial Services, Inc. ("NFS"), a holding company. Nationwide Corporation owns all of NFS's common stock and is a holding company, as well. All of Nationwide Corporation's common stock is held by Nationwide Mutual Insurance Company (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), the ultimate controlling persons of the Nationwide group of companies. The Nationwide group of companies is one of America's largest insurance and financial services family of companies, with combined assets of over $197 billion as of December 31, 2015.
Nationwide VLI Separate Account-2
Nationwide VLI Separate Account-2 is a separate account that invests in mutual funds offered and sold to insurance companies and certain retirement plans. Nationwide established the Variable Account on May 7, 1987 pursuant to Ohio law. Although the Variable Account is registered with the SEC as a unit investment trust pursuant to the Investment Company Act of 1940, the SEC does not supervise the management of Nationwide or the management of the Variable Account. Nationwide serves as the custodian of the assets of the Variable Account.
Nationwide Investment Services Corporation (NISC)
The policies are distributed by NISC, located at One Nationwide Plaza, Columbus, Ohio 43215, a wholly owned subsidiary of Nationwide. For policies issued in Michigan, all references to NISC will mean Nationwide Investment Svcs. Corporation.
The policies will be sold on a continuous basis by licensed insurance agents in those states where the policies may lawfully be sold. Agents are registered representatives of broker dealers registered under the Securities Exchange Act of 1934 who are member firms of the Financial Industry Regulatory Authority (FINRA).
Gross first year commissions plus any expense allowance payments paid by Nationwide on the sale of these policies provided by NISC will not exceed the maximum (99% of first year premium and no more than 4% of any excess and renewal premium). Commission may also be paid as an asset-based amount instead of a premium based amount. If an asset-based commission is paid, it will not exceed 0.45% of the non-loaned Cash Value per year.
No underwriting commissions were paid to NISC for each of this Variable Account’s last three fiscal years.
Services
Nationwide has responsibility for administration of the policies and the Variable Account. Nationwide also maintains the records of the name, address, taxpayer identification number, and other pertinent information for each policy owner and the number and type of policy issued to each policy owner and records with respect to the policy value of each policy.
Nationwide will maintain a record of all purchases and redemption of shares of the mutual funds.
Distribution, Promotional, and Sales Expenses
In addition to or partially in lieu of commission, Nationwide may pay the selling firms a marketing allowance, which is based on the firm's ability and demonstrated willingness to promote and market Nationwide's products. How any marketing allowance is spent is determined by the firm, but generally will be used to finance firm activities that may contribute to the promotion and marketing of Nationwide's products. Nationwide makes certain assumptions about the amount of marketing allowance it will pay and takes these assumptions into consideration when it determines the charges that will be assessed under the policies. Nationwide assumed 0.00% of the Commissionable Target Premium for marketing allowance when determining the charges for the contracts. The actual amount of the marketing allowance may be higher than this assumption. If the actual amount of marketing allowance paid is more than what was assumed, Nationwide will fund the difference. For more information about marketing allowance or how a particular selling firm uses marketing allowances, consult with your registered representative.
2

 

Commissionable Target Premium (CTP) is an amount used in the calculation of the Premium Load and total compensation Nationwide pays. CTP is actuarially derived based on the Base Policy Specified Amount, the Insured’s characteristics and the death benefit option of the policy.
Independent Registered Public Accounting Firm
The financial statements of Nationwide VLI Separate Account-2 and the consolidated financial statements and schedules of Nationwide Life Insurance Company and subsidiaries for the periods indicated have been included herein in reliance upon the reports of KPMG LLP, independent registered public accounting firm, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing. KPMG LLP is located at 191 West Nationwide Blvd., Suite 500, Columbus, Ohio 43215.
Underwriting Procedure
Nationwide underwrites the policies issued through Nationwide VLI Separate Account-2. The policy's cost of insurance depends upon the Insured's sex, issue age, risk class, and length of time the policy has been In Force. The rates will vary depending upon tobacco use and other risk factors. Monthly cost of insurance rates will not exceed those guaranteed in the policy. Guaranteed cost of insurance rates for policies issued on Specified Amounts less than $100,000 are based on the 1980 Commissioners' Extended Term Mortality Table, Age Last Birthday (1980 CET). Guaranteed cost of insurance rates for policies issued on Specified Amounts $100,000 or more are based on the 1980 Commissioners' Standard Ordinary Mortality Table, Age Last Birthday (1980 CSO). For policies issued in Texas on a standard basis ("Special Class–
Standard" in Texas), guaranteed cost of insurance rates for Specified Amounts less than $100,000 are based on 130% of the 1980 CSO. Guaranteed cost of insurance rates for policies issued on a substandard basis are based on appropriate percentage multiples of the standard guaranteed cost of insurance rate on a standard basis. That is, standard guaranteed cost of insurance rates for substandard risks are guaranteed cost of insurance rates for standard risks times a percentage greater than 100%. These mortality tables are sex distinct. In addition, separate mortality tables will be used for tobacco and non-tobacco. As a component of base policy and Rider cost of insurance charges, we may deduct a "flat extra charge," which is an additional factor in determining the constant charge per $1,000 of Specified Amount, for certain activities or medical conditions of the Insured. We apply the same flat extra charge to all Insureds that engage in the same activity or have the same medical condition irrespective of their sex, issue age, underwriting class, or Substandard Rating, if any.
The rate class of an insured may affect the cost of insurance rate. Nationwide currently places Insureds into both standard rate classes and substandard rate classes that involve a higher mortality risk. In an otherwise identical policy, an insured in the standard rate class will have a lower cost of insurance than an insured in a rate class with higher mortality risks. Any change in the cost of insurance rates will apply to all Insureds of the same age, gender, risk class and whose policies have been in effect for the same length of time. The cost of insurance rates, policy charges, and payment options for policies issued in some states or in connection with certain employee benefit arrangements may be issued on a gender-neutral (unisex) basis. The unisex rates will be higher than those applicable to females and lower than those applicable to males. If the rating class for any increase in the Specified Amount of insurance coverage is not the same as the rating class at issue, the cost of insurance rate used after such increase will be a composite rate based upon a weighted average of the rates of the different rating classes. The actual charges made during the policy year will be shown in the annual report delivered to policy owners.
Policy Restoration Procedure
Requests to restore a surrendered policy must meet the following requirements:
• the request must be in writing and signed by the policy owner (if the surrender was a Code Section 1035 exchange to a new policy with a different insurer, the signature of an officer of the replacing insurer is also required);
• the written request must be received at the Service Center within 30 days of the date the policy was surrendered (periods up to 60 days will be permitted based on the right to examine period applicable to replaced life insurance policies in the state where the policy was issued);
• the surrender Proceeds must be returned in their entirety; and
• the insured must be alive on the date the restoration request is received.
3

 

No proof of insurability or additional underwriting will be required for requests to restore a surrendered policy that meet the above requirements.
A restored policy will be treated as if it had never been surrendered for all purposes, including Investment Experience, accrual of interest, and deduction of charges, resulting in the following:
• the returned surrender proceeds and any amount taken as a surrender charge will be used to purchase Accumulation Units according to the allocations currently in effect on, and priced as of, the surrender date;
• any charges that would otherwise have been assessed during the period of surrender will be assessed as of the date(s) they were due resulting in the cancellation of Accumulation Units priced as of the applicable date(s);
• interest will be credited on any allocation to a fixed investment option at the rate(s) in effect during the period of surrender;
• interest charged and credited on any Indebtedness will accrue at the rates in effect for the period of surrender; and
• any transfer of loan interest charged or credited that would have occurred during the period of surrender will be transferred as of the date(s) such transfers would have otherwise occurred.
Policy restoration is not a contract right of the policy; it is an administrative procedure based on requirements of state insurance law and the terms are subject to change without notice at any time.
Maximum Surrender Charge and Maximum Surrender Charge Calculation
The surrender charge equals the underwriting component and 26.5% of the sales expense component. The underwriting component is designed to cover the administrative expenses associated with underwriting and issuing policies and varies by issue age in the following manner:
Per $1,000 of Initial Specified Amount
Issue Age   Specified Amounts
less than $100,000 		  Specified Amounts
$100,000 or more
0-35   $6.00   $4.00
36-55   $7.50   $5.00
56-80   $7.50   $6.50
The sales expense component will not exceed 26.5% of the lesser of the guideline level Premium required in the first year, or Premiums paid in the first policy year. The sales component is designed to reimburse us for expenses incurred in the distribution of the policies.
The maximum surrender charge under the policy is based on the following calculation.
Maximum Surrender Charge 26.50% multiplied by the lesser of (a) or (b),where:
(a) = the Specified Amount multiplied by the rate indicated on the chart "Surrender Target Factor" below divided by 1,000; and
(b) = Premiums paid by the policy owner during the first policy year
Plus (c) multiplied by (d) where:
(c) = the Specified Amount divided by 1,000; and
(d) = the applicable rate from the "Administrative Target Factor" chart below.
The Surrender Target Factor allows the company to account for the probability that our costs incurred in the sales process will not be recouped. The Administrative Target Factor allows the company to account for the probability (at various ages) that death will occur and no surrender charge will be recouped.
Surrender Target Factor
Age   Male
Non-Tobacco 		  Female
Non-Tobacco 		  Male
Tobacco 		  Female
Tobacco
0   N/A   N/A   3.43   2.61
1   N/A   N/A   3.46   2.64
Age   Male
Non-Tobacco 		  Female
Non-Tobacco 		  Male
Tobacco 		  Female
Tobacco
2   N/A   N/A   3.58   2.73
3   N/A   N/A   3.72   2.83
4   N/A   N/A   3.86   2.93
 
 
4

 

Age   Male
Non-Tobacco 		  Female
Non-Tobacco 		  Male
Tobacco 		  Female
Tobacco
5   N/A   N/A   4.01   3.04
6   N/A   N/A   4.18   3.16
7   N/A   N/A   4.35   3.28
8   N/A   N/A   4.54   3.42
9   N/A   N/A   4.75   3.56
10   N/A   N/A   4.96   3.70
11   N/A   N/A   5.19   3.86
12   N/A   N/A   5.42   4.03
13   N/A   N/A   5.67   4.20
14   N/A   N/A   5.92   4.38
15   N/A   N/A   6.17   4.57
16   N/A   N/A   6.14   4.76
17   N/A   N/A   6.66   4.96
18   5.21   4.36   6.91   5.17
19   5.40   4.54   7.17   5.39
20   5.63   4.76   7.47   5.65
21   5.84   4.96   7.76   5.90
22   6.07   5.17   8.06   6.15
23   6.31   5.39   8.38   6.42
24   6.56   5.62   8.73   6.70
25   6.84   5.86   9.11   7.00
26   7.13   6.12   9.51   7.32
27   7.45   6.39   9.94   7.65
28   7.78   6.68   10.41   8.01
29   8.14   6.99   10.90   8.38
30   8.56   7.34   11.46   8.81
31   8.96   7.68   12.03   9.22
32   9.39   8.04   12.62   9.66
33   9.85   8.42   13.26   10.12
34   10.34   8.82   13.93   10.61
35   10.85   9.24   14.65   11.13
36   11.39   9.69   15.41   11.67
37   11.97   10.16   16.21   12.24
38   12.58   10.66   17.06   12.85
39   13.23   11.18   17.96   13.48
40   13.95   11.77   18.94   14.17
41   14.67   12.35   19.95   14.86
42   15.44   12.95   21.00   15.58
43   16.26   13.60   22.12   16.34
44   17.12   14.27   23.30   17.13
45   18.04   14.99   24.55   17.96
Age   Male
Non-Tobacco 		  Female
Non-Tobacco 		  Male
Tobacco 		  Female
Tobacco
46   19.02   15.74   25.86   18.83
47   20.06   16.55   27.26   19.75
48   21.16   17.39   28.74   20.72
49   22.34   18.29   30.31   21.75
50   23.64   19.29   32.02   22.87
51   24.98   20.30   33.79   24.02
52   26.41   21.38   35.67   25.23
53   27.93   22.52   37.66   26.50
54   29.56   23.73   39.76   27.85
55   31.29   25.02   41.99   29.27
56   33.14   26.40   44.34   30.79
57   35.11   27.87   46.83   32.40
58   37.22   29.44   49.48   34.13
59   39.49   31.14   52.30   35.98
60   42.01   33.07   55.42   38.09
61   44.61   35.05   58.63   40.26
62   47.40   37.18   62.04   42.59
63   50.38   39.47   65.65   45.08
64   53.58   41.92   69.47   47.74
65   56.99   44.55   73.51   50.56
66   60.65   47.37   77.78   53.58
67   64.57   50.41   82.30   56.81
68   68.78   53.71   87.12   60.31
69   73.33   57.30   92.26   64.13
70   78.52   61.49   98.10   68.57
71   83.82   65.79   103.99   73.14
72   89.50   70.49   110.27   78.11
73   95.58   75.59   116.89   83.47
74   102.05   81.11   123.85   89.23
75   108.92   87.06   131.11   95.38
76   116.22   93.48   138.65   101.95
77   123.91   100.35   146.41   108.92
78   132.14   107.81   154.56   116.44
79   141.00   115.96   163.19   124.59
80   150.61   124.91   172.42   133.51
81   160.93   134.65   182.18   143.16
82   172.06   145.31   192.54   153.68
83   183.91   156.85   203.37   165.03
84   196.41   169.27   214.56   177.14
85   209.46   182.58   226.02   189.97
Illustrations
Nationwide will provide illustrations of future benefits under the policy before the policy is purchased and upon request thereafter. Nationwide may assess a $25 fee for this service to persons who request more than one policy illustration during a policy year.
Note: The policy owner selects the Premium amount and frequency shown in the policy illustration to show Nationwide how much Premium the policy owner intends to pay and when. Illustrated Premium and hypothetical rates of return are not guaranteed. Investment Experience varies over time, is rarely the same year-over-year, and may be negative. Because the policy is a variable universal life insurance policy with the potential for unfavorable Investment Experience, including extended periods of significant stock market decline, additional Premium may be required to meet a policy owner's goals and/or to prevent the policy from Lapsing. Generally, variable universal life insurance is considered a long-term investment. Policy owners should weigh the investment risk and costs associated with the policy against their objectives, time horizon, risk tolerance, and ability to pay additional Premium if necessary.
5

 

Advertising
Rating Agencies
Independent financial rating services, including Moody's, Standard & Poor's and A.M. Best Company rank and rate Nationwide. The purpose of these ratings is to reflect the financial strength or claims-paying ability of Nationwide. The ratings are not intended to reflect the Investment Experience or financial strength of the Variable Account. Nationwide may advertise these ratings from time to time. In addition, Nationwide may include in certain advertisements, endorsements in the form of a list of organizations, individuals or other parties which recommend Nationwide or the policies. Furthermore, Nationwide may occasionally include in advertisements comparisons of currently taxable and tax deferred investment programs, based on selected tax brackets, or discussions of alternative investment vehicles and general economic conditions.
Money Market Yields
Nationwide may advertise the "yield" and "effective yield" for the money market Sub-Account. Yield and effective yield are annualized, which means that it is assumed that the underlying mutual fund generates the same level of net income throughout a year.
Yield is a measure of the net dividend and interest income earned over a specific seven-day period (which period will be stated in the advertisement) expressed as a percentage of the offering price of the underlying mutual fund's units. The effective yield is calculated similarly, but reflects assumed compounding, calculated under rules prescribed by the SEC. Thus, effective yield will be slightly higher than yield, due to the compounding.
Historical Performance of the Sub-Accounts
Nationwide will advertise historical performance of the Sub-Accounts in accordance with SEC prescribed calculations. Performance information is annualized. However, if a Sub-Account has been available in the Variable Account for less than one year, the performance information for that Sub-Account is not annualized. Performance information is based on historical earnings and is not intended to predict or project future results.
Additional Materials
Nationwide may provide information on various topics to owners and prospective purchasers in advertising, sales literature, or other materials.
Tax Definition of Life Insurance
Section 7702(b)(1) of the Internal Revenue Code provides that if one of two alternate tests is met, a policy will be treated as life insurance for federal tax purposes. The two tests are referred to as the Guideline Premium/Cash Value Corridor Test and the Cash Value Accumulation Test. Both tests are available to flexible premium policies such as this one.
The tables that follow show, numerically, the requirements for each test.
Guideline Premium/Cash Value Corridor Test
Table of Applicable Percentages of Cash Value
Attained Age
of Insured 		  Percentage of
Cash Value
0-40   250%
41   243%
42   236%
43   229%
44   222%
45   215%
46   209%
47   203%
48   197%
49   191%
50   185%
Attained Age
of Insured 		  Percentage of
Cash Value
51   178%
52   171%
53   164%
54   157%
55   150%
56   146%
57   142%
58   138%
59   134%
60   130%
61   128%
Attained Age
of Insured 		  Percentage of
Cash Value
62   126%
63   124%
64   122%
65   120%
66   119%
67   118%
68   117%
69   116%
70   115%
71   113%
72   111%
6

 

Attained Age
of Insured 		  Percentage of
Cash Value
73   109%
74   107%
75   105%
76   105%
77   105%
78   105%
79   105%
80   105%
81   105%
82   105%
Attained Age
of Insured 		  Percentage of
Cash Value
83   105%
84   105%
85   105%
86   105%
87   105%
88   105%
89   105%
90   105%
91   104%
92   103%
Attained Age
of Insured 		  Percentage of
Cash Value
93   102%
94   101%
95   101%
96   101%
97   101%
98   101%
99   101%
100   100%
7

 

Cash Value Accumulation Test
The Cash Value Accumulation Test also requires the Death Benefit to exceed an applicable percentage of the Cash Value. These applicable percentages are calculated by determining net single premiums, as defined in Code Section 7702(b), for each policy year given a set of actuarial assumptions. The relevant material assumptions include an interest rate of 4% and 1980 CSO guaranteed mortality as prescribed in Revenue Code Section 7702 for the Cash Value Accumulation Test. The resulting net single premiums are then inverted (i.e., multiplied by 1/net single premium) to give the applicable cash value percentages. These premiums vary with the ages, sexes, and risk classifications of the Insureds.
The table below provides an example of applicable percentages for the Cash Value Accumulation Test. This example is for a male non-tobacco preferred issue age 55.
Policy
Year 		  Percentage of
Cash Value
1   221%
2   215%
3   209%
4   203%
5   197%
6   192%
7   187%
8   182%
9   177%
10   172%
11   168%
12   164%
13   160%
14   157%
15   153%
Policy
Year 		  Percentage of
Cash Value
16   150%
17   147%
18   144%
19   141%
20   138%
21   136%
22   133%
23   131%
24   129%
25   127%
26   125%
27   124%
28   122%
29   120%
30   119%
Policy
Year 		  Percentage of
Cash Value
31   118%
32   117%
33   115%
34   114%
35   113%
36   112%
37   111%
38   110%
39   109%
40   108%
41   107%
42   106%
43   104%
44   103%
45   102%
8

Report of Independent Registered Public Accounting Firm

The Board of Directors of Nationwide Life Insurance Company and Subsidiaries and

Contract Owners of Nationwide VLI Separate Account-2:

We have audited the accompanying statement of assets, liabilities and contract owners’ equity of Nationwide VLI Separate Account-2 (comprised of the sub-accounts listed in note 1(b), (collectively, “the Accounts”)) as of December 31, 2015, and the related statements of operations for the period then ended, the statements of changes in contract owners’ equity for each of the periods in the two-year period then ended, and the financial highlights for each of the periods in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Accounts’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2015, by correspondence with the transfer agents of the underlying mutual funds or by other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Accounts as of December 31, 2015, the results of their operations for the period then ended, the changes in contract owners’ equity for each of the periods in the two-year period then ended, and the financial highlights for each of the periods in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

/s/ KPMG LLP

Columbus, Ohio

March 16, 2016

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2015

 

Assets:

   

Investments at fair value:

   

VPS Dynamic Asset Allocation Portfolio - Class A (ALVDAA)

   

44 shares (cost $521)

    $ 500   

Global Allocation V.I. Fund - Class II (MLVGA2)

   

218,787 shares (cost $3,584,724)

      3,290,560   

VIP Small Cap Value Series: Service Class (DWVSVS)

   

6,195 shares (cost $241,442)

      208,030   

Stock Index Fund, Inc. - Initial Shares (DSIF)

   

1,001,232 shares (cost $30,337,377)

      43,473,494   

Socially Responsible Growth Fund Inc - Initial Shares (DSRG)

   

173,088 shares (cost $5,043,647)

      6,674,257   

Goldman Sachs Global Markets Navigator Fund - Service Shares (GVGMNS)

   

925 shares (cost $10,730)

      10,067   

Van Kampen V.I. Mid Cap Growth Fund - Series I Shares (IVKMG1)

   

53,184 shares (cost $246,340)

      286,131   

Balanced-Risk Allocation Fund: Series I Shares (IVBRA1)

   

11,288 shares (cost $134,564)

      115,139   

Balanced Portfolio: Service Shares (JABS)

   

42,780 shares (cost $1,286,861)

      1,352,290   

Forty Portfolio: Service Shares (JACAS)

   

131,676 shares (cost $5,023,836)

      4,619,181   

Global Technology Portfolio: Service Shares (JAGTS)

   

279,402 shares (cost $2,212,933)

      2,165,365   

Overseas Portfolio: Service Shares (JAIGS)

   

97,802 shares (cost $3,580,106)

      2,722,799   

Var Insurance Trust II - MFS Investors Growth Stock Portfolio: Initial Class (MV2IGI)

   

12,372 shares (cost $218,132)

      202,658   

Variable Insurance Trust - MFS New Discovery Series - Intital Class (MNDIC)

   

8,598 shares (cost $163,118)

      133,187   

Value Series - Initial Class (MVFIC)

   

142,222 shares (cost $2,399,869)

      2,615,465   

Core Plus Fixed Income Portfolio - Class I (MSVFI)

   

25,047 shares (cost $262,787)

      256,734   

Emerging Markets Debt Portfolio - Class I (MSEM)

   

107,030 shares (cost $941,240)

      797,371   

U.S. Real Estate Portfolio - Class I (MSVRE)

   

62,386 shares (cost $1,036,227)

      1,265,193   

NVIT Investor Destinations Managed Growth Class I (IDPG)

   

15,320 shares (cost $159,969)

      153,659   

NVIT Bond Index Fund Class I (NVBX)

   

7,699 shares (cost $82,477)

      79,837   

NVIT International Index Fund Class I (NVIX)

   

10,250 shares (cost $94,726)

      89,177   

American Century NVIT Multi Cap Value Fund - Class I (NVAMV1)

   

439,642 shares (cost $6,811,631)

      6,774,877   

American Funds NVIT Asset Allocation Fund - Class II (GVAAA2)

   

123,010 shares (cost $2,743,172)

      2,903,027   

American Funds NVIT Bond Fund - Class II (GVABD2)

   

59,835 shares (cost $656,139)

      678,532   

American Funds NVIT Global Growth Fund - Class II (GVAGG2)

   

55,181 shares (cost $1,581,852)

      1,626,731   

American Funds NVIT Growth Fund - Class II (GVAGR2)

   

21,088 shares (cost $1,271,059)

      1,820,083   

American Funds NVIT Growth-Income Fund - Class II (GVAGI2)

   

15,147 shares (cost $798,269)

      830,183   

Federated NVIT High Income Bond Fund - Class I (HIBF)

   

160,578 shares (cost $1,105,114)

      971,496   

NVIT Emerging Markets Fund - Class I (GEM)

   

234,436 shares (cost $2,663,696)

      2,147,436   

NVIT International Equity Fund - Class I (GIG)

   

389,661 shares (cost $4,170,053)

      3,717,363   

Neuberger Berman NVIT Multi Cap Opportunities Fund - Class I (NVNMO1)

   

1,457,397 shares (cost $12,710,859)

      13,189,444   

Neuberger Berman NVIT Socially Responsible Fund - Class I (NVNSR1)

   

8,281 shares (cost $122,858)

      110,882   

NVIT Cardinal Aggressive Fund - Class I (NVCRA1)

   

32,020 shares (cost $328,986)

      306,116   

NVIT Cardinal Balanced Fund - Class I (NVCRB1)

   

67,455 shares (cost $756,299)

      741,333   

NVIT Cardinal Capital Appreciation Fund - Class I (NVCCA1)

   

59,503 shares (cost $699,229)

      639,058   

NVIT Cardinal Conservative Fund - Class I (NVCCN1)

   

4,553 shares (cost $50,177)

      45,666   

NVIT Cardinal Moderate Fund - Class I (NVCMD1)

   

113,892 shares (cost $1,190,287)

      1,238,011   

NVIT Cardinal Moderately Aggressive Fund - Class I (NVCMA1)

   

74,403 shares (cost $760,546)

      709,064   

NVIT Cardinal Moderately Conservative Fund - Class I (NVCMC1)

   

17,163 shares (cost $191,878)

      182,270   

NVIT Core Bond Fund - Class I (NVCBD1)

   

48,504 shares (cost $529,485)

      507,357   

NVIT Core Plus Bond Fund - Class I (NVLCP1)

   

10,661 shares (cost $123,646)

      118,446   

NVIT Nationwide Fund - Class I (TRF)

   

3,266,298 shares (cost $33,525,741)

      47,589,967   

NVIT Government Bond Fund - Class I (GBF)

   

525,137 shares (cost $6,183,234)

      5,702,989   

American Century NVIT Growth Fund - Class I (CAF)

   

669,957 shares (cost $7,878,836)

      13,600,120   

NVIT International Index Fund - Class II (GVIX2)

   

45,217 shares (cost $441,354)

      392,935   

NVIT Investor Destinations Aggressive Fund - Class II (GVIDA)

   

158,179 shares (cost $1,420,653)

      1,994,641   

NVIT Investor Destinations Balanced Fund - Class II (NVDBL2)

   

23,684 shares (cost $359,880)

      351,474   

NVIT Investor Destinations Capital Appreciation Fund - Class II (NVDCA2)

   

5,762 shares (cost $101,138)

      96,687   

NVIT Investor Destinations Conservative Fund - Class II (GVIDC)

   

46,358 shares (cost $488,261)

      459,875   

NVIT Investor Destinations Moderate Fund - Class II (GVIDM)

   

271,182 shares (cost $2,984,490)

      3,400,623   

NVIT Investor Destinations Moderately Aggressive Fund - Class II (GVDMA)

   

374,138 shares (cost $3,990,772)

      4,972,292   

NVIT Investor Destinations Moderately Conservative Fund - Class II (GVDMC)

   

321,780 shares (cost $3,351,678)

      3,565,326   

NVIT Mid Cap Index Fund - Class I (MCIF)

   

272,679 shares (cost $5,655,491)

      6,121,649   

NVIT Money Market Fund - Class I (SAM)

   

15,331,412 shares (cost $15,331,412)

      15,331,412   

NVIT Multi-Manager International Growth Fund - Class I (NVMIG1)

   

407,139 shares (cost $4,915,225)

      4,177,243   

NVIT Multi-Manager International Value Fund - Class I (GVDIVI)

   

60,095 shares (cost $658,862)

      567,301   

NVIT Multi-Manager Large Cap Growth Fund - Class I (NVMLG1)

   

145,315 shares (cost $1,967,320)

      1,833,874   

NVIT Multi-Manager Large Cap Value Fund - Class I (NVMLV1)

   

125,191 shares (cost $1,464,755)

      1,246,904   

NVIT Multi-Manager Mid Cap Growth Fund - Class I (NVMMG1)

   

2,578,848 shares (cost $24,538,030)

      27,722,614   

NVIT Multi-Manager Mid Cap Value Fund - Class II (NVMMV2)

   

2,162,182 shares (cost $21,529,789)

      21,751,549   

NVIT Multi-Manager Small Cap Growth Fund - Class I (SCGF)

   

82,844 shares (cost $1,659,802)

      1,521,018   

NVIT Multi-Manager Small Cap Value Fund - Class I (SCVF)

   

380,937 shares (cost $4,931,000)

      5,020,755   

NVIT Multi-Manager Small Company Fund - Class I (SCF)

   

725,785 shares (cost $13,119,621)

      14,943,912   

NVIT Multi-Sector Bond Fund - Class I (MSBF)

   

120,324 shares (cost $1,121,182)

      1,044,412   

NVIT Short Term Bond Fund - Class II (NVSTB2)

   

53,337 shares (cost $554,512)

      541,903   

NVIT Large Cap Growth Fund - Class I (NVOLG1)

   

2,527,485 shares (cost $42,584,919)

      50,524,418   

Templeton NVIT International Value Fund - Class III (NVTIV3)

   

16,336 shares (cost $216,225)

      177,736   

Invesco NVIT Comstock Value Fund - Class I (EIF)

   

51,998 shares (cost $735,737)

      796,088   

NVIT Real Estate Fund - Class I (NVRE1)

   

1,376,150 shares (cost $11,522,236)

      8,931,215   

Loring Ward NVIT Capital Appreciation Fund - Class P (NVLCAP)

   

109 shares (cost $1,282)

      1,133   

Loring Ward NVIT Moderate Fund - Class P (NVLMP)

   

902 shares (cost $10,505)

      9,782   

NVIT Small Cap Index Fund Class II (NVSIX2)

   

9,614 shares (cost $129,651)

      114,890   

NVIT S&P 500 Index Fund Class I (GVEX1)

   

158,941 shares (cost $2,230,162)

      2,221,990   

TOPS Managed Risk Growth ETF Portfolio - Class 3 (NOTG3)

   

195 shares (cost $2,101)

      2,035   

VPS Growth and Income Portfolio - Class A (ALVGIA)

   

10,421 shares (cost $276,957)

      313,883   

VPS Small/Mid Cap Value Portfolio - Class A (ALVSVA)

   

61,273 shares (cost $1,224,068)

      1,059,414   

VP Balanced Fund - Class I (ACVB)

   

749,163 shares (cost $5,288,339)

      5,191,702   

VP Capital Appreciation Fund - Class I (ACVCA)

   

108,614 shares (cost $1,423,006)

      1,631,388   

VP Income & Growth Fund - Class I (ACVIG)

   

226,624 shares (cost $2,015,207)

      1,942,165   

VP Inflation Protection Fund - Class II (ACVIP2)

   

107,554 shares (cost $1,226,440)

      1,069,087   

VP International Fund - Class I (ACVI)

   

51,464 shares (cost $433,340)

      515,669   

VP Mid Cap Value Fund - Class I (ACVMV1)

   

112,320 shares (cost $2,008,058)

      2,065,570   

VP Ultra(R) Fund - Class I (ACVU1)

   

11,126 shares (cost $174,332)

      172,123   

Small Cap Stock Index Portfolio - Service Shares (DVSCS)

   

121,694 shares (cost $2,090,981)

      2,033,502   

Appreciation Portfolio - Initial Shares (DCAP)

   

94,039 shares (cost $3,841,566)

      4,253,395   

Opportunistic Small Cap Portfolio: Initial Shares (DSC)

   

9,527 shares (cost $425,030)

      438,441   

Growth and Income Portfolio - Initial Shares (DGI)

   

49,450 shares (cost $1,161,800)

      1,482,517   

Managed Tail Risk Fund II: Primary Shares (FVCA2P)

   

29,457 shares (cost $183,143)

      150,526   

Quality Bond Fund II - Primary Shares (FQB)

   

106,996 shares (cost $1,209,028)

      1,173,746   

Equity-Income Portfolio - Initial Class (FEIP)

   

1,802,704 shares (cost $39,919,419)

      36,883,317   

High Income Portfolio - Initial Class (FHIP)

   

1,760,676 shares (cost $9,990,262)

      8,715,345   

VIP Asset Manager Portfolio - Initial Class (FAMP)

   

719,540 shares (cost $10,721,850)

      11,339,948   

VIP Energy Portfolio - Service Class 2 (FNRS2)

   

106,466 shares (cost $2,380,084)

      1,651,280   

VIP Freedom Fund 2010 Portfolio - Service Class (FF10S)

   

31,756 shares (cost $366,467)

      385,520   

VIP Freedom Fund 2020 Portfolio - Service Class (FF20S)

   

96,765 shares (cost $1,048,047)

      1,200,849   

VIP Freedom Fund 2030 Portfolio - Service Class (FF30S)

   

88,040 shares (cost $950,697)

      1,114,588   

VIP Growth Portfolio - Initial Class (FGP)

   

919,411 shares (cost $32,508,657)

      60,451,285   

VIP Investment Grade Bond Portfolio - Service Class (FIGBS)

   

168,928 shares (cost $2,176,577)

      2,067,683   

VIP Mid Cap Portfolio - Service Class (FMCS)

   

212,400 shares (cost $6,701,293)

      6,883,882   

VIP Overseas Portfolio - Initial Class (FOP)

   

274,205 shares (cost $5,296,274)

      5,231,839   

VIP Overseas Portfolio - Service Class (FOS)

   

204,979 shares (cost $4,152,261)

      3,894,600   

VIP Value Strategies Portfolio - Service Class (FVSS)

   

55,072 shares (cost $750,518)

      799,643   

Franklin Income Securities Fund - Class 2 (FTVIS2)

   

116,218 shares (cost $1,849,655)

      1,650,300   

Rising Dividends Securities Fund - Class 1 (FTVRDI)

   

168,520 shares (cost $4,205,113)

      4,256,809   

Small Cap Value Securities Fund - Class 1 (FTVSVI)

   

125,593 shares (cost $2,269,471)

      2,275,746   

Templeton Developing Markets Securities Fund - Class 2 (FTVDM2)

   

111,496 shares (cost $1,045,335)

      704,656   

Templeton Foreign Securities Fund - Class 1 (TIF)

   

7,541 shares (cost $96,105)

      101,500   

Templeton Foreign Securities Fund - Class 2 (TIF2)

   

77,081 shares (cost $1,327,008)

      1,017,470   

Templeton Global Bond Securities Fund - Class 2 (FTVGI2)

   

132,592 shares (cost $2,444,893)

      2,094,951   

VIP Founding Funds Allocation Fund - Class 2 (FTVFA2)

   

36,969 shares (cost $278,605)

      249,539   

Short Duration Bond Portfolio - I Class Shares (AMTB)

   

238,474 shares (cost $2,596,833)

      2,508,752   

Guardian Portfolio - I Class Shares (AMGP)

   

8,758 shares (cost $182,155)

      146,251   

International Portfolio - S Class Shares (AMINS)

   

1,850 shares (cost $19,556)

      20,632   

Mid-Cap Growth Portfolio - I Class Shares (AMCG)

   

76,328 shares (cost $1,809,885)

      1,734,945   

Mid-Cap Growth Portfolio - S Class Shares (AMMCGS)

   

9,449 shares (cost $210,531)

      201,742   

Advisers Management Trust: Large Cap Value Portfolio - Class I (AMTP)

   

194,572 shares (cost $1,904,094)

      2,566,398   

Advisers Management Trust: Mid Cap Intrinsic Value Portfolio - Class S (AMRS)

   

1,210 shares (cost $17,264)

      21,522   

Socially Responsive Portfolio - I Class Shares (AMSRS)

   

31,876 shares (cost $576,471)

      684,059   

Capital Income Fund/VA - Non-Service Shares (OVMS)

   

382,991 shares (cost $5,580,898)

      5,538,053   

Core Bond Fund/VA - Non-Service Shares (OVB)

   

454,696 shares (cost $3,288,393)

      3,505,705   

Global Securities Fund/VA - Non-Service Shares (OVGS)

   

579,350 shares (cost $20,607,994)

      22,015,306   

International Growth Fund/VA - Non-Service Shares (OVIG)

   

13,149 shares (cost $29,875)

      28,929   

Main Street Fund(R)/VA - Non-Service Shares (OVGI)

   

43,383 shares (cost $1,234,368)

      1,268,528   

Main Street Small- & Mid-Cap Fund(R)/VA - Non-Service Shares (OVSC)

   

73,386 shares (cost $1,747,576)

      1,564,583   

Discovery Mid Cap Growth Fund/VA - Non-Service Shares (OVAG)

   

15,221 shares (cost $984,718)

      1,169,716   

Global Strategic Income Fund/VA: Non-service Shares (OVSB)

   

43,517 shares (cost $231,958)

      212,362   

All Asset Portfolio - Administrative Class (PMVAAA)

   

23,123 shares (cost $254,994)

      210,415   

CommodityRealReturn(R) Strategy Portfolio - Administrative Class (PMVRSA)

   

946 shares (cost $9,112)

      6,540   

Foreign Bond Portfolio (Unhedged) - Administrative Class (PMVFBA)

   

30,215 shares (cost $340,979)

      290,370   

Low Duration Portfolio - Administrative Class (PMVLDA)

   

151,933 shares (cost $1,606,678)

      1,557,311   

Total Return Portfolio - Administrative Class (PMVTRA)

   

93,255 shares (cost $1,043,815)

      986,641   

VT Growth & Income Fund: Class IB (PVGIB)

   

3,877 shares (cost $96,654)

      91,991   

VT International Equity Fund: Class IB (PVTIGB)

   

18,419 shares (cost $255,934)

      240,730   

VT Voyager Fund: Class IB (PVTVB)

   

12,729 shares (cost $592,309)

      556,515   

VI American Franchise Fund - Series I Shares (ACEG)

   

1,164 shares (cost $59,239)

      66,690   

VI Value Opportunities Fund - Series I Shares (AVBVI)

   

509 shares (cost $3,710)

      3,981   

VI Mid Cap Core Equity Fund: Series I Shares (AVMCCI)

   

69 shares (cost $962)

      838   

Variable Fund - Multi-Hedge Strategies (RVARS)

   

2,093 shares (cost $50,195)

      50,409   

Health Sciences Portfolio - II (TRHS2)

   

166,104 shares (cost $6,003,265)

      6,257,127   

Limited-Term Bond Portfolio - II (TRLT2)

   

12,899 shares (cost $63,102)

      62,175   

VIP Trust - Unconstrained Emerging Markets Bond Fund - Initial Class (VWBF)

   

136,694 shares (cost $1,437,002)

      1,042,976   

VIP Trust Emerging Markets Fund - Initial Class (VWEM)

   

384,327 shares (cost $4,988,613)

      4,035,435   

VIP Trust Global Hard Assets Fund - Initial Class (VWHA)

   

189,088 shares (cost $5,926,177)

      3,191,807   

Variable Insurance Portfolios - Asset Strategy (WRASP)

   

257,809 shares (cost $2,711,562)

      2,140,796   

Variable Insurance Portfolios - High Income (WRHIP)

   

180,863 shares (cost $681,596)

      606,125   

Variable Insurance Portfolios - Mid Cap Growth (WRMCG)

   

31,779 shares (cost $341,328)

      299,420   

Advantage VT Discovery Fund (SVDF)

   

28,604 shares (cost $836,721)

      743,413   

Advantage VT Opportunity Fund - Class 2 (SVOF)

   

56,973 shares (cost $978,828)

      1,427,179   

Advantage VT Small Cap Growth Fund - Class 2 (WFVSCG)

   

48,324 shares (cost $487,361)

      413,657   
  

 

 

  

Total Investments

    $ 600,433,133   

Other Accounts Receivable

      237,072   

Accounts Receivable - VPS Dynamic Asset Allocation Portfolio - Class A (ALVDAA)

      3   

Accounts Receivable - TOPS Managed Risk Growth ETF Portfolio - Class 3 (NOTG3)

      4   

Accounts Receivable - NVIT Cardinal Conservative Fund - Class I (NVCCN1)

      12   

Accounts Receivable - Loring Ward NVIT Capital Appreciation Fund - Class P (NVLCAP)

      1   

Accounts Payable - VP Capital Appreciation Fund - Class I (ACVCA)

      (10,340 ) 

Accounts Payable - VP International Fund - Class I (ACVI)

      (15,768 ) 

Accounts Payable - Short Duration Bond Portfolio - I Class Shares (AMTB)

      (1,931 ) 

Accounts Payable - Advisers Management Trust: Large Cap Value Portfolio - Class I (AMTP)

      (2,417 ) 

Accounts Payable - VI Value Opportunities Fund - Series I Shares (AVBVI)

      (1 ) 

Accounts Payable - VI Mid Cap Core Equity Fund: Series I Shares (AVMCCI)

      (4 ) 

Accounts Payable - Stock Index Fund, Inc. - Initial Shares (DSIF)

      (12,917 ) 

Accounts Payable - VIP Asset Manager Portfolio - Initial Class (FAMP)

      (4,400 ) 

Accounts Payable - Equity-Income Portfolio - Initial Class (FEIP)

      (24,891 ) 

Accounts Payable - VIP Growth Portfolio - Initial Class (FGP)

      (18,550 ) 

Accounts Payable - High Income Portfolio - Initial Class (FHIP)

      (5,008 ) 

Accounts Payable - VIP Overseas Portfolio - Initial Class (FOP)

      (3,322 ) 

Accounts Payable - NVIT Government Bond Fund - Class I (GBF)

      (2,908 ) 

Accounts Payable - U.S. Real Estate Portfolio - Class I (MSVRE)

      (561 ) 

Accounts Payable - Core Bond Fund/VA - Non-Service Shares (OVB)

      (4,615 ) 

Accounts Payable - Global Securities Fund/VA - Non-Service Shares (OVGS)

      (26,713 ) 

Accounts Payable - Capital Income Fund/VA - Non-Service Shares (OVMS)

      (4,203 ) 

Accounts Payable - CommodityRealReturn(R) Strategy Portfolio - Administrative Class (PMVRSA)

      (2 ) 

Accounts Payable - NVIT Money Market Fund - Class I (SAM)

      89,621   

Accounts Payable - NVIT Multi-Manager Small Company Fund - Class I (SCF)

      (43,691 ) 

Accounts Payable - Advantage VT Opportunity Fund - Class 2 (SVOF)

      (12,043 ) 

Accounts Payable - VIP Trust Global Hard Assets Fund - Initial Class (VWHA)

      (8,178 ) 
  

 

 

  
   $ 600,557,383   
  

 

 

  

Contract Owners’ Equity:

   

Accumulation units

      600,557,383   
  

 

 

  

Total Contract Owners’ Equity (note 5)

    $ 600,557,383   
  

 

 

  

See accompanying notes to financial statements.

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF OPERATIONS

Year Ended December 31, 2015

 

Investment Activity:    Total     ALVDAA     MLVGA2     DWVSVS     DSIF     DSRG     GVGMNS     IVKMG1  

Reinvested dividends

    $ 8,296,051        5        32,235        972        818,494        76,375        9        -       

Asset charges (note 3)

      (3,368,148 )      (6 )      (14,870 )      (1,198 )      (216,897 )      (40,733 )      (102 )      (1,299 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      4,927,903        (1 )      17,365        (226 )      601,597        35,642        (93 )      (1,299 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      17,669,057        (14 )      1,371        (3,425 )      1,693,402        363,453        494        9,436   

Change in unrealized gain (loss) on investments

      (67,695,508 )      (3 )      (225,620 )      (30,718 )      (3,276,496 )      (1,606,073 )      (1,226 )      (26,888 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (50,026,451 )      (17 )      (224,249 )      (34,143 )      (1,583,094 )      (1,242,620 )      (732 )      (17,452 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      42,758,276        11        174,038        21,809        1,267,240        958,115        220        20,625   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (2,340,272 )      (7 )      (32,846 )      (12,560 )      285,743        (248,863 )      (605 )      1,874   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:    IVBRA1     JABS     JACAS     JAGTS     JAIGS     MV2IGI     MNDIC     MVFIC  

Reinvested dividends

    $ 5,110        22,070        51,790        14,134        15,579        1,115        -            65,028   

Asset charges (note 3)

      (652 )      (6,302 )      (21,377 )      (8,639 )      (16,078 )      (888 )      (892 )      (12,809 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      4,458        15,768        30,413        5,495        (499 )      227        (892 )      52,219   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      (82 )      46,342        4,089        99,883        (198,313 )      (1,396 )      (15,421 )      96,976   

Change in unrealized gain (loss) on investments

      (21,292 )      (103,709 )      (398,612 )      (243,901 )      (161,502 )      (15,474 )      8,614        (339,217 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (21,374 )      (57,367 )      (394,523 )      (144,018 )      (359,815 )      (16,870 )      (6,807 )      (242,241 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      10,637        39,747        810,763        232,816        91,925        13,094        4,525        163,192   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (6,279 )      (1,852 )      446,653        94,293        (268,389 )      (3,549 )      (3,174 )      (26,830 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF OPERATIONS

Year Ended December 31, 2015

 

Investment Activity:    MSVFI     MSEM     MSVRE     IDPG     NVBX     NVIX     NVAMV1     GVAAA2  

Reinvested dividends

    $ 9,788        43,512        19,263        2,649        1,437        2,282        172,695        42,204   

Asset charges (note 3)

      (1,390 )      (4,120 )      (10,485 )      (123 )      (301 )      (383 )      (37,714 )      (14,411 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      8,398        39,392        8,778        2,526        1,136        1,899        134,981        27,793   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      1,971        (16,928 )      132,570        (6 )      (72 )      (95 )      259,919        77,137   

Change in unrealized gain (loss) on investments

      (13,435 )      (33,883 )      (129,558 )      (6,310 )      (1,796 )      (5,182 )      (1,657,346 )      (228,084 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (11,464 )      (50,811 )      3,012        (6,316 )      (1,868 )      (5,277 )      (1,397,427 )      (150,947 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      -            -            -            -            766        -            901,500        130,973   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (3,066 )      (11,419 )      11,790        (3,790 )      34        (3,378 )      (360,946 )      7,819   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:    GVABD2     GVAGG2     GVAGR2     GVAGI2     HIBF     GEM     GIG     NVNMO1  

Reinvested dividends

    $ 9,686        10,767        13,042        7,569        55,473        20,860        20,065        107,390   

Asset charges (note 3)

      (3,737 )      (8,266 )      (9,070 )      (4,685 )      (4,578 )      (13,263 )      (19,928 )      (71,803 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      5,949        2,501        3,972        2,884        50,895        7,597        137        35,587   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      18,207        177,878        71,257        127,560        (17,229 )      (50,967 )      (1,086 )      375,791   

Change in unrealized gain (loss) on investments

      (28,852 )      (240,473 )      (19,829 )      (184,913 )      (71,904 )      (382,944 )      (274,637 )      (1,802,664 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (10,645 )      (62,595 )      51,428        (57,353 )      (89,133 )      (433,911 )      (275,723 )      (1,426,873 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      297        149,454        47,984        61,100        10,047        -            147,138        1,184,849   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (4,399 )      89,360        103,384        6,631        (28,191 )      (426,314 )      (128,448 )      (206,437 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF OPERATIONS

Year Ended December 31, 2015

 

Investment Activity:    NVNSR1     NVCRA1     NVCRB1     NVCCA1     NVCCN1     NVCMD1     NVCMA1     NVCMC1  

Reinvested dividends

    $ 990        8,719        15,874        20,747        1,024        36,678        21,695        4,934   

Asset charges (note 3)

      (617 )      (1,830 )      (2,641 )      (3,747 )      (313 )      (6,249 )      (3,988 )      (845 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      373        6,889        13,233        17,000        711        30,429        17,707        4,089   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      30,138        7,654        1,531        29,030        (1,976 )      20,771        17,894        13,529   

Change in unrealized gain (loss) on investments

      (47,990 )      (45,447 )      (35,316 )      (98,563 )      (243 )      (138,724 )      (111,061 )      (25,106 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (17,852 )      (37,793 )      (33,785 )      (69,533 )      (2,219 )      (117,953 )      (93,167 )      (11,577 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      16,723        24,740        14,516        44,516        1,404        69,615        64,317        7,644   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (756 )      (6,164 )      (6,036 )      (8,017 )      (104 )      (17,909 )      (11,143 )      156   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:    NVCBD1     NVLCP1     TRF     GBF     CAF     GVIX2     GVIDA     NVDBL2  

Reinvested dividends

    $ 15,590        2,210        600,448        103,150        48,768        8,599        29,367        6,002   

Asset charges (note 3)

      (3,577 )      (779 )      (297,374 )      (30,726 )      (80,649 )      (1,414 )      (11,379 )      (576 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      12,013        1,431        303,074        72,424        (31,881 )      7,185        17,988        5,426   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      (2,312 )      2,994        976,843        (54,615 )      759,586        (1,229 )      132,688        2,489   

Change in unrealized gain (loss) on investments

      (19,792 )      (5,352 )      (1,047,198 )      (51,863 )      (1,845,217 )      (12,853 )      (175,162 )      (16,823 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (22,104 )      (2,358 )      (70,355 )      (106,478 )      (1,085,631 )      (14,082 )      (42,474 )      (14,334 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      2,380        956        -            -            1,681,069        -            -            7,693   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (7,711 )      29        232,719        (34,054 )      563,557        (6,897 )      (24,486 )      (1,215 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF OPERATIONS

Year Ended December 31, 2015

 

Investment Activity:    NVDCA2     GVIDC     GVIDM     GVDMA     GVDMC     MCIF     SAM     NVMIG1  

Reinvested dividends

    $ 1,543        7,867        57,466        76,366        61,235        71,034        -            31,536   

Asset charges (note 3)

      (635 )      (3,237 )      (17,536 )      (26,182 )      (20,269 )      (31,918 )      (89,560 )      (23,639 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      908        4,630        39,930        50,184        40,966        39,116        (89,560 )      7,897   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      (2,706 )      435        396,898        54,913        15,493        187,748        -            (33,340 ) 

Change in unrealized gain (loss) on investments

      (1,914 )      (21,745 )      (613,924 )      (256,094 )      (263,047 )      (802,059 )      -            (287,793 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (4,620 )      (21,310 )      (217,026 )      (201,181 )      (247,554 )      (614,311 )      -            (321,133 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      5,379        15,741        159,441        94,766        187,054        407,893        -            259,733   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ 1,667        (939 )      (17,655 )      (56,231 )      (19,534 )      (167,302 )      (89,560 )      (53,503 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:    GVDIVI     NVMLG1     NVMLV1     NVMMG1     NVMMV2     SCGF     SCVF     SCF  

Reinvested dividends

    $ 7,740        8,772        17,113        -            272,582        -            37,329        60,183   

Asset charges (note 3)

      (2,941 )      (11,154 )      (6,691 )      (166,025 )      (126,658 )      (6,848 )      (23,237 )      (83,817 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      4,799        (2,382 )      10,422        (166,025 )      145,924        (6,848 )      14,092        (23,634 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      (2,308 )      208,737        55,042        1,158,366        670,460        81,446        448,885        (72,804 ) 

Change in unrealized gain (loss) on investments

      (36,881 )      (331,028 )      (306,841 )      (5,388,566 )      (4,050,342 )      (267,373 )      (1,351,892 )      (1,849,853 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (39,189 )      (122,291 )      (251,799 )      (4,230,200 )      (3,379,882 )      (185,927 )      (903,007 )      (1,922,657 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      -            156,654        170,378        4,299,066        2,475,846        196,919        546,767        1,659,488   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (34,390 )      31,981        (70,999 )      (97,159 )      (758,112 )      4,144        (342,148 )      (286,803 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF OPERATIONS

Year Ended December 31, 2015

 

Investment Activity:    MSBF     NVSTB2     NVOLG1     NVTIV3     EIF     NVRE1     NVLCAP     NVLMP  

Reinvested dividends

    $ 21,717        9,293        325,703        3,524        12,076        252,693        31        187   

Asset charges (note 3)

      (6,162 )      (3,198 )      (257,172 )      (979 )      (4,114 )      (52,341 )      (13 )      (21 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      15,555        6,095        68,531        2,545        7,962        200,352        18        166   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      123        (7,523 )      1,979,169        (865 )      39,711        (37,780 )      (85 )      (6 ) 

Change in unrealized gain (loss) on investments

      (52,530 )      (4,578 )      (7,496,685 )      (21,489 )      (102,042 )      (2,095,864 )      222        (723 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (52,407 )      (12,101 )      (5,517,516 )      (22,354 )      (62,331 )      (2,133,644 )      137        (729 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      -            -            7,805,221        8,492        -            1,367,077        61        131   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (36,852 )      (6,006 )      2,356,236        (11,317 )      (54,369 )      (566,215 )      216        (432 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:    NVSIX2     GVEX1     NOTG3     ALVGIA     ALVSVA     ACVB     ACVCA     ACVIG  

Reinvested dividends

    $ 1,256        42,354        29        4,375        9,354        100,466        -            47,079   

Asset charges (note 3)

      (597 )      (11,869 )      (18 )      (1,676 )      (6,022 )      (37,074 )      (14,433 )      (13,487 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      659        30,485        11        2,699        3,332        63,392        (14,433 )      33,592   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      (37 )      52,407        6        19,258        40,625        213,764        164,466        122,577   

Change in unrealized gain (loss) on investments

      (15,994 )      (87,031 )      (254 )      (16,601 )      (303,393 )      (1,061,551 )      (241,063 )      (513,594 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (16,031 )      (34,624 )      (248 )      2,657        (262,768 )      (847,787 )      (76,597 )      (391,017 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      9,264        32,140        10        -            190,119        608,275        122,410        209,836   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (6,108 )      28,001        (227 )      5,356        (69,317 )      (176,120 )      31,380        (147,589 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF OPERATIONS

Year Ended December 31, 2015

 

Investment Activity:    ACVIP2     ACVI     ACVMV1     ACVU1     DVSCS     DCAP     DSC     DGI  

Reinvested dividends

    $ 22,726        1,622        36,939        951        15,671        77,077        -            13,143   

Asset charges (note 3)

      (4,633 )      (2,180 )      (11,066 )      (1,358 )      (10,899 )      (22,213 )      (2,143 )      (7,493 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      18,093        (558 )      25,873        (407 )      4,772        54,864        (2,143 )      5,650   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      (27,835 )      74,994        124,885        (11,020 )      147,110        129,939        13,053        29,660   

Change in unrealized gain (loss) on investments

      (23,725 )      (83,807 )      (293,336 )      (3,481 )      (358,038 )      (533,137 )      (23,659 )      (157,860 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (51,560 )      (8,813 )      (168,451 )      (14,501 )      (210,928 )      (403,198 )      (10,606 )      (128,200 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      -            -            104,500        20,475        139,707        218,154        6,502        140,400   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (33,467 )      (9,371 )      (38,078 )      5,567        (66,449 )      (130,180 )      (6,247 )      17,850   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:    FVCA2P     FQB     FEIP     FHIP     FAMP     FNRS2     FF10S     FF20S  

Reinvested dividends

    $ 2,639        46,670        1,245,644        637,249        186,684        19,425        6,758        21,785   

Asset charges (note 3)

      (412 )      (7,302 )      (219,179 )      (45,560 )      (71,305 )      (10,179 )      (2,085 )      (6,434 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      2,227        39,368        1,026,465        591,689        115,379        9,246        4,673        15,351   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      (763 )      (1,960 )      (402,953 )      (500 )      162,856        (45,729 )      21,022        29,487   

Change in unrealized gain (loss) on investments

      (12,187 )      (47,104 )      (6,189,751 )      (1,122,374 )      (1,155,866 )      (477,629 )      (31,340 )      (62,073 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (12,950 )      (49,064 )      (6,592,704 )      (1,122,874 )      (993,010 )      (523,358 )      (10,318 )      (32,586 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      221        -            3,810,025        -            850,345        68,358        1,127        5,325   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (10,502 )      (9,696 )      (1,756,214 )      (531,185 )      (27,286 )      (445,754 )      (4,518 )      (11,910 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF OPERATIONS

Year Ended December 31, 2015

 

Investment Activity:    FF30S     FGP     FIGBS     FMCS     FOP     FOS     FVSS     FTVIS2  

Reinvested dividends

    $ 18,973        159,183        53,426        29,387        73,640        51,890        8,924        80,804   

Asset charges (note 3)

      (6,741 )      (344,263 )      (9,827 )      (39,294 )      (30,467 )      (14,035 )      (4,696 )      (8,593 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      12,232        (185,080 )      43,599        (9,907 )      43,173        37,855        4,228        72,211   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      38,621        2,319,505        (4,711 )      557,369        (102,963 )      (6,898 )      139,072        18,579   

Change in unrealized gain (loss) on investments

      (67,399 )      (73,178 )      (64,876 )      (1,660,050 )      223,466        (257,661 )      (171,491 )      (228,005 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (28,778 )      2,246,327        (69,587 )      (1,102,681 )      120,503        (264,559 )      (32,419 )      (209,426 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      6,132        1,921,974        1,695        998,497        5,435        4,086        776        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (10,414 )      3,983,221        (24,293 )      (114,091 )      169,111        (222,618 )      (27,415 )      (137,215 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:    FTVRDI     FTVSVI     FTVDM2     TIF     TIF2     FTVGI2     FTVFA2     AMTB  

Reinvested dividends

    $ 74,587        24,460        16,875        4,341        38,638        174,887        7,883        38,102   

Asset charges (note 3)

      (20,830 )      (13,191 )      (4,132 )      (615 )      (5,753 )      (10,343 )      (1,240 )      (13,843 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      53,757        11,269        12,743        3,726        32,885        164,544        6,643        24,259   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      229,332        271,313        (26,037 )      (4,968 )      (55,100 )      (27,102 )      (1,017 )      (20,251 ) 

Change in unrealized gain (loss) on investments

      (922,805 )      (883,329 )      (273,272 )      (9,997 )      (95,533 )      (256,761 )      (24,894 )      (12,385 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (693,473 )      (612,016 )      (299,309 )      (14,965 )      (150,633 )      (283,863 )      (25,911 )      (32,636 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      464,223        388,063        107,463        4,071        39,464        11,359        431        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (175,493 )      (212,684 )      (179,103 )      (7,168 )      (78,284 )      (107,960 )      (18,837 )      (8,377 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF OPERATIONS

Year Ended December 31, 2015

 

Investment Activity:    AMGP     AMINS     AMCG     AMMCGS     AMTP     AMRS     AMSRS     OVMS  

Reinvested dividends

    $ 1,109        203        -            -            23,004        93        4,050        129,385   

Asset charges (note 3)

      (692 )      -            (1,426 )      (167 )      (4,884 )      -            (3,695 )      (31,521 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      417        203        (1,426 )      (167 )      18,120        93        355        97,864   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      2,064        196        (2,998 )      (2,867 )      138,686        652        49,649        (75,338 ) 

Change in unrealized gain (loss) on investments

      (50,299 )      (289 )      (74,940 )      (5,763 )      (746,960 )      (3,245 )      (120,344 )      (1,770 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (48,235 )      (93 )      (77,938 )      (8,630 )      (608,274 )      (2,593 )      (70,695 )      (77,108 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      38,715        59        -            222        232,469        504        64,025        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (9,103 )      169        (79,364 )      (8,575 )      (357,685 )      (1,996 )      (6,315 )      20,756   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:    OVB     OVGS     OVIG     OVGI     OVSC     OVAG     OVSB     PMVAAA  

Reinvested dividends

    $ 145,717        302,369        314        12,392        11,583        -            12,988        7,813   

Asset charges (note 3)

      (18,976 )      (120,323 )      (109 )      (5,717 )      (6,629 )      (7,266 )      (1,022 )      (1,215 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      126,741        182,046        205        6,675        4,954        (7,266 )      11,966        6,598   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      (75,210 )      429,431        (3,909 )      89,456        46,720        81,600        (4,364 )      (3,708 ) 

Change in unrealized gain (loss) on investments

      (34,416 )      (1,359,622 )      (947 )      (258,515 )      (323,287 )      (116,841 )      (13,731 )      (26,297 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (109,626 )      (930,191 )      (4,856 )      (169,059 )      (276,567 )      (35,241 )      (18,095 )      (30,005 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      -            1,507,432        1,918        202,345        191,189        101,136        -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ 17,115        759,287        (2,733 )      39,961        (80,424 )      58,629        (6,129 )      (23,407 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF OPERATIONS

Year Ended December 31, 2015

 

Investment Activity:    PMVRSA     PMVFBA     PMVLDA     PMVTRA     PVGIB     PVTIGB     PVTVB     ACEG  

Reinvested dividends

    $ 486        4,782        54,514        49,420        3,871        3,106        5,258        -       

Asset charges (note 3)

      (47 )      (1,597 )      (6,405 )      (5,001 )      (716 )      (1,364 )      (2,444 )      (134 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      439        3,185        48,109        44,419        3,155        1,742        2,814        (134 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      (1,309 )      (8,718 )      1,137        364        28,080        24,336        15,912        3,166   

Change in unrealized gain (loss) on investments

      (1,452 )      (20,022 )      (50,075 )      (57,648 )      (39,501 )      (30,299 )      (128,136 )      (171 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (2,761 )      (28,740 )      (48,938 )      (57,284 )      (11,421 )      (5,963 )      (112,224 )      2,995   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      -            802        -            10,634        -            -            71,876        357   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (2,322 )      (24,753 )      (829 )      (2,231 )      (8,266 )      (4,221 )      (37,534 )      3,218   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:    AVBVI     AVMCCI     RVARS     TRHS2     TRLT2     VWBF     VWEM     VWHA  

Reinvested dividends

    $ 122        3        101        -            523        83,659        30,379        1,534   

Asset charges (note 3)

      -            (12 )      (104 )      (30,718 )      -            (8,302 )      (25,286 )      (25,420 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      122        (9 )      (3 )      (30,718 )      523        75,357        5,093        (23,886 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      289        (3,434 )      446        780,100        (61 )      (93,928 )      74,658        (286,658 ) 

Change in unrealized gain (loss) on investments

      (1,241 )      2,567        (105 )      (566,064 )      (486 )      (157,207 )      (1,126,907 )      (1,334,368 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (952 )      (867 )      341        214,036        (547 )      (251,135 )      (1,052,249 )      (1,621,026 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      341        85        -            472,752        -            -            299,770        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (489 )      (791 )      338        656,070        (24 )      (175,778 )      (747,386 )      (1,644,912 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENT OF OPERATIONS

Year Ended December 31, 2015

 

Investment Activity:    WRASP     WRHIP     WRMCG     SVDF     SVOF     WFVSCG     MIGIC     FHIPR  

Reinvested dividends

    $ 9,054        86,153        -            -            2,004        -            1,981        9,157   

Asset charges (note 3)

      (12,351 )      (5,640 )      (1,695 )      (6,636 )      (9,284 )      (2,193 )      (291 )      (6,522 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

      (3,297 )      80,513        (1,695 )      (6,636 )      (7,280 )      (2,193 )      1,690        2,635   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Realized gain (loss) on investments

      (26,490 )      (115,899 )      (355 )      27,298        53,297        18,931        43,470        23,751   

Change in unrealized gain (loss) on investments

      (614,979 )      (54,391 )      (45,330 )      (175,037 )      (260,810 )      (93,222 )      (62,627 )      131,850   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

      (641,469 )      (170,290 )      (45,685 )      (147,739 )      (207,513 )      (74,291 )      (19,157 )      155,601   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

      434,781        14,628        26,697        132,761        160,423        51,715        20,840        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

    $ (209,985 )      (75,149 )      (20,683 )      (21,614 )      (54,370 )      (24,769 )      3,373        158,236   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:    FOSR     ACVI3     AMBP     AMTG     AMFAS                    

Reinvested dividends

    $ -            645        -            -            -             

Asset charges (note 3)

      (6,780 )      -            (196 )      (9,057 )      (781 )       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

        

Net investment income (loss)

      (6,780 )      645        (196 )      (9,057 )      (781 )       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

        

Realized gain (loss) on investments

      980,873        46,035        3,551        903,446        (1,073 )       

Change in unrealized gain (loss) on investments

      (593,089 )      (33,377 )      (10,009 )      (812,862 )      (26,548 )       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

        

Net gain (loss) on investments

      387,784        12,658        (6,458 )      90,584        (27,621 )       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

        

Reinvested capital gains

      -            -            7,671        -            26,722         
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

        

Net increase (decrease) in contract owners’ equity resulting from operations

    $ 381,004        13,303        1,017        81,527        (1,680 )       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

        

See accompanying notes to financial statements.

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     Total     ALVDAA     MLVGA2     DWVSVS  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 4,927,903        5,031,988        (1 )      13        17,365        49,799        (226 )      (710 ) 

Realized gain (loss) on investments

      17,669,057        27,741,639        (14 )      652        1,371        52,059        (3,425 )      2,232   

Change in unrealized gain (loss) on investments

      (67,695,508 )      (23,577,761 )      (3 )      (769 )      (225,620 )      (302,607 )      (30,718 )      (8,676 ) 

Reinvested capital gains

      42,758,276        33,984,023        11        316        174,038        246,873        21,809        13,037   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (2,340,272 )      43,179,889        (7 )      212        (32,846 )      46,124        (12,560 )      5,883   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      22,837,353        25,444,894        -            -            125,726        121,628        540        2,852   

Transfers between funds

      -            3,890,527        -            3,430        305,022        (147,202 )      (183,714 )      391,260   

Surrenders (note 6)

      (44,816,562 )      (52,118,692 )      -            (5,222 )      (114,541 )      (348,348 )      -            (3,102 ) 

Death Benefits (note 4)

      (10,869,510 )      (6,270,005 )      -            -            (13,246 )      (84,191 )      (8,851 )      -       

Net policy repayments (loans) (note 5)

      8,992,250        5,846,434        (28 )      (2,329 )      7,516        92,461        (5,364 )      (25,962 ) 

Deductions for surrender charges (note 2d)

      (2,199 )      (2,121 )      -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (32,425,481 )      (33,470,696 )      (367 )      (227 )      (154,332 )      (165,543 )      (6,348 )      (6,372 ) 

Asset charges (note 3):

                 

MSP contracts

      (277,280 )      (290,784 )      -            -            (3,924 )      (3,613 )      -            -       

SL contracts or LSFP contracts

      (146,526 )      (149,874 )      -            -            -            -            -            -       

Adjustments to maintain reserves

      (7,511 )      14,849        (8 )      6        (4 )      (8 )      (1 )      1   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (56,715,466 )      (57,105,468 )      (403 )      (4,342 )      152,217        (534,816 )      (203,738 )      358,677   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (59,055,738 )      (13,925,579 )      (410 )      (4,130 )      119,371        (488,692 )      (216,298 )      364,560   

Contract owners’ equity beginning of period

      659,613,121        673,538,700        907        5,037        3,171,176        3,659,868        424,330        59,770   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 600,557,383        659,613,121        497        907        3,290,547        3,171,176        208,032        424,330   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      24,777,106        26,990,861        77        441        196,223        229,979        32,825        4,859   

Units purchased

      2,930,968        4,238,771        -            292        31,470        17,330        192        30,676   

Units redeemed

      (4,828,486 )      (6,452,526 )      (34 )      (656 )      (21,371 )      (51,086 )      (15,725 )      (2,710 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      22,879,589        24,777,106        43        77        206,322        196,223        17,292        32,825   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     DSIF     DSRG     GVGMNS     IVKMG1  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 601,597        586,348        35,642        36,092        (93 )      (113 )      (1,299 )      (1,045 ) 

Realized gain (loss) on investments

      1,693,402        1,742,515        363,453        232,913        494        70        9,436        5,200   

Change in unrealized gain (loss) on investments

      (3,276,496 )      2,778,607        (1,606,073 )      106,054        (1,226 )      436        (26,888 )      11,935   

Reinvested capital gains

      1,267,240        541,793        958,115        512,739        220        139        20,625        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      285,743        5,649,263        (248,863 )      887,798        (605 )      532        1,874        16,090   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      1,485,804        1,631,119        350,834        377,810        766        1,019        20,388        12,684   

Transfers between funds

      323,570        72,898        (174,403 )      91,867        (6,259 )      -            67,645        (5,374 ) 

Surrenders (note 6)

      (3,421,138 )      (3,704,429 )      (664,757 )      (426,872 )      -            -            (6,088 )      (225 ) 

Death Benefits (note 4)

      (401,192 )      (402,082 )      (5,309 )      (43,268 )      -            -            (3,839 )      (1,895 ) 

Net policy repayments (loans) (note 5)

      135,818        136,410        146,381        20,512        -            -            (488 )      693   

Deductions for surrender charges (note 2d)

      (98 )      (350 )      (247 )      -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (2,263,673 )      (2,278,058 )      (424,139 )      (446,005 )      (1,401 )      (1,189 )      (16,043 )      (14,897 ) 

Asset charges (note 3):

                 

MSP contracts

      (18,836 )      (19,598 )      (2,163 )      (2,073 )      -            -            (62 )      (62 ) 

SL contracts or LSFP contracts

      (20,537 )      (21,332 )      (925 )      (972 )      -            -            (140 )      (132 ) 

Adjustments to maintain reserves

      113        1,553        (13 )      73        (3 )      1        (5 )      12   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (4,180,169 )      (4,583,869 )      (774,741 )      (428,928 )      (6,897 )      (169 )      61,368        (9,196 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (3,894,426 )      1,065,394        (1,023,604 )      458,870        (7,502 )      363        63,242        6,894   

Contract owners’ equity beginning of period

      47,380,837        46,315,443        7,698,420        7,239,550        17,567        17,204        222,889        215,995   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 43,486,411        47,380,837        6,674,816        7,698,420        10,065        17,567        286,131        222,889   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      986,251        1,090,770        182,744        193,190        1,470        1,486        15,517        16,170   

Units purchased

      55,012        63,462        12,170        22,211        65        87        6,161        1,346   

Units redeemed

      (144,582 )      (167,981 )      (30,545 )      (32,657 )      (631 )      (103 )      (1,893 )      (1,999 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      896,681        986,251        164,369        182,744        904        1,470        19,785        15,517   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     IVBRA1     JABS     JACAS     JAGTS  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 4,458        (272 )      15,768        16,478        30,413        (17,318 )      5,495        (9,030 ) 

Realized gain (loss) on investments

      (82 )      (6,555 )      46,342        31,189        4,089        308,950        99,883        262,170   

Change in unrealized gain (loss) on investments

      (21,292 )      1,867        (103,709 )      31,260        (398,612 )      (1,176,543 )      (243,901 )      (231,139 ) 

Reinvested capital gains

      10,637        5,913        39,747        38,559        810,763        1,151,659        232,816        121,632   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (6,279 )      953        (1,852 )      117,486        446,653        266,748        94,293        143,633   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      2,587        366        35,545        43,728        105,879        125,185        34,054        40,025   

Transfers between funds

      30,803        121,423        (219,453 )      65,466        763,551        (300,332 )      539,429        (263,262 ) 

Surrenders (note 6)

      -            -            (8,887 )      (49,415 )      (223,963 )      (417,837 )      (177,466 )      (77,167 ) 

Death Benefits (note 4)

      -            -            -            (30,808 )      (72,006 )      (5,453 )      -            (16,256 ) 

Net policy repayments (loans) (note 5)

      (963 )      (23,987 )      (8,440 )      26,719        32,234        173,732        1,318        9,231   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (6,725 )      (3,038 )      (63,532 )      (60,419 )      (188,815 )      (173,897 )      (61,292 )      (62,576 ) 

Asset charges (note 3):

                 

MSP contracts

      -            -            (1,048 )      (1,055 )      (2,023 )      (1,705 )      (209 )      (187 ) 

SL contracts or LSFP contracts

      -            -            (173 )      (174 )      (1,323 )      (1,262 )      (1,338 )      (1,180 ) 

Adjustments to maintain reserves

      (4 )      3        (31 )      13        15        (31 )      17        (6 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      25,698        94,767        (266,019 )      (5,945 )      413,549        (601,600 )      334,513        (371,378 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      19,419        95,720        (267,871 )      111,541        860,202        (334,852 )      428,806        (227,745 ) 

Contract owners’ equity beginning of period

      95,720        -            1,620,148        1,508,607        3,758,983        4,093,835        1,736,575        1,964,320   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 115,139        95,720        1,352,277        1,620,148        4,619,185        3,758,983        2,165,381        1,736,575   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      9,313        -            64,330        64,527        229,303        269,822        194,191        239,301   

Units purchased

      3,233        11,974        2,334        5,348        54,899        17,776        66,626        9,472   

Units redeemed

      (794 )      (2,661 )      (12,962 )      (5,545 )      (31,089 )      (58,295 )      (28,412 )      (54,582 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      11,752        9,313        53,702        64,330        253,113        229,303        232,405        194,191   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     JAIGS     MV2IGI      MNDIC     MVFIC  
     2015     2014     2015     2014      2015     2014     2015     2014  

Investment activity:

                  

Net investment income (loss)

    $ (499 )      217,109        227        -             (892 )      (1,504 )      52,219        18,528   

Realized gain (loss) on investments

      (198,313 )      (173,014 )      (1,396 )      -             (15,421 )      33,719        96,976        165,660   

Change in unrealized gain (loss) on investments

      (161,502 )      (850,406 )      (15,474 )      -             8,614        (94,290 )      (339,217 )      (27,053 ) 

Reinvested capital gains

      91,925        294,496        13,094        -             4,525        33,973        163,192        56,857   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (268,389 )      (511,815 )      (3,549 )      -             (3,174 )      (28,102 )      (26,830 )      213,992   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (notes 2a and 6)

      152,728        155,728        8,944        -             7,655        13,031        43,354        58,342   

Transfers between funds

      (148,062 )      (443,499 )      226,713        -             2,458        (103,447 )      41,387        657,221   

Surrenders (note 6)

      (222,353 )      (387,443 )      (17,461 )      -             -            (9,438 )      (119,127 )      (78,133 ) 

Death Benefits (note 4)

      (45,346 )      (19,501 )      -            -             (26,214 )      -            (17,008 )      (5,606 ) 

Net policy repayments (loans) (note 5)

      66,707        36,103        (195 )      -             (277 )      (588 )      70,943        (16,580 ) 

Deductions for surrender charges (note 2d)

      -            -            -            -             -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (167,152 )      (197,313 )      (11,783 )      -             (14,334 )      (17,143 )      (80,502 )      (71,339 ) 

Asset charges (note 3):

                  

MSP contracts

      (775 )      (1,047 )      -            -             -            -            (964 )      (949 ) 

SL contracts or LSFP contracts

      (937 )      (1,026 )      (9 )      -             -            -            (755 )      (686 ) 

Adjustments to maintain reserves

      (7 )      (21 )      -            -             (7 )      (3 )      11        2   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (365,197 )      (858,019 )      206,209        -             (30,719 )      (117,588 )      (62,661 )      542,272   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (633,586 )      (1,369,834 )      202,660        -             (33,893 )      (145,690 )      (89,491 )      756,264   

Contract owners’ equity beginning of period

      3,356,389        4,726,223        -            -             167,080        312,770        2,704,971        1,948,707   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 2,722,803        3,356,389        202,660        -             133,187        167,080        2,615,480        2,704,971   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

      244,895        301,550        -            -             12,507        21,574        89,656        71,085   

Units purchased

      20,831        18,399        23,691        -             1,171        1,684        5,567        26,817   

Units redeemed

      (46,871 )      (75,054 )      (3,055 )      -             (3,456 )      (10,751 )      (7,380 )      (8,246 ) 
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      218,855        244,895        20,636        -             10,222        12,507        87,843        89,656   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     MSVFI     MSEM     MSVRE     IDPG  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 8,398        8,558        39,392        55,598        8,778        11,225        2,526        -       

Realized gain (loss) on investments

      1,971        1,175        (16,928 )      (6,552 )      132,570        83,114        (6 )      -       

Change in unrealized gain (loss) on investments

      (13,435 )      11,946        (33,883 )      (18,946 )      (129,558 )      252,940        (6,310 )      -       

Reinvested capital gains

      -            -            -            8,422        -            -            -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (3,066 )      21,679        (11,419 )      38,522        11,790        347,279        (3,790 )      -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      5,818        2,887        28,276        30,788        31,666        148,889        -            -       

Transfers between funds

      (9,219 )      65,534        (24,079 )      (193,923 )      (180,244 )      159,664        157,870        -       

Surrenders (note 6)

      (7,603 )      (50,407 )      (32,094 )      (191,933 )      (151,841 )      (253,228 )      -            -       

Death Benefits (note 4)

      (10,044 )      -            (24,444 )      -            (19,611 )      -            -            -       

Net policy repayments (loans) (note 5)

      (3,213 )      17        (825 )      15,270        (5,070 )      (6,550 )      -            -       

Deductions for surrender charges (note 2d)

      -            (236 )      -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (9,574 )      (12,210 )      (39,323 )      (41,606 )      (31,614 )      (30,716 )      (420 )      -       

Asset charges (note 3):

                 

MSP contracts

      (152 )      (154 )      (500 )      (611 )      -            -            -            -       

SL contracts or LSFP contracts

      (37 )      (134 )      (230 )      (344 )      (1,697 )      (1,584 )      -            -       

Adjustments to maintain reserves

      20        9        12        18        11        79        -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (34,004 )      5,306        (93,207 )      (382,341 )      (358,400 )      16,554        157,450        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (37,070 )      26,985        (104,626 )      (343,819 )      (346,610 )      363,833        153,660        -       

Contract owners’ equity beginning of period

      293,831        266,846        902,014        1,245,833        1,612,364        1,248,531        -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 256,761        293,831        797,388        902,014        1,265,754        1,612,364        153,660        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      19,453        18,667        29,799        42,545        33,626        32,399        -            -       

Units purchased

      902        11,281        2,131        1,796        450        4,047        15,905        -       

Units redeemed

      (3,125 )      (10,495 )      (5,001 )      (14,542 )      (9,264 )      (2,820 )      (43 )      -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      17,230        19,453        26,929        29,799        24,812        33,626        15,862        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     NVBX     NVIX     NVAMV1     GVAAA2  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 1,136        911        1,899        80        134,981        118,627        27,793        9,494   

Realized gain (loss) on investments

      (72 )      -            (95 )      (1 )      259,919        341,203        77,137        141,260   

Change in unrealized gain (loss) on investments

      (1,796 )      (844 )      (5,182 )      (367 )      (1,657,346 )      (397,935 )      (228,084 )      (55,128 ) 

Reinvested capital gains

      766        -            -            -            901,500        875,562        130,973        3,282   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      34        67        (3,378 )      (288 )      (360,946 )      937,457        7,819        98,908   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      852        198        718        126        230,905        243,307        66,846        124,396   

Transfers between funds

      37,640        42,692        89,284        4,385        (62,283 )      (66,965 )      617,549        541,755   

Surrenders (note 6)

      -            -            -            -            (1,100,489 )      (474,553 )      (167,462 )      (69,559 ) 

Death Benefits (note 4)

      -            -            -            -            (202,845 )      (64,363 )      -            (15,802 ) 

Net policy repayments (loans) (note 5)

      -            -            -            -            476,133        58,197        (1,193 )      (13,608 ) 

Deductions for surrender charges (note 2d)

      -            -            -            -            -            (92 )      -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (1,508 )      (138 )      (1,585 )      (86 )      (323,289 )      (389,641 )      (91,183 )      (68,157 ) 

Asset charges (note 3):

                 

MSP contracts

      -            -            -            -            (3,783 )      (4,102 )      (1,572 )      (1,633 ) 

SL contracts or LSFP contracts

      -            -            -            -            (2,044 )      (2,353 )      -            -       

Adjustments to maintain reserves

      (3 )      (1 )      (9 )      8        (50 )      713        (1 )      10   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      36,981        42,751        88,408        4,433        (987,745 )      (699,852 )      422,984        497,402   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      37,015        42,818        85,030        4,145        (1,348,691 )      237,605        430,803        596,310   

Contract owners’ equity beginning of period

      42,818        -            4,145        -            8,123,560        7,885,955        2,472,224        1,875,914   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 79,833        42,818        89,175        4,145        6,774,869        8,123,560        2,903,027        2,472,224   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      4,180        -            452        -            340,738        372,043        156,967        124,360   

Units purchased

      7,950        4,194        9,587        461        12,469        19,195        43,657        43,798   

Units redeemed

      (4,305 )      (14 )      (167 )      (9 )      (54,784 )      (50,500 )      (17,216 )      (11,191 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      7,825        4,180        9,872        452        298,423        340,738        183,408        156,967   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     GVABD2     GVAGG2     GVAGR2     GVAGI2  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 5,949        5,282        2,501        3,024        3,972        (1,100 )      2,884        3,204   

Realized gain (loss) on investments

      18,207        27,593        177,878        123,672        71,257        160,764        127,560        200,414   

Change in unrealized gain (loss) on investments

      (28,852 )      (2,671 )      (240,473 )      (105,161 )      (19,829 )      (34,248 )      (184,913 )      (116,475 ) 

Reinvested capital gains

      297        6,826        149,454        -            47,984        -            61,100        9,967   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (4,399 )      37,030        89,360        21,535        103,384        125,416        6,631        97,110   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      23,577        25,420        40,573        49,782        59,927        80,862        23,726        45,231   

Transfers between funds

      (12,023 )      (69,999 )      72,055        92,674        (4,288 )      (138,599 )      7,404        77,346   

Surrenders (note 6)

      (73,499 )      (28,312 )      (61,651 )      (177,829 )      (54,030 )      (170,605 )      (289,534 )      (50,001 ) 

Death Benefits (note 4)

      -            -            (16,167 )      (3,675 )      (18,885 )      (8,122 )      (171 )      -       

Net policy repayments (loans) (note 5)

      (5,621 )      (24,397 )      (16,590 )      (4,677 )      8,276        41,143        1,197        3,490   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (24,662 )      (24,546 )      (60,571 )      (66,346 )      (69,835 )      (74,188 )      (30,301 )      (32,443 ) 

Asset charges (note 3):

                 

MSP contracts

      (47 )      (48 )      (907 )      (885 )      (1,191 )      (1,142 )      (237 )      (267 ) 

SL contracts or LSFP contracts

      -            -            -            -            -            -            -            -       

Adjustments to maintain reserves

      (10 )      1        (13 )      10        (15 )      10        (13 )      (2 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (92,285 )      (121,881 )      (43,271 )      (110,946 )      (80,041 )      (270,641 )      (287,929 )      43,354   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (96,684 )      (84,851 )      46,089        (89,411 )      23,343        (145,225 )      (281,298 )      140,464   

Contract owners’ equity beginning of period

      775,210        860,061        1,580,636        1,670,047        1,796,736        1,941,961        1,111,476        971,012   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 678,526        775,210        1,626,725        1,580,636        1,820,079        1,796,736        830,178        1,111,476   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      61,439        71,177        94,935        101,666        112,790        131,148        77,509        74,243   

Units purchased

      2,099        2,394        7,667        10,433        6,785        6,453        2,169        9,403   

Units redeemed

      (9,346 )      (12,132 )      (10,423 )      (17,164 )      (11,699 )      (24,811 )      (22,125 )      (6,137 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      54,192        61,439        92,179        94,935        107,876        112,790        57,553        77,509   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     HIBF     GEM     GIG     NVNMO1  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 50,895        51,886        7,597        16,965        137        81,490        35,587        55,306   

Realized gain (loss) on investments

      (17,229 )      1,476        (50,967 )      22,928        (1,086 )      125,017        375,791        685,567   

Change in unrealized gain (loss) on investments

      (71,904 )      (62,629 )      (382,944 )      (146,397 )      (274,637 )      (320,845 )      (1,802,664 )      (2,313,199 ) 

Reinvested capital gains

      10,047        -            -            -            147,138        -            1,184,849        2,386,517   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (28,191 )      (9,267 )      (426,314 )      (106,504 )      (128,448 )      (114,338 )      (206,437 )      814,191   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      58,025        33,154        85,743        61,152        140,533        106,317        462,996        515,384   

Transfers between funds

      (267,931 )      1,264,298        (27,080 )      2,168,065        (54,422 )      4,078,017        (140,034 )      (517,967 ) 

Surrenders (note 6)

      (15,877 )      (49,165 )      (168,751 )      (134,964 )      (489,263 )      (299,107 )      (796,831 )      (993,166 ) 

Death Benefits (note 4)

      (48,583 )      -            (19,431 )      (4,745 )      (50,758 )      (11,667 )      (312,596 )      (131,765 ) 

Net policy repayments (loans) (note 5)

      943        14,022        112,580        6,952        156,361        18,793        166,247        54,080   

Deductions for surrender charges (note 2d)

      -            -            (7 )      (45 )      -            -            (42 )      -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (45,622 )      (40,792 )      (134,341 )      (107,215 )      (173,584 )      (135,100 )      (630,322 )      (671,350 ) 

Asset charges (note 3):

                 

MSP contracts

      (1,618 )      (1,705 )      (309 )      (237 )      (2,575 )      (2,001 )      (8,379 )      (9,353 ) 

SL contracts or LSFP contracts

      (349 )      (263 )      (827 )      (656 )      (463 )      (318 )      (8 )      (8 ) 

Adjustments to maintain reserves

      20        19        (12 )      (12 )      9        (28 )      (10 )      (15 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (320,992 )      1,219,568        (152,435 )      1,988,295        (474,162 )      3,754,906        (1,258,979 )      (1,754,160 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (349,183 )      1,210,301        (578,749 )      1,881,791        (602,610 )      3,640,568        (1,465,416 )      (939,969 ) 

Contract owners’ equity beginning of period

      1,320,699        110,398        2,726,162        844,371        4,319,964        679,396        14,654,852        15,594,821   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 971,516        1,320,699        2,147,413        2,726,162        3,717,354        4,319,964        13,189,436        14,654,852   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      62,280        5,235        115,025        34,669        279,705        43,387        1,044,467        1,179,010   

Units purchased

      3,364        66,179        8,439        110,467        15,395        291,837        51,630        61,510   

Units redeemed

      (18,320 )      (9,134 )      (15,020 )      (30,111 )      (45,762 )      (55,519 )      (141,080 )      (196,053 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      47,324        62,280        108,444        115,025        249,338        279,705        955,017        1,044,467   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     NVNSR1     NVCRA1     NVCRB1     NVCCA1  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 373        572        6,889        4,993        13,233        7,146        17,000        14,497   

Realized gain (loss) on investments

      30,138        11,098        7,654        9,664        1,531        8,732        29,030        81,441   

Change in unrealized gain (loss) on investments

      (47,990 )      1,236        (45,447 )      (18,487 )      (35,316 )      (9,417 )      (98,563 )      (86,404 ) 

Reinvested capital gains

      16,723        -            24,740        15,391        14,516        9,645        44,516        20,910   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (756 )      12,906        (6,164 )      11,561        (6,036 )      16,106        (8,017 )      30,444   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      4,295        7,402        12,590        15,863        7,372        9,469        27,664        29,259   

Transfers between funds

      (23,625 )      (4,614 )      8,307        (17,972 )      354,949        (52,246 )      (119,783 )      (48,260 ) 

Surrenders (note 6)

      (4,191 )      (8,431 )      (14,114 )      (16,862 )      (39 )      -            (6,261 )      -       

Death Benefits (note 4)

      -            -            (5,399 )      -            -            -            -            -       

Net policy repayments (loans) (note 5)

      (40 )      (101 )      4,610        3,493        (55 )      135        23        174   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (3,518 )      (4,747 )      (17,913 )      (16,915 )      (11,520 )      (9,667 )      (35,638 )      (34,050 ) 

Asset charges (note 3):

                 

MSP contracts

      -            -            -            -            (51 )      (51 )      (58 )      (57 ) 

SL contracts or LSFP contracts

      -            -            -            -            -            -            -            -       

Adjustments to maintain reserves

      (9 )      18        (5 )      6        (16 )      20        12        (5 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (27,088 )      (10,473 )      (11,924 )      (32,387 )      350,640        (52,340 )      (134,041 )      (52,939 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (27,844 )      2,433        (18,088 )      (20,826 )      344,604        (36,234 )      (142,058 )      (22,495 ) 

Contract owners’ equity beginning of period

      138,728        136,295        324,208        345,034        396,731        432,965        781,124        803,619   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 110,884        138,728        306,120        324,208        741,335        396,731        639,066        781,124   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      8,635        9,336        23,914        26,454        29,486        33,453        57,074        61,151   

Units purchased

      307        229        3,476        2,087        27,859        751        2,567        2,288   

Units redeemed

      (1,976 )      (930 )      (4,346 )      (4,627 )      (1,452 )      (4,718 )      (12,131 )      (6,365 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      6,966        8,635        23,044        23,914        55,893        29,486        47,510        57,074   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     NVCCN1     NVCMD1     NVCMA1     NVCMC1  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 711        (2,544 )      30,429        23,737        17,707        14,035        4,089        6,306   

Realized gain (loss) on investments

      (1,976 )      109,383        20,771        29,053        17,894        14,274        13,529        11,662   

Change in unrealized gain (loss) on investments

      (243 )      (61,775 )      (138,724 )      (33,330 )      (111,061 )      (59,147 )      (25,106 )      (13,099 ) 

Reinvested capital gains

      1,404        4,016        69,615        28,706        64,317        58,301        7,644        7,213   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (104 )      49,080        (17,909 )      48,166        (11,143 )      27,463        156        12,082   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      5,686        3,980        37,297        35,129        34,835        60,097        9,631        16,660   

Transfers between funds

      (41,794 )      (575,905 )      110,961        (3,757 )      9,272        18,694        (2,690 )      25,999   

Surrenders (note 6)

      (9,520 )      (884,995 )      (42,137 )      (31,450 )      (1,694 )      (19,766 )      -            (26,744 ) 

Death Benefits (note 4)

      (25,858 )      -            -            -            -            (17,034 )      (88,508 )      (21,245 ) 

Net policy repayments (loans) (note 5)

      193        44,855        20,539        27,241        761        11,897        1,870        4,123   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (6,235 )      (20,073 )      (72,701 )      (68,739 )      (41,104 )      (38,153 )      (41,988 )      (42,296 ) 

Asset charges (note 3):

                 

MSP contracts

      (29 )      (30 )      (1,017 )      (1,000 )      -            -            (697 )      (1,366 ) 

SL contracts or LSFP contracts

      -            -            -            -            -            -            -            -       

Adjustments to maintain reserves

      (5 )      (4 )      (15 )      10        10        (12 )      6        (14 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (77,562 )      (1,432,172 )      52,927        (42,566 )      2,080        15,723        (122,376 )      (44,883 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (77,666 )      (1,383,092 )      35,018        5,600        (9,063 )      43,186        (122,220 )      (32,801 ) 

Contract owners’ equity beginning of period

      123,320        1,506,412        1,202,982        1,197,382        718,134        674,948        304,493        337,294   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 45,654        123,320        1,238,000        1,202,982        709,071        718,134        182,273        304,493   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      9,728        122,213        88,472        91,749        52,799        51,690        22,655        26,062   

Units purchased

      468        6,735        14,043        10,032        9,260        8,128        1,236        4,010   

Units redeemed

      (6,546 )      (119,220 )      (10,172 )      (13,309 )      (8,922 )      (7,019 )      (10,053 )      (7,417 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      3,650        9,728        92,343        88,472        53,137        52,799        13,838        22,655   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     NVCBD1     NVLCP1     TRF     GBF  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 12,013        10,569        1,431        3,653        303,074        281,627        72,424        94,457   

Realized gain (loss) on investments

      (2,312 )      (2,357 )      2,994        2,045        976,843        753,946        (54,615 )      (77,235 ) 

Change in unrealized gain (loss) on investments

      (19,792 )      16,278        (5,352 )      5,201        (1,047,198 )      4,475,821        (51,863 )      240,317   

Reinvested capital gains

      2,380        -            956        -            -            -            -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (7,711 )      24,490        29        10,899        232,719        5,511,394        (34,054 )      257,539   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      14,802        16,904        5,551        7,449        2,745,086        2,952,300        265,912        300,587   

Transfers between funds

      1,066        9,660        1,396        499,175        (109,475 )      (90,753 )      (59,172 )      (171,089 ) 

Surrenders (note 6)

      (11,756 )      (82,264 )      (42,550 )      (463,074 )      (3,400,665 )      (3,338,448 )      (507,619 )      (292,808 ) 

Death Benefits (note 4)

      -            -            (49,392 )      -            (589,656 )      (450,076 )      (333,354 )      (199,281 ) 

Net policy repayments (loans) (note 5)

      298        (2,073 )      18        603        826,048        409,870        438,380        77,614   

Deductions for surrender charges (note 2d)

      -            -            -            -            (231 )      -            (5 )      -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (12,667 )      (13,221 )      (7,093 )      (7,146 )      (3,613,607 )      (3,692,223 )      (384,577 )      (399,396 ) 

Asset charges (note 3):

                 

MSP contracts

      (131 )      (96 )      -            -            (10,791 )      (11,205 )      (7,312 )      (7,949 ) 

SL contracts or LSFP contracts

      (13 )      (15 )      -            -            (6,721 )      (6,776 )      (1,024 )      (1,133 ) 

Adjustments to maintain reserves

      (2 )      (1 )      9        (6 )      110        929        3        599   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (8,403 )      (71,106 )      (92,061 )      37,001        (4,159,902 )      (4,226,382 )      (588,768 )      (692,856 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (16,114 )      (46,616 )      (92,032 )      47,900        (3,927,183 )      1,285,012        (622,822 )      (435,317 ) 

Contract owners’ equity beginning of period

      523,470        570,086        210,486        162,586        51,525,804        50,240,792        6,328,719        6,764,036   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 507,356        523,470        118,454        210,486        47,598,621        51,525,804        5,705,897        6,328,719   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      39,970        45,475        14,705        11,879        877,893        968,562        191,939        215,753   

Units purchased

      1,910        3,261        554        3,626        68,621        96,765        13,244        14,785   

Units redeemed

      (2,572 )      (8,766 )      (6,900 )      (800 )      (152,046 )      (187,434 )      (32,946 )      (38,599 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      39,308        39,970        8,359        14,705        794,468        877,893        172,237        191,939   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     CAF     GVIX2     GVIDA     NVDBL2  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ (31,881 )      (32,223 )      7,185        7,120        17,988        24,123        5,426        5,018   

Realized gain (loss) on investments

      759,586        729,721        (1,229 )      (10,278 )      132,688        189,254        2,489        4,025   

Change in unrealized gain (loss) on investments

      (1,845,217 )      726,069        (12,853 )      (35,567 )      (175,162 )      (106,530 )      (16,823 )      (5,663 ) 

Reinvested capital gains

      1,681,069        -            -            -            -            -            7,693        1,326   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      563,557        1,423,567        (6,897 )      (38,725 )      (24,486 )      106,847        (1,215 )      4,706   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      786,033        826,278        5,287        4,962        91,020        109,312        13,653        8,448   

Transfers between funds

      26,371        (68,319 )      29,564        573,354        20,838        (131,711 )      (7,234 )      252,606   

Surrenders (note 6)

      (1,082,657 )      (1,023,259 )      (10,823 )      (130,871 )      (517,633 )      (208,028 )      (1,304 )      (13,315 ) 

Death Benefits (note 4)

      (195,468 )      (76,022 )      -            -            (15,150 )      (7,156 )      -            -       

Net policy repayments (loans) (note 5)

      205,659        96,876        (12,259 )      4,330        327,163        24,942        656        1,645   

Deductions for surrender charges (note 2d)

      (59 )      -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (966,120 )      (971,276 )      (12,010 )      (10,888 )      (84,597 )      (91,391 )      (6,283 )      (5,346 ) 

Asset charges (note 3):

                 

MSP contracts

      (3,196 )      (3,285 )      (1,212 )      (879 )      (768 )      (750 )      (2,232 )      (737 ) 

SL contracts or LSFP contracts

      (2,238 )      (2,383 )      -            -            -            -            -            -       

Adjustments to maintain reserves

      125        269        6        (1 )      (43 )      3,402        3        (8 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (1,231,550 )      (1,221,121 )      (1,447 )      440,007        (179,170 )      (301,380 )      (2,741 )      243,293   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (667,993 )      202,446        (8,344 )      401,282        (203,656 )      (194,533 )      (3,956 )      247,999   

Contract owners’ equity beginning of period

      14,270,705        14,068,259        401,282        -            2,198,277        2,392,810        355,428        107,429   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 13,602,712        14,270,705        392,938        401,282        1,994,621        2,198,277        351,472        355,428   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      455,264        499,743        43,094        -            102,676        116,767        21,450        6,895   

Units purchased

      35,762        49,094        3,147        48,112        6,637        7,666        892        15,773   

Units redeemed

      (75,217 )      (93,573 )      (3,356 )      (5,018 )      (14,642 )      (21,757 )      (1,064 )      (1,218 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      415,809        455,264        42,885        43,094        94,671        102,676        21,278        21,450   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     NVDCA2     GVIDC     GVIDM     GVDMA  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 908        1,018        4,630        6,555        39,930        55,811        50,184        62,088   

Realized gain (loss) on investments

      (2,706 )      17,880        435        12,363        396,898        188,851        54,913        12,380   

Change in unrealized gain (loss) on investments

      (1,914 )      (22,008 )      (21,745 )      (16,915 )      (613,924 )      (34,444 )      (256,094 )      154,088   

Reinvested capital gains

      5,379        1,839        15,741        17,064        159,441        -            94,766        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      1,667        (1,271 )      (939 )      19,067        (17,655 )      210,218        (56,231 )      228,556   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      3,761        2,144        17,856        10,696        171,045        238,760        182,236        189,123   

Transfers between funds

      52,113        10,935        -            110,149        (97,917 )      (111,049 )      81,786        193,087   

Surrenders (note 6)

      (51,590 )      (26,126 )      (467,545 )      (133,690 )      (743,684 )      (391,482 )      (517,156 )      (442,751 ) 

Death Benefits (note 4)

      (6,767 )      -            -            (39,563 )      (97,486 )      (14,304 )      (91 )      -       

Net policy repayments (loans) (note 5)

      (1,422 )      (81 )      395,686        55,273        240,151        86,954        209,915        34,087   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            (203 )      -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (8,655 )      (12,833 )      (39,326 )      (44,511 )      (406,443 )      (420,791 )      (236,842 )      (239,369 ) 

Asset charges (note 3):

                 

MSP contracts

      (39 )      (41 )      (398 )      (536 )      (8,679 )      (9,130 )      (3,939 )      (3,559 ) 

SL contracts or LSFP contracts

      -            -            (187 )      (186 )      (1,167 )      (1,958 )      (1,139 )      (1,143 ) 

Adjustments to maintain reserves

      3        (7 )      4        (15 )      (23 )      40        (9 )      13   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (12,596 )      (26,009 )      (93,910 )      (42,383 )      (944,203 )      (622,960 )      (285,442 )      (270,512 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (10,929 )      (27,280 )      (94,849 )      (23,316 )      (961,858 )      (412,742 )      (341,673 )      (41,956 ) 

Contract owners’ equity beginning of period

      107,625        134,905        554,727        578,043        4,362,478        4,775,220        5,313,970        5,355,926   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 96,696        107,625        459,878        554,727        3,400,620        4,362,478        4,972,297        5,313,970   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      5,824        7,635        36,129        38,417        224,415        257,540        256,990        270,794   

Units purchased

      3,882        361        3,689        10,649        15,998        20,296        13,850        24,506   

Units redeemed

      (4,424 )      (2,172 )      (9,869 )      (12,937 )      (63,513 )      (53,421 )      (27,613 )      (38,310 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      5,282        5,824        29,949        36,129        176,900        224,415        243,227        256,990   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     GVDMC     MCIF     SAM     NVMIG1  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 40,966        44,528        39,116        33,301        (89,560 )      (100,704 )      7,897        31,418   

Realized gain (loss) on investments

      15,493        10,905        187,748        293,654        -            -            (33,340 )      79,770   

Change in unrealized gain (loss) on investments

      (263,047 )      20,686        (802,059 )      (158,369 )      -            -            (287,793 )      (450,189 ) 

Reinvested capital gains

      187,054        67,301        407,893        321,415        -            -            259,733        236,420   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (19,534 )      143,420        (167,302 )      490,001        (89,560 )      (100,704 )      (53,503 )      (102,581 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      172,430        172,494        111,139        122,516        1,312,636        1,439,474        151,866        126,142   

Transfers between funds

      (6,568 )      63,280        411,715        48,202        2,547        2,302,319        143,196        4,615,056   

Surrenders (note 6)

      (34,223 )      (9,761 )      (140,560 )      (319,721 )      (3,279,330 )      (3,281,294 )      (211,032 )      (219,661 ) 

Death Benefits (note 4)

      -            -            (22,367 )      (1 )      (612,352 )      (749,705 )      (45,715 )      (3,478 ) 

Net policy repayments (loans) (note 5)

      (7,396 )      6,139        (38,621 )      (1,792 )      1,402,402        1,608,638        42,692        85,914   

Deductions for surrender charges (note 2d)

      -            -            (4 )      -            (2 )      -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (115,017 )      (107,463 )      (276,089 )      (281,554 )      (1,556,678 )      (1,736,347 )      (203,159 )      (145,532 ) 

Asset charges (note 3):

                 

MSP contracts

      (1,143 )      (1,143 )      (3,562 )      (3,684 )      (13,088 )      (12,746 )      (1,748 )      (1,205 ) 

SL contracts or LSFP contracts

      -            -            (813 )      (778 )      (6,768 )      (7,071 )      (3 )      (1 ) 

Adjustments to maintain reserves

      -            382        (18 )      417        (289 )      (343 )      (5 )      (5 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      8,083        123,928        40,820        (436,395 )      (2,750,922 )      (437,075 )      (123,908 )      4,457,230   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (11,451 )      267,348        (126,482 )      53,606        (2,840,482 )      (537,779 )      (177,411 )      4,354,649   

Contract owners’ equity beginning of period

      3,576,769        3,309,421        6,248,126        6,194,520        18,082,273        18,620,052        4,354,649        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 3,565,318        3,576,769        6,121,644        6,248,126        15,241,791        18,082,273        4,177,238        4,354,649   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      202,460        194,912        205,415        221,987        1,080,346        1,110,278        446,203        -       

Units purchased

      11,728        16,495        22,014        8,813        172,207        257,588        40,210        478,873   

Units redeemed

      (11,367 )      (8,947 )      (20,931 )      (25,385 )      (331,474 )      (287,520 )      (53,986 )      (32,670 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      202,821        202,460        206,498        205,415        921,079        1,080,346        432,427        446,203   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     GVDIVI     NVMLG1     NVMLV1     NVMMG1  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 4,799        11,346        (2,382 )      268        10,422        9,750        (166,025 )      (165,057 ) 

Realized gain (loss) on investments

      (2,308 )      (33,493 )      208,737        273,350        55,042        162,638        1,158,366        1,449,728   

Change in unrealized gain (loss) on investments

      (36,881 )      (32,883 )      (331,028 )      (277,430 )      (306,841 )      (231,975 )      (5,388,566 )      (3,948,147 ) 

Reinvested capital gains

      -            -            156,654        169,600        170,378        161,561        4,299,066        3,631,806   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (34,390 )      (55,030 )      31,981        165,788        (70,999 )      101,974        (97,159 )      968,330   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      18,783        20,359        54,415        70,114        55,582        56,205        1,031,866        1,111,613   

Transfers between funds

      119,374        467,794        (105,903 )      97,178        2,240        423        238,082        (738,845 ) 

Surrenders (note 6)

      (22,012 )      (39,998 )      (210,453 )      (142,773 )      (14,932 )      (261,888 )      (2,021,250 )      (1,588,782 ) 

Death Benefits (note 4)

      (2,071 )      -            (5,289 )      (61,650 )      -            (14,070 )      (203,993 )      (207,297 ) 

Net policy repayments (loans) (note 5)

      (1,209 )      (5,401 )      11,949        39,803        4,412        1,330        188,066        311,266   

Deductions for surrender charges (note 2d)

      -            (116 )      -            -            -            -            (236 )      -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (31,285 )      (22,150 )      (95,230 )      (95,043 )      (64,492 )      (66,709 )      (1,496,636 )      (1,488,418 ) 

Asset charges (note 3):

                 

MSP contracts

      (112 )      (83 )      (1,130 )      (1,062 )      (272 )      (389 )      (10,569 )      (10,067 ) 

SL contracts or LSFP contracts

      (205 )      (179 )      (658 )      (759 )      (475 )      (467 )      (514 )      (968 ) 

Adjustments to maintain reserves

      (1 )      (12 )      (9 )      (15 )      (19 )      (6 )      (43 )      (46 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      81,262        420,214        (352,308 )      (94,207 )      (17,956 )      (285,571 )      (2,275,227 )      (2,611,544 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      46,872        365,184        (320,327 )      71,581        (88,955 )      (183,597 )      (2,372,386 )      (1,643,214 ) 

Contract owners’ equity beginning of period

      520,425        155,241        2,154,180        2,082,599        1,335,836        1,519,433        30,094,977        31,738,191   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 567,297        520,425        1,833,853        2,154,180        1,246,881        1,335,836        27,722,591        30,094,977   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      28,978        7,825        138,851        147,302        90,319        113,081        1,938,492        2,115,910   

Units purchased

      8,829        31,064        6,448        14,291        6,989        6,575        123,652        137,217   

Units redeemed

      (4,353 )      (9,911 )      (30,464 )      (22,742 )      (9,846 )      (29,337 )      (264,517 )      (314,635 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      33,454        28,978        114,835        138,851        87,462        90,319        1,797,627        1,938,492   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     NVMMV2     SCGF     SCVF     SCF  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 145,924        186,574        (6,848 )      (10,087 )      14,092        4,385        (23,634 )      (61,661 ) 

Realized gain (loss) on investments

      670,460        1,264,444        81,446        233,707        448,885        651,048        (72,804 )      283,490   

Change in unrealized gain (loss) on investments

      (4,050,342 )      (3,144,162 )      (267,373 )      (392,557 )      (1,351,892 )      (816,773 )      (1,849,853 )      (2,929,182 ) 

Reinvested capital gains

      2,475,846        5,229,886        196,919        189,477        546,767        511,701        1,659,488        2,680,312   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (758,112 )      3,536,742        4,144        20,540        (342,148 )      350,361        (286,803 )      (27,041 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      617,500        647,905        62,222        68,719        189,275        187,271        459,018        515,951   

Transfers between funds

      198,647        58,430        297,086        (529,314 )      74,156        (339,391 )      (781,827 )      (1,132,774 ) 

Surrenders (note 6)

      (1,223,044 )      (2,228,887 )      (93,235 )      (111,701 )      (357,155 )      (469,173 )      (979,656 )      (1,288,699 ) 

Death Benefits (note 4)

      (250,379 )      (169,897 )      (80,942 )      (2,077 )      (61,233 )      (183,531 )      (172,194 )      (265,846 ) 

Net policy repayments (loans) (note 5)

      196,921        111,622        (19,259 )      (4,589 )      126,361        164,702        85,563        187,570   

Deductions for surrender charges (note 2d)

      (111 )      -            -            -            -            (95 )      (56 )      -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (1,025,468 )      (1,022,973 )      (56,001 )      (52,350 )      (225,639 )      (242,588 )      (729,558 )      (803,808 ) 

Asset charges (note 3):

                 

MSP contracts

      (6,049 )      (6,014 )      (494 )      (491 )      (2,185 )      (2,676 )      (7,314 )      (8,608 ) 

SL contracts or LSFP contracts

      (44 )      (41 )      (597 )      (545 )      (4,895 )      (4,774 )      (3,963 )      (4,212 ) 

Adjustments to maintain reserves

      (3 )      9        (25 )      5        (24 )      25        (815 )      296   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (1,492,030 )      (2,609,846 )      108,755        (632,343 )      (261,339 )      (890,230 )      (2,130,802 )      (2,800,130 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (2,250,142 )      926,896        112,899        (611,803 )      (603,487 )      (539,869 )      (2,417,605 )      (2,827,171 ) 

Contract owners’ equity beginning of period

      24,001,681        23,074,785        1,408,111        2,019,914        5,624,222        6,164,091        17,405,208        20,232,379   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 21,751,539        24,001,681        1,521,010        1,408,111        5,020,735        5,624,222        14,987,603        17,405,208   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      1,308,008        1,463,947        117,262        176,232        139,264        163,575        295,850        344,129   

Units purchased

      80,007        94,357        27,866        19,982        12,477        9,144        11,036        15,908   

Units redeemed

      (161,144 )      (250,296 )      (19,240 )      (78,952 )      (19,261 )      (33,455 )      (47,688 )      (64,187 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      1,226,871        1,308,008        125,888        117,262        132,480        139,264        259,198        295,850   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     MSBF     NVSTB2     NVOLG1     NVTIV3  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 15,555        34,137        6,095        2,577        68,531        115,743        2,545        5,718   

Realized gain (loss) on investments

      123        31,054        (7,523 )      2,927        1,979,169        2,131,201        (865 )      2,227   

Change in unrealized gain (loss) on investments

      (52,530 )      (19,001 )      (4,578 )      (6,401 )      (7,496,685 )      (3,570,880 )      (21,489 )      (30,951 ) 

Reinvested capital gains

      -            -            -            -            7,805,221        5,480,717        8,492        6,800   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (36,852 )      46,190        (6,006 )      (897 )      2,356,236        4,156,781        (11,317 )      (16,206 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      24,584        25,462        24,127        25,508        1,437,430        1,645,624        6,637        7,463   

Transfers between funds

      (22,909 )      (65,618 )      (5,011 )      (710 )      (733,173 )      (1,202,388 )      21,716        17,744   

Surrenders (note 6)

      (12,312 )      (200,773 )      (8,883 )      (7,202 )      (3,115,663 )      (2,696,852 )      (6,690 )      (6,296 ) 

Death Benefits (note 4)

      -            (30,102 )      (11,202 )      -            (585,458 )      (218,683 )      -            -       

Net policy repayments (loans) (note 5)

      (27,834 )      (28,439 )      (7,024 )      (8,494 )      160,245        (102,979 )      363        271   

Deductions for surrender charges (note 2d)

      -            -            -            (92 )      (110 )      (93 )      -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (48,087 )      (49,815 )      (17,247 )      (18,748 )      (2,291,070 )      (2,322,736 )      (7,161 )      (7,739 ) 

Asset charges (note 3):

                 

MSP contracts

      (689 )      (746 )      (97 )      (126 )      (19,407 )      (20,383 )      -            -       

SL contracts or LSFP contracts

      (264 )      (308 )      -            -            (17,890 )      (17,050 )      -            (6 ) 

Adjustments to maintain reserves

      (8 )      14        (7 )      (1 )      980        (26 )      22        (20 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (87,519 )      (350,325 )      (25,344 )      (9,865 )      (5,164,116 )      (4,935,566 )      14,887        11,417   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (124,371 )      (304,135 )      (31,350 )      (10,762 )      (2,807,880 )      (778,785 )      3,570        (4,789 ) 

Contract owners’ equity beginning of period

      1,168,785        1,472,920        573,245        584,007        53,332,403        54,111,188        174,171        178,960   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 1,044,414        1,168,785        541,895        573,245        50,524,523        53,332,403        177,741        174,171   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      58,596        76,689        51,526        52,481        2,236,695        2,458,573        11,223        10,518   

Units purchased

      2,275        3,019        3,117        3,572        99,943        118,726        1,740        11,928   

Units redeemed

      (6,639 )      (21,112 )      (5,490 )      (4,527 )      (311,021 )      (340,604 )      (966 )      (11,223 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      54,232        58,596        49,153        51,526        2,025,618        2,236,695        11,997        11,223   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     EIF     NVRE1     NVLCAP     NVLMP  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 7,962        9,890        200,352        242,587        18        115        166        -       

Realized gain (loss) on investments

      39,711        87,921        (37,780 )      548,073        (85 )      (19 )      (6 )      -       

Change in unrealized gain (loss) on investments

      (102,042 )      (40,212 )      (2,095,864 )      (955,360 )      222        (370 )      (723 )      -       

Reinvested capital gains

      -            -            1,367,077        2,452,464        61        208        131        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (54,369 )      57,599        (566,215 )      2,287,764        216        (66 )      (432 )      -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      25,345        42,720        265,215        645,013        1,215        -            188        -       

Transfers between funds

      63,999        42,646        (577,031 )      1,322,671        -            8,455        10,131        -       

Surrenders (note 6)

      (16,090 )      (9,748 )      (495,360 )      (773,476 )      -            -            -            -       

Death Benefits (note 4)

      (985 )      (1,872 )      (233,589 )      (101,373 )      (6,662 )      -            -            -       

Net policy repayments (loans) (note 5)

      (23,616 )      (7,331 )      78,944        (29,086 )      -            -            -            -       

Deductions for surrender charges (note 2d)

      -            -            -            (75 )      -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (36,100 )      (40,002 )      (415,384 )      (417,091 )      (987 )      (1,039 )      (106 )      -       

Asset charges (note 3):

                 

MSP contracts

      (10 )      (10 )      (4,058 )      (4,148 )      -            -            -            -       

SL contracts or LSFP contracts

      (55 )      (92 )      (1,048 )      (1,143 )      -            -            -            -       

Adjustments to maintain reserves

      18        7        (15 )      48        (1 )      1        1        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      12,506        26,318        (1,382,326 )      641,340        (6,435 )      7,417        10,214        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (41,863 )      83,917        (1,948,541 )      2,929,104        (6,219 )      7,351        9,782        -       

Contract owners’ equity beginning of period

      837,977        754,060        10,879,790        7,950,686        7,351        -            -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 796,114        837,977        8,931,249        10,879,790        1,132        7,351        9,782        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      31,499        30,815        716,177        669,846        627        -            -            -       

Units purchased

      4,385        3,560        34,465        162,469        102        716        887        -       

Units redeemed

      (3,780 )      (2,876 )      (126,179 )      (116,138 )      (629 )      (89 )      (9 )      -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      32,104        31,499        624,463        716,177        100        627        878        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     NVSIX2     GVEX1     NOTG3     ALVGIA  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 659        77        30,485        32,582        11        6        2,699        3,285   

Realized gain (loss) on investments

      (37 )      (4,285 )      52,407        69,199        6        10        19,258        91,190   

Change in unrealized gain (loss) on investments

      (15,994 )      (2,692 )      (87,031 )      40,141        (254 )      (5 )      (16,601 )      (68,171 ) 

Reinvested capital gains

      9,264        5,007        32,140        -            10        -            -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (6,108 )      (1,893 )      28,001        141,922        (227 )      11        5,356        26,304   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      7,883        276        34,699        13,525        -            -            8,097        12,299   

Transfers between funds

      55,552        60,372        64,972        1,269,291        -            -            19,853        (394,286 ) 

Surrenders (note 6)

      -            (46,737 )      (7,533 )      (154,517 )      -            -            (84,883 )      (6,074 ) 

Death Benefits (note 4)

      -            -            (28,777 )      -            -            -            -            -       

Net policy repayments (loans) (note 5)

      172        1,540        (11 )      (26,799 )      -            -            (391 )      3,745   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (4,154 )      (4,958 )      (58,808 )      (30,136 )      (84 )      (87 )      (18,520 )      (21,685 ) 

Asset charges (note 3):

                 

MSP contracts

      -            -            -            -            -            -            (60 )      (116 ) 

SL contracts or LSFP contracts

      -            -            -            -            -            -            (43 )      (27 ) 

Adjustments to maintain reserves

      3        (6 )      3        -            -            (2 )      4        (22 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      59,456        10,487        4,545        1,071,364        (84 )      (89 )      (75,943 )      (406,166 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      53,348        8,594        32,546        1,213,286        (311 )      (78 )      (70,587 )      (379,862 ) 

Contract owners’ equity beginning of period

      61,540        52,946        2,189,443        976,157        2,342        2,420        384,461        764,323   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 114,888        61,540        2,221,989        2,189,443        2,031        2,342        313,874        384,461   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      4,685        4,191        164,565        82,752        215        223        15,204        32,892   

Units purchased

      4,955        2,262        11,896        90,517        -            -            1,239        1,887   

Units redeemed

      (398 )      (1,768 )      (10,504 )      (8,704 )      (8 )      (8 )      (4,208 )      (19,575 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      9,242        4,685        165,957        164,565        207        215        12,235        15,204   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     ALVSVA     ACVB     ACVCA     ACVIG  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 3,332        2,843        63,392        49,930        (14,433 )      (14,364 )      33,592        37,868   

Realized gain (loss) on investments

      40,625        62,551        213,764        137,191        164,466        55,927        122,577        350,173   

Change in unrealized gain (loss) on investments

      (303,393 )      (109,774 )      (1,061,551 )      (110,320 )      (241,063 )      (274,479 )      (513,594 )      (90,425 ) 

Reinvested capital gains

      190,119        154,679        608,275        454,110        122,410        363,577        209,836        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (69,317 )      110,299        (176,120 )      530,911        31,380        130,661        (147,589 )      297,616   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      32,841        38,126        126,391        140,885        11,675        (9,044 )      42,810        48,078   

Transfers between funds

      (52,760 )      199,793        (703,472 )      1,084,428        27,484        33,734        (150,826 )      (60,634 ) 

Surrenders (note 6)

      (86,038 )      (156,667 )      (193,931 )      (375,939 )      (156,147 )      (71,076 )      (154,954 )      (213,932 ) 

Death Benefits (note 4)

      -            (16 )      (12,037 )      (57,048 )      (206,191 )      511        (106,649 )      (6,551 ) 

Net policy repayments (loans) (note 5)

      (15,932 )      32,717        64,834        21,700        126,988        8,112        (94,553 )      94,994   

Deductions for surrender charges (note 2d)

      -            -            (44 )      -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (52,899 )      (59,653 )      (225,007 )      (221,673 )      (44,933 )      (33,603 )      (108,908 )      (103,710 ) 

Asset charges (note 3):

                 

MSP contracts

      (418 )      (436 )      (1,974 )      (2,341 )      -            1,608        (2,154 )      (2,595 ) 

SL contracts or LSFP contracts

      (243 )      (255 )      (574 )      (524 )      (1,560 )      (1,350 )      (347 )      (510 ) 

Adjustments to maintain reserves

      12        23        (31 )      373        246        (2,149 )      (25 )      414   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (175,437 )      53,632        (945,845 )      589,861        (242,438 )      (73,257 )      (575,606 )      (244,446 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (244,754 )      163,931        (1,121,965 )      1,120,772        (211,058 )      57,404        (723,195 )      53,170   

Contract owners’ equity beginning of period

      1,304,186        1,140,255        6,313,545        5,192,773        1,852,786        1,795,382        2,665,348        2,612,178   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 1,059,432        1,304,186        5,191,580        6,313,545        1,641,728        1,852,786        1,942,153        2,665,348   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      35,245        33,478        202,718        173,234        98,440        100,920        128,055        139,633   

Units purchased

      1,529        7,086        24,369        52,197        2,392        5,156        3,780        6,050   

Units redeemed

      (6,375 )      (5,319 )      (41,348 )      (22,713 )      (17,390 )      (7,636 )      (31,750 )      (17,628 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      30,399        35,245        185,739        202,718        83,442        98,440        100,085        128,055   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     ACVIP2     ACVI     ACVMV1     ACVU1  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 18,093        10,917        (558 )      6,012        25,873        12,770        (407 )      (859 ) 

Realized gain (loss) on investments

      (27,835 )      (27,305 )      74,994        9,612        124,885        191,508        (11,020 )      1,347   

Change in unrealized gain (loss) on investments

      (23,725 )      25,152        (83,807 )      (47,894 )      (293,336 )      (40,348 )      (3,481 )      (1,674 ) 

Reinvested capital gains

      -            32,823        -            -            104,500        109,437        20,475        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (33,467 )      41,587        (9,371 )      (32,270 )      (38,078 )      273,367        5,567        (1,186 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      55,862        43,674        2,656        1        41,604        43,956        -            (529 ) 

Transfers between funds

      (15,461 )      (51,205 )      176,060        (19,712 )      108,296        126,073        (60,099 )      40,461   

Surrenders (note 6)

      (46,158 )      (197,748 )      (72,406 )      (46,908 )      (133,552 )      (85,074 )      -            (808 ) 

Death Benefits (note 4)

      (12,538 )      (272 )      (46,852 )      (20,825 )      (12,414 )      (837 )      -            -       

Net policy repayments (loans) (note 5)

      18,995        27,448        (1,171 )      (1,726 )      (9,244 )      (42,888 )      7,091        (142 ) 

Deductions for surrender charges (note 2d)

      -            (89 )      -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (66,931 )      (65,959 )      (14,868 )      (15,304 )      (70,124 )      (63,104 )      (2,439 )      (1,402 ) 

Asset charges (note 3):

                 

MSP contracts

      (2,349 )      (2,446 )      -            -            (684 )      (656 )      -            -       

SL contracts or LSFP contracts

      (100 )      (63 )      (1,077 )      (893 )      (12 )      (55 )      (104 )      (14 ) 

Adjustments to maintain reserves

      (7 )      (8 )      129        (923 )      14        18        4        52   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (68,687 )      (246,668 )      42,471        (106,290 )      (76,116 )      (22,567 )      (55,547 )      37,618   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (102,154 )      (205,081 )      33,100        (138,560 )      (114,194 )      250,800        (49,980 )      36,432   

Contract owners’ equity beginning of period

      1,171,233        1,376,314        498,337        636,897        2,179,777        1,928,977        222,110        185,678   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 1,069,079        1,171,233        531,437        498,337        2,065,583        2,179,777        172,130        222,110   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      76,999        93,282        31,161        36,115        83,768        85,896        11,928        10,891   

Units purchased

      9,453        5,463        13,284        99        6,980        6,734        1,924        1,667   

Units redeemed

      (14,204 )      (21,746 )      (18,170 )      (5,053 )      (9,772 )      (8,862 )      (5,279 )      (630 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      72,248        76,999        26,275        31,161        80,976        83,768        8,573        11,928   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     DVSCS     DCAP     DSC     DGI  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 4,772        1,830        54,864        65,531        (2,143 )      (1,939 )      5,650        4,356   

Realized gain (loss) on investments

      147,110        342,303        129,939        231,444        13,053        80,400        29,660        116,439   

Change in unrealized gain (loss) on investments

      (358,038 )      (393,520 )      (533,137 )      (84,015 )      (23,659 )      (89,160 )      (157,860 )      15,466   

Reinvested capital gains

      139,707        127,835        218,154        128,531        6,502        -            140,400        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (66,449 )      78,448        (130,180 )      341,491        (6,247 )      (10,699 )      17,850        136,261   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      31,675        53,577        137,931        147,379        15,603        13,087        50,778        56,743   

Transfers between funds

      170,628        (313,115 )      (120,419 )      (41,310 )      169,006        (280,728 )      (19,061 )      21,379   

Surrenders (note 6)

      (217,205 )      (60,355 )      (211,449 )      (361,262 )      (12,571 )      (14,660 )      (66,854 )      (121,425 ) 

Death Benefits (note 4)

      (8,760 )      (19,312 )      (155,546 )      -            (4,580 )      -            -            (31,642 ) 

Net policy repayments (loans) (note 5)

      51,385        (72,058 )      64,303        (21,839 )      (1,321 )      9,513        21,057        15,177   

Deductions for surrender charges (note 2d)

      -            (29 )      -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (79,849 )      (95,724 )      (200,179 )      (213,488 )      (22,747 )      (23,566 )      (90,944 )      (92,120 ) 

Asset charges (note 3):

                 

MSP contracts

      (1,508 )      (1,600 )      (1,597 )      (1,653 )      (165 )      (115 )      (845 )      (799 ) 

SL contracts or LSFP contracts

      (836 )      (820 )      (1,952 )      (2,053 )      (32 )      (50 )      (755 )      (710 ) 

Adjustments to maintain reserves

      (11 )      42        (6 )      (4 )      (5 )      23        (27 )      32   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (54,481 )      (509,394 )      (488,914 )      (494,230 )      143,188        (296,496 )      (106,651 )      (153,365 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (120,930 )      (430,946 )      (619,094 )      (152,739 )      136,941        (307,195 )      (88,801 )      (17,104 ) 

Contract owners’ equity beginning of period

      2,154,442        2,585,388        4,872,602        5,025,341        301,521        608,716        1,571,310        1,588,414   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 2,033,512        2,154,442        4,253,508        4,872,602        438,462        301,521        1,482,509        1,571,310   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      78,084        98,177        191,958        212,115        14,105        28,819        63,073        70,468   

Units purchased

      11,065        4,461        9,112        11,285        9,255        923        3,285        5,327   

Units redeemed

      (13,215 )      (24,554 )      (27,941 )      (31,442 )      (2,281 )      (15,637 )      (7,536 )      (12,722 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      75,934        78,084        173,129        191,958        21,079        14,105        58,822        63,073   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     FVCA2P     FQB     FEIP     FHIP  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 2,227        2,360        39,368        48,758        1,026,465        959,835        591,689        378,321   

Realized gain (loss) on investments

      (763 )      (1,665 )      (1,960 )      3,439        (402,953 )      135,092        (500 )      532,867   

Change in unrealized gain (loss) on investments

      (12,187 )      (32,976 )      (47,104 )      (2,921 )      (6,189,751 )      1,732,780        (1,122,374 )      (838,853 ) 

Reinvested capital gains

      221        30,607        -            -            3,810,025        594,601        -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (10,502 )      (1,674 )      (9,696 )      49,276        (1,756,214 )      3,422,308        (531,185 )      72,335   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      4,792        4,537        30,237        30,280        1,438,805        1,519,924        299,021        20,775   

Transfers between funds

      (1,710 )      (12 )      (3,104 )      (112,875 )      (206,502 )      (749,562 )      3,006,712        (526,138 ) 

Surrenders (note 6)

      -            -            (24,382 )      (185,277 )      (2,202,646 )      (3,281,240 )      (520,832 )      (401,261 ) 

Death Benefits (note 4)

      -            -            (9,695 )      (28,172 )      (1,219,798 )      (593,834 )      (121,438 )      (65,169 ) 

Net policy repayments (loans) (note 5)

      (79 )      460        (11,483 )      11,282        325,513        472,128        40,394        (112,888 ) 

Deductions for surrender charges (note 2d)

      -            -            -            -            (113 )      (188 )      (43 )      -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (3,185 )      (3,547 )      (64,948 )      (69,703 )      (2,155,230 )      (2,284,845 )      (492,558 )      (318,604 ) 

Asset charges (note 3):

                 

MSP contracts

      -            -            (1,031 )      (1,037 )      (18,778 )      (22,125 )      (6,289 )      (6,215 ) 

SL contracts or LSFP contracts

      (237 )      (247 )      (238 )      (245 )      (4,988 )      (5,692 )      (3,263 )      (3,492 ) 

Adjustments to maintain reserves

      (4 )      19        (31 )      17        (1,111 )      3,186        (166 )      112   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (423 )      1,210        (84,675 )      (355,730 )      (4,044,848 )      (4,942,248 )      2,201,538        (1,412,880 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (10,925 )      (464 )      (94,371 )      (306,454 )      (5,801,062 )      (1,519,940 )      1,670,353        (1,340,545 ) 

Contract owners’ equity beginning of period

      161,462        161,926        1,268,099        1,574,553        42,709,270        44,229,210        7,050,000        8,390,545   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 150,537        161,462        1,173,728        1,268,099        36,908,208        42,709,270        8,720,353        7,050,000   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      9,061        8,972        73,842        94,617        676,970        767,539        206,871        257,480   

Units purchased

      348        315        4,900        2,674        30,449        35,585        198,882        4,256   

Units redeemed

      (367 )      (226 )      (9,913 )      (23,449 )      (111,705 )      (126,154 )      (170,403 )      (54,865 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      9,042        9,061        68,829        73,842        595,714        676,970        235,350        206,871   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     FAMP     FNRS2     FF10S     FF20S  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 115,379        113,107        9,246        2,963        4,673        4,988        15,351        13,155   

Realized gain (loss) on investments

      162,856        230,351        (45,729 )      306,374        21,022        12,729        29,487        42,419   

Change in unrealized gain (loss) on investments

      (1,155,866 )      (280,760 )      (477,629 )      (753,406 )      (31,340 )      (7,472 )      (62,073 )      (32,098 ) 

Reinvested capital gains

      850,345        598,481        68,358        31,221        1,127        6,464        5,325        20,328   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (27,286 )      661,179        (445,754 )      (412,848 )      (4,518 )      16,709        (11,910 )      43,804   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      432,668        468,210        112,027        120,817        13,038        12,586        24,615        25,260   

Transfers between funds

      333,568        155,266        (13,685 )      277,026        (39,527 )      36,600        31,156        97,061   

Surrenders (note 6)

      (1,096,350 )      (792,434 )      (225,083 )      (180,543 )      (38,548 )      (4,727 )      (12,974 )      (78,781 ) 

Death Benefits (note 4)

      (548,190 )      (98,867 )      (8,814 )      (25,249 )      (18,675 )      (22,738 )      -            -       

Net policy repayments (loans) (note 5)

      377,736        92,418        79,645        9,537        42,014        26,512        2,259        3,662   

Deductions for surrender charges (note 2d)

      (83 )      -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (631,677 )      (669,653 )      (137,996 )      (180,258 )      (17,509 )      (18,131 )      (46,575 )      (44,497 ) 

Asset charges (note 3):

                 

MSP contracts

      (3,648 )      (3,809 )      (928 )      (1,222 )      (463 )      (550 )      (635 )      (623 ) 

SL contracts or LSFP contracts

      (1,880 )      (1,660 )      (325 )      (629 )      -            -            -            -       

Adjustments to maintain reserves

      (26 )      1,757        (14 )      (41 )      (22 )      (2 )      (9 )      12   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (1,137,882 )      (848,772 )      (195,173 )      19,438        (59,692 )      29,550        (2,163 )      2,094   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (1,165,168 )      (187,593 )      (640,927 )      (393,410 )      (64,210 )      46,259        (14,073 )      45,898   

Contract owners’ equity beginning of period

      12,509,516        12,697,109        2,292,207        2,685,617        449,715        403,456        1,214,914        1,169,016   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 11,344,348        12,509,516        1,651,280        2,292,207        385,505        449,715        1,200,841        1,214,914   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      333,655        354,922        121,575        123,779        26,431        24,584        69,148        69,351   

Units purchased

      19,793        28,385        16,834        17,448        3,498        5,311        4,538        8,648   

Units redeemed

      (49,507 )      (49,652 )      (27,211 )      (19,652 )      (7,012 )      (3,464 )      (4,683 )      (8,851 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      303,941        333,655        111,198        121,575        22,917        26,431        69,003        69,148   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     FF30S     FGP     FIGBS     FMCS  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 12,232        10,634        (185,080 )      (233,365 )      43,599        35,749        (9,907 )      (28,762 ) 

Realized gain (loss) on investments

      38,621        76,822        2,319,505        1,265,443        (4,711 )      (39,110 )      557,369        476,868   

Change in unrealized gain (loss) on investments

      (67,399 )      (64,132 )      (73,178 )      5,222,802        (64,876 )      143,429        (1,660,050 )      (170,327 ) 

Reinvested capital gains

      6,132        23,984        1,921,974        -            1,695        1,105        998,497        197,053   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (10,414 )      47,308        3,983,221        6,254,880        (24,293 )      141,173        (114,091 )      474,832   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      48,810        62,000        2,347,353        2,472,664        66,877        78,810        213,544        240,116   

Transfers between funds

      (8,627 )      14,475        (268,945 )      237,812        (15,084 )      (1,208,081 )      (441,243 )      126,579   

Surrenders (note 6)

      (68,759 )      (59,883 )      (3,504,662 )      (4,424,565 )      (53,661 )      (226,018 )      (910,113 )      (456,001 ) 

Death Benefits (note 4)

      -            (3,056 )      (1,594,121 )      (497,720 )      (6,501 )      (4,993 )      (59,807 )      (10,747 ) 

Net policy repayments (loans) (note 5)

      8,422        (31,566 )      577,027        570,099        11,143        75,387        (46,133 )      (4,573 ) 

Deductions for surrender charges (note 2d)

      -            (9 )      (360 )      (179 )      -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (64,537 )      (61,276 )      (3,180,837 )      (3,228,943 )      (104,563 )      (119,922 )      (329,522 )      (334,966 ) 

Asset charges (note 3):

                 

MSP contracts

      (73 )      (71 )      (16,640 )      (15,854 )      (1,808 )      (1,831 )      (1,475 )      (1,552 ) 

SL contracts or LSFP contracts

      -            -            (12,231 )      (11,724 )      (399 )      (404 )      (923 )      (951 ) 

Adjustments to maintain reserves

      (12 )      9        1,224        2,855        1        12        39        (19 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (84,776 )      (79,377 )      (5,652,192 )      (4,895,555 )      (103,995 )      (1,407,040 )      (1,575,633 )      (442,114 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (95,190 )      (32,069 )      (1,668,971 )      1,359,325        (128,288 )      (1,265,867 )      (1,689,724 )      32,718   

Contract owners’ equity beginning of period

      1,209,777        1,241,846        62,138,806        60,779,481        2,195,991        3,461,858        8,573,644        8,540,926   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 1,114,587        1,209,777        60,469,835        62,138,806        2,067,703        2,195,991        6,883,920        8,573,644   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      66,272        71,020        1,018,407        1,096,597        138,270        230,006        208,483        219,649   

Units purchased

      3,856        7,259        48,913        68,758        10,497        10,768        8,013        16,637   

Units redeemed

      (8,507 )      (12,007 )      (153,952 )      (146,948 )      (16,983 )      (102,504 )      (45,721 )      (27,803 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      61,621        66,272        913,368        1,018,407        131,784        138,270        170,775        208,483   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     FOP     FOS      FVSS     FTVIS2  
     2015     2014     2015     2014      2015     2014     2015     2014  

Investment activity:

                  

Net investment income (loss)

    $ 43,173        44,301        37,855        -             4,228        3,275        72,211        98,510   

Realized gain (loss) on investments

      (102,963 )      147,817        (6,898 )      -             139,072        153,128        18,579        60,798   

Change in unrealized gain (loss) on investments

      223,466        (751,010 )      (257,661 )      -             (171,491 )      (74,669 )      (228,005 )      (79,477 ) 

Reinvested capital gains

      5,435        1,683        4,086        -             776        -            -            -       
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      169,111        (557,209 )      (222,618 )      -             (27,415 )      81,734        (137,215 )      79,831   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (notes 2a and 6)

      1,284        (3,014 )      241,659        -             20,227        30,990        70,920        164,438   

Transfers between funds

      421,057        23,988        4,245,803        -             (145,229 )      (128,512 )      77,198        157,831   

Surrenders (note 6)

      (439,936 )      (532,421 )      (182,352 )      -             (27,040 )      (57,134 )      (93,975 )      (264,462 ) 

Death Benefits (note 4)

      (263,819 )      (118,684 )      (8,138 )      -             (15,175 )      (38,221 )      -            (79,334 ) 

Net policy repayments (loans) (note 5)

      (20,803 )      (9,249 )      (7,202 )      -             8,126        11,218        (6,197 )      40,368   

Deductions for surrender charges (note 2d)

      (11 )      -            -            -             -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (186,820 )      (203,032 )      (172,136 )      -             (54,918 )      (54,910 )      (96,619 )      (100,131 ) 

Asset charges (note 3):

                  

MSP contracts

      (2,118 )      (3,151 )      (400 )      -             (913 )      (893 )      (1,580 )      (1,740 ) 

SL contracts or LSFP contracts

      (2,081 )      (1,326 )      -            -             (401 )      (467 )      -            -       

Adjustments to maintain reserves

      72        505        (21 )      -             (22 )      33        (8 )      5   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (493,175 )      (846,384 )      4,117,213        -             (215,345 )      (237,896 )      (50,261 )      (83,025 ) 
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (324,064 )      (1,403,593 )      3,894,595        -             (242,760 )      (156,162 )      (187,476 )      (3,194 ) 

Contract owners’ equity beginning of period

      5,559,225        6,962,818        -            -             1,042,411        1,198,573        1,837,767        1,840,961   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 5,235,161        5,559,225        3,894,595        -             799,651        1,042,411        1,650,291        1,837,767   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

      200,573        225,192        -            -             41,702        51,121        111,453        116,247   

Units purchased

      133,370        9,827        456,497        -             3,237        2,502        12,455        17,178   

Units redeemed

      (155,288 )      (34,446 )      (43,127 )      -             (11,840 )      (11,921 )      (15,713 )      (21,972 ) 
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      178,655        200,573        413,370        -             33,099        41,702        108,195        111,453   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     FTVRDI     FTVSVI     FTVDM2     TIF  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 53,757        52,928        11,269        10,760        12,743        11,713        3,726        2,685   

Realized gain (loss) on investments

      229,332        505,565        271,313        463,181        (26,037 )      39        (4,968 )      (3,972 ) 

Change in unrealized gain (loss) on investments

      (922,805 )      (236,287 )      (883,329 )      (722,622 )      (273,272 )      (67,407 )      (9,997 )      (18,154 ) 

Reinvested capital gains

      464,223        94,215        388,063        236,556        107,463        -            4,071        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (175,493 )      416,421        (212,684 )      (12,125 )      (179,103 )      (55,655 )      (7,168 )      (19,441 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      125,962        141,732        59,790        84,594        31,401        21,670        -            -       

Transfers between funds

      43,181        412,138        (532,250 )      (437,925 )      17,522        989,843        (2,493 )      -       

Surrenders (note 6)

      (329,669 )      (803,283 )      (124,855 )      (416,480 )      (41,279 )      (96,463 )      (19,896 )      (24,100 ) 

Death Benefits (note 4)

      (5,827 )      -            (14,833 )      -            (5,854 )      -            -            -       

Net policy repayments (loans) (note 5)

      48,238        (1,675 )      (47,781 )      (56,193 )      23,491        70,342        (17,265 )      (4,902 ) 

Deductions for surrender charges (note 2d)

      -            -            -            (159 )      -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (143,226 )      (150,533 )      (88,083 )      (103,398 )      (39,842 )      (30,829 )      (2,949 )      (4,068 ) 

Asset charges (note 3):

                 

MSP contracts

      (971 )      (988 )      (923 )      (987 )      (174 )      (161 )      (37 )      (41 ) 

SL contracts or LSFP contracts

      (976 )      (989 )      (253 )      (398 )      (137 )      (117 )      -            -       

Adjustments to maintain reserves

      (1 )      (10 )      (53 )      (13 )      (4 )      (4 )      4        (5 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (263,289 )      (403,608 )      (749,241 )      (930,959 )      (14,876 )      954,281        (42,636 )      (33,116 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (438,782 )      12,813        (961,925 )      (943,084 )      (193,979 )      898,626        (49,804 )      (52,557 ) 

Contract owners’ equity beginning of period

      4,695,586        4,682,773        3,237,630        4,180,714        898,626        -            151,324        203,881   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 4,256,804        4,695,586        2,275,705        3,237,630        704,647        898,626        101,520        151,324   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      173,632        188,022        93,738        121,642        95,621        -            6,282        7,507   

Units purchased

      9,878        8,938        2,929        4,253        9,274        103,589        15        41   

Units redeemed

      (19,697 )      (23,328 )      (25,288 )      (32,157 )      (11,180 )      (7,968 )      (1,785 )      (1,266 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      163,813        173,632        71,379        93,738        93,715        95,621        4,512        6,282   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     TIF2     FTVGI2     FTVFA2     AMTB  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 32,885        23,869        164,544        114,927        6,643        4,537        24,259        30,891   

Realized gain (loss) on investments

      (55,100 )      (15,415 )      (27,102 )      (10,377 )      (1,017 )      (2,771 )      (20,251 )      (32,374 ) 

Change in unrealized gain (loss) on investments

      (95,533 )      (214,004 )      (256,761 )      (93,180 )      (24,894 )      345        (12,385 )      2,647   

Reinvested capital gains

      39,464        -            11,359        -            431        162        -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (78,284 )      (205,550 )      (107,960 )      11,370        (18,837 )      2,273        (8,377 )      1,164   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      38,602        25,022        91,248        56,607        5,066        6,149        63,475        68,876   

Transfers between funds

      (111,810 )      1,613,430        (79,782 )      2,487,348        79,370        81,885        (87,264 )      32,295   

Surrenders (note 6)

      (101,815 )      (103,552 )      (39,125 )      (88,664 )      (4,361 )      (9,141 )      (118,093 )      (93,749 ) 

Death Benefits (note 4)

      -            -            (23,457 )      -            (2,189 )      (13,480 )      (65,006 )      (21,130 ) 

Net policy repayments (loans) (note 5)

      7,937        (1,304 )      7,066        (45,738 )      41        325        43,305        20,797   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (35,683 )      (28,846 )      (102,040 )      (68,893 )      (19,705 )      (13,705 )      (89,097 )      (97,041 ) 

Asset charges (note 3):

                 

MSP contracts

      (200 )      (148 )      (1,455 )      (1,081 )      (232 )      (345 )      (3,830 )      (4,209 ) 

SL contracts or LSFP contracts

      (190 )      (136 )      (332 )      (159 )      -            -            (734 )      (654 ) 

Adjustments to maintain reserves

      (10 )      (3 )      (7 )      2        (11 )      -            (13 )      7   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (203,169 )      1,504,463        (147,884 )      2,339,422        57,979        51,688        (257,257 )      (94,808 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (281,453 )      1,298,913        (255,844 )      2,350,792        39,142        53,961        (265,634 )      (93,644 ) 

Contract owners’ equity beginning of period

      1,298,913        -            2,350,792        -            210,388        156,427        2,776,317        2,869,961   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 1,017,460        1,298,913        2,094,948        2,350,792        249,530        210,388        2,510,683        2,776,317   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      149,193        -            233,805        -            15,708        11,864        151,479        161,759   

Units purchased

      8,445        157,657        11,141        253,660        7,513        8,968        10,195        13,743   

Units redeemed

      (32,059 )      (8,464 )      (26,207 )      (19,855 )      (3,252 )      (5,124 )      (22,957 )      (24,023 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      125,579        149,193        218,739        233,805        19,969        15,708        138,717        151,479   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     AMGP     AMINS     AMCG      AMMCGS  
     2015     2014     2015     2014     2015     2014      2015     2014  

Investment activity:

                  

Net investment income (loss)

    $ 417        (43 )      203        69        (1,426 )      -             (167 )      -       

Realized gain (loss) on investments

      2,064        13,864        196        41        (2,998 )      -             (2,867 )      74   

Change in unrealized gain (loss) on investments

      (50,299 )      (27,145 )      (289 )      (766 )      (74,940 )      -             (5,763 )      (6,335 ) 

Reinvested capital gains

      38,715        25,161        59        -            -            -             222        7,512   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (9,103 )      11,837        169        (656 )      (79,364 )      -             (8,575 )      1,251   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (notes 2a and 6)

      -            (73 )      2,421        965        1,020        -             582        226   

Transfers between funds

      (1,939 )      (47,489 )      -            -            1,926,103        -             193,634        -       

Surrenders (note 6)

      (5,393 )      -            -            -            (15,507 )      -             (541 )      -       

Death Benefits (note 4)

      -            -            -            -            -            -             -            -       

Net policy repayments (loans) (note 5)

      277        217        -            -            (88,052 )      -             257        -       

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -             -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (5,408 )      (5,336 )      (1,435 )      (222 )      (8,794 )      -             (1,936 )      (374 ) 

Asset charges (note 3):

                  

MSP contracts

      -            -            -            -            -            -             -            -       

SL contracts or LSFP contracts

      (308 )      (312 )      (77 )      (66 )      (461 )      -             (15 )      (56 ) 

Adjustments to maintain reserves

      (7 )      (8 )      (4 )      (7 )      6        -             2        (24 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Net equity transactions

      (12,778 )      (53,001 )      905        670        1,814,315        -             191,983        (228 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Net change in contract owners’ equity

      (21,881 )      (41,164 )      1,074        14        1,734,951        -             183,408        1,023   

Contract owners’ equity beginning of period

      168,168        209,332        19,555        19,541        -            -             18,324        17,301   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 146,287        168,168        20,629        19,555        1,734,951        -             201,732        18,324   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

      7,518        10,511        1,255        1,213        -            -             530        537   

Units purchased

      46        43        143        60        193,678        -             6,282        7   

Units redeemed

      (698 )      (3,036 )      (94 )      (18 )      (12,865 )      -             (624 )      (14 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Ending units

      6,866        7,518        1,304        1,255        180,813        -             6,188        530   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     AMTP     AMRS     AMSRS     OVMS  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 18,120        18,100        93        182        355        (1,034 )      97,864        90,621   

Realized gain (loss) on investments

      138,686        169,765        652        375        49,649        46,820        (75,338 )      (67,395 ) 

Change in unrealized gain (loss) on investments

      (746,960 )      100,096        (3,245 )      2,166        (120,344 )      26,509        (1,770 )      421,874   

Reinvested capital gains

      232,469        -            504        666        64,025        -            -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (357,685 )      287,961        (1,996 )      3,389        (6,315 )      72,295        20,756        445,100   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      78,570        59,008        -            -            8,094        23,096        254,023        263,771   

Transfers between funds

      32,635        (185,201 )      -            -            (34,136 )      (21,929 )      (205,400 )      (28,922 ) 

Surrenders (note 6)

      (354,883 )      (89,727 )      -            -            (30,022 )      (30,666 )      (344,001 )      (365,960 ) 

Death Benefits (note 4)

      -            (440 )      -            -            (10,084 )      -            (22,106 )      (172,531 ) 

Net policy repayments (loans) (note 5)

      121,955        2,762        -            -            (7,147 )      (18,954 )      102,071        240,361   

Deductions for surrender charges (note 2d)

      -            (158 )      -            -            -            -            (12 )      -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (49,099 )      (51,734 )      (3,468 )      (3,111 )      (27,397 )      (30,193 )      (340,425 )      (341,260 ) 

Asset charges (note 3):

                 

MSP contracts

      -            -            -            -            (144 )      (149 )      (3,691 )      (3,837 ) 

SL contracts or LSFP contracts

      (11,179 )      (11,427 )      (77 )      (80 )      (59 )      (66 )      (497 )      (473 ) 

Adjustments to maintain reserves

      (313 )      235        10        (15 )      14        4        48        815   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (182,314 )      (276,682 )      (3,535 )      (3,206 )      (100,881 )      (78,857 )      (559,990 )      (408,036 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (539,999 )      11,279        (5,531 )      183        (107,196 )      (6,562 )      (539,234 )      37,064   

Contract owners’ equity beginning of period

      3,108,814        3,097,535        27,054        26,871        791,284        797,846        6,081,490        6,044,426   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 2,568,815        3,108,814        21,523        27,054        684,088        791,284        5,542,256        6,081,490   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      96,614        105,356        1,220        1,376        28,648        31,752        183,102        197,883   

Units purchased

      4,323        2,609        -            -            414        2,020        11,243        13,074   

Units redeemed

      (11,054 )      (11,351 )      (159 )      (156 )      (4,029 )      (5,124 )      (35,740 )      (27,855 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      89,883        96,614        1,061        1,220        25,033        28,648        158,605        183,102   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     OVB     OVGS     OVIG      OVGI  
     2015     2014     2015     2014     2015     2014      2015     2014  

Investment activity:

                  

Net investment income (loss)

    $ 126,741        171,923        182,046        151,141        205        -             6,675        5,224   

Realized gain (loss) on investments

      (75,210 )      (631,289 )      429,431        712,615        (3,909 )      -             89,456        169,193   

Change in unrealized gain (loss) on investments

      (34,416 )      741,020        (1,359,622 )      (1,488,890 )      (947 )      -             (258,515 )      (68,824 ) 

Reinvested capital gains

      -            -            1,507,432        1,046,481        1,918        -             202,345        26,193   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      17,115        281,654        759,287        421,347        (2,733 )      -             39,961        131,786   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (notes 2a and 6)

      201,126        191,913        579,402        399,178        863        -             25,332        33,144   

Transfers between funds

      (26,848 )      879,940        233,870        8,743,161        32,142        -             5,826        72,968   

Surrenders (note 6)

      (149,048 )      (2,441,550 )      (1,189,006 )      (1,048,798 )      -            -             (107,514 )      20,127   

Death Benefits (note 4)

      (44,851 )      (25,555 )      (184,933 )      (159,870 )      -            -             (40,096 )      (57 ) 

Net policy repayments (loans) (note 5)

      84,111        50,605        251,094        19,017        (419 )      -             (70,693 )      (7,506 ) 

Deductions for surrender charges (note 2d)

      (1 )      -            (19 )      (76 )      -            -             -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (240,925 )      (255,502 )      (911,681 )      (766,478 )      (924 )      -             (44,523 )      (46,935 ) 

Asset charges (note 3):

                  

MSP contracts

      (3,943 )      (3,916 )      (9,602 )      (9,703 )      -            -             (2,641 )      (2,605 ) 

SL contracts or LSFP contracts

      (588 )      (584 )      (3,549 )      (3,087 )      -            -             (284 )      (304 ) 

Adjustments to maintain reserves

      52        628        961        626        (4 )      -             15        (10 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Net equity transactions

      (180,915 )      (1,604,021 )      (1,233,463 )      7,173,970        31,658        -             (234,578 )      68,822   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Net change in contract owners’ equity

      (163,800 )      (1,322,367 )      (474,176 )      7,595,317        28,925        -             (194,617 )      200,608   

Contract owners’ equity beginning of period

      3,674,120        4,996,487        22,516,195        14,920,878        -            -             1,463,161        1,262,553   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 3,510,320        3,674,120        22,042,019        22,516,195        28,925        -             1,268,544        1,463,161   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

      168,555        235,134        377,992        269,140        -            -             85,851        81,288   

Units purchased

      12,549        12,833        22,974        353,602        3,279        -             5,004        14,290   

Units redeemed

      (20,394 )      (79,412 )      (40,201 )      (244,750 )      (179 )      -             (19,009 )      (9,727 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Ending units

      160,710        168,555        360,765        377,992        3,100        -             71,846        85,851   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     OVSC     OVAG     OVSB     PMVAAA  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 4,954        4,988        (7,266 )      (6,962 )      11,966        7,519        6,598        18,206   

Realized gain (loss) on investments

      46,720        185,507        81,600        119,663        (4,364 )      (1,431 )      (3,708 )      (19,531 ) 

Change in unrealized gain (loss) on investments

      (323,287 )      (244,830 )      (116,841 )      (78,544 )      (13,731 )      (2,005 )      (26,297 )      4,856   

Reinvested capital gains

      191,189        182,782        101,136        -            -            -            -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (80,424 )      128,447        58,629        34,157        (6,129 )      4,083        (23,407 )      3,531   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      37,522        32,525        42,732        46,701        22,510        18,421        9,488        11,408   

Transfers between funds

      476,114        (217,804 )      115,506        35,179        2,218        51,405        19,473        (276,368 ) 

Surrenders (note 6)

      (101,283 )      (84,757 )      (56,776 )      (66,523 )      (5,275 )      (24,542 )      -            (12,379 ) 

Death Benefits (note 4)

      (9,538 )      (5,945 )      (1,136 )      (14,009 )      (14,856 )      (137 )      -            -       

Net policy repayments (loans) (note 5)

      (30,702 )      6,549        11,181        13,321        2,185        7,559        5,546        4,586   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (60,276 )      (51,670 )      (62,274 )      (86,158 )      (12,407 )      (11,635 )      (13,568 )      (16,116 ) 

Asset charges (note 3):

                 

MSP contracts

      (794 )      (763 )      (142 )      (214 )      (222 )      (227 )      -            -       

SL contracts or LSFP contracts

      (107 )      (127 )      (191 )      (172 )      (42 )      (71 )      -            -       

Adjustments to maintain reserves

      33        (26 )      3        (17 )      (2 )      (5 )      3        1   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      310,969        (322,018 )      48,903        (71,892 )      (5,891 )      40,768        20,942        (288,868 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      230,545        (193,571 )      107,532        (37,735 )      (12,020 )      44,851        (2,465 )      (285,337 ) 

Contract owners’ equity beginning of period

      1,334,075        1,527,646        1,062,172        1,099,907        224,373        179,522        212,881        498,218   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 1,564,620        1,334,075        1,169,704        1,062,172        212,353        224,373        210,416        212,881   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      35,640        45,529        114,268        123,702        21,672        17,746        19,994        46,752   

Units purchased

      15,732        3,546        15,237        13,779        4,610        8,400        3,532        1,674   

Units redeemed

      (6,786 )      (13,435 )      (10,906 )      (23,213 )      (5,175 )      (4,474 )      (1,702 )      (28,432 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      44,586        35,640        118,599        114,268        21,107        21,672        21,824        19,994   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     PMVRSA     PMVFBA     PMVLDA     PMVTRA  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 439        (113 )      3,185        5,577        48,109        13,275        44,419        18,982   

Realized gain (loss) on investments

      (1,309 )      (16,970 )      (8,718 )      (36,973 )      1,137        6,035        364        (31,016 ) 

Change in unrealized gain (loss) on investments

      (1,452 )      (1,120 )      (20,022 )      26,940        (50,075 )      (9,269 )      (57,648 )      55,857   

Reinvested capital gains

      -            -            802        1,004        -            -            10,634        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (2,322 )      (18,203 )      (24,753 )      (3,452 )      (829 )      10,041        (2,231 )      43,823   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      321        120        13,453        12,425        37,203        38,732        26,361        30,373   

Transfers between funds

      5,393        43,665        (4,286 )      (155,892 )      (26,513 )      (224,608 )      62,383        (157,814 ) 

Surrenders (note 6)

      -            -            (21,726 )      (105,800 )      (22,206 )      (108,798 )      (85,834 )      (77,152 ) 

Death Benefits (note 4)

      -            -            -            -            (8,675 )      -            -            -       

Net policy repayments (loans) (note 5)

      (281 )      (20,559 )      1,497        60,801        (22,294 )      76,223        69,604        (89,300 ) 

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (997 )      (596 )      (15,311 )      (17,417 )      (63,465 )      (61,666 )      (39,752 )      (44,561 ) 

Asset charges (note 3):

                 

MSP contracts

      -            -            -            (46 )      (3,374 )      (3,469 )      -            -       

SL contracts or LSFP contracts

      -            -            -            -            -            -            -            -       

Adjustments to maintain reserves

      (4 )      5        (29 )      6        (89 )      (62 )      (127 )      (80 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      4,432        22,635        (26,402 )      (205,923 )      (109,413 )      (283,648 )      32,635        (338,534 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      2,110        4,432        (51,155 )      (209,375 )      (110,242 )      (273,607 )      30,404        (294,711 ) 

Contract owners’ equity beginning of period

      4,432        -            341,480        550,855        1,667,389        1,940,996        956,030        1,250,741   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 6,542        4,432        290,325        341,480        1,557,147        1,667,389        986,434        956,030   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      598        -            27,237        43,871        136,114        159,225        86,019        116,742   

Units purchased

      1,089        3,298        1,737        2,322        5,569        11,939        10,378        9,000   

Units redeemed

      (492 )      (2,700 )      (3,934 )      (18,956 )      (14,488 )      (35,050 )      (7,591 )      (39,723 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      1,195        598        25,040        27,237        127,195        136,114        88,806        86,019   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     PVGIB     PVTIGB     PVTVB     ACEG  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 3,155        1,011        1,742        989        2,814        1,455        (134 )      (118 ) 

Realized gain (loss) on investments

      28,080        6,462        24,336        23,137        15,912        32,264        3,166        2,508   

Change in unrealized gain (loss) on investments

      (39,501 )      10,585        (30,299 )      (43,664 )      (128,136 )      (2,663 )      (171 )      3,165   

Reinvested capital gains

      -            -            -            -            71,876        10,149        357        -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (8,266 )      18,058        (4,221 )      (19,538 )      (37,534 )      41,205        3,218        5,555   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      3,679        6,840        7,553        8,772        13,715        13,183        1,494        3,276   

Transfers between funds

      (119,335 )      94,277        13,032        (2,371 )      138,317        (36,448 )      (6,477 )      44,634   

Surrenders (note 6)

      -            (4,678 )      (36,097 )      (3,006 )      -            (14,263 )      -            -       

Death Benefits (note 4)

      -            -            -            -            (9,256 )      -            -            -       

Net policy repayments (loans) (note 5)

      (4,341 )      (10,847 )      1,787        2,354        (6,012 )      (18,106 )      (40 )      497   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (8,809 )      (9,807 )      (13,951 )      (14,492 )      (20,379 )      (20,184 )      (4,260 )      (5,692 ) 

Asset charges (note 3):

                 

MSP contracts

      (66 )      (65 )      -            -            (150 )      (156 )      -            -       

SL contracts or LSFP contracts

      (9 )      (9 )      (84 )      (25 )      (8 )      (16 )      (135 )      (88 ) 

Adjustments to maintain reserves

      (35 )      16        (3 )      (16 )      16        (6 )      (14 )      (5 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (128,916 )      75,727        (27,763 )      (8,784 )      116,243        (75,996 )      (9,432 )      42,622   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (137,182 )      93,785        (31,984 )      (28,322 )      78,709        (34,791 )      (6,214 )      48,177   

Contract owners’ equity beginning of period

      229,158        135,373        272,706        301,028        477,813        512,604        72,889        24,712   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 91,976        229,158        240,722        272,706        556,522        477,813        66,675        72,889   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      9,899        6,448        13,518        13,833        18,772        22,000        4,951        1,827   

Units purchased

      232        4,432        1,353        824        7,110        783        201        4,018   

Units redeemed

      (5,808 )      (981 )      (2,939 )      (1,139 )      (2,468 )      (4,011 )      (834 )      (894 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      4,323        9,899        11,932        13,518        23,414        18,772        4,318        4,951   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     AVBVI     AVMCCI     RVARS     TRHS2  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 122        78        (9 )      (127 )      (3 )      (35 )      (30,718 )      (23,603 ) 

Realized gain (loss) on investments

      289        457        (3,434 )      635        446        2        780,100        970,334   

Change in unrealized gain (loss) on investments

      (1,241 )      (161 )      2,567        (2,838 )      (105 )      319        (566,064 )      (149,737 ) 

Reinvested capital gains

      341        -            85        3,486        -            -            472,752        393,438   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (489 )      374        (791 )      1,156        338        286        656,070        1,190,432   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      -            -            445        996        119        39        284,406        244,112   

Transfers between funds

      136        (96 )      (29,434 )      30,881        43,595        6,417        854,894        151,727   

Surrenders (note 6)

      -            -            -            -            -            -            (419,357 )      (178,243 ) 

Death Benefits (note 4)

      -            -            -            -            -            -            (204,755 )      (6,584 ) 

Net policy repayments (loans) (note 5)

      -            -            -            (691 )      (62 )      7        (61,264 )      (84,216 ) 

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (959 )      (1,246 )      (285 )      (2,674 )      (553 )      (68 )      (327,608 )      (237,419 ) 

Asset charges (note 3):

                 

MSP contracts

      -            -            -            -            -            -            (5,006 )      (4,462 ) 

SL contracts or LSFP contracts

      (24 )      (29 )      -            -            -            -            -            -       

Adjustments to maintain reserves

      (6 )      7        6        (1 )      2        1        47        (9 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (853 )      (1,364 )      (29,268 )      28,511        43,101        6,396        121,357        (115,094 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (1,342 )      (990 )      (30,059 )      29,667        43,439        6,682        777,427        1,075,338   

Contract owners’ equity beginning of period

      5,324        6,314        30,901        1,234        6,970        288        5,479,700        4,404,362   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 3,982        5,324        842        30,901        50,409        6,970        6,257,127        5,479,700   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      242        306        2,314        96        672        29        184,423        193,626   

Units purchased

      6        -            33        2,470        4,185        650        33,113        15,835   

Units redeemed

      (46 )      (64 )      (2,281 )      (252 )      (62 )      (7 )      (29,335 )      (25,038 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      202        242        66        2,314        4,795        672        188,201        184,423   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     TRLT2     VWBF     VWEM     VWHA  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 523        370        75,357        65,424        5,093        1,301        (23,886 )      (34,729 ) 

Realized gain (loss) on investments

      (61 )      (28 )      (93,928 )      (52,584 )      74,658        196,243        (286,658 )      181,518   

Change in unrealized gain (loss) on investments

      (486 )      (205 )      (157,207 )      (115,386 )      (1,126,907 )      (989,734 )      (1,334,368 )      (1,491,763 ) 

Reinvested capital gains

      -            -            -            121,213        299,770        741,472        -            -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (24 )      137        (175,778 )      18,667        (747,386 )      (50,718 )      (1,644,912 )      (1,344,974 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      -            603        47,891        58,674        95,026        111,896        140,111        187,223   

Transfers between funds

      25,704        3,563        (22,257 )      27,824        (225,939 )      118,911        (20,427 )      (141,604 ) 

Surrenders (note 6)

      -            -            (100,619 )      (88,551 )      (814,084 )      (512,594 )      (630,967 )      (455,290 ) 

Death Benefits (note 4)

      -            -            (37,870 )      -            (103,245 )      (2,187 )      (141,541 )      (156,068 ) 

Net policy repayments (loans) (note 5)

      -            -            (1,031 )      19,035        157,014        18,793        159,866        138,669   

Deductions for surrender charges (note 2d)

      -            -            -            -            (52 )      -            (17 )      -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (682 )      (317 )      (70,502 )      (82,342 )      (230,156 )      (258,352 )      (211,633 )      (293,142 ) 

Asset charges (note 3):

                 

MSP contracts

      -            -            (556 )      (775 )      (1,810 )      (2,264 )      (2,473 )      (4,042 ) 

SL contracts or LSFP contracts

      (176 )      (110 )      (117 )      (131 )      (1,980 )      (2,487 )      (524 )      (803 ) 

Adjustments to maintain reserves

      (3 )      (6 )      -            (5 )      (19 )      (20 )      (4,160 )      (2,995 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      24,843        3,733        (185,061 )      (66,271 )      (1,125,245 )      (528,304 )      (711,765 )      (728,052 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      24,819        3,870        (360,839 )      (47,604 )      (1,872,631 )      (579,022 )      (2,356,677 )      (2,073,026 ) 

Contract owners’ equity beginning of period

      37,350        33,480        1,403,775        1,451,379        5,908,083        6,487,105        5,556,662        7,629,688   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 62,169        37,350        1,042,936        1,403,775        4,035,452        5,908,083        3,199,985        5,556,662   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      2,898        2,608        58,400        61,223        194,813        211,949        132,220        145,762   

Units purchased

      1,989        324        3,178        3,886        7,199        13,013        9,456        8,441   

Units redeemed

      (66 )      (34 )      (12,025 )      (6,709 )      (45,199 )      (30,149 )      (29,210 )      (21,983 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      4,821        2,898        49,553        58,400        156,813        194,813        112,466        132,220   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     WRASP     WRHIP     WRMCG     SVDF  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ (3,297 )      (126 )      80,513        33,600        (1,695 )      (1,666 )      (6,636 )      (6,508 ) 

Realized gain (loss) on investments

      (26,490 )      96,383        (115,899 )      31,266        (355 )      42,543        27,298        33,188   

Change in unrealized gain (loss) on investments

      (614,979 )      (651,101 )      (54,391 )      (50,878 )      (45,330 )      (37,476 )      (175,037 )      (139,366 ) 

Reinvested capital gains

      434,781        387,871        14,628        5,816        26,697        19,055        132,761        112,587   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (209,985 )      (166,973 )      (75,149 )      19,804        (20,683 )      22,456        (21,614 )      (99 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      79,066        86,089        18,498        25,988        8,840        8,096        3,785        4,313   

Transfers between funds

      (296,991 )      (4,964 )      46,177        356,958        (8,966 )      (2,559 )      4,208        10,512   

Surrenders (note 6)

      (60,495 )      (137,408 )      (125,732 )      (591,950 )      (13,784 )      (23,350 )      -            (27,702 ) 

Death Benefits (note 4)

      (9,155 )      (46,326 )      -            (12 )      -            -            (44,392 )      -       

Net policy repayments (loans) (note 5)

      (3,461 )      68,130        66,580        (94,334 )      8        (8,693 )      283        72   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (87,749 )      (96,558 )      (47,877 )      (48,046 )      (9,667 )      (7,871 )      (17,922 )      (17,547 ) 

Asset charges (note 3):

                 

MSP contracts

      (1,420 )      (1,514 )      -            -            -            -            -            -       

SL contracts or LSFP contracts

      -            -            -            -            -            -            (696 )      (669 ) 

Adjustments to maintain reserves

      (33 )      6        13        (2 )      1        (2 )      (8 )      8   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (380,238 )      (132,545 )      (42,341 )      (351,398 )      (23,568 )      (34,379 )      (54,742 )      (31,013 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (590,223 )      (299,518 )      (117,490 )      (331,594 )      (44,251 )      (11,923 )      (76,356 )      (31,112 ) 

Contract owners’ equity beginning of period

      2,730,998        3,030,516        723,618        1,055,212        343,668        355,591        819,752        850,864   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ 2,140,775        2,730,998        606,128        723,618        299,417        343,668        743,396        819,752   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      164,815        172,375        59,740        88,301        24,481        27,179        22,700        23,406   

Units purchased

      6,228        12,585        4,347        3,447        1,324        1,665        514        1,028   

Units redeemed

      (29,428 )      (20,145 )      (10,286 )      (32,008 )      (3,052 )      (4,363 )      (2,252 )      (1,734 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      141,615        164,815        53,801        59,740        22,753        24,481        20,962        22,700   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     SVOF     WFVSCG     OVGS3     TIF3  
     2015     2014     2015     2014     2015      2014     2015      2014  

Investment activity:

                   

Net investment income (loss)

    $ (7,280 )      (8,313 )      (2,193 )      (2,159 )      -             (15,526 )      -             (2,400 ) 

Realized gain (loss) on investments

      53,297        83,822        18,931        66,193        -             2,806,380        -             289,158   

Change in unrealized gain (loss) on investments

      (260,810 )      68,302        (93,222 )      (118,348 )      -             (2,787,257 )      -             (254,632 ) 

Reinvested capital gains

      160,423        -            51,715        34,913        -             -            -             -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      (54,370 )      143,811        (24,769 )      (19,401 )      -             3,597        -             32,126   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Equity transactions:

                   

Purchase payments received from contract owners (notes 2a and 6)

      8,302        19,449        12,349        14,789        -             203,857        -             13,018   

Transfers between funds

      (224 )      (4,638 )      124,807        (201,616 )      -             (9,092,866 )      -             (1,432,504 ) 

Surrenders (note 6)

      (18,405 )      (58,434 )      (20,610 )      (24,324 )      -             (196,042 )      -             (101,021 ) 

Death Benefits (note 4)

      (8,965 )      -            (29,952 )      -            -             (12,643 )      -             -       

Net policy repayments (loans) (note 5)

      (2,951 )      (2,767 )      10,685        12,419        -             88,809        -             (1,712 ) 

Deductions for surrender charges (note 2d)

      -            -            -            -            -             -            -             -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (54,363 )      (50,241 )      (21,524 )      (19,949 )      -             (157,034 )      -             (13,813 ) 

Asset charges (note 3):

                   

MSP contracts

      -            -            (162 )      (132 )      -             (378 )      -             (67 ) 

SL contracts or LSFP contracts

      (2,164 )      (2,218 )      -            -            -             (392 )      -             (69 ) 

Adjustments to maintain reserves

      (416 )      1,068        12        (5 )      -             2        -             (16 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Net equity transactions

      (79,186 )      (97,781 )      75,605        (218,818 )      -             (9,166,687 )      -             (1,536,184 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Net change in contract owners’ equity

      (133,556 )      46,030        50,836        (238,219 )      -             (9,163,090 )      -             (1,504,058 ) 

Contract owners’ equity beginning of period

      1,572,778        1,526,748        362,827        601,046        -             9,163,090        -             1,504,058   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Contract owners’ equity end of period

    $ 1,439,222        1,572,778        413,663        362,827        -             -            -             -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

CHANGES IN UNITS:

                   

Beginning units

      52,233        54,766        14,713        23,802        -             463,067        -             86,109   

Units purchased

      465        875        5,225        1,553        -             16,621        -             963   

Units redeemed

      (2,789 )      (3,408 )      (2,592 )      (10,642 )      -             (479,688 )      -             (87,072 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Ending units

      49,909        52,233        17,346        14,713        -             -            -             -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     MIGIC     FHIPR     FOSR     GVDIV3  
     2015     2014     2015     2014     2015     2014     2015      2014  

Investment activity:

                  

Net investment income (loss)

    $ 1,690        65        2,635        195,299        (6,780 )      33,628        -             10,729   

Realized gain (loss) on investments

      43,470        7,214        23,751        45,927        980,873        289,500        -             64,642   

Change in unrealized gain (loss) on investments

      (62,627 )      3,423        131,850        (218,406 )      (593,089 )      (722,316 )      -             (79,573 ) 

Reinvested capital gains

      20,840        12,111        -            -            -            1,138        -             -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      3,373        22,813        158,236        22,820        381,004        (398,050 )      -             (4,202 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (notes 2a and 6)

      2,288        10,944        125,461        448,634        132,247        536,604        -             13,030   

Transfers between funds

      (242,602 )      9,682        (3,747,934 )      (58,741 )      (4,457,130 )      (128,042 )      -             (462,717 ) 

Surrenders (note 6)

      -            (7,803 )      (265,726 )      (330,386 )      (94,188 )      (425,373 )      -             (2,901 ) 

Death Benefits (note 4)

      -            -            (33,659 )      (57,334 )      (70,540 )      (82,669 )      -             (22,688 ) 

Net policy repayments (loans) (note 5)

      965        1,548        246,357        252,478        60,200        70,892        -             (4,849 ) 

Deductions for surrender charges (note 2d)

      -            -            (33 )      -            -            (40 )      -             -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (3,982 )      (13,295 )      (99,240 )      (316,519 )      (83,518 )      (263,057 )      -             (9,062 ) 

Asset charges (note 3):

                  

MSP contracts

      -            -            (623 )      (1,958 )      (356 )      (1,122 )      -             (43 ) 

SL contracts or LSFP contracts

      (6 )      (50 )      -            -            (392 )      (1,182 )      -             (71 ) 

Adjustments to maintain reserves

      4        (8 )      30        (10 )      12        (3 )      -             (12 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Net equity transactions

      (243,333 )      1,018        (3,775,367 )      (63,836 )      (4,513,665 )      (293,992 )      -             (489,313 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Net change in contract owners’ equity

      (239,960 )      23,831        (3,617,131 )      (41,016 )      (4,132,661 )      (692,042 )      -             (493,515 ) 

Contract owners’ equity beginning of period

      239,960        216,129        3,617,131        3,658,147        4,132,661        4,824,703        -             493,515   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Contract owners’ equity end of period

    $ -            239,960        -            3,617,131        -            4,132,661        -             -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

CHANGES IN UNITS:

                  

Beginning units

      9,468        9,467        243,156        247,587        261,702        279,237        -             40,107   

Units purchased

      159        1,100        13,303        45,864        11,357        40,031        -             1,499   

Units redeemed

      (9,627 )      (1,099 )      (256,459 )      (50,295 )      (273,059 )      (57,566 )      -             (41,606 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Ending units

      -            9,468        -            243,156        -            261,702        -             -       
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     ACVI3     AMBP     AMTG     AMFAS  
     2015     2014     2015     2014     2015     2014     2015     2014  

Investment activity:

                 

Net investment income (loss)

    $ 645        2,931        (196 )      (232 )      (9,057 )      (10,514 )      (781 )      (968 ) 

Realized gain (loss) on investments

      46,035        12,918        3,551        1,834        903,446        137,054        (1,073 )      14,282   

Change in unrealized gain (loss) on investments

      (33,377 )      (26,751 )      (10,009 )      (3,468 )      (812,862 )      (11,018 )      (26,548 )      (28,143 ) 

Reinvested capital gains

      -            -            7,671        3,086        -            -            26,722        17,565   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      13,303        (10,902 )      1,017        1,220        81,527        115,522        (1,680 )      2,736   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                 

Purchase payments received from contract owners (notes 2a and 6)

      1,946        4,695        1,358        2,230        24,258        31,651        3,497        5,118   

Transfers between funds

      (184,765 )      (14,269 )      (38,634 )      6        (1,790,324 )      (45,395 )      (187,957 )      25,858   

Surrenders (note 6)

      -            (9,305 )      -            (1,768 )      (37,420 )      (154,263 )      (6,452 )      (15,684 ) 

Death Benefits (note 4)

      (25 )      -            -            -            (236,093 )      (6,296 )      -            -       

Net policy repayments (loans) (note 5)

      -            40        249        325        94,440        (19,579 )      (368 )      1,527   

Deductions for surrender charges (note 2d)

      -            -            -            -            -            -            -            -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      (1,937 )      (3,306 )      (2,304 )      (2,560 )      (44,826 )      (52,330 )      (6,678 )      (6,931 ) 

Asset charges (note 3):

                 

MSP contracts

      -            -            -            -            -            -            -            (36 ) 

SL contracts or LSFP contracts

      (417 )      (707 )      -            -            (2,638 )      (2,924 )      (26 )      (30 ) 

Adjustments to maintain reserves

      8        (2 )      (20 )      31        (3,500 )      131        (23 )      5   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

      (185,190 )      (22,854 )      (39,351 )      (1,736 )      (1,996,103 )      (249,005 )      (198,007 )      9,827   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

      (171,887 )      (33,756 )      (38,334 )      (516 )      (1,914,576 )      (133,483 )      (199,687 )      12,563   

Contract owners’ equity beginning of period

      171,887        205,643        38,334        38,850        1,914,576        2,048,059        199,687        187,124   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

    $ -            171,887        -            38,334        -            1,914,576        -            199,687   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                 

Beginning units

      9,678        10,941        1,939        1,813        111,027        126,682        9,561        9,188   

Units purchased

      104        255        81        443        -            4,684        199        2,611   

Units redeemed

      (9,782 )      (1,518 )      (2,020 )      (317 )      (111,027 )      (20,339 )      (9,760 )      (2,238 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

      -            9,678        -            1,939        -            111,027        -            9,561   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     FTVDM3     FTVGI3     HIBF3     GEM3  
     2015      2014     2015      2014     2015      2014     2015      2014  

Investment activity:

                     

Net investment income (loss)

    $ -             (1,638 )      -             (3,671 )      -             27,758        -             7,366   

Realized gain (loss) on investments

      -             (32,075 )      -             (27,371 )      -             16,907        -             (16,679 ) 

Change in unrealized gain (loss) on investments

      -             3,257        -             50,171        -             (1,703 )      -             (70,685 ) 

Reinvested capital gains

      -             -            -             -            -             -            -             -       
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      -             (30,456 )      -             19,129        -             42,962        -             (79,998 ) 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Equity transactions:

                     

Purchase payments received from contract owners (notes 2a and 6)

      -             9,103        -             29,425        -             29,427        -             34,994   

Transfers between funds

      -             (1,017,316 )      -             (2,345,317 )      -             (1,472,263 )      -             (2,338,290 ) 

Surrenders (note 6)

      -             (6,091 )      -             (12,913 )      -             (12,367 )      -             (29,568 ) 

Death Benefits (note 4)

      -             (1,608 )      -             (46,892 )      -             -            -             (7,835 ) 

Net policy repayments (loans) (note 5)

      -             4,184        -             45,915        -             813        -             31,344   

Deductions for surrender charges (note 2d)

      -             -            -             -            -             -            -             -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      -             (15,917 )      -             (34,703 )      -             (21,156 )      -             (39,751 ) 

Asset charges (note 3):

                     

MSP contracts

      -             (87 )      -             (497 )      -             (584 )      -             (184 ) 

SL contracts or LSFP contracts

      -             (69 )      -             (103 )      -             (75 )      -             (254 ) 

Adjustments to maintain reserves

      -             (22 )      -             (6 )      -             1        -             (7 ) 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Net equity transactions

      -             (1,027,823 )      -             (2,365,091 )      -             (1,476,204 )      -             (2,349,551 ) 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Net change in contract owners’ equity

      -             (1,058,279 )      -             (2,345,962 )      -             (1,433,242 )      -             (2,429,549 ) 

Contract owners’ equity beginning of period

      -             1,058,279        -             2,345,962        -             1,433,242        -             2,429,549   
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Contract owners’ equity end of period

    $ -             -            -             -            -             -            -             -       
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

CHANGES IN UNITS:

                     

Beginning units

      -             57,765        -             118,045        -             81,707        -             129,754   

Units purchased

      -             832        -             1,735        -             1,747        -             3,585   

Units redeemed

      -             (58,597 )      -             (119,780 )      -             (83,454 )      -             (133,339 ) 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Ending units

      -             -            -             -            -             -            -             -       
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2015 and 2014

 

     GVIX6     NVMIG3     ACVVS1  
     2015      2014     2015      2014     2015      2014  

Investment activity:

                

Net investment income (loss)

    $ -             5,773        -             43,594        -             -       

Realized gain (loss) on investments

      -             82,822        -             1,554,038        -             12,529   

Change in unrealized gain (loss) on investments

      -             (85,971 )      -             (1,557,674 )      -             (18,971 ) 

Reinvested capital gains

      -             -            -             -            -             5,224   
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Net increase (decrease) in contract owners’ equity resulting from operations

      -             2,624        -             39,958        -             (1,218 ) 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Equity transactions:

                

Purchase payments received from contract owners (notes 2a and 6)

      -             1,214        -             52,121        -             (19,303 ) 

Transfers between funds

      -             (490,334 )      -             (4,532,686 )      -             (31,559 ) 

Surrenders (note 6)

      -             (2,323 )      -             (119,696 )      -             -       

Death Benefits (note 4)

      -             -            -             (1,471 )      -             -       

Net policy repayments (loans) (note 5)

      -             (14,452 )      -             17,058        -             -       

Deductions for surrender charges (note 2d)

      -             -            -             -            -             -       

Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)

      -             (4,076 )      -             (69,946 )      -             3,260   

Asset charges (note 3):

                

MSP contracts

      -             (456 )      -             (572 )      -             -       

SL contracts or LSFP contracts

      -             -            -             -            -             488   

Adjustments to maintain reserves

      -             (7 )      -             (2 )      -             -       
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Net equity transactions

      -             (510,434 )      -             (4,655,194 )      -             (47,114 ) 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Net change in contract owners’ equity

      -             (507,810 )      -             (4,615,236 )      -             (48,332 ) 

Contract owners’ equity beginning of period

      -             507,810        -             4,615,236        -             48,332   
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Contract owners’ equity end of period

    $ -             -            -             -            -             -       
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

CHANGES IN UNITS:

                

Beginning units

      -             44,038        -             385,573        -             2,561   

Units purchased

      -             145        -             7,044        -             -       

Units redeemed

      -             (44,183 )      -             (392,617 )      -             (2,561 ) 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Ending units

      -             -            -             -            -             -       
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

See accompanying notes to financial statements.

NATIONWIDE VLI SEPARATE ACCOUNT-2

NOTES TO FINANCIAL STATEMENTS

December 31, 2015

(1) Background and Summary of Significant Accounting Policies

(a) Organization and Nature of Operations

The Nationwide VLI Separate Account-2 (the Account) was established pursuant to a resolution of the Board of Directors of Nationwide Life Insurance Company (the Company) on May 7, 1987. The Account is registered as a unit investment trust under the Investment Company Act of 1940. The Account is an investment company and follows accounting and reporting guidance under Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 946, Financial Services - Investment Companies. The Company offers Single Premium, Modified Single Premium, Flexible Premium and Last Survivor Flexible Premium Variable Life Insurance Policies through the Account. The primary distribution for the contracts is through the brokerage community; however, other distributors may be utilized.

(b) The Contracts

Prior to December 31, 1990, only contracts without a front-end sales charge and certain other fees, were offered for purchase. Beginning December 31, 1990, contracts with a front-end sales charge and certain other fees, are offered for purchase. See note 2 for a discussion of policy charges and note 3 for asset charges.

With certain exceptions, contract owners may invest in the following:

AB FUNDS

VPS Dynamic Asset Allocation Portfolio - Class A (ALVDAA)

BLACKROCK FUNDS

Global Allocation V.I. Fund - Class II (MLVGA2)

DELAWARE GROUP

VIP Small Cap Value Series: Service Class (DWVSVS)

DREYFUS CORPORATION

Stock Index Fund, Inc. - Initial Shares (DSIF)

Socially Responsible Growth Fund Inc - Initial Shares (DSRG)

GOLDMAN SACHS ASSET MANAGEMENT GROUP

Goldman Sachs Global Markets Navigator Fund - Service Shares (GVGMNS)

INVESCO INVESTMENTS

Van Kampen V.I. Mid Cap Growth Fund - Series I Shares (IVKMG1)

Balanced-Risk Allocation Fund: Series I Shares (IVBRA1)

JANUS FUNDS

Balanced Portfolio: Service Shares (JABS)

Forty Portfolio: Service Shares (JACAS)

Global Technology Portfolio: Service Shares (JAGTS)

Overseas Portfolio: Service Shares (JAIGS)

MASSACHUSETTS FINANCIAL SERVICES CO.

Var Insurance Trust II - MFS Investors Growth Stock Portfolio: Initial Class (MV2IGI)

Variable Insurance Trust - MFS New Discovery Series - Intital Class  (MNDIC)

Value Series - Initial Class (MVFIC)

MORGAN STANLEY

Core Plus Fixed Income Portfolio - Class I (MSVFI)

Emerging Markets Debt Portfolio - Class I (MSEM)

U.S. Real Estate Portfolio - Class I (MSVRE)

NATIONWIDE FUNDS GROUP

NVIT Investor Destinations Managed Growth and Income Class I (IDPGI)*

NVIT Investor Destinations Managed Growth Class I (IDPG)

NVIT Cardinal Managed Growth and Income Class I (NCPGI)*

NVIT Cardinal Managed Growth Class I (NCPG)*

NVIT Bond Index Fund Class I (NVBX)

NVIT International Index Fund Class I (NVIX)

American Century NVIT Multi Cap Value Fund - Class I (NVAMV1)

American Funds NVIT Asset Allocation Fund - Class II (GVAAA2)

American Funds NVIT Bond Fund - Class II (GVABD2)

American Funds NVIT Global Growth Fund - Class II (GVAGG2)

American Funds NVIT Growth Fund - Class II (GVAGR2)

American Funds NVIT Growth-Income Fund - Class II (GVAGI2)

Federated NVIT High Income Bond Fund - Class I (HIBF)

NVIT Emerging Markets Fund - Class I (GEM)

NVIT International Equity Fund - Class I (GIG)

Neuberger Berman NVIT Multi Cap Opportunities Fund - Class I (NVNMO1)

Neuberger Berman NVIT Socially Responsible Fund - Class I (NVNSR1)

Neuberger Berman NVIT Socially Responsible Fund - Class II (NVNSR2)*

NVIT Cardinal Aggressive Fund - Class I (NVCRA1)

NVIT Cardinal Balanced Fund - Class I (NVCRB1)

NVIT Cardinal Capital Appreciation Fund - Class I (NVCCA1)

NVIT Cardinal Conservative Fund - Class I (NVCCN1)

NVIT Cardinal Moderate Fund - Class I (NVCMD1)

NVIT Cardinal Moderately Aggressive Fund - Class I (NVCMA1)

NVIT Cardinal Moderately Conservative Fund - Class I (NVCMC1)

NVIT Core Bond Fund - Class I (NVCBD1)

NVIT Core Plus Bond Fund - Class I (NVLCP1)

NVIT Nationwide Fund - Class I (TRF)

NVIT Government Bond Fund - Class I (GBF)

American Century NVIT Growth Fund - Class I (CAF)

NVIT International Index Fund - Class II (GVIX2)

NVIT Investor Destinations Aggressive Fund - Class II (GVIDA)

NVIT Investor Destinations Balanced Fund - Class II (NVDBL2)

NVIT Investor Destinations Capital Appreciation Fund - Class II (NVDCA2)

NVIT Investor Destinations Conservative Fund - Class II (GVIDC)

NVIT Investor Destinations Moderate Fund - Class II (GVIDM)

NVIT Investor Destinations Moderately Aggressive Fund - Class II (GVDMA)

NVIT Investor Destinations Moderately Conservative Fund - Class II (GVDMC)

NVIT Mid Cap Index Fund - Class I (MCIF)

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

NVIT Money Market Fund - Class I (SAM)

NVIT Multi-Manager International Growth Fund - Class I (NVMIG1)

NVIT Multi-Manager International Value Fund - Class I (GVDIVI)

NVIT Multi-Manager Large Cap Growth Fund - Class I (NVMLG1)

NVIT Multi-Manager Large Cap Value Fund - Class I (NVMLV1)

NVIT Multi-Manager Mid Cap Growth Fund - Class I (NVMMG1)

NVIT Multi-Manager Mid Cap Value Fund - Class II (NVMMV2)

NVIT Multi-Manager Small Cap Growth Fund - Class I (SCGF)

NVIT Multi-Manager Small Cap Value Fund - Class I (SCVF)

NVIT Multi-Manager Small Company Fund - Class I (SCF)

NVIT Multi-Sector Bond Fund - Class I (MSBF)

NVIT Short Term Bond Fund - Class II (NVSTB2)

NVIT Large Cap Growth Fund - Class I (NVOLG1)

Templeton NVIT International Value Fund - Class III (NVTIV3)

Invesco NVIT Comstock Value Fund - Class I (EIF)

NVIT Real Estate Fund - Class I (NVRE1)

Loring Ward NVIT Capital Appreciation Fund - Class P (NVLCAP)

Loring Ward NVIT Moderate Fund - Class P (NVLMP)

NVIT Small Cap Index Fund Class II (NVSIX2)

NVIT S&P 500 Index Fund Class I (GVEX1)

NORTHERN LIGHTS

TOPS Managed Risk Balanced ETF Portfolio - Class 3 (NOTB3)*

TOPS Managed Risk Growth ETF Portfolio - Class 3 (NOTG3)

TOPS Managed Risk Moderate Growth ETF Portfolio - Class 3 (NOTMG3)*

PORTFOLIOS OF THE ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC

VPS Growth and Income Portfolio - Class A (ALVGIA)

VPS Small/Mid Cap Value Portfolio - Class A (ALVSVA)

PORTFOLIOS OF THE AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

VP Balanced Fund - Class I (ACVB)

VP Capital Appreciation Fund - Class I (ACVCA)

VP Income & Growth Fund - Class I (ACVIG)

VP Inflation Protection Fund - Class II (ACVIP2)

VP International Fund - Class I (ACVI)

VP Mid Cap Value Fund - Class I (ACVMV1)

VP Ultra(R) Fund - Class I (ACVU1)

VP Value Fund - Class I (ACVV)*

PORTFOLIOS OF THE DREYFUS INVESTMENT PORTFOLIOS

Small Cap Stock Index Portfolio - Service Shares (DVSCS)

PORTFOLIOS OF THE DREYFUS VARIABLE INVESTMENT FUND

Appreciation Portfolio - Initial Shares (DCAP)

Opportunistic Small Cap Portfolio: Initial Shares (DSC)

Growth and Income Portfolio - Initial Shares (DGI)

PORTFOLIOS OF THE FEDERATED INSURANCE SERIES

Managed Tail Risk Fund II: Primary Shares (FVCA2P)

Quality Bond Fund II - Primary Shares (FQB)

PORTFOLIOS OF THE FIDELITY(R) VARIABLE INSURANCE PRODUCTS

Equity-Income Portfolio - Initial Class (FEIP)

High Income Portfolio - Initial Class (FHIP)

VIP Asset Manager Portfolio - Initial Class (FAMP)

VIP Contrafund(R) Portfolio - Initial Class (FCP)*

VIP Energy Portfolio - Service Class 2 (FNRS2)

VIP Freedom Fund 2010 Portfolio - Service Class (FF10S)

VIP Freedom Fund 2020 Portfolio - Service Class (FF20S)

VIP Freedom Fund 2030 Portfolio - Service Class (FF30S)

VIP Growth Opportunities Portfolio - Initial Class (FGOP)*

VIP Growth Portfolio - Initial Class (FGP)

VIP Investment Grade Bond Portfolio - Service Class (FIGBS)

VIP Mid Cap Portfolio - Service Class (FMCS)

VIP Overseas Portfolio - Initial Class (FOP)

VIP Overseas Portfolio - Service Class (FOS)

VIP Value Strategies Portfolio - Service Class (FVSS)

PORTFOLIOS OF THE FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRU

Franklin Income Securities Fund - Class 2 (FTVIS2)

Rising Dividends Securities Fund - Class 1 (FTVRDI)

Small Cap Value Securities Fund - Class 1 (FTVSVI)

Templeton Developing Markets Securities Fund - Class 2 (FTVDM2)

Templeton Foreign Securities Fund - Class 1 (TIF)

Templeton Foreign Securities Fund - Class 2 (TIF2)

Templeton Global Bond Securities Fund - Class 2 (FTVGI2)

VIP Founding Funds Allocation Fund - Class 2 (FTVFA2)

PORTFOLIOS OF THE NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST

Short Duration Bond Portfolio - I Class Shares (AMTB)

Guardian Portfolio - I Class Shares (AMGP)

International Portfolio - S Class Shares (AMINS)

Mid-Cap Growth Portfolio - I Class Shares (AMCG)

Mid-Cap Growth Portfolio - S Class Shares (AMMCGS)

Advisers Management Trust: Large Cap Value Portfolio - Class I (AMTP)

Advisers Management Trust: Mid Cap Intrinsic Value Portfolio - Class S  (AMRS)

Socially Responsive Portfolio - I Class Shares (AMSRS)

PORTFOLIOS OF THE OPPENHEIMER VARIABLE ACCOUNT FUNDS

Capital Income Fund/VA - Non-Service Shares (OVMS)

Capital Appreciation Fund/VA - Non-Service Shares (OVGR)*

Core Bond Fund/VA - Non-Service Shares (OVB)

Global Securities Fund/VA - Non-Service Shares (OVGS)

International Growth Fund/VA - Non-Service Shares (OVIG)

Main Street Fund(R)/VA - Non-Service Shares (OVGI)

Main Street Small- & Mid-Cap Fund(R)/VA - Non-Service Shares (OVSC)

Discovery Mid Cap Growth Fund/VA - Non-Service Shares (OVAG)

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

Global Strategic Income Fund/VA: Non-service Shares (OVSB)

PORTFOLIOS OF THE PIMCO VARIABLE INSURANCE TRUST

All Asset Portfolio - Administrative Class (PMVAAA)

CommodityRealReturn(R) Strategy Portfolio - Administrative Class (PMVRSA)

Foreign Bond Portfolio (Unhedged) - Administrative Class (PMVFBA)

Low Duration Portfolio - Administrative Class (PMVLDA)

Total Return Portfolio - Administrative Class (PMVTRA)

PORTFOLIOS OF THE PUTNAM VARIABLE TRUST

VT Growth & Income Fund: Class IB (PVGIB)

VT International Equity Fund: Class IB (PVTIGB)

VT Voyager Fund: Class IB (PVTVB)

PORTFOLIOS OF THE INVESCO INVESTMENTS TRUST

VI American Franchise Fund - Series I Shares (ACEG)

VI Value Opportunities Fund - Series I Shares (AVBVI)

VI Mid Cap Core Equity Fund: Series I Shares (AVMCCI)

GUGGENHEIM INVESTMENTS

Variable Fund - Multi-Hedge Strategies (RVARS)

T. ROWE PRICE

Blue Chip Growth Portfolio - II (TRBCG2)*

Equity Income Portfolio - II (TREI2)*

Health Sciences Portfolio - II (TRHS2)

Limited-Term Bond Portfolio - II (TRLT2)

VAN ECK ASSOCIATES CORPORATION

VIP Trust - Unconstrained Emerging Markets Bond Fund - Initial Class (VWBF)

VIP Trust Emerging Markets Fund - Initial Class (VWEM)

VIP Trust Global Hard Assets Fund - Initial Class (VWHA)

WADDELL & REED, INC.

Variable Insurance Portfolios - Asset Strategy (WRASP)

Variable Insurance Portfolios - High Income (WRHIP)

Variable Insurance Portfolios - Mid Cap Growth (WRMCG)

WELLS FARGO FUNDS

Advantage VT Discovery Fund (SVDF)

Advantage VT Opportunity Fund - Class 2 (SVOF)

Advantage VT Small Cap Growth Fund - Class 2 (WFVSCG)

 

  * At December 31, 2015, contract owners were not invested in this fund.

The contract owners’ equity is affected by the investment results of each fund, equity transactions by contract owners and certain policy and assets charges (see notes 2 and 3). The accompanying financial statements include only contract owners’ purchase payments pertaining to the variable portions of their contracts and exclude any purchase payments for fixed dollar benefits, the latter being included in the accounts of the Company.

A contract owner may choose from among a number of different underlying mutual fund options. The underlying mutual fund options are not available to the general public directly. The underlying mutual funds are available as investment options in variable life insurance policies or variable annuity contracts issued by life insurance companies or, in some cases, through participation in certain qualified pension or retirement plans.

Some of the underlying mutual funds have been established by investment advisers which manage publicly traded mutual funds having similar names and investment objectives. While some of the underlying mutual funds may be similar to, and may in fact be modeled after, publicly traded mutual funds, the underlying mutual funds are not otherwise directly related to any publicly traded mutual fund. Consequently, the investment performance of publicly traded mutual funds and any corresponding underlying mutual funds may differ substantially.

A purchase payment could be presented as a negative equity transaction in the Statements of Changes in Contract Owners’ Equity if a prior period purchase payment is refunded to a contract owner due to a contract cancellation during the free look period, and/or if a gain is realized by the contract owner during the free look period.

The Company allocates purchase payments to sub-accounts and/or the fixed account as instructed by the contract owner. Shares of the sub-accounts are purchased at Net Asset Value, then converted into accumulation units. Certain transactions may be subject to conditions imposed by the underlying mutual funds, as well as those set forth in the contract.

(c) Security Valuation, Transactions and Related Investment Income

Investments in underlying mutual funds are valued at the closing net asset value per share at December 31, 2015 of such funds. The cost of investments sold is determined on a first in - first out basis. Investment transactions are accounted for on the trade date (date the order to buy or sell is executed), and dividends and capital gain distributions are accrued as of the ex-dividend date and are reinvested in the underlying mutual funds.

(d) Federal Income Taxes

Operations of the Account form a part of, and are taxed with, operations of the Company, which is taxed as a life insurance company under the provisions of the Internal Revenue Code. The Company does not provide for income taxes within the Account. Taxes are generally the responsibility of the contract owner upon termination or withdrawal.

(e) Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with U.S generally accepted accounting principles may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, if any, at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

(f) Recently Issued Accounting Standards

There are no recently issued accounting standards applicable to the Account.

(g) Subsequent Events

The Company evaluated subsequent events through the date the financial statements were issued with the Securities Exchange Commission (SEC), and no subsequent events have occurred requiring accrual or disclosure.

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

(2) Policy Charges

(a) Deductions from Premiums

For single premium and modified single premium contracts, no deduction is made from any premium at the time of payment. On multiple payment and flexible premium contracts, the Company deducts a premium load charge that will not exceed 6%. The 6% is comprised of a charge for premium taxes that ranges from 2.50% to 3.50% of each premium payment and a charge for the sales load that ranges from 2.50% to 3.50% of each premium payment. For flexible premium contracts, the sales load is reduced to 0.50% on any portion of the annual premium paid in excess of the annual break point premium. On last survivor flexible premium contracts, the Company deducts a charge for state premium taxes equal to 3.50% of all premiums received to cover the payment of these premium taxes. The Company also deducts a sales load from each premium payment received not to exceed 5.00% of each premium payment during the first ten years and 1.50% of each premium payment ten years and 1.50% of each premium payment thereafter.

For policies issued in New York, the Company deducts a sales load from each premium payment received not to exceed 9.50% of each premium payment during the first ten years and 6.00% of each premium payment thereafter. The Company may at its sole discretion reduce this sales loading. For the periods ended December 31, 2015 and 2014, total front-end sales charge deductions were $1,389,661 and $1,490,768, respectively and were recognized as a reduction of purchase payments on the Statements of Changes in Contract Owners’ Equity.

(b) Cost of Insurance

A cost of insurance charge is assessed monthly against each contract by liquidating units. The amount of the charge varies widely and is based upon age, sex, rate class and net amount at risk (death benefit less total contract value).

For last survivor flexible premium contracts, the monthly cost of insurance is determined in a manner that reflects the anticipated mortality of the two insureds and the fact that the death benefit is not payable until the death of the second insured contract owner.

(c) Administrative Charges

An administrative charge is assessed against each contract to recover policy maintenance, accounting, record keeping and other administrative expenses and is assessed against each contract by liquidating units.

For single premium contracts, the Company deducts an annual administrative charge which is determined as follows:

Contracts issued prior to April 16, 1990:

Purchase payments totaling less than $25,000 - $10/month

Purchase payments totaling $25,000 or more - none

Contracts issued on or after April 16, 1990:

Purchase payments totaling less than $25,000 - $90/year ($65/year in New York)

Purchase payments totaling $25,000 or more - $50/year

For multiple payment contracts, the Company currently deducts a monthly administrative charge of $5.00 (not to exceed $7.50 per month). For flexible premium contracts, the Company currently deducts a monthly administrative charge of $12.50 during the first policy year. For all subsequent years, a monthly administrative charge is deducted (currently $5.00 per month not to exceed $7.50). Additionally, the Company deducts an increase charge when the policy’s specified amount is increased. The charge is equal $2.04 per year per $1,000 of the specified amount increase.

For modified single premium contracts, the Company deducts a monthly administrative charge equal to an annualized rate of 0.30% multiplied by the policy’s cash value to cover administrative, premium tax and deferred acquisition costs. For policy years 11 and later, this monthly charge is reduced to an annualized rate of 0.15% of the policy’s cash value. The monthly charge is subject to a $10.00 minimum.

For last survivor flexible premium contracts, the Company deducts a monthly administrative charge equal to the sum of the per policy charge and the per $1,000.00 basic coverage charge. For policy years one through ten, the per policy charge is $10.00. Additionally, there is a $0.04 per $1,000.00 basic coverage charge (not less than $20.00 or more than $80.00 per policy per year). For policy years eleven and after, the per policy charge is $5.00. Additionally, there is a $0.02 per $1,000 basic coverage charge (not less than $10.00 or more than $40.00 per policy per year). For policies issued in New York, the per policy charge is guaranteed not to exceed $7.50 per month in all years and there is a $0.04 per $1,000.00 basic coverage charge in policy year one only.

(d) Surrender Charges

Policy surrenders result in a withdrawal of contract value from the Account and payment of the surrender proceeds to the policy owner or designee. The surrender proceeds consist of the contract value, less any outstanding policy loans, and less a surrender charge, if applicable. The charge is determined according to contract type.

For single premium contracts, the charge is a percentage of the original purchase payment. For single premium contracts issued prior to April 16, 1990, the charge is 8.00% in the first year and declines a specified amount each year. After the ninth year, the charge is 0.00%. For single premium contracts issued on or after April 16, 1990, the charge is 8.50% in the first year, and declines a specified amount each year. After the ninth year, the charge is 0.00%. However, if a policy’s specified amount increases, the amount of the increase will have a nine-year surrender charge period.

For multiple payment contracts, last survivor flexible premium contract and flexible premium contracts, the amount charged is based upon a specified percentage of the initial specified amount and varies by issue age, sex and rate class. The charge is reduced at certain time intervals, and declines a specified amount each year. After the eighth year for flexible premium contracts, after the ninth year for multiple payment contracts and after the tenth year for last survivor contracts, the charge is 0.00%. However, if a policy’s specified amount increases, the amount of the increase will have the same nine-year surrender charge period.

For modified single premium contracts, the amount charged is based on a percentage of the original premium payment. The charge is 10.00% of the initial premium payment and declines a specified amount each year to 0.00% after the end of the ninth year.

The Company may waive the surrender charge for certain contracts in which the sales expenses normally associated with the distribution of a contract are not incurred.

The charges above are assessed against each contract by liquidating units.

(3) Asset Charges

The Company deducts a charge related to the assumption of mortality and expense risk.

For modified single premium contracts (MSP), the Company deducts a charge equal to an annualized rate of 0.90%. For flexible premium contracts, the Company deducts a charge equal to an annualized rate of 0.80% in policy years one through nine. After the ninth year, the annualized rate is 0.80% on the first $25,000 of cash value and 0.50% on additional cash value. For last survivor flexible premium contracts (LSFP), the Company deducts a charge equal to an annualized rate of 0.80% in policy years one through ten. In policy years eleven and after, the charge will continue to be deducted, but may be reduced for policies at specified asset levels. For LSFP issued in New York, the Company deducts a charge equal to an annualized rate of 0.80% in policy years one through ten and 0.50% thereafter, regardless of cash value. This charge is assessed monthly by liquidating units.

For single premium contracts issued prior to April 16, 1990, the Company deducts a charge equal to an annualized rate of 0.95% during the first ten policy years, and 0.50% thereafter. For single premium contracts issued on or after April 16, 1990, the charge is equal to an annualized rate of 1.30% during the first ten policy years, and 1.00% thereafter. For multiple payment contracts, the Company deducts a charge equal to an annualized rate of 0.80%. For flexible premium and Variable Executive Life contracts, the charge is equal to an annualized rate of 0.80% during the first ten policy years, and 0.50% thereafter. This charge is assessed through a reduction in the unit value.

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

The following table provides mortality and expense risk charges by contract type for those charges that are assessed through a reduction in the unit value for the period ended December 31, 2015:

 

     Total      ALVDAA      MLVGA2      DWVSVS      DSIF  

Single Premium issue prior to April 16, 1990

    $ 2,756         -         -         -         -   

Single Premium issue after to April 16, 1990

    $ 396,416         -         -         -         18,710   

Multiple Payment and Flexible Premium contracts

    $ 2,955,895         6         14,835         1,198         197,419   

Variable Executive Life

    $ 13,081         -         35         -         768   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 3,368,148         6         14,870         1,198         216,897   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     DSRG      GVGMNS      IVKMG1      IVBRA1      JABS  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      1,712         -         -         -         -   

Multiple Payment and Flexible Premium contracts

      39,021         102         1,299         652         6,302   

Variable Executive Life

      -         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      40,733         102         1,299         652         6,302   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     JACAS      JAGTS      JAIGS      MV2IGI      MNDIC  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      4,649         2,376         1,937         -         -   

Multiple Payment and Flexible Premium contracts

      16,728         6,225         14,127         888         892   

Variable Executive Life

      -         38         14         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      21,377         8,639         16,078         888         892   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     MVFIC      MSVFI      MSEM      MSVRE      IDPG  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         -         392         10,481         -   

Multiple Payment and Flexible Premium contracts

      12,809         1,390         3,728         4         123   

Variable Executive Life

      -         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      12,809         1,390         4,120         10,485         123   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     NVBX      NVIX      NVAMV1      GVAAA2      GVABD2  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         -         7,352         -         -   

Multiple Payment and Flexible Premium contracts

      301         383         30,131         14,411         3,737   

Variable Executive Life

      -         -         231         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      301         383         37,714         14,411         3,737   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     GVAGG2      GVAGR2      GVAGI2      HIBF      GEM  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         -         -         -         2,613   

Multiple Payment and Flexible Premium contracts

      8,266         9,048         4,685         4,578         10,616   

Variable Executive Life

      -         22         -         -         34   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      8,266         9,070         4,685         4,578         13,263   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     GIG      NVNMO1      NVNSR1      NVCRA1      NVCRB1  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      306         604         -         -         -   

Multiple Payment and Flexible Premium contracts

      19,534         70,937         617         1,830         2,641   

Variable Executive Life

      88         262         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      19,928         71,803         617         1,830         2,641   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     NVCCA1      NVCCN1      NVCMD1      NVCMA1      NVCMC1  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         -         -         -         -   

Multiple Payment and Flexible Premium contracts

      3,747         313         6,249         3,988         845   

Variable Executive Life

      -         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      3,747         313         6,249         3,988         845   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     NVCBD1      NVLCP1      TRF      GBF      CAF  

Single Premium issue prior to April 16, 1990

      -         -         70         75         -   

Single Premium issue after to April 16, 1990

      1,914         -         10,368         5,350         4,580   

Multiple Payment and Flexible Premium contracts

      1,663         779         285,835         25,301         75,933   

Variable Executive Life

      -         -         1,101         -         136   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      3,577         779         297,374         30,726         80,649   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     GVIX2      GVIDA      NVDBL2      NVDCA2      GVIDC  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         161         -         -         1,469   

Multiple Payment and Flexible Premium contracts

      1,414         11,218         576         635         1,768   

Variable Executive Life

      -         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      1,414         11,379         576         635         3,237   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     GVIDM      GVDMA      GVDMC      MCIF      SAM  

Single Premium issue prior to April 16, 1990

      -         -         -         -         2   

Single Premium issue after to April 16, 1990

      2,196         3,868         4,069         6,046         25,629   

Multiple Payment and Flexible Premium contracts

      15,340         22,162         16,200         25,754         63,210   

Variable Executive Life

      -         152         -         118         719   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      17,536         26,182         20,269         31,918         89,560   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     NVMIG1      GVDIVI      NVMLG1      NVMLV1      NVMMG1  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      2,055         -         1,625         208         1,582   

Multiple Payment and Flexible Premium contracts

      21,584         2,941         9,529         6,483         164,104   

Variable Executive Life

      -         -         -         -         339   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      23,639         2,941         11,154         6,691         166,025   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

     NVMMV2      SCGF      SCVF      SCF      MSBF  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      2,079         382         2,643         3,879         2,125   

Multiple Payment and Flexible Premium contracts

      124,579         6,443         20,538         78,586         4,037   

Variable Executive Life

      -         23         56         1,352         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      126,658         6,848         23,237         83,817         6,162   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     NVSTB2      NVOLG1      NVTIV3      EIF      NVRE1  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         17,492         -         -         8,716   

Multiple Payment and Flexible Premium contracts

      3,198         238,372         979         4,114         43,428   

Variable Executive Life

      -         1,308         -         -         197   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      3,198         257,172         979         4,114         52,341   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     NVLCAP      NVLMP      NVSIX2      GVEX1      NOTG3  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         -         -         -         -   

Multiple Payment and Flexible Premium contracts

      13         21         597         11,869         18   

Variable Executive Life

      -         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      13         21         597         11,869         18   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     ALVGIA      ALVSVA      ACVB      ACVCA      ACVIG  

Single Premium issue prior to April 16, 1990

      -         -         -         216         -   

Single Premium issue after to April 16, 1990

      -         -         16,746         14,053         6,585   

Multiple Payment and Flexible Premium contracts

      1,676         6,022         20,328         164         6,902   

Variable Executive Life

      -         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      1,676         6,022         37,074         14,433         13,487   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     ACVIP2      ACVI      ACVMV1      ACVU1      DVSCS  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         2,049         -         1,357         3,187   

Multiple Payment and Flexible Premium contracts

      4,533         131         11,066         1         7,712   

Variable Executive Life

      100         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      4,633         2,180         11,066         1,358         10,899   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     DCAP      DSC      DGI      FVCA2P      FQB  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      4,490         -         965         -         3,561   

Multiple Payment and Flexible Premium contracts

      17,723         2,143         6,511         412         3,741   

Variable Executive Life

      -         -         17         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      22,213         2,143         7,493         412         7,302   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     FEIP      FHIP      FAMP      FNRS2      FF10S  

Single Premium issue prior to April 16, 1990

      306         36         291         -         -   

Single Premium issue after to April 16, 1990

      30,237         7,620         19,027         -         -   

Multiple Payment and Flexible Premium contracts

      187,041         37,689         51,939         10,179         2,085   

Variable Executive Life

      1,595         215         48         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      219,179         45,560         71,305         10,179         2,085   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     FF20S      FF30S      FGP      FIGBS      FMCS  

Single Premium issue prior to April 16, 1990

      -         -         1,170         -         -   

Single Premium issue after to April 16, 1990

      -         -         41,413         -         -   

Multiple Payment and Flexible Premium contracts

      6,434         6,741         299,148         9,799         39,294   

Variable Executive Life

      -         -         2,532         28         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      6,434         6,741         344,263         9,827         39,294   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     FOP      FOS      FVSS      FTVIS2      FTVRDI  

Single Premium issue prior to April 16, 1990

      35         -         -         -         -   

Single Premium issue after to April 16, 1990

      9,637         -         1,446         -         -   

Multiple Payment and Flexible Premium contracts

      20,779         13,983         3,250         8,559         20,830   

Variable Executive Life

      16         52         -         34         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      30,467         14,035         4,696         8,593         20,830   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     FTVSVI      FTVDM2      TIF      TIF2      FTVGI2  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         -         -         -         -   

Multiple Payment and Flexible Premium contracts

      13,191         4,132         615         5,753         10,245   

Variable Executive Life

      -         -         -         -         98   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      13,191         4,132         615         5,753         10,343   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     FTVFA2      AMTB      AMGP      AMCG      AMMCGS  

Single Premium issue prior to April 16, 1990

      -         25         -         37         -   

Single Premium issue after to April 16, 1990

      -         7,329         692         1,367         -   

Multiple Payment and Flexible Premium contracts

      1,240         6,423         -         22         163   

Variable Executive Life

      -         66         -         -         4   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      1,240         13,843         692         1,426         167   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     AMTP      AMSRS      OVMS      OVB      OVGS  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      4,863         -         3,944         4,289         10,701   

Multiple Payment and Flexible Premium contracts

      21         3,695         27,570         14,687         108,494   

Variable Executive Life

      -         -         7         -         1,128   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      4,884         3,695         31,521         18,976         120,323   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     OVIG      OVGI      OVSC      OVAG      OVSB  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         831         -         2,276         -   

Multiple Payment and Flexible Premium contracts

      109         4,886         6,629         4,990         1,022   

Variable Executive Life

      -         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      109         5,717         6,629         7,266         1,022   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

     PMVAAA      PMVRSA      PMVFBA      PMVLDA      PMVTRA  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         -         -         -         -   

Multiple Payment and Flexible Premium contracts

      1,215         47         1,597         6,405         5,001   

Variable Executive Life

      -         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      1,215         47         1,597         6,405         5,001   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     PVGIB      PVTIGB      PVTVB      ACEG      AVMCCI  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         -         -         -         -   

Multiple Payment and Flexible Premium contracts

      716         1,364         2,444         134         12   

Variable Executive Life

      -         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      716         1,364         2,444         134         12   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     RVARS      TRHS2      VWBF      VWEM      VWHA  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         -         4,341         3,661         5,954   

Multiple Payment and Flexible Premium contracts

      104         30,718         3,916         21,605         19,451   

Variable Executive Life

      -         -         45         20         15   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      104         30,718         8,302         25,286         25,420   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     WRASP      WRHIP      WRMCG      SVDF      SVOF  

Single Premium issue prior to April 16, 1990

      -         -         -         -         206   

Single Premium issue after to April 16, 1990

      -         -         -         6,636         8,978   

Multiple Payment and Flexible Premium contracts

      12,351         5,640         1,695         -         100   

Variable Executive Life

      -         -         -         -         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      12,351         5,640         1,695         6,636         9,284   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     WFVSCG      MIGIC      FHIPR      FOSR      AMBP  

Single Premium issue prior to April 16, 1990

      -         -         -         -         -   

Single Premium issue after to April 16, 1990

      -         -         -         -         -   

Multiple Payment and Flexible Premium contracts

      2,193         291         6,506         6,754         196   

Variable Executive Life

      -         -         16         26         -   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

      2,193         291         6,522         6,780         196   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
     AMTG      AMFAS                       

Single Premium issue prior to April 16, 1990

      287         -            

Single Premium issue after to April 16, 1990

      8,613         -            

Multiple Payment and Flexible Premium contracts

      157         755            

Variable Executive Life

      -         26            
  

 

 

     

 

 

           

Total

      9,057         781            
  

 

 

     

 

 

           

(4) Death Benefits

Death benefit proceeds result in a redemption of the contract value from the Account and payment of those proceeds, less any outstanding policy loans (and policy charges), to the legal beneficiary. For last survivor flexible premium contracts, the proceeds are payable on the death of the last surviving insured. In the event that the guaranteed death benefit exceeds the contract value on the date of death, the excess is paid by the Company’s general account.

(5) Policy Loans (Net of Repayments)

Contract provisions allow contract owners to borrow up to 90.00% (50% during first year of single and modified single premium contracts) of a policy’s cash surrender value. For single premium contracts issued prior to April 16, 1990, 6.50% interest is due and payable annually in advance of the policy anniversary date. For single premium contracts issued on or after April 16, 1990, multiple payment, flexible premium, modified single and last survivor flexible premium contracts, 6.00% interest is due and payable in advance on the policy anniversary when there is a loan outstanding on the policy.

At the time the loan is granted, the amount of the loan is transferred from the Account to the Company’s general account as collateral for the outstanding loan. Collateral amounts in the general account are credited with the stated rate of interest in effect at the time the loan is made, subject to a guaranteed minimum rate. Loan repayments result in a transfer of collateral including interest credited back to the Account.

(6) Related Party Transactions

The Company performs various services on behalf of the mutual fund companies in which the Account invests and may receive fees for the services performed. These services include, among other things, shareholder communications, postage, fund transfer agency and various other record keeping and customer service functions. These fees are paid to an affiliate of the Company.

Contract owners may, with certain restrictions, transfer their assets between the Account and a fixed dollar contract (fixed account) maintained in the accounts of the Company. These transfers are the result of the contract owner executing fund exchanges. Fund exchanges from the Account to the fixed account are included in surrenders, and fund exchanges from the fixed account to the Account are included in purchase payments received from contract owners, as applicable, on the accompanying Statements of Change in Contract Owners’ Equity. Policy loan transactions (note 5), executed at the direction of the contract owner, also result in transfers between the Account and the fixed account of the Company, but are included in Net Policy (Loans) Repayments. The fixed account assets are not reflected in the accompanying financial statements. For the periods ended December 31, 2015 and 2014, total transfers into the Account from the fixed account were $24,014,557 and $22,368,333, respectively, and total transfers from the Account to the fixed account were $18,645,557 and $26,183,509, respectively.

(7) Fair Value Measurement

FASB ASC 820, Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the Account generally uses the market approach as the valuation technique due to the nature of the mutual fund investments offered in the Account. This technique maximizes the use of observable inputs and minimizes the use of unobservable inputs.

In accordance with FASB ASC 820, the Account categorized its financial instruments into a three level hierarchy based on the priority of the inputs to the valuation technique. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument in its entirety.

The Account categorizes financial assets recorded at fair value as follows:

 

  •  

Level 1 – Unadjusted quoted prices accessible in active markets and mutual funds where the value per share (unit) is determined and published and is the basis for current transactions for identical assets or liabilities at the measurement date.

 

  •  

Level 2 – Unadjusted quoted prices for similar assets or liabilities in active markets or inputs (other than quoted prices) that are observable or that are derived principally from or corroborated by observable market data through correlation or other means.

 

  •  

Level 3 – Prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management’s best estimate about the assumptions market participants would use at the measurement date in pricing the asset or liability. Consideration is given to the risk inherent in both the method of valuation and the valuation inputs.

The Account recognizes transfers between fair value hierarchy levels at the reporting period end. There were no transfers between Level 1 and 2 as of December 31, 2015.

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

The following table summarizes assets measured at fair value on a recurring basis as of December 31, 2015:

 

     Level 1      Level 2      Level 3      Total  

Separate Account Investments

    $ 600,433,133       $ -       $ -       $ 600,433,133   

The cost of purchases and proceeds from sales of Investments for the year ended December 31, 2015 are as follows:

 

     Purchases of
Investments		      Sales of
Investments		  

VPS Dynamic Asset Allocation Portfolio - Class A (ALVDAA)

    $ 16       $ 400   

Global Allocation V.I. Fund - Class II (MLVGA2)

      683,693         340,064   

VIP Small Cap Value Series: Service Class (DWVSVS)

      97,646         279,800   

Stock Index Fund, Inc. - Initial Shares (DSIF)

      2,963,397         5,274,774   

Socially Responsible Growth Fund Inc - Initial Shares (DSRG)

      1,146,042         927,013   

Goldman Sachs Global Markets Navigator Fund - Service Shares (GVGMNS)

      6,012         12,779   

Van Kampen V.I. Mid Cap Growth Fund - Series I Shares (IVKMG1)

      110,287         29,588   

Balanced-Risk Allocation Fund: Series I Shares (IVBRA1)

      48,928         8,132   

Balanced Portfolio: Service Shares (JABS)

      152,531         363,005   

Forty Portfolio: Service Shares (JACAS)

      2,532,909         1,278,199   

Global Technology Portfolio: Service Shares (JAGTS)

      1,160,651         587,844   

Overseas Portfolio: Service Shares (JAIGS)

      319,655         593,450   

Var Insurance Trust II - MFS Investors Growth Stock Portfolio: Initial Class (MV2IGI)

      258,978         39,449   

Variable Insurance Trust - MFS New Discovery Series - Initial Class (MNDIC)

      33,224         60,303   

Value Series - Initial Class (MVFIC)

      432,085         279,346   

Core Plus Fixed Income Portfolio - Class I (MSVFI)

      38,883         64,508   

Emerging Markets Debt Portfolio - Class I (MSEM)

      113,424         167,253   

U.S. Real Estate Portfolio - Class I (MSVRE)

      76,824         426,458   

NVIT Investor Destinations Managed Growth Class I (IDPG)

      160,309         334   

NVIT Bond Index Fund Class I (NVBX)

      86,494         47,609   

NVIT International Index Fund Class I (NVIX)

      92,012         1,696   

American Century NVIT Multi Cap Value Fund - Class I (NVAMV1)

      1,186,354         1,137,308   

American Funds NVIT Asset Allocation Fund - Class II (GVAAA2)

      805,500         223,748   

American Funds NVIT Bond Fund - Class II (GVABD2)

      33,167         119,195   

American Funds NVIT Global Growth Fund - Class II (GVAGG2)

      723,849         615,153   

American Funds NVIT Growth Fund - Class II (GVAGR2)

      123,677         151,745   

American Funds NVIT Growth-Income Fund - Class II (GVAGI2)

      107,025         330,958   

Federated NVIT High Income Bond Fund - Class I (HIBF)

      146,831         406,900   

NVIT Emerging Markets Fund - Class I (GEM)

      161,248         306,074   

NVIT International Equity Fund - Class I (GIG)

      432,449         759,344   

Neuberger Berman NVIT Multi Cap Opportunities Fund - Class I (NVNMO1)

      1,496,355         1,534,887   

Neuberger Berman NVIT Socially Responsible Fund - Class I (NVNSR1)

      84,910         94,892   

NVIT Cardinal Aggressive Fund - Class I (NVCRA1)

      54,742         35,031   

NVIT Cardinal Balanced Fund - Class I (NVCRB1)

      395,796         17,392   

NVIT Cardinal Capital Appreciation Fund - Class I (NVCCA1)

      96,954         169,491   

NVIT Cardinal Conservative Fund - Class I (NVCCN1)

      6,151         81,591   

NVIT Cardinal Moderate Fund - Class I (NVCMD1)

      250,197         97,209   

NVIT Cardinal Moderately Aggressive Fund - Class I (NVCMA1)

      176,854         92,760   

NVIT Cardinal Moderately Conservative Fund - Class I (NVCMC1)

      17,823         128,471   

NVIT Core Bond Fund - Class I (NVCBD1)

      184,368         178,376   

NVIT Core Plus Bond Fund - Class I (NVLCP1)

      31,345         121,028   

NVIT Nationwide Fund - Class I (TRF)

      683,177         4,540,147   

NVIT Government Bond Fund - Class I (GBF)

      249,176         765,491   

American Century NVIT Growth Fund - Class I (CAF)

      1,838,875         1,421,362   

NVIT International Index Fund - Class II (GVIX2)

      45,020         39,288   

NVIT Investor Destinations Aggressive Fund - Class II (GVIDA)

      107,024         268,162   

NVIT Investor Destinations Balanced Fund - Class II (NVDBL2)

      23,840         13,466   

NVIT Investor Destinations Capital Appreciation Fund - Class II (NVDCA2)

      62,036         68,349   

NVIT Investor Destinations Conservative Fund - Class II (GVIDC)

      48,463         122,007   

NVIT Investor Destinations Moderate Fund - Class II (GVIDM)

      283,521         1,028,330   

NVIT Investor Destinations Moderately Aggressive Fund - Class II (GVDMA)

      449,147         589,630   

NVIT Investor Destinations Moderately Conservative Fund - Class II (GVDMC)

      406,118         169,968   

NVIT Mid Cap Index Fund - Class I (MCIF)

      1,215,421         727,509   

NVIT Money Market Fund - Class I (SAM)

      8,347,240         11,188,575   

NVIT Multi-Manager International Growth Fund - Class I (NVMIG1)

      552,213         408,486   

NVIT Multi-Manager International Value Fund - Class I (GVDIVI)

      160,113         74,052   

NVIT Multi-Manager Large Cap Growth Fund - Class I (NVMLG1)

      940,082         1,138,110   

NVIT Multi-Manager Large Cap Value Fund - Class I (NVMLV1)

      559,110         396,249   

NVIT Multi-Manager Mid Cap Growth Fund - Class I (NVMMG1)

      4,696,896         2,839,039   

NVIT Multi-Manager Mid Cap Value Fund - Class II (NVMMV2)

      3,430,912         2,301,169   

NVIT Multi-Manager Small Cap Growth Fund - Class I (SCGF)

      647,029         348,178   

NVIT Multi-Manager Small Cap Value Fund - Class I (SCVF)

      1,180,377         880,834   

NVIT Multi-Manager Small Company Fund - Class I (SCF)

      1,819,601         2,313,365   

NVIT Multi-Sector Bond Fund - Class I (MSBF)

      77,125         149,081   

NVIT Short Term Bond Fund - Class II (NVSTB2)

      615,025         634,267   

NVIT Large Cap Growth Fund - Class I (NVOLG1)

      8,870,695         6,161,158   

Templeton NVIT International Value Fund - Class III (NVTIV3)

      70,182         44,279   

Invesco NVIT Comstock Value Fund - Class I (EIF)

      125,211         104,762   

NVIT Real Estate Fund - Class I (NVRE1)

      2,106,709         1,921,591   

Loring Ward NVIT Capital Appreciation Fund - Class P (NVLCAP)

      1,307         7,660   

Loring Ward NVIT Moderate Fund - Class P (NVLMP)

      10,636         125   

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

NVIT Small Cap Index Fund Class II (NVSIX2)

      73,404         4,029   

NVIT S&P 500 Index Fund Class I (GVEX1)

      875,928         808,761   

TOPS Managed Risk Growth ETF Portfolio - Class 3 (NOTG3)

      39         102   

VPS Growth and Income Portfolio - Class A (ALVGIA)

      27,182         100,430   

VPS Small/Mid Cap Value Portfolio - Class A (ALVSVA)

      256,408         238,406   

VP Balanced Fund - Class I (ACVB)

      1,127,568         1,401,339   

VP Capital Appreciation Fund - Class I (ACVCA)

      193,372         329,270   

VP Income & Growth Fund - Class I (ACVIG)

      304,610         636,696   

VP Inflation Protection Fund - Class II (ACVIP2)

      123,729         174,315   

VP International Fund - Class I (ACVI)

      188,421         146,489   

VP Mid Cap Value Fund - Class I (ACVMV1)

      580,036         525,794   

VP Ultra(R) Fund - Class I (ACVU1)

      169,551         204,988   

Small Cap Stock Index Portfolio - Service Shares (DVSCS)

      675,449         585,439   

Appreciation Portfolio - Initial Shares (DCAP)

      400,093         615,980   

Opportunistic Small Cap Portfolio: Initial Shares (DSC)

      217,535         69,984   

Growth and Income Portfolio - Initial Shares (DGI)

      182,035         142,609   

Managed Tail Risk Fund II: Primary Shares (FVCA2P)

      7,678         5,649   

Quality Bond Fund II - Primary Shares (FQB)

      119,226         164,502   

Equity-Income Portfolio - Initial Class (FEIP)

      5,172,070         4,379,165   

High Income Portfolio - Initial Class (FHIP)

      4,746,839         1,953,409   

VIP Asset Manager Portfolio - Initial Class (FAMP)

      1,451,723         1,622,912   

VIP Energy Portfolio - Service Class 2 (FNRS2)

      458,454         576,038   

VIP Freedom Fund 2010 Portfolio - Service Class (FF10S)

      71,893         125,761   

VIP Freedom Fund 2020 Portfolio - Service Class (FF20S)

      104,577         86,056   

VIP Freedom Fund 2030 Portfolio - Service Class (FF30S)

      52,075         118,475   

VIP Growth Portfolio - Initial Class (FGP)

      2,424,217         6,340,672   

VIP Investment Grade Bond Portfolio - Service Class (FIGBS)

      198,040         256,741   

VIP Mid Cap Portfolio - Service Class (FMCS)

      1,290,469         1,877,551   

VIP Overseas Portfolio - Initial Class (FOP)

      566,837         1,011,207   

VIP Overseas Portfolio - Service Class (FOS)

      4,923,035         763,876   

VIP Value Strategies Portfolio - Service Class (FVSS)

      238,663         448,984   

Franklin Income Securities Fund - Class 2 (FTVIS2)

      313,051         291,094   

Rising Dividends Securities Fund - Class 1 (FTVRDI)

      957,577         702,884   

Small Cap Value Securities Fund - Class 1 (FTVSVI)

      462,593         812,450   

Templeton Developing Markets Securities Fund - Class 2 (FTVDM2)

      193,783         88,448   

Templeton Foreign Securities Fund - Class 1 (TIF)

      8,412         43,255   

Templeton Foreign Securities Fund - Class 2 (TIF2)

      148,929         279,740   

Templeton Global Bond Securities Fund - Class 2 (FTVGI2)

      284,959         256,934   

VIP Founding Funds Allocation Fund - Class 2 (FTVFA2)

      111,287         46,225   

Short Duration Bond Portfolio - I Class Shares (AMTB)

      294,867         527,853   

Guardian Portfolio - I Class Shares (AMGP)

      40,343         13,982   

International Portfolio - S Class Shares (AMINS)

      2,550         1,379   

Mid-Cap Growth Portfolio - I Class Shares (AMCG)

      1,983,085         170,202   

Mid-Cap Growth Portfolio - S Class Shares (AMMCGS)

      210,255         18,220   

Advisers Management Trust: Large Cap Value Portfolio - Class I (AMTP)

      361,913         293,300   

Advisers Management Trust: Mid Cap Intrinsic Value Portfolio - Class S (AMRS)

      597         3,545   

Socially Responsive Portfolio - I Class Shares (AMSRS)

      71,004         107,519   

Capital Income Fund/VA - Non-Service Shares (OVMS)

      186,440         648,137   

Core Bond Fund/VA - Non-Service Shares (OVB)

      229,203         283,378   

Global Securities Fund/VA - Non-Service Shares (OVGS)

      2,781,548         2,326,260   

International Growth Fund/VA - Non-Service Shares (OVIG)

      85,513         51,730   

Main Street Fund(R)/VA - Non-Service Shares (OVGI)

      257,735         283,308   

Main Street Small- & Mid-Cap Fund(R)/VA - Non-Service Shares (OVSC)

      886,643         379,565   

Discovery Mid Cap Growth Fund/VA - Non-Service Shares (OVAG)

      341,650         198,880   

Global Strategic Income Fund/VA: Non-service Shares (OVSB)

      54,768         48,690   

All Asset Portfolio - Administrative Class (PMVAAA)

      59,390         31,852   

CommodityRealReturn(R) Strategy Portfolio - Administrative Class (PMVRSA)

      8,376         3,502   

Foreign Bond Portfolio (Unhedged) - Administrative Class (PMVFBA)

      23,356         45,742   

Low Duration Portfolio - Administrative Class (PMVLDA)

      129,872         191,112   

Total Return Portfolio - Administrative Class (PMVTRA)

      259,601         171,785   

VT Growth & Income Fund: Class IB (PVGIB)

      5,423         131,151   

VT International Equity Fund: Class IB (PVTIGB)

      161,579         187,598   

VT Voyager Fund: Class IB (PVTVB)

      275,357         84,442   

VI American Franchise Fund - Series I Shares (ACEG)

      5,259         14,454   

VI Value Opportunities Fund - Series I Shares (AVBVI)

      617         1,001   

VI Mid Cap Core Equity Fund: Series I Shares (AVMCCI)

      266         29,464   

Variable Fund - Multi-Hedge Strategies (RVARS)

      50,552         7,454   

Health Sciences Portfolio - II (TRHS2)

      2,623,541         2,060,159   

Limited-Term Bond Portfolio - II (TRLT2)

      27,634         2,265   

VIP Trust - Unconstrained Emerging Markets Bond Fund - Initial Class (VWBF)

      134,240         243,944   

VIP Trust Emerging Markets Fund - Initial Class (VWEM)

      803,597         1,624,000   

VIP Trust Global Hard Assets Fund - Initial Class (VWHA)

      572,053         1,303,544   

Variable Insurance Portfolios - Asset Strategy (WRASP)

      532,339         481,060   

Variable Insurance Portfolios - High Income (WRHIP)

      1,161,785         1,108,997   

Variable Insurance Portfolios - Mid Cap Growth (WRMCG)

      53,703         52,270   

Advantage VT Discovery Fund (SVDF)

      226,572         155,182   

Advantage VT Opportunity Fund - Class 2 (SVOF)

      201,685         127,215   

Advantage VT Small Cap Growth Fund - Class 2 (WFVSCG)

      250,435         125,320   

Investors Growth Stock Series - Initial Class (obsolete) (MIGIC)

      36,656         257,463   

VIP High Income Portfolio - Initial Class R (obsolete) (FHIPR)

      66,469         3,839,219   

VIP Overseas Portfolio - Service Class R (obsolete) (FOSR)

      78,870         4,599,319   

VP International Fund - Class III (obsolete) (ACVI3)

      5,620         190,174   

Balanced Portfolio - I Class Shares (obsolete) (AMBP)

      8,914         40,768   

Growth Portfolio - I Class Shares (obsolete) (AMTG)

      170,937         2,172,549   

Small-Cap Growth Portfolio - S Class Shares (obsolete) (AMFAS)

      80,123         252,162   
  

 

 

     

 

 

  

Total

    $ 102,156,558       $ 111,176,020   
  

 

 

     

 

 

  

(8) Financial Highlights

The following tabular presentation is a summary of units, unit fair values, contract owners’ equity outstanding and contract expense rates for variable life contracts as of December 31, 2015, and the investment income ratio and total return for each of the periods in the five year period ended December 31, 2015. Total return and investment income ratio for periods with no ending contract owners’ equity were considered to be irrelevant, and therefore are not presented.

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VPS Dynamic Asset Allocation Portfolio - Class A (ALVDAA)

2015     0.80%        43      $ 11.553583      $ 497        0.76%        -1.88%     
2014     0.80%        77        11.774902        907        0.83%        3.62%     
2013     0.50%        441        11.420733        5,037        0.37%        11.75%     
2012     0.50%        443        10.220316        4,528        0.14%        2.20%      5/1/2012

Global Allocation V.I. Fund - Class II (MLVGA2)

2015     0.00%        25,956        16.452774        427,048        1.01%        -0.87%     
2015     0.50%        159,013        15.913354        2,530,430        1.01%        -1.36%     
2015     0.80%        21,353        15.598233        333,069        1.01%        -1.66%     
2014     0.00%        25,752        16.596941        427,404        1.93%        1.97%     
2014     0.50%        146,627        16.133287        2,365,575        1.93%        1.46%     
2014     0.80%        23,844        15.861324        378,197        1.93%        1.15%     
2013     0.00%        23,846        16.276845        388,138        1.06%        14.55%     
2013     0.50%        178,617        15.901450        2,840,269        1.06%        13.98%     
2013     0.80%        27,516        15.680379        431,461        1.06%        13.64%     
2012     0.00%        24,810        14.209224        352,531        1.49%        10.14%     
2012     0.50%        187,347        13.951062        2,613,690        1.49%        9.59%     
2012     0.80%        32,501        13.798429        448,463        1.49%        9.26%     
2011     0.00%        16,561        12.900807        213,650        2.10%        -3.63%     
2011     0.50%        195,667        12.730054        2,490,851        2.10%        -4.11%     
2011     0.80%        32,253        12.628697        407,313        2.10%        -4.39%     

VIP Small Cap Value Series: Service Class (DWVSVS)

2015     0.50%        17,123        12.031473        206,015        0.40%        -6.93%     
2015     0.80%        169        11.935554        2,017        0.40%        -7.21%     
2014     0.50%        32,764        12.927139        423,545        0.21%        5.09%     
2014     0.80%        61        12.862623        785        0.21%        4.78%     
2013     0.50%        4,856        12.300808        59,733        0.00%        23.01%      5/1/2013
2013     0.80%        3        12.276201        37        0.00%        22.76%      5/1/2013

Stock Index Fund, Inc. - Initial Shares (DSIF)

2015     0.00%        165,525        42.884259        7,098,417        1.81%        1.11%     
2015     0.50%        511,292        56.401644        28,837,709        1.81%        0.60%     
2015     0.80%        106,989        53.825726        5,758,761        1.81%        0.30%     
2015     1.00%        112,875        15.871756        1,791,524        1.81%        0.10%     
2014     0.00%        183,537        42.414675        7,784,662        1.74%        13.42%     
2014     0.50%        554,113        56.063662        31,065,604        1.74%        12.86%     
2014     0.80%        121,371        53.663940        6,513,246        1.74%        12.52%     
2014     1.00%        127,230        15.855736        2,017,325        1.74%        12.30%     
2013     0.00%        211,211        37.394784        7,898,190        1.83%        32.03%     
2013     0.50%        592,197        49.676048        29,418,007        1.83%        31.37%     
2013     0.80%        147,183        47.692575        7,019,536        1.83%        30.98%     
2013     1.00%        140,164        14.119622        1,979,063        1.83%        30.71%     
2013     1.30%        15        43.100987        647        1.83%        30.32%     
2012     0.00%        232,518        28.323595        6,585,746        2.02%        15.74%     
2012     0.50%        675,418        37.814121        25,540,338        2.02%        15.16%     
2012     0.80%        177,439        36.413259        6,461,132        2.02%        14.81%     
2012     1.00%        183,017        10.801888        1,976,929        2.02%        14.58%     
2012     1.30%        1        33.072407        33        2.02%        14.24%     
2011     0.00%        242,229        24.472264        5,927,892        1.81%        1.88%     
2011     0.50%        801,833        32.836419        26,329,324        1.81%        1.37%     
2011     0.80%        201,415        31.715171        6,387,911        1.81%        1.07%     
2011     1.00%        192,956        9.427090        1,819,014        1.81%        0.87%     
2011     1.30%        1        28.950048        29        1.81%        0.56%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Socially Responsible Growth Fund Inc - Initial Shares (DSRG)

2015     0.00%        15,245      $ 32.409587      $ 494,084        1.07%        -3.19%     
2015     0.50%        88,042        45.192328        3,978,823        1.07%        -3.68%     
2015     0.80%        47,495        43.127277        2,048,330        1.07%        -3.97%     
2015     1.00%        13,587        11.303362        153,579        1.07%        -4.16%     
2014     0.00%        16,199        33.479090        542,328        1.06%        13.45%     
2014     0.50%        97,660        46.917703        4,581,983        1.06%        12.89%     
2014     0.80%        53,200        44.908354        2,389,124        1.06%        12.55%     
2014     1.00%        15,685        11.793744        184,985        1.06%        12.32%     
2013     0.00%        17,865        29.509325        527,184        1.24%        34.34%     
2013     0.50%        97,257        41.561726        4,042,169        1.24%        33.67%     
2013     0.80%        62,939        39.901274        2,511,346        1.24%        33.27%     
2013     1.00%        15,129        10.499772        158,851        1.24%        33.01%     
2012     0.00%        19,449        21.965624        427,209        0.80%        11.97%     
2012     0.50%        99,652        31.091907        3,098,371        0.80%        11.42%     
2012     0.80%        72,243        29.939352        2,162,909        0.80%        11.08%     
2012     1.00%        17,745        7.894104        140,081        0.80%        10.86%     
2011     0.00%        21,010        19.616581        412,144        0.89%        0.90%     
2011     0.50%        108,447        27.906384        3,026,364        0.89%        0.40%     
2011     0.80%        82,025        26.952830        2,210,806        0.89%        0.10%     
2011     1.00%        25,610        7.120901        182,366        0.89%        -0.10%     

Goldman Sachs Global Markets Navigator Fund - Service Shares (GVGMNS)

2015     0.80%        904        11.134016        10,065        0.06%        -6.57%     
2014     0.50%        523        12.012319        6,282        0.04%        3.43%     
2014     0.80%        947        11.916637        11,285        0.04%        3.12%     
2013     0.50%        527        11.614308        6,121        0.08%        13.00%     
2013     0.80%        959        11.556408        11,083        0.08%        12.66%     
2012     0.50%        532        10.278168        5,468        0.00%        2.78%      5/1/2012

Van Kampen V.I. Mid Cap Growth Fund - Series I Shares (IVKMG1)

2015     0.00%        2,015        14.722930        29,667        0.00%        1.21%     
2015     0.50%        15,276        14.454682        220,810        0.00%        0.70%     
2015     0.80%        2,494        14.296093        35,654        0.00%        0.40%     
2014     0.00%        2,351        14.547427        34,201        0.00%        8.04%     
2014     0.50%        10,579        14.353979        151,851        0.00%        7.50%     
2014     0.80%        2,587        14.239161        36,837        0.00%        7.18%     
2013     0.00%        2,463        13.465170        33,165        0.41%        37.01%     
2013     0.50%        10,788        13.352737        144,049        0.41%        36.33%     
2013     0.80%        2,919        13.285742        38,781        0.41%        35.92%     
2012     0.00%        2,945        9.827596        28,942        0.00%        -1.72%      4/27/2012
2012     0.50%        10,719        9.794347        104,986        0.00%        -2.06%      4/27/2012
2012     0.80%        3,722        9.774456        36,381        0.00%        -2.26%      4/27/2012

Balanced-Risk Allocation Fund: Series I Shares (IVBRA1)

2015     0.50%        8,885        9.809355        87,156        4.50%        -4.58%     
2015     0.80%        2,867        9.760364        27,983        4.50%        -4.86%     
2014     0.50%        8,480        10.280010        87,174        0.00%        2.80%      5/1/2014
2014     0.80%        833        10.259413        8,546        0.00%        2.59%      5/1/2014

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Balanced Portfolio: Service Shares (JABS)

2015     0.00%        6,053      $ 26.705237      $ 161,647        1.59%        0.41%     
2015     0.50%        43,622        25.066501        1,093,451        1.59%        -0.09%     
2015     0.80%        4,027        24.131876        97,179        1.59%        -0.39%     
2014     0.00%        6,247        26.596035        166,145        1.53%        8.24%     
2014     0.50%        54,289        25.089133        1,362,064        1.53%        7.70%     
2014     0.80%        3,795        24.226239        91,939        1.53%        7.38%     
2013     0.00%        6,681        24.571761        164,164        2.03%        19.80%     
2013     0.50%        53,592        23.295722        1,248,464        2.03%        19.20%     
2013     0.80%        4,254        22.562091        95,979        2.03%        18.85%     
2012     0.00%        6,544        20.510267        134,219        2.45%        13.37%     
2012     0.50%        66,020        19.542573        1,290,201        2.45%        12.81%     
2012     0.80%        4,774        18.983974        90,629        2.45%        12.47%     
2011     0.00%        3,796        18.090668        68,672        2.42%        1.35%     
2011     0.50%        84,060        17.323728        1,456,233        2.42%        0.85%     
2011     0.80%        5,460        16.879234        92,161        2.42%        0.55%     

Forty Portfolio: Service Shares (JACAS)

2015     0.00%        38,461        19.681241        756,960        1.23%        11.94%     
2015     0.50%        152,074        18.198114        2,767,460        1.23%        11.38%     
2015     0.80%        23,114        17.362476        401,316        1.23%        11.05%     
2015     1.00%        39,464        17.571689        693,449        1.23%        10.82%     
2014     0.00%        33,078        17.582418        581,591        0.03%        8.47%     
2014     0.50%        149,191        16.338927        2,437,621        0.03%        7.93%     
2014     0.80%        27,099        15.635493        423,706        0.03%        7.60%     
2014     1.00%        19,934        15.855574        316,065        0.03%        7.39%     
2013     0.00%        36,834        16.209830        597,073        0.57%        30.89%     
2013     0.50%        173,739        15.138919        2,630,221        0.57%        30.23%     
2013     0.80%        35,260        14.530669        512,351        0.57%        29.84%     
2013     1.00%        23,989        14.764693        354,190        0.57%        29.58%     
2012     0.00%        43,000        12.384741        532,544        0.58%        23.86%     
2012     0.50%        188,843        11.624473        2,195,200        0.58%        23.24%     
2012     0.80%        45,537        11.190935        509,602        0.58%        22.87%     
2012     1.00%        49,672        11.393919        565,959        0.58%        22.62%     
2011     0.00%        61,290        9.999175        612,849        0.23%        -6.94%     
2011     0.50%        204,085        9.432470        1,925,026        0.23%        -7.40%     
2011     0.80%        51,667        9.108015        470,584        0.23%        -7.68%     
2011     1.00%        37,117        9.291820        344,884        0.23%        -7.87%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Global Technology Portfolio: Service Shares (JAGTS)

2015     0.00%        45,665      $ 9.978812      $ 455,682        0.76%        4.65%     
2015     0.50%        145,966        9.226629        1,346,774        0.76%        4.12%     
2015     0.80%        12,396        8.802803        109,120        0.76%        3.81%     
2015     1.00%        28,378        8.943715        253,805        0.76%        3.60%     
2014     0.00%        40,647        9.535810        387,602        0.00%        9.35%     
2014     0.50%        112,333        8.861220        995,407        0.00%        8.80%     
2014     0.80%        14,262        8.479586        120,936        0.00%        8.48%     
2014     1.00%        26,948        8.632565        232,630        0.00%        8.26%     
2013     0.00%        43,908        8.720680        382,908        0.00%        35.39%     
2013     0.50%        151,983        8.144356        1,237,804        0.00%        34.72%     
2013     0.80%        16,143        7.817003        126,190        0.00%        34.31%     
2013     1.00%        27,256        7.973959        217,338        0.00%        34.04%     
2013     1.30%        11        7.300366        80        0.00%        33.64%     
2012     0.00%        44,277        6.441181        285,196        0.00%        19.15%     
2012     0.50%        155,921        6.045616        942,638        0.00%        18.55%     
2012     0.80%        19,980        5.820037        116,284        0.00%        18.20%     
2012     1.00%        24,515        5.948768        145,834        0.00%        17.96%     
2012     1.30%        11        5.462609        60        0.00%        17.61%     
2011     0.00%        59,113        5.405987        319,564        0.00%        -8.66%     
2011     0.50%        83,027        5.099493        423,396        0.00%        -9.11%     
2011     0.80%        13,985        4.923995        68,862        0.00%        -9.38%     
2011     1.00%        16,819        5.043000        84,818        0.00%        -9.56%     

Overseas Portfolio: Service Shares (JAIGS)

2015     0.00%        23,628        13.412445        316,909        0.50%        -8.80%     
2015     0.50%        149,951        12.401443        1,859,609        0.50%        -9.26%     
2015     0.80%        31,686        11.831820        374,903        0.50%        -9.53%     
2015     1.00%        13,590        12.610885        171,382        0.50%        -9.71%     
2014     0.00%        24,321        14.707142        357,692        5.83%        -12.10%     
2014     0.50%        169,881        13.666799        2,321,729        5.83%        -12.54%     
2014     0.80%        34,957        13.078293        457,178        5.83%        -12.80%     
2014     1.00%        15,736        13.967364        219,790        5.83%        -12.98%     
2013     0.00%        26,990        16.731743        451,590        3.03%        14.28%     
2013     0.50%        206,980        15.626200        3,234,311        3.03%        13.71%     
2013     0.80%        42,158        14.998307        632,299        3.03%        13.37%     
2013     1.00%        25,422        16.050014        408,023        3.03%        13.14%     
2012     0.00%        29,255        14.640868        428,319        0.85%        13.18%     
2012     0.50%        248,458        13.741998        3,414,309        0.85%        12.62%     
2012     0.80%        52,919        13.229420        700,088        0.85%        12.28%     
2012     1.00%        27,845        14.185418        394,993        0.85%        12.05%     
2011     0.00%        40,409        12.935745        522,721        0.40%        -32.34%     
2011     0.50%        60,202        12.202589        734,620        0.40%        -32.67%     
2011     0.80%        12,846        11.782833        151,362        0.40%        -32.88%     
2011     1.00%        60,882        12.659656        770,745        0.40%        -33.01%     

Var Insurance Trust II - MFS Investors Growth Stock Portfolio: Initial Class  (MV2IGI)

2015     0.00%        237        9.859642        2,337        0.50%        -1.40%      3/27/2015
2015     0.50%        18,779        9.822021        184,448        0.50%        -1.78%      3/27/2015
2015     0.80%        1,620        9.799511        15,875        0.50%        -2.00%      3/27/2015

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

       Contract
Expense
Rate*		        Units        Unit
Fair Value		        Contract
Owners’  Equity		        Investment
Income
Ratio**		        Total
Return***		    

Inception

Date****

Variable Insurance Trust - MFS New Discovery Series - Initial Class  (MNDIC)

2015        0.50%           7,452         $ 13.068207         $ 97,384           0.00%           -2.37%     
2015        0.80%           2,770           12.925222           35,803           0.00%           -2.67%     
2014        0.50%           9,319           13.386093           124,745           0.00%           -7.72%     
2014        0.80%           3,188           13.279431           42,335           0.00%           -8.00%     
2013        0.50%           19,043           14.505988           276,238           0.00%           40.81%     
2013        0.80%           2,531           14.433683           36,532           0.00%           40.39%     
2012        0.50%           3,032           10.301526           31,234           0.00%           3.02%      5/1/2012
2012        0.80%           621           10.280941           6,384           0.00%           2.81%      5/1/2012

Value Series - Initial Class (MVFIC)

2015        0.00%           8,161           31.585843           257,772           2.35%           -0.74%     
2015        0.50%           75,462           29.647517           2,237,261           2.35%           -1.23%     
2015        0.80%           4,220           28.542042           120,447           2.35%           -1.53%     
2014        0.00%           10,239           31.820252           325,808           1.33%           10.51%     
2014        0.50%           74,848           30.017248           2,246,731           1.33%           9.96%     
2014        0.80%           4,569           28.984824           132,432           1.33%           9.63%     
2013        0.00%           9,427           28.794051           271,442           1.22%           35.89%     
2013        0.50%           54,778           27.298649           1,495,365           1.22%           35.21%     
2013        0.80%           6,880           26.438908           181,900           1.22%           34.80%     
2012        0.00%           7,952           21.189802           168,501           1.75%           16.26%     
2012        0.50%           62,380           20.189915           1,259,447           1.75%           15.68%     
2012        0.80%           7,555           19.612765           148,174           1.75%           15.33%     
2011        0.00%           10,143           18.226114           184,867           1.48%           -0.30%     
2011        0.50%           92,819           17.453308           1,619,999           1.48%           -0.80%     
2011        0.80%           7,870           17.005440           133,833           1.48%           -1.10%     

Core Plus Fixed Income Portfolio - Class I (MSVFI)

2015        0.00%           893           15.862273           14,165           3.38%           -0.65%     
2015        0.50%           15,180           14.888818           226,012           3.38%           -1.15%     
2015        0.80%           1,157           14.333624           16,584           3.38%           -1.44%     
2014        0.00%           1,541           15.966198           24,604           3.24%           7.85%     
2014        0.50%           16,841           15.061499           253,651           3.24%           7.32%     
2014        0.80%           1,071           14.543436           15,576           3.24%           7.00%     
2013        0.00%           7,055           14.803414           104,438           3.97%           -0.32%     
2013        0.50%           10,340           14.034591           145,118           3.97%           -0.81%     
2013        0.80%           1,272           13.592553           17,290           3.97%           -1.11%     
2012        0.00%           5,129           14.850467           76,168           5.75%           9.44%     
2012        0.50%           16,286           14.149776           230,443           5.75%           8.89%     
2012        0.80%           1,741           13.745300           23,931           5.75%           8.57%     
2011        0.00%           5,195           13.569488           70,493           3.62%           5.65%     
2011        0.50%           10,523           12.994186           136,738           3.62%           5.12%     
2011        0.80%           2,121           12.660760           26,853           3.62%           4.81%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Emerging Markets Debt Portfolio - Class I (MSEM)

2015     0.00%        3,183      $ 32.546083      $ 103,594        5.12%        -1.12%     
2015     0.50%        18,372        29.587592        543,583        5.12%        -1.61%     
2015     0.80%        3,564        28.076874        100,066        5.12%        -1.90%     
2015     1.00%        1,810        27.704633        50,145        5.12%        -2.10%     
2014     0.00%        4,735        32.913131        155,844        5.45%        2.93%     
2014     0.50%        20,141        30.071320        605,666        5.45%        2.41%     
2014     0.80%        3,683        28.621666        105,414        5.45%        2.11%     
2014     1.00%        1,240        28.298765        35,090        5.45%        1.90%     
2013     0.00%        5,572        31.976955        178,176        3.76%        -8.75%     
2013     0.50%        24,973        29.362442        733,268        3.76%        -9.20%     
2013     0.80%        4,398        28.030943        123,280        3.76%        -9.48%     
2013     1.00%        7,602        27.770198        211,109        3.76%        -9.66%     
2012     0.00%        5,484        35.042942        192,175        2.88%        17.96%     
2012     0.50%        33,503        32.339111        1,083,457        2.88%        17.37%     
2012     0.80%        6,099        30.965468        188,858        2.88%        17.02%     
2012     1.00%        11,005        30.738881        338,281        2.88%        16.78%     
2011     0.00%        6,472        29.707233        192,265        3.16%        7.03%     
2011     0.50%        34,581        27.552804        952,804        3.16%        6.50%     
2011     0.80%        6,431        26.461901        170,176        3.16%        6.18%     
2011     1.00%        9,433        26.320970        248,286        3.16%        5.97%     

U.S. Real Estate Portfolio - Class I (MSVRE)

2015     0.00%        5,368        85.535733        459,156        1.29%        2.17%     
2015     0.80%        7        80.842950        566        1.29%        1.36%     
2015     1.00%        19,437        41.468961        806,032        1.29%        1.15%     
2014     0.00%        5,467        83.718637        457,690        1.49%        29.72%     
2014     0.80%        7        79.761003        558        1.49%        28.69%     
2014     1.00%        28,152        40.995865        1,154,116        1.49%        28.43%     
2013     0.00%        6,565        64.537567        423,689        1.21%        2.05%     
2013     0.80%        7        61.979946        434        1.21%        1.24%     
2013     1.00%        25,827        31.920385        824,408        1.21%        1.04%     
2012     0.00%        7,751        63.238652        490,163        0.84%        15.84%     
2012     0.80%        7        61.220395        429        0.84%        14.91%     
2012     1.00%        43,683        31.592343        1,380,048        0.84%        14.68%     
2011     0.00%        9,460        54.593503        516,455        0.97%        5.92%     
2011     0.80%        7        53.276522        373        0.97%        5.08%     
2011     1.00%        46,749        27.548115        1,287,847        0.97%        4.87%     

NVIT Investor Destinations Managed Growth Class I (IDPG)

2015     0.50%        15,862        9.687322        153,660        1.71%        -4.19%     

NVIT Bond Index Fund Class I (NVBX)

2015     0.50%        7,084        10.207041        72,307        2.52%        -0.36%     
2015     0.80%        741        10.156065        7,526        2.52%        -0.66%     
2014     0.50%        4,162        10.243678        42,634        3.72%        2.44%      5/1/2014
2014     0.80%        18        10.223154        184        3.72%        2.23%      5/1/2014

NVIT International Index Fund Class I (NVIX)

2015     0.50%        9,463        9.034998        85,498        3.18%        -1.45%     
2015     0.80%        409        8.989867        3,677        3.18%        -1.75%     
2014     0.50%        50        9.168219        458        2.22%        -8.32%      5/1/2014
2014     0.80%        403        9.149840        3,687        2.22%        -8.50%      5/1/2014

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

American Century NVIT Multi Cap Value Fund - Class I (NVAMV1)

2015     0.00%        38,165      $ 23.497274      $ 896,773        2.35%        -4.28%     
2015     0.50%        199,100        22.727043        4,524,954        2.35%        -4.75%     
2015     0.80%        29,699        22.277085        661,607        2.35%        -5.04%     
2015     1.00%        31,459        21.982092        691,535        2.35%        -5.23%     
2014     0.00%        43,762        24.546677        1,074,212        2.00%        13.12%     
2014     0.50%        228,157        23.861093        5,444,075        2.00%        12.55%     
2014     0.80%        34,192        23.458993        802,110        2.00%        12.22%     
2014     1.00%        34,627        23.194702        803,163        2.00%        11.99%     
2013     0.00%        54,402        21.699995        1,180,415        1.83%        31.90%     
2013     0.50%        242,960        21.199628        5,150,662        1.83%        31.24%     
2013     0.80%        42,091        20.904981        879,912        1.83%        30.85%     
2013     1.00%        32,590        20.710842        674,966        1.83%        30.59%     
2012     0.00%        64,944        16.452105        1,068,466        0.95%        14.66%     
2012     0.50%        264,220        16.153244        4,268,010        0.95%        14.09%     
2012     0.80%        52,739        15.976557        842,588        0.95%        13.75%     
2012     1.00%        46,918        15.859841        744,112        0.95%        13.52%     
2011     0.00%        75,881        14.348277        1,088,762        1.63%        0.65%     
2011     0.50%        321,145        14.158408        4,546,902        1.63%        0.15%     
2011     0.80%        64,614        14.045709        907,549        1.63%        -0.15%     
2011     1.00%        52,825        13.971078        738,022        1.63%        -0.35%     

American Funds NVIT Asset Allocation Fund - Class II (GVAAA2)

2015     0.00%        11,235        16.606784        186,577        1.47%        0.98%     
2015     0.50%        154,817        15.823041        2,449,676        1.47%        0.48%     
2015     0.80%        17,356        15.370711        266,774        1.47%        0.18%     
2014     0.00%        10,445        16.444935        171,767        0.94%        4.99%     
2014     0.50%        129,499        15.747381        2,039,270        0.94%        4.47%     
2014     0.80%        17,023        15.343176        261,187        0.94%        4.15%     
2013     0.00%        12,346        15.663250        193,378        1.34%        23.28%     
2013     0.50%        94,608        15.074035        1,426,124        1.34%        22.67%     
2013     0.80%        17,406        14.731250        256,412        1.34%        22.30%     
2012     0.00%        5,562        12.704984        70,665        1.43%        15.72%     
2012     0.50%        85,379        12.288311        1,049,164        1.43%        15.14%     
2012     0.80%        21,712        12.044923        261,519        1.43%        14.79%     
2011     0.00%        5,660        10.979437        62,144        1.43%        0.93%     
2011     0.50%        70,814        10.672693        755,776        1.43%        0.43%     
2011     0.80%        15,136        10.492803        158,819        1.43%        0.13%     

American Funds NVIT Bond Fund - Class II (GVABD2)

2015     0.00%        388        13.166435        5,109        1.34%        -0.23%     
2015     0.50%        49,437        12.545212        620,198        1.34%        -0.73%     
2015     0.80%        4,367        12.186595        53,219        1.34%        -1.03%     
2014     0.00%        406        13.196903        5,358        1.15%        4.98%     
2014     0.50%        56,597        12.637276        715,232        1.15%        4.45%     
2014     0.80%        4,436        12.312919        54,620        1.15%        4.14%     
2013     0.00%        424        12.571090        5,330        1.73%        -2.57%     
2013     0.50%        66,168        12.098332        800,522        1.73%        -3.06%     
2013     0.80%        4,585        11.823220        54,209        1.73%        -3.35%     
2012     0.00%        3,749        12.903197        48,374        1.92%        4.97%     
2012     0.50%        67,226        12.480192        838,993        1.92%        4.44%     
2012     0.80%        5,234        12.233039        64,028        1.92%        4.13%     
2011     0.00%        5,942        12.292646        73,043        2.31%        5.72%     
2011     0.50%        89,002        11.949408        1,063,521        2.31%        5.20%     
2011     0.80%        6,129        11.748041        72,004        2.31%        4.88%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

American Funds NVIT Global Growth Fund - Class II (GVAGG2)

2015     0.00%        5,004      $ 18.531767      $ 92,733        0.65%        6.54%     
2015     0.50%        76,732        17.657174        1,354,870        0.65%        6.01%     
2015     0.80%        10,443        17.152313        179,122        0.65%        5.69%     
2014     0.00%        5,523        17.393687        96,065        0.68%        1.84%     
2014     0.50%        78,503        16.655884        1,307,537        0.68%        1.33%     
2014     0.80%        10,909        16.228270        177,034        0.68%        1.02%     
2013     0.00%        6,010        17.080144        102,652        0.38%        28.64%     
2013     0.50%        82,382        16.437630        1,354,165        0.38%        28.00%     
2013     0.80%        13,274        16.063746        213,230        0.38%        27.62%     
2012     0.00%        5,401        13.277399        71,711        0.80%        22.09%          
2012     0.50%        93,461        12.841941        1,200,221        0.80%        21.48%     
2012     0.80%        15,246        12.587521        191,909        0.80%        21.11%     
2011     0.00%        6,655        10.875437        72,376        0.95%        -9.31%     
2011     0.50%        137,757        10.571579        1,456,309        0.95%        -9.76%     
2011     0.80%        13,570        10.393328        141,037        0.95%        -10.03%     

American Funds NVIT Growth Fund - Class II (GVAGR2)

2015     0.00%        7,304        17.702463        129,299        0.72%        6.43%     
2015     0.50%        89,046        16.866914        1,501,931        0.72%        5.90%     
2015     0.80%        11,526        16.384632        188,849        0.72%        5.58%     
2014     0.00%        7,831        16.633406        130,256        0.44%        8.07%     
2014     0.50%        92,006        15.927752        1,465,449        0.44%        7.53%     
2014     0.80%        12,954        15.518818        201,031        0.44%        7.21%     
2013     0.00%        7,647        15.391784        117,701        0.33%        29.61%     
2013     0.50%        108,301        14.812689        1,604,229        0.33%        28.96%     
2013     0.80%        15,200        14.475737        220,031        0.33%        28.58%     
2012     0.00%        7,791        11.875465        92,522        0.22%        17.40%     
2012     0.50%        117,743        11.485910        1,352,386        0.22%        16.81%     
2012     0.80%        16,640        11.258336        187,339        0.22%        16.46%     
2011     0.00%        9,503        10.115272        96,125        0.27%        -4.69%     
2011     0.50%        154,823        9.832585        1,522,310        0.27%        -5.16%     
2011     0.80%        18,599        9.666797        179,793        0.27%        -5.45%     

American Funds NVIT Growth-Income Fund - Class II (GVAGI2)

2015     0.00%        1,720        15.067505        25,916        0.82%        1.09%     
2015     0.50%        52,281        14.428331        754,328        0.82%        0.58%     
2015     0.80%        3,552        14.057897        49,934        0.82%        0.28%     
2014     0.00%        1,754        14.905501        26,144        0.81%        10.23%     
2014     0.50%        71,601        14.344756        1,027,099        0.81%        9.68%     
2014     0.80%        4,154        14.018469        58,233        0.81%        9.35%     
2013     0.00%        2,514        13.522509        33,996        1.03%        32.97%     
2013     0.50%        67,370        13.079019        881,134        1.03%        32.31%     
2013     0.80%        4,359        12.819916        55,882        1.03%        31.91%     
2012     0.00%        2,914        10.169772        29,635        0.95%        17.06%     
2012     0.50%        69,302        9.885503        685,085        0.95%        16.48%     
2012     0.80%        3,797        9.718758        36,902        0.95%        16.13%     
2011     0.00%        2,657        8.687464        23,083        0.99%        -2.24%     
2011     0.50%        115,306        8.487048        978,608        0.99%        -2.72%     
2011     0.80%        3,715        8.369014        31,091        0.99%        -3.01%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Federated NVIT High Income Bond Fund - Class I (HIBF)

2015     0.00%        10,207      $ 21.630634      $ 220,784        4.79%        -2.61%     
2015     0.50%        33,330        20.303323        676,710        4.79%        -3.09%     
2015     0.80%        3,787        19.546248        74,022        4.79%        -3.38%     
2014     0.00%        15,551        22.209619        345,382        5.49%        2.55%     
2014     0.50%        41,571        20.951308        870,967        5.49%        2.04%     
2014     0.80%        5,158        20.230706        104,350        5.49%        1.73%     
2013     0.00%        2,808        21.657285        60,814        6.61%        7.07%     
2013     0.50%        2,043        20.532668        41,948        6.61%        6.54%     
2013     0.80%        384        19.886039        7,636        6.61%        6.22%     
2012     0.00%        2,854        20.226839        57,727        6.54%        14.56%          
2012     0.50%        2,123        19.272608        40,916        6.54%        13.98%     
2012     0.80%        407        18.721734        7,620        6.54%        13.64%     
2011     0.00%        4,766        17.656619        84,151        8.19%        3.82%     
2011     0.50%        2,410        16.908181        40,749        8.19%        3.30%     
2011     0.80%        570        16.474351        9,390        8.19%        2.99%     

NVIT Emerging Markets Fund - Class I (GEM)

2015     0.00%        10,524        21.512038        226,393        0.83%        -15.99%     
2015     0.50%        75,298        19.932578        1,500,883        0.83%        -16.41%     
2015     0.80%        10,108        19.041117        192,468        0.83%        -16.67%     
2015     1.00%        12,514        18.193147        227,669        0.83%        -16.83%     
2014     0.00%        11,469        25.608009        293,698        1.27%        -5.51%     
2014     0.50%        78,785        23.846907        1,878,779        1.27%        -5.98%     
2014     0.80%        12,134        22.848918        277,249        1.27%        -6.26%     
2014     1.00%        12,637        21.875140        276,436        1.27%        -6.45%     
2013     0.00%        754        27.100074        20,433        1.13%        0.75%     
2013     0.50%        14,668        25.362948        372,024        1.13%        0.24%     
2013     0.80%        1,886        24.374582        45,970        1.13%        -0.06%     
2013     1.00%        17,361        23.382534        405,944        1.13%        -0.26%     
2012     0.00%        869        26.899413        23,376        0.49%        17.22%     
2012     0.50%        16,753        25.301371        423,874        0.49%        16.63%     
2012     0.80%        2,308        24.388485        56,289        0.49%        16.28%     
2012     1.00%        20,461        23.442718        479,661        0.49%        16.05%     
2011     0.00%        985        22.948246        22,604        0.64%        -22.37%     
2011     0.50%        19,654        21.693374        426,362        0.64%        -22.76%     
2011     0.80%        2,961        20.973634        62,103        0.64%        -22.99%     
2011     1.00%        22,453        20.200753        453,568        0.64%        -23.15%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT International Equity Fund - Class I (GIG)

2015     0.00%        23,440      $ 16.060113      $ 376,449        0.49%        -3.06%     
2015     0.50%        195,376        14.880984        2,907,387        0.49%        -3.54%     
2015     0.80%        29,478        14.215565        419,046        0.49%        -3.83%     
2015     1.00%        1,044        13.861728        14,472        0.49%        -4.02%     
2014     0.00%        26,132        16.566460        432,915        2.89%        -0.45%     
2014     0.50%        216,564        15.427137        3,340,962        2.89%        -0.94%     
2014     0.80%        34,206        14.781599        505,619        2.89%        -1.24%     
2014     1.00%        2,802        14.442552        40,468        2.89%        -1.44%          
2013     0.00%        7,722        16.641029        128,502        0.54%        17.83%     
2013     0.50%        29,091        15.574278        453,071        0.54%        17.24%     
2013     0.80%        4,751        14.967429        71,110        0.54%        16.89%     
2013     1.00%        1,823        14.653397        26,713        0.54%        16.66%     
2012     0.00%        9,497        14.122631        134,123        0.85%        15.61%     
2012     0.50%        30,028        13.283536        398,878        0.85%        15.03%     
2012     0.80%        5,275        12.804278        67,543        0.85%        14.68%     
2012     1.00%        1,136        12.560723        14,269        0.85%        14.46%     
2011     0.00%        11,889        12.216006        145,236        1.21%        -9.76%     
2011     0.50%        29,995        11.547898        346,379        1.21%        -10.21%     
2011     0.80%        5,692        11.164772        63,550        1.21%        -10.48%     
2011     1.00%        2,338        10.974373        25,658        1.21%        -10.66%     

Neuberger Berman NVIT Multi Cap Opportunities Fund - Class I (NVNMO1)

2015     0.00%        61,213        14.364226        879,277        0.77%        -1.08%     
2015     0.50%        750,786        13.823879        10,378,775        0.77%        -1.57%     
2015     0.80%        139,591        13.509410        1,885,792        0.77%        -1.87%     
2015     1.00%        3,427        13.303772        45,592        0.77%        -2.06%     
2014     0.00%        68,047        14.520984        988,109        0.88%        6.60%     
2014     0.50%        810,822        14.044790        11,387,825        0.88%        6.07%     
2014     0.80%        161,234        13.766559        2,219,637        0.88%        5.75%     
2014     1.00%        4,364        13.584144        59,281        0.88%        5.54%     
2013     0.00%        80,186        13.621982        1,092,292        1.04%        43.82%     
2013     0.50%        889,883        13.241308        11,783,215        1.04%        43.10%     
2013     0.80%        204,304        13.018003        2,659,630        1.04%        42.67%     
2013     1.00%        4,637        12.871222        59,684        1.04%        42.39%     
2012     0.00%        81,034        9.471654        767,526        1.47%        16.94%     
2012     0.50%        929,767        9.253058        8,603,188        1.47%        16.36%     
2012     0.80%        244,333        9.124314        2,229,371        1.47%        16.01%     
2011     0.00%        88,502        8.099461        716,818        0.57%        -11.62%     
2011     0.50%        1,006,367        7.952277        8,002,909        0.57%        -12.06%     
2011     0.80%        281,765        7.865245        2,216,151        0.57%        -12.32%     

Neuberger Berman NVIT Socially Responsible Fund - Class I (NVNSR1)

2015     0.50%        6,114        15.962214        97,593        0.85%        -0.82%     
2015     0.80%        852        15.599224        13,291        0.85%        -1.12%     
2014     0.50%        7,812        16.094343        125,729        0.95%        10.05%     
2014     0.80%        824        15.775608        12,999        0.95%        9.72%     
2013     0.50%        8,369        14.624455        122,392        0.94%        38.07%     
2013     0.80%        967        14.377892        13,903        0.94%        37.66%     
2012     0.50%        8,154        10.591756        86,365        0.59%        10.94%     
2012     0.80%        540        10.444446        5,640        0.59%        10.61%     
2011     0.50%        23,204        9.547148        221,532        0.78%        -3.66%     
2011     0.80%        1,623        9.442714        15,326        0.78%        -3.95%     

 

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Cardinal Aggressive Fund - Class I (NVCRA1)

2015     0.50%        18,331      $ 13.346240      $ 244,650        2.71%        -2.07%     
2015     0.80%        4,713        13.042718        61,470        2.71%        -2.36%     
2014     0.50%        17,610        13.627822        239,986        2.11%        3.95%     
2014     0.80%        6,305        13.357922        84,222        2.11%        3.64%     
2013     0.50%        18,478        13.109417        242,236        1.50%        29.00%     
2013     0.80%        7,976        12.888391        102,798        1.50%        28.62%     
2012     0.50%        8,186        10.162172        83,188        1.08%        15.64%          
2012     0.80%        7,584        10.020827        75,998        1.08%        15.30%     
2011     0.50%        10,030        8.787510        88,139        2.01%        -6.65%     
2011     0.80%        5,766        8.691366        50,114        2.01%        -6.93%     

NVIT Cardinal Balanced Fund - Class I (NVCRB1)

2015     0.00%        397        13.800315        5,479        3.15%        -1.05%     
2015     0.50%        51,506        13.281354        684,069        3.15%        -1.55%     
2015     0.80%        3,990        12.979315        51,787        3.15%        -1.84%     
2014     0.00%        407        13.947302        5,677        2.23%        4.46%     
2014     0.50%        24,444        13.490111        329,752        2.23%        3.94%     
2014     0.80%        4,636        13.222946        61,302        2.23%        3.63%     
2013     0.00%        417        13.351426        5,568        2.05%        14.72%     
2013     0.50%        26,818        12.978480        348,057        2.05%        14.15%     
2013     0.80%        6,218        12.759683        79,340        2.05%        13.80%     
2012     0.00%        426        11.638522        4,958        1.48%        11.24%     
2012     0.50%        12,209        11.370100        138,818        1.48%        10.68%     
2012     0.80%        8,407        11.211995        94,259        1.48%        10.35%     
2011     0.00%        437        10.462826        4,572        2.59%        -1.26%     
2011     0.50%        3,104        10.272876        31,887        2.59%        -1.75%     
2011     0.80%        10,388        10.160539        105,548        2.59%        -2.05%     

NVIT Cardinal Capital Appreciation Fund - Class I (NVCCA1)

2015     0.00%        442        14.021191        6,197        3.01%        -1.15%     
2015     0.50%        39,708        13.493842        535,813        3.01%        -1.64%     
2015     0.80%        7,360        13.187024        97,056        3.01%        -1.93%     
2014     0.00%        452        14.183683        6,411        2.46%        4.70%     
2014     0.50%        49,019        13.718657        672,475        2.46%        4.18%     
2014     0.80%        7,603        13.447019        102,238        2.46%        3.87%     
2013     0.00%        463        13.546578        6,272        1.94%        21.44%     
2013     0.50%        52,578        13.168123        692,354        1.94%        20.84%     
2013     0.80%        8,110        12.946159        104,993        1.94%        20.48%     
2012     0.00%        474        11.154725        5,287        1.51%        13.74%     
2012     0.50%        39,272        10.897413        427,963        1.51%        13.17%     
2012     0.80%        6,735        10.745888        72,374        1.51%        12.83%     
2011     0.00%        485        9.807509        4,757        2.24%        -3.37%     
2011     0.50%        34,007        9.629406        327,467        2.24%        -3.85%     
2011     0.80%        7,281        9.524103        69,345        2.24%        -4.13%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Cardinal Conservative Fund - Class I (NVCCN1)

2015     0.00%        244      $ 13.034982      $ 3,181        1.72%        -0.65%     
2015     0.50%        2,512        12.544832        31,513        1.72%        -1.15%     
2015     0.80%        894        12.259602        10,960        1.72%        -1.44%     
2014     0.00%        250        13.120260        3,280        0.27%        3.42%     
2014     0.50%        8,580        12.690207        108,882        0.27%        2.91%     
2014     0.80%        897        12.438930        11,158        0.27%        2.60%     
2013     0.00%        256        12.686282        3,248        1.85%        5.03%     
2013     0.50%        118,087        12.331960        1,456,244        1.85%        4.50%     
2013     0.80%        3,870        12.124095        46,920        1.85%        4.19%     
2012     0.00%        262        12.078891        3,165        1.97%        7.58%     
2012     0.50%        125,677        11.800384        1,483,037        1.97%        7.04%     
2012     0.80%        2,499        11.636337        29,079        1.97%        6.72%          
2011     0.00%        2,769        11.227964        31,090        2.16%        1.50%     
2011     0.50%        7,054        11.024191        77,765        2.16%        0.99%     
2011     0.80%        2,400        10.903683        26,169        2.16%        0.69%     

NVIT Cardinal Moderate Fund - Class I (NVCMD1)

2015     0.00%        7,798        13.935133        108,666        3.00%        -0.98%     
2015     0.50%        69,776        13.411061        935,770        3.00%        -1.47%     
2015     0.80%        14,769        13.106100        193,564        3.00%        -1.76%     
2014     0.00%        7,957        14.072360        111,974        2.49%        4.66%     
2014     0.50%        62,397        13.611027        849,287        2.49%        4.14%     
2014     0.80%        18,118        13.341496        241,721        2.49%        3.82%     
2013     0.00%        8,120        13.446120        109,182        1.72%        17.98%     
2013     0.50%        61,511        13.070501        803,980        1.72%        17.39%     
2013     0.80%        22,118        12.850167        284,220        1.72%        17.04%     
2012     0.00%        8,286        11.397169        94,437        1.52%        12.45%     
2012     0.50%        61,650        11.134287        686,429        1.52%        11.89%     
2012     0.80%        22,093        10.979484        242,570        1.52%        11.55%     
2011     0.00%        8,440        10.135390        85,543        2.45%        -2.25%     
2011     0.50%        61,673        9.951354        613,730        2.45%        -2.73%     
2011     0.80%        21,926        9.842542        215,808        2.45%        -3.02%     

NVIT Cardinal Moderately Aggressive Fund - Class I (NVCMA1)

2015     0.50%        43,784        13.397846        586,611        3.02%        -1.92%     
2015     0.80%        9,353        13.093144        122,460        3.02%        -2.21%     
2014     0.50%        41,362        13.659891        565,000        2.60%        4.14%     
2014     0.80%        11,437        13.389348        153,134        2.60%        3.82%     
2013     0.50%        37,730        13.117335        494,917        1.59%        23.74%     
2013     0.80%        13,960        12.896172        180,031        1.59%        23.36%     
2012     0.50%        28,065        10.601144        297,521        1.37%        14.10%     
2012     0.80%        18,386        10.453700        192,202        1.37%        13.75%     
2011     0.50%        18,827        9.291441        174,930        2.58%        -5.05%     
2011     0.80%        20,521        9.189793        188,584        2.58%        -5.33%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Cardinal Moderately Conservative Fund - Class I (NVCMC1)

2015     0.00%        3,965      $ 13.598100      $ 53,916        2.15%        -0.88%     
2015     0.50%        7,021        13.086745        91,882        2.15%        -1.37%     
2015     0.80%        2,852        12.789198        36,475        2.15%        -1.67%     
2014     0.00%        10,355        13.718708        142,057        2.34%        4.17%     
2014     0.50%        9,359        13.269010        124,185        2.34%        3.65%     
2014     0.80%        2,941        13.006282        38,251        2.34%        3.34%     
2013     0.00%        12,117        13.169178        159,571        1.72%        11.33%     
2013     0.50%        10,274        12.801334        131,521        1.72%        10.78%     
2013     0.80%        3,671        12.585576        46,202        1.72%        10.44%     
2012     0.00%        12,345        11.828808        146,027        1.57%        10.13%     
2012     0.50%        13,367        11.556019        154,469        1.57%        9.58%          
2012     0.80%        4,247        11.395367        48,396        1.57%        9.25%     
2011     0.00%        12,584        10.740467        135,158        2.72%        -0.28%     
2011     0.50%        15,078        10.545498        159,005        2.72%        -0.78%     
2011     0.80%        5,377        10.430205        56,083        2.72%        -1.07%     

NVIT Core Bond Fund - Class I (NVCBD1)

2015     0.00%        586        13.609836        7,975        2.98%        -0.72%     
2015     0.50%        22,181        13.098062        290,528        2.98%        -1.22%     
2015     0.80%        1,767        12.800299        22,618        2.98%        -1.51%     
2015     1.00%        14,774        12.605559        186,235        2.98%        -1.71%     
2014     0.00%        1,056        13.708553        14,476        2.56%        5.06%     
2014     0.50%        22,151        13.259207        293,705        2.56%        4.53%     
2014     0.80%        1,802        12.996712        23,420        2.56%        4.22%     
2014     1.00%        14,961        12.824610        191,869        2.56%        4.01%     
2013     0.00%        632        13.048920        8,247        2.58%        -1.91%     
2013     0.50%        24,060        12.684452        305,188        2.58%        -2.40%     
2013     0.80%        2,795        12.470693        34,856        2.58%        -2.69%     
2013     1.00%        17,988        12.330187        221,795        2.58%        -2.89%     
2012     0.00%        5,364        13.303193        71,358        3.26%        7.75%     
2012     0.50%        15,991        12.996442        207,826        3.26%        7.22%     
2012     0.80%        1,564        12.815824        20,044        3.26%        6.89%     
2012     1.00%        13,058        12.696813        165,795        3.26%        6.68%     
2011     0.00%        10,606        12.345910        130,941        3.44%        6.59%     
2011     0.50%        18,261        12.121845        221,357        3.44%        6.06%     
2011     0.80%        1,634        11.989375        19,591        3.44%        5.75%     
2011     1.00%        10,223        11.901878        121,673        3.44%        5.54%     

NVIT Core Plus Bond Fund - Class I (NVLCP1)

2015     0.50%        7,127        14.218455        101,335        1.50%        -0.81%     
2015     0.80%        1,232        13.895258        17,119        1.50%        -1.11%     
2014     0.50%        13,598        14.335263        194,931        2.44%        4.57%     
2014     0.80%        1,107        14.051506        15,555        2.44%        4.25%     
2013     0.50%        10,722        13.709338        146,992        2.06%        -2.26%     
2013     0.80%        1,157        13.478328        15,594        2.06%        -2.56%     
2012     0.50%        13,334        14.026661        187,031        2.43%        6.84%     
2012     0.80%        1,636        13.831749        22,629        2.43%        6.52%     
2011     0.50%        10,094        13.128149        132,516        2.91%        5.84%     
2011     0.80%        828        12.984709        10,751        2.91%        5.53%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Nationwide Fund - Class I (TRF)

2015     0.00%        85,545      $ 35.133556      $ 3,005,500        1.20%        0.94%     
2015     0.50%        352,222        74.184806        26,129,521        1.20%        0.43%     
2015     0.80%        304,453        57.982649        17,652,991        1.20%        0.13%     
2015     1.00%        52,248        15.514649        810,609        1.20%        -0.07%     
2014     0.00%        89,844        34.807939        3,127,284        1.16%        12.15%     
2014     0.50%        371,203        73.865693        27,419,167        1.16%        11.59%     
2014     0.80%        342,313        57.906704        19,822,218        1.16%        11.25%     
2014     1.00%        74,532        15.525349        1,157,135        1.16%        11.03%     
2013     0.00%        101,369        31.037588        3,146,249        1.32%        31.10%     
2013     0.50%        369,380        66.194760        24,451,020        1.32%        30.45%     
2013     0.80%        411,985        52.049003        21,443,409        1.32%        30.06%     
2013     1.00%        85,828        13.982782        1,200,114        1.32%        29.80%     
2012     0.00%        117,116        23.674524        2,772,666        1.41%        14.21%     
2012     0.50%        378,810        50.744233        19,222,423        1.41%        13.64%     
2012     0.80%        486,478        40.020036        19,468,867        1.41%        13.30%     
2012     1.00%        98,516        10.772753        1,061,289        1.41%        13.08%     
2011     0.00%        142,775        20.728147        2,959,461        1.14%        0.53%     
2011     0.50%        412,184        44.652135        18,404,896        1.14%        0.03%     
2011     0.80%        542,718        35.321483        19,169,605        1.14%        -0.27%          
2011     1.00%        108,508        9.527060        1,033,762        1.14%        -0.47%     
2011     1.30%        3        34.329664        103        1.14%        -0.77%     

NVIT Government Bond Fund - Class I (GBF)

2015     0.00%        35,320        25.802376        911,340        1.69%        -0.11%     
2015     0.50%        77,238        43.363363        3,349,299        1.69%        -0.61%     
2015     0.80%        29,660        31.927769        946,978        1.69%        -0.90%     
2015     1.00%        30,019        16.598821        498,280        1.69%        -1.10%     
2014     0.00%        45,593        25.830432        1,177,687        1.97%        4.57%     
2014     0.50%        81,961        43.628136        3,575,806        1.97%        4.05%     
2014     0.80%        32,043        32.219240        1,032,401        1.97%        3.74%     
2014     1.00%        32,342        16.783889        542,825        1.97%        3.53%     
2013     0.00%        51,599        24.701818        1,274,589        1.81%        -4.06%     
2013     0.50%        88,492        41.930997        3,710,558        1.81%        -4.53%     
2013     0.80%        37,197        31.058943        1,155,300        1.81%        -4.82%     
2013     1.00%        38,465        16.211842        623,589        1.81%        -5.01%     
2012     0.00%        66,264        25.745883        1,706,025        2.14%        3.06%     
2012     0.50%        112,707        43.922389        4,950,361        2.14%        2.54%     
2012     0.80%        44,154        32.631769        1,440,823        2.14%        2.23%     
2012     1.00%        75,338        17.066917        1,285,787        2.14%        2.03%     
2011     0.00%        71,393        24.982190        1,783,553        2.93%        7.25%     
2011     0.50%        134,783        42.833702        5,773,255        2.93%        6.72%     
2011     0.80%        52,003        31.918804        1,659,874        2.93%        6.40%     
2011     1.00%        101,054        16.727524        1,690,383        2.93%        6.19%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

American Century NVIT Growth Fund - Class I (CAF)

2015     0.00%        36,461      $ 25.810261      $ 941,068        0.35%        4.67%     
2015     0.50%        218,365        36.761737        8,027,477        0.35%        4.15%     
2015     0.80%        119,221        35.155483        4,191,272        0.35%        3.83%     
2015     1.00%        41,762        10.605220        442,895        0.35%        3.63%     
2014     0.00%        42,177        24.659135        1,040,048        0.35%        11.33%     
2014     0.50%        233,410        35.298207        8,238,954        0.35%        10.77%     
2014     0.80%        133,465        33.857321        4,518,767        0.35%        10.44%     
2014     1.00%        46,212        10.234057        472,936        0.35%        10.22%     
2013     0.00%        48,008        22.149716        1,063,364        0.67%        29.74%     
2013     0.50%        236,432        31.865009        7,533,908        0.67%        29.09%     
2013     0.80%        162,440        30.656078        4,979,773        0.67%        28.71%     
2013     1.00%        52,842        9.284963        490,636        0.67%        28.45%     
2013     1.30%        21        27.505011        578        0.67%        28.06%     
2012     0.00%        58,712        17.072452        1,002,358        0.55%        14.02%     
2012     0.50%        248,603        24.683788        6,136,464        0.55%        13.45%     
2012     0.80%        189,859        23.818612        4,522,178        0.55%        13.11%     
2012     1.00%        54,423        7.228500        393,397        0.55%        12.88%     
2011     0.00%        71,801        14.973016        1,075,078        0.58%        -0.69%     
2011     0.50%        266,244        21.757113        5,792,701        0.58%        -1.18%     
2011     0.80%        211,204        21.057718        4,447,474        0.58%        -1.48%     
2011     1.00%        57,501        6.403442        368,204        0.58%        -1.68%     

NVIT International Index Fund - Class II (GVIX2)

2015     0.00%        13,756        9.215814        126,773        2.09%        -1.26%     
2015     0.50%        28,482        9.138464        260,282        2.09%        -1.75%     
2015     0.80%        647        9.092378        5,883        2.09%        -2.04%     
2014     0.00%        14,528        9.333223        135,593        1.63%        -6.67%      4/25/2014
2014     0.50%        27,931        9.301297        259,795        1.63%        -6.99%      4/25/2014
2014     0.80%        635        9.282195        5,894        1.63%        -7.18%      4/25/2014

NVIT Investor Destinations Aggressive Fund - Class II (GVIDA)

2015     0.00%        3,611        22.707558        81,997        1.39%        -1.00%     
2015     0.50%        73,119        21.179621        1,548,633        1.39%        -1.49%     
2015     0.80%        17,157        20.312637        348,504        1.39%        -1.79%     
2015     1.00%        784        19.754390        15,487        1.39%        -1.98%     
2014     0.00%        3,692        22.936445        84,681        1.55%        4.99%     
2014     0.50%        81,629        21.500362        1,755,053        1.55%        4.46%     
2014     0.80%        16,565        20.682213        342,601        1.55%        4.15%     
2014     1.00%        791        20.154085        15,942        1.55%        3.94%     
2013     0.00%        3,770        21.847269        82,364        1.68%        27.25%     
2013     0.50%        92,423        20.582038        1,902,254        1.68%        26.61%     
2013     0.80%        19,777        19.858311        392,738        1.68%        26.23%     
2013     1.00%        797        19.389984        15,454        1.68%        25.98%     
2012     0.00%        3,629        17.169227        62,307        1.52%        15.90%     
2012     0.50%        88,197        16.255930        1,433,724        1.52%        15.32%     
2012     0.80%        23,100        15.731416        363,396        1.52%        14.98%     
2012     1.00%        805        15.391139        12,390        1.52%        14.75%     
2011     0.00%        3,697        14.813448        54,765        1.80%        -3.93%     
2011     0.50%        95,067        14.095927        1,340,057        1.80%        -4.41%     
2011     0.80%        27,902        13.682175        381,760        1.80%        -4.70%     
2011     1.00%        820        13.413080        10,999        1.80%        -4.89%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Investor Destinations Balanced Fund - Class II (NVDBL2)

2015     0.00%        14,518      $ 16.704200      $ 242,512        1.70%        -0.17%     
2015     0.50%        5,954        16.156606        96,196        1.70%        -0.67%     
2015     0.80%        806        15.836701        12,764        1.70%        -0.97%     
2014     0.00%        14,741        16.733256        246,665        3.02%        4.59%     
2014     0.50%        5,378        16.265827        87,478        3.02%        4.06%     
2014     0.80%        1,331        15.991674        21,285        3.02%        3.75%     
2013     0.50%        5,308        15.630658        82,968        1.71%        12.86%     
2013     0.80%        1,587        15.413373        24,461        1.71%        12.52%     
2012     0.50%        4,538        13.849830        62,851        1.85%        8.84%     
2012     0.80%        2,262        13.698322        30,986        1.85%        8.51%     
2011     0.50%        4,133        12.725028        52,593        2.03%        0.38%     
2011     0.80%        1,419        12.623728        17,913        2.03%        0.08%     

NVIT Investor Destinations Capital Appreciation Fund - Class II (NVDCA2)

2015     0.00%        215        19.013052        4,088        1.47%        -0.53%     
2015     0.50%        3,494        18.389805        64,254        1.47%        -1.03%     
2015     0.80%        1,573        18.025703        28,354        1.47%        -1.32%     
2014     0.00%        234        19.114689        4,473        1.50%        5.21%          
2014     0.50%        3,307        18.580794        61,447        1.50%        4.69%     
2014     0.80%        2,283        18.267630        41,705        1.50%        4.37%     
2013     0.00%        248        18.167791        4,506        1.88%        19.49%     
2013     0.50%        4,501        17.748867        79,888        1.88%        18.90%     
2013     0.80%        2,886        17.502158        50,511        1.88%        18.54%     
2012     0.50%        3,118        14.927778        46,545        1.64%        11.69%     
2012     0.80%        2,912        14.764482        42,994        1.64%        11.35%     
2011     0.50%        3,601        13.365506        48,129        1.77%        -1.43%     
2011     0.80%        2,553        13.259099        33,850        1.77%        -1.72%     

NVIT Investor Destinations Conservative Fund - Class II (GVIDC)

2015     0.00%        3,939        16.833321        66,306        1.61%        0.26%     
2015     0.50%        8,757        15.700819        137,492        1.61%        -0.24%     
2015     0.80%        8,264        15.058187        124,441        1.61%        -0.53%     
2015     1.00%        8,989        14.644442        131,639        1.61%        -0.73%     
2014     0.00%        4,024        16.788858        67,558        1.78%        3.89%     
2014     0.50%        9,741        15.737835        153,302        1.78%        3.37%     
2014     0.80%        10,194        15.139054        154,328        1.78%        3.06%     
2014     1.00%        12,170        14.752556        179,539        1.78%        2.86%     
2013     0.00%        5,998        16.160183        96,929        1.58%        4.83%     
2013     0.50%        14,238        15.224446        216,766        1.58%        4.31%     
2013     0.80%        10,338        14.689194        151,857        1.58%        4.00%     
2013     1.00%        7,843        14.342829        112,491        1.58%        3.79%     
2012     0.00%        9,213        15.415374        142,022        1.31%        5.18%     
2012     0.50%        21,627        14.595544        315,658        1.31%        4.65%     
2012     0.80%        11,313        14.124710        159,793        1.31%        4.34%     
2012     1.00%        6,951        13.819265        96,058        1.31%        4.13%     
2011     0.00%        6,588        14.656785        96,559        2.41%        2.93%     
2011     0.50%        41,779        13.947019        582,693        2.41%        2.42%     
2011     0.80%        13,467        13.537768        182,313        2.41%        2.11%     
2011     1.00%        6,801        13.271591        90,260        2.41%        1.91%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Investor Destinations Moderate Fund - Class II (GVIDM)

2015     0.00%        51,527      $ 20.473919      $ 1,054,960        1.44%        -0.33%     
2015     0.50%        71,218        19.096332        1,360,003        1.44%        -0.83%     
2015     0.80%        41,881        18.314731        767,039        1.44%        -1.13%     
2015     1.00%        12,274        17.811493        218,618        1.44%        -1.33%     
2014     0.00%        69,066        20.542646        1,418,798        1.65%        5.18%     
2014     0.50%        97,671        19.256487        1,880,800        1.65%        4.66%     
2014     0.80%        45,931        18.523829        850,818        1.65%        4.34%     
2014     1.00%        11,748        18.050914        212,062        1.65%        4.13%     
2013     0.00%        80,435        19.530736        1,570,955        1.61%        16.63%     
2013     0.50%        105,749        18.399703        1,945,750        1.61%        16.05%     
2013     0.80%        51,634        17.752817        916,649        1.61%        15.70%     
2013     1.00%        19,722        17.334221        341,866        1.61%        15.47%     
2012     0.00%        77,643        16.746328        1,300,235        1.58%        10.81%     
2012     0.50%        112,911        15.855596        1,790,271        1.58%        10.26%     
2012     0.80%        70,907        15.344089        1,088,003        1.58%        9.93%     
2012     1.00%        21,064        15.012265        316,218        1.58%        9.71%     
2011     0.00%        109,350        15.112388        1,652,540        2.13%        -0.04%          
2011     0.50%        137,944        14.380454        1,983,697        2.13%        -0.54%     
2011     0.80%        75,950        13.958439        1,060,143        2.13%        -0.84%     
2011     1.00%        18,271        13.683980        250,020        2.13%        -1.03%     

NVIT Investor Destinations Moderately Aggressive Fund - Class II (GVDMA)

2015     0.00%        33,868        21.949295        743,379        1.49%        -0.73%     
2015     0.50%        153,656        20.472428        3,145,711        1.49%        -1.22%     
2015     0.80%        36,259        19.634425        711,925        1.49%        -1.52%     
2015     1.00%        19,444        19.094916        371,282        1.49%        -1.72%     
2014     0.00%        34,780        22.110620        769,007        1.70%        4.96%     
2014     0.50%        158,084        20.726276        3,276,493        1.70%        4.43%     
2014     0.80%        44,344        19.937630        884,114        1.70%        4.12%     
2014     1.00%        19,783        19.428613        384,356        1.70%        3.91%     
2013     0.00%        33,364        21.066347        702,858        1.63%        22.38%     
2013     0.50%        165,735        19.846371        3,289,238        1.63%        21.77%     
2013     0.80%        51,703        19.148562        990,038        1.63%        21.40%     
2013     1.00%        19,992        18.697056        373,792        1.63%        21.16%     
2012     0.00%        38,658        17.214305        665,471        1.56%        13.76%     
2012     0.50%        166,722        16.298646        2,717,343        1.56%        13.19%     
2012     0.80%        67,326        15.772806        1,061,920        1.56%        12.85%     
2012     1.00%        35,372        15.431703        545,850        1.56%        12.63%     
2011     0.00%        37,793        15.132127        571,888        2.01%        -2.13%     
2011     0.50%        204,010        14.399187        2,937,578        2.01%        -2.61%     
2011     0.80%        81,321        13.976593        1,136,591        2.01%        -2.90%     
2011     1.00%        35,914        13.701766        492,085        2.01%        -3.10%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Investor Destinations Moderately Conservative Fund - Class II (GVDMC)

2015     0.00%        6,512      $ 18.983169      $ 123,618        1.67%        -0.03%     
2015     0.50%        164,221        17.705928        2,907,685        1.67%        -0.53%     
2015     0.80%        8,770        16.981269        148,926        1.67%        -0.83%     
2015     1.00%        23,318        16.514677        385,089        1.67%        -1.03%     
2014     0.00%        6,719        18.988951        127,587        1.81%        4.74%     
2014     0.50%        160,074        17.800116        2,849,336        1.81%        4.22%     
2014     0.80%        10,824        17.122895        185,338        1.81%        3.90%     
2014     1.00%        24,842        16.685759        414,508        1.81%        3.70%     
2013     0.00%        6,944        18.129719        125,893        1.73%        10.49%     
2013     0.50%        155,987        17.079857        2,664,236        1.73%        9.94%     
2013     0.80%        12,071        16.479401        198,923        1.73%        9.61%     
2013     1.00%        19,910        16.090841        320,369        1.73%        9.40%     
2012     0.00%        12,744        16.407771        209,101        1.74%        8.04%     
2012     0.50%        154,565        15.535096        2,401,182        1.74%        7.50%     
2012     0.80%        13,202        15.033966        198,478        1.74%        7.18%     
2012     1.00%        12,163        14.708875        178,904        1.74%        6.96%     
2011     0.00%        18,920        15.186765        287,334        2.27%        2.06%          
2011     0.50%        146,362        14.451279        2,115,118        2.27%        1.55%     
2011     0.80%        11,647        14.027229        163,375        2.27%        1.25%     
2011     1.00%        13,029        13.751450        179,168        2.27%        1.05%     

NVIT Mid Cap Index Fund - Class I (MCIF)

2015     0.00%        28,650        32.334576        926,386        1.16%        -2.53%     
2015     0.50%        141,727        29.898124        4,237,371        1.16%        -3.02%     
2015     0.80%        14,341        28.525303        409,081        1.16%        -3.31%     
2015     1.00%        21,780        25.197704        548,806        1.16%        -3.50%     
2014     0.00%        20,256        33.175282        671,999        1.07%        9.42%     
2014     0.50%        145,643        30.829256        4,490,065        1.07%        8.87%     
2014     0.80%        15,989        29.502073        471,709        1.07%        8.55%     
2014     1.00%        23,527        26.112699        614,353        1.07%        8.33%     
2013     0.00%        21,008        30.319093        636,944        1.14%        33.05%     
2013     0.50%        153,576        28.316283        4,348,701        1.14%        32.38%     
2013     0.80%        21,551        27.178692        585,728        1.14%        31.99%     
2013     1.00%        25,852        24.104406        623,147        1.14%        31.72%     
2012     0.00%        18,906        22.788209        430,834        1.01%        17.47%     
2012     0.50%        165,403        21.389461        3,537,881        1.01%        16.89%     
2012     0.80%        24,568        20.591788        505,899        1.01%        16.53%     
2012     1.00%        25,753        18.299103        471,257        1.01%        16.30%     
2011     0.00%        26,862        19.398700        521,088        0.77%        -2.54%     
2011     0.50%        190,987        18.299463        3,494,960        0.77%        -3.03%     
2011     0.80%        26,979        17.670078        476,721        0.77%        -3.32%     
2011     1.00%        33,507        15.734191        527,206        0.77%        -3.51%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Money Market Fund - Class I (SAM)

2015     0.00%        179,968      $ 15.554998      $ 2,799,402        0.00%       
2015     0.50%        421,561        20.240028        8,532,406        0.00%        -0.50%     
2015     0.80%        99,297        15.776044        1,566,514        0.00%        -0.80%     
2015     1.00%        220,253        10.639895        2,343,469        0.00%        -1.00%     
2014     0.00%        194,903        15.554998        3,031,716        0.00%       
2014     0.50%        510,842        20.341726        10,391,408        0.00%        -0.50%     
2014     0.80%        122,808        15.903266        1,953,048        0.00%        -0.80%     
2014     1.00%        251,792        10.747367        2,706,101        0.00%        -1.00%     
2013     0.00%        185,079        15.554998        2,856,986        0.00%       
2013     0.50%        522,730        20.443941        10,686,661        0.00%        -0.50%     
2013     0.80%        135,933        16.031513        2,179,212        0.00%        -0.80%     
2013     1.00%        265,650        10.855923        2,883,876        0.00%        -1.00%     
2013     1.30%        886        15.030270        13,317        0.00%        -1.30%     
2012     0.00%        202,588        15.554998        3,151,256        0.00%       
2012     0.50%        646,978        20.546671        13,293,244        0.00%        -0.50%     
2012     0.80%        158,342        16.160793        2,558,932        0.00%        -0.80%     
2012     1.00%        284,606        10.965576        3,120,869        0.00%        -1.00%     
2012     1.30%        1,044        15.228234        15,898        0.00%        -1.30%     
2011     0.00%        276,659        15.554998        4,303,430        0.00%        0.00%     
2011     0.50%        656,999        20.650204        13,567,163        0.00%        -0.50%     
2011     0.80%        172,798        16.291469        2,815,133        0.00%        -0.80%     
2011     1.00%        314,552        11.076639        3,484,179        0.00%        -1.00%     
2011     1.30%        428        15.429352        6,604        0.00%        -1.30%     

NVIT Multi-Manager International Growth Fund - Class I (NVMIG1)

2015     0.00%        19,175        9.747456        186,907        0.72%        -0.49%     
2015     0.50%        343,068        9.665662        3,315,979        0.72%        -0.99%     
2015     0.80%        51,630        9.616898        496,520        0.72%        -1.28%     
2015     1.00%        18,554        9.584544        177,832        0.72%        -1.48%     
2014     0.00%        19,560        9.795541        191,601        1.06%        -2.04%      4/25/2014
2014     0.50%        348,409        9.762049        3,401,186        1.06%        -2.38%      4/25/2014
2014     0.80%        56,211        9.742002        547,608        1.06%        -2.58%      4/25/2014
2014     1.00%        22,023        9.728663        214,254        1.06%        -2.71%      4/25/2014

NVIT Multi-Manager International Value Fund - Class I (GVDIVI)

2015     0.00%        3,657        18.002792        65,836        1.27%        -5.12%     
2015     0.50%        26,566        16.897583        448,901        1.27%        -5.59%     
2015     0.80%        3,231        16.267282        52,560        1.27%        -5.88%     
2014     0.00%        3,808        18.973981        72,253        3.04%        -9.46%     
2014     0.50%        21,382        17.898487        382,705        3.04%        -9.92%     
2014     0.80%        3,788        17.282666        65,467        3.04%        -10.19%     
2013     0.00%        302        20.957356        6,329        2.32%        21.41%     
2013     0.50%        6,629        19.868606        131,709        2.32%        20.80%     
2013     0.80%        894        19.242679        17,203        2.32%        20.44%     
2012     0.00%        308        17.262313        5,317        0.39%        17.29%     
2012     0.50%        7,162        16.447511        117,797        0.39%        16.71%     
2012     0.80%        1,142        15.977207        18,246        0.39%        16.36%     
2011     0.00%        315        14.717057        4,636        1.51%        -16.24%     
2011     0.50%        7,720        14.092846        108,797        1.51%        -16.66%     
2011     0.80%        1,263        13.731085        17,342        1.51%        -16.91%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Multi-Manager Large Cap Growth Fund - Class I (NVMLG1)

2015     0.00%        15,760      $ 16.589334      $ 261,448        0.39%        3.43%     
2015     0.50%        79,270        15.965444        1,265,581        0.39%        2.92%     
2015     0.80%        10,620        15.602400        165,697        0.39%        2.61%     
2015     1.00%        9,185        15.364980        141,127        0.39%        2.41%     
2014     0.00%        19,677        16.038508        315,590        0.50%        10.44%     
2014     0.50%        94,808        15.512706        1,470,729        0.50%        9.88%     
2014     0.80%        11,355        15.205499        172,658        0.50%        9.56%     
2014     1.00%        13,010        15.004103        195,203        0.50%        9.34%     
2013     0.00%        23,427        14.522943        340,229        0.82%        34.74%     
2013     0.50%        102,442        14.117223        1,446,197        0.82%        34.07%     
2013     0.80%        13,122        13.879225        182,123        0.82%        33.67%     
2013     1.00%        8,311        13.722812        114,050        0.82%        33.40%     
2012     0.00%        26,317        10.778503        283,658        0.46%        16.35%     
2012     0.50%        89,102        10.529858        938,231        0.46%        15.77%     
2012     0.80%        18,210        10.383415        189,082        0.46%        15.43%     
2012     1.00%        8,944        10.286933        92,006        0.46%        15.19%     
2011     0.00%        29,306        9.263525        271,477        0.01%        -2.91%          
2011     0.50%        109,085        9.095279        992,159        0.01%        -3.39%     
2011     0.80%        21,034        8.995790        189,217        0.01%        -3.68%     
2011     1.00%        16,222        8.930079        144,864        0.01%        -3.87%     

NVIT Multi-Manager Large Cap Value Fund - Class I (NVMLV1)

2015     0.00%        10,810        14.746982        159,415        1.22%        -3.15%     
2015     0.50%        68,591        14.192233        973,459        1.22%        -3.63%     
2015     0.80%        7,016        13.869458        97,308        1.22%        -3.92%     
2015     1.00%        1,045        15.980192        16,699        1.22%        -4.11%     
2014     0.00%        11,628        15.226743        177,057        1.15%        10.52%     
2014     0.50%        69,360        14.727421        1,021,494        1.15%        9.97%     
2014     0.80%        8,172        14.435726        117,969        1.15%        9.64%     
2014     1.00%        1,159        16.665961        19,316        1.15%        9.42%     
2013     0.00%        12,985        13.777622        178,902        1.39%        35.44%     
2013     0.50%        89,433        13.392610        1,197,741        1.39%        34.76%     
2013     0.80%        9,504        13.166780        125,137        1.39%        34.36%     
2013     1.00%        1,159        15.231413        17,653        1.39%        34.09%     
2012     0.00%        15,807        10.172659        160,799        1.33%        17.81%     
2012     0.50%        91,309        9.937905        907,420        1.33%        17.22%     
2012     0.80%        12,168        9.799657        119,242        1.33%        16.87%     
2012     1.00%        1,255        11.358976        14,256        1.33%        16.64%     
2011     0.00%        34,148        8.634796        294,861        1.08%        -5.83%     
2011     0.50%        96,838        8.477900        820,983        1.08%        -6.30%     
2011     0.80%        13,969        8.385144        117,132        1.08%        -6.58%     
2011     1.00%        1,262        9.738891        12,290        1.08%        -6.77%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Multi-Manager Mid Cap Growth Fund - Class I (NVMMG1)

2015     0.00%        82,159      $ 16.073975      $ 1,320,622        0.00%        -0.18%     
2015     0.50%        1,334,518        15.469408        20,644,203        0.00%        -0.68%     
2015     0.80%        375,429        15.117565        5,675,572        0.00%        -0.98%     
2015     1.00%        5,521        14.887497        82,194        0.00%        -1.18%     
2014     0.00%        77,500        16.103721        1,248,038        0.00%        4.04%     
2014     0.50%        1,415,623        15.575735        22,049,369        0.00%        3.52%     
2014     0.80%        435,572        15.267231        6,649,978        0.00%        3.21%     
2014     1.00%        9,797        15.064990        147,592        0.00%        3.00%     
2013     0.00%        83,954        15.479098        1,299,532        0.00%        38.94%     
2013     0.50%        1,503,890        15.046656        22,628,515        0.00%        38.25%     
2013     0.80%        518,987        14.792956        7,677,352        0.00%        37.84%     
2013     1.00%        9,079        14.626229        132,792        0.00%        37.56%     
2012     0.00%        87,228        11.140525        971,766        0.00%        14.90%     
2012     0.50%        1,587,943        10.883523        17,282,414        0.00%        14.33%     
2012     0.80%        642,181        10.732136        6,891,974        0.00%        13.99%     
2012     1.00%        5,625        10.632396        59,807        0.00%        13.76%     
2011     0.00%        94,806        9.695515        919,193        0.00%        -4.23%     
2011     0.50%        1,813,315        9.519437        17,261,738        0.00%        -4.71%     
2011     0.80%        731,063        9.415283        6,883,165        0.00%        -4.99%     
2011     1.00%        9,617        9.346508        89,885        0.00%        -5.18%     

NVIT Multi-Manager Mid Cap Value Fund - Class II (NVMMV2)

2015     0.00%        35,029        18.482716        647,431        1.18%        -2.89%     
2015     0.50%        961,036        17.787535        17,094,461        1.18%        -3.37%     
2015     0.80%        221,472        17.383067        3,849,863        1.18%        -3.66%     
2015     1.00%        9,334        17.118531        159,784        1.18%        -3.85%     
2014     0.00%        36,300        19.031857        690,856        1.35%        17.02%     
2014     0.50%        1,008,235        18.407850        18,559,439        1.35%        16.44%     
2014     0.80%        252,966        18.043337        4,564,351        1.35%        16.09%     
2014     1.00%        10,505        17.804342        187,035        1.35%        15.86%     
2013     0.00%        43,783        16.263836        712,080        1.18%        35.68%     
2013     0.50%        1,088,971        15.809412        17,215,991        1.18%        35.00%     
2013     0.80%        325,582        15.542892        5,060,486        1.18%        34.60%     
2013     1.00%        5,611        15.367716        86,228        1.18%        34.33%     
2012     0.00%        50,732        11.987208        608,135        1.11%        16.35%     
2012     0.50%        1,112,518        11.710634        13,028,291        1.11%        15.76%     
2012     0.80%        422,872        11.547772        4,883,229        1.11%        15.42%     
2012     1.00%        2,361        11.440460        27,011        1.11%        15.19%     
2011     0.00%        61,520        10.303092        633,846        0.81%        -2.32%     
2011     0.50%        1,245,189        10.115953        12,596,273        0.81%        -2.81%     
2011     0.80%        479,786        10.005304        4,800,405        0.81%        -3.10%     
2011     1.00%        2,127        9.932212        21,126        0.81%        -3.29%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Multi-Manager Small Cap Growth Fund - Class I (SCGF)

2015     0.00%        18,197      $ 12.994841      $ 236,467        0.00%        0.76%     
2015     0.50%        93,653        12.015436        1,125,282        0.00%        0.25%     
2015     0.80%        9,144        11.463575        104,823        0.00%        -0.05%     
2015     1.00%        4,894        11.123476        54,438        0.00%        -0.25%     
2014     0.00%        16,757        12.897295        216,120        0.00%        2.81%     
2014     0.50%        81,283        11.985014        974,178        0.00%        2.30%     
2014     0.80%        10,876        11.468922        124,736        0.00%        1.99%     
2014     1.00%        8,347        11.150957        93,077        0.00%        1.79%     
2013     0.00%        19,859        12.544579        249,123        0.00%        44.29%     
2013     0.50%        69,680        11.715687        816,349        0.00%        43.57%     
2013     0.80%        16,277        11.244880        183,033        0.00%        43.14%     
2013     1.00%        70,416        10.955026        771,409        0.00%        42.85%     
2012     0.00%        22,570        8.694087        196,226        0.00%        13.44%     
2012     0.50%        77,757        8.160266        634,518        0.00%        12.87%     
2012     0.80%        15,425        7.855846        121,176        0.00%        12.53%     
2012     1.00%        78,406        7.668653        601,268        0.00%        12.31%     
2011     0.00%        12,333        7.664195        94,523        0.00%        -0.65%     
2011     0.50%        93,597        7.229749        676,683        0.00%        -1.14%     
2011     0.80%        18,453        6.981005        128,820        0.00%        -1.44%     
2011     1.00%        123,708        6.828337        844,720        0.00%        -1.63%     

NVIT Multi-Manager Small Cap Value Fund - Class I (SCVF)

2015     0.00%        27,794        41.428086        1,151,452        0.70%        -6.02%     
2015     0.50%        85,762        37.924878        3,252,513        0.70%        -6.49%     
2015     0.80%        10,713        35.966790        385,312        0.70%        -6.77%     
2015     1.00%        8,211        28.188717        231,458        0.70%        -6.96%     
2014     0.00%        29,691        44.082799        1,308,862        0.52%        7.02%     
2014     0.50%        86,807        40.557464        3,520,672        0.52%        6.49%     
2014     0.80%        12,672        38.579063        488,874        0.52%        6.17%     
2014     1.00%        10,094        30.296625        305,814        0.52%        5.96%     
2013     0.00%        33,572        41.190400        1,382,844        0.82%        40.40%     
2013     0.50%        98,427        38.086314        3,748,722        0.82%        39.70%     
2013     0.80%        16,716        36.337305        607,414        0.82%        39.28%     
2013     1.00%        14,817        28.593267        423,666        0.82%        39.00%     
2013     1.30%        43        33.599044        1,445        0.82%        38.59%     
2012     0.00%        37,412        29.338040        1,097,595        0.81%        20.44%     
2012     0.50%        108,270        27.262957        2,951,760        0.81%        19.84%     
2012     0.80%        21,125        26.089050        551,131        0.81%        19.48%     
2012     1.00%        13,893        20.570124        285,781        0.81%        19.24%     
2011     0.00%        43,501        24.358089        1,059,601        0.46%        -5.07%     
2011     0.50%        121,991        22.748905        2,775,162        0.46%        -5.54%     
2011     0.80%        23,301        21.834904        508,775        0.46%        -5.83%     
2011     1.00%        20,207        17.250436        348,580        0.46%        -6.01%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Multi-Manager Small Company Fund - Class I (SCF)

2015     0.00%        31,864      $ 51.769318      $ 1,649,578        0.36%        -1.63%     
2015     0.50%        171,090        61.802598        10,573,806        0.36%        -2.13%     
2015     0.80%        41,366        58.798055        2,432,240        0.36%        -2.42%     
2015     1.00%        14,878        22.313416        331,979        0.36%        -2.61%     
2014     0.00%        38,886        52.629785        2,046,562        0.16%        0.82%     
2014     0.50%        191,575        63.144833        12,096,971        0.16%        0.31%     
2014     0.80%        47,223        60.255595        2,845,450        0.16%        0.01%     
2014     1.00%        18,166        22.912330        416,225        0.16%        -0.19%     
2013     0.00%        46,240        52.204120        2,413,919        0.14%        40.91%     
2013     0.50%        219,955        62.948145        13,845,759        0.14%        40.20%     
2013     0.80%        58,555        60.248434        3,527,847        0.14%        39.78%     
2013     1.00%        19,379        22.955484        444,854        0.14%        39.51%     
2012     0.00%        52,840        37.048983        1,957,668        0.15%        15.50%     
2012     0.50%        237,355        44.897637        10,656,679        0.15%        14.93%     
2012     0.80%        70,077        43.101045        3,020,392        0.15%        14.58%     
2012     1.00%        22,830        16.454928        375,666        0.15%        14.35%     
2011     0.00%        58,368        32.076366        1,872,233        0.53%        -5.56%     
2011     0.50%        267,316        39.066862        10,443,197        0.53%        -6.03%     
2011     0.80%        80,173        37.616516        3,015,829        0.53%        -6.31%     
2011     1.00%        26,131        14.389885        376,022        0.53%        -6.50%     

NVIT Multi-Sector Bond Fund - Class I (MSBF)

2015     0.00%        6,132        21.093281        129,344        1.94%        -2.89%     
2015     0.50%        33,896        19.504377        661,120        1.94%        -3.37%     
2015     0.80%        3,116        18.609020        57,986        1.94%        -3.66%     
2015     1.00%        11,088        17.673482        195,964        1.94%        -3.86%     
2014     0.00%        6,660        21.721029        144,662        3.15%        3.88%     
2014     0.50%        36,654        20.185537        739,881        3.15%        3.37%     
2014     0.80%        3,535        19.316793        68,285        3.15%        3.06%     
2014     1.00%        11,748        18.382406        215,957        3.15%        2.85%     
2013     0.00%        8,647        20.909005        180,800        2.58%        -1.12%     
2013     0.50%        43,819        19.528307        855,711        2.58%        -1.62%     
2013     0.80%        3,985        18.743985        74,695        2.58%        -1.91%     
2013     1.00%        20,238        17.873021        361,714        2.58%        -2.11%     
2012     0.00%        14,422        21.146740        304,978        2.55%        12.25%     
2012     0.50%        60,062        19.849367        1,192,193        2.55%        11.69%     
2012     0.80%        6,494        19.109390        124,096        2.55%        11.35%     
2012     1.00%        31,800        18.257940        580,602        2.55%        11.13%     
2011     0.00%        13,494        18.839019        254,214        4.57%        5.55%     
2011     0.50%        62,879        17.772057        1,117,489        4.57%        5.02%     
2011     0.80%        7,241        17.161065        124,263        4.57%        4.71%     
2011     1.00%        33,462        16.429316        549,758        4.57%        4.50%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Short Term Bond Fund - Class II (NVSTB2)

2015     0.00%        220      $ 11.468229      $ 2,523        1.45%        -0.34%     
2015     0.50%        46,145        11.036978        509,301        1.45%        -0.84%     
2015     0.80%        2,788        10.786003        30,071        1.45%        -1.14%     
2014     0.00%        1,202        11.507465        13,832        0.95%        0.49%     
2014     0.50%        47,119        11.130256        524,447        0.95%        -0.01%     
2014     0.80%        3,205        10.909843        34,966        0.95%        -0.31%     
2013     0.00%        1,221        11.450912        13,982        1.47%        0.11%     
2013     0.50%        48,316        11.131047        537,808        1.47%        -0.39%     
2013     0.80%        2,944        10.943432        32,217        1.47%        -0.69%     
2012     0.00%        1,240        11.438838        14,184        1.41%        3.52%     
2012     0.50%        42,525        11.175048        475,219        1.41%        3.01%     
2012     0.80%        3,662        11.019701        40,354        1.41%        2.70%     
2011     0.00%        1,279        11.049485        14,132        1.61%        1.30%     
2011     0.50%        35,719        10.848926        387,513        1.61%        0.79%     
2011     0.80%        4,432        10.730325        47,557        1.61%        0.49%     

NVIT Large Cap Growth Fund - Class I (NVOLG1)

2015     0.00%        245,083        25.770856        6,315,999        0.62%        5.09%     
2015     0.50%        1,471,731        24.926227        36,684,701        0.62%        4.57%     
2015     0.80%        243,543        24.432765        5,950,429        0.62%        4.26%     
2015     1.00%        65,261        24.109259        1,573,394        0.62%        4.05%     
2014     0.00%        267,651        24.521987        6,563,334        0.71%        8.80%     
2014     0.50%        1,607,030        23.837164        38,307,038        0.71%        8.26%     
2014     0.80%        278,937        23.435455        6,537,016        0.71%        7.93%     
2014     1.00%        83,077        23.171453        1,925,015        0.71%        7.72%     
2013     0.00%        287,453        22.538634        6,467,799        0.78%        36.70%     
2013     0.50%        1,711,729        22.019016        37,690,588        0.78%        36.02%     
2013     0.80%        350,527        21.712988        7,610,989        0.78%        35.61%     
2013     1.00%        108,862        21.511366        2,341,770        0.78%        35.34%     
2013     1.30%        2        21.212389        42        0.78%        34.94%     
2012     0.00%        338,602        16.487341        5,582,647        0.69%        18.68%     
2012     0.50%        1,901,644        16.187910        30,783,642        0.69%        18.09%     
2012     0.80%        439,107        16.010853        7,030,478        0.69%        17.74%     
2012     1.00%        137,473        15.893913        2,184,984        0.69%        17.50%     
2012     1.30%        2        15.720064        31        0.69%        17.15%     
2011     0.00%        383,225        13.891692        5,323,644        0.67%        -2.23%     
2011     0.50%        2,143,935        13.707902        29,388,851        0.67%        -2.72%     
2011     0.80%        511,317        13.598787        6,953,291        0.67%        -3.01%     
2011     1.00%        199,807        13.526537        2,702,697        0.67%        -3.20%     
2011     1.30%        2        13.418859        27        0.67%        -3.49%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Templeton NVIT International Value Fund - Class III (NVTIV3)

2015     0.00%        1      $ 15.385758      $ 15        2.04%        -3.90%     
2015     0.50%        9,318        14.881221        138,663        2.04%        -4.38%     
2015     0.80%        2,678        14.586513        39,063        2.04%        -4.67%     
2014     0.00%        14        16.010507        224        3.71%        -8.15%     
2014     0.50%        9,362        15.563156        145,702        3.71%        -8.60%     
2014     0.80%        1,846        15.300817        28,245        3.71%        -8.88%     
2013     0.00%        65        17.430436        1,133        2.50%        20.09%     
2013     0.50%        9,731        17.028404        165,703        2.50%        19.50%     
2013     0.80%        722        16.791684        12,124        2.50%        19.14%     
2012     0.00%        1,527        14.513999        22,163        3.34%        19.56%     
2012     0.50%        4,570        14.250281        65,124        3.34%        18.97%     
2012     0.80%        537        14.094377        7,569        3.34%        18.61%     
2011     0.00%        176        12.139096        2,136        2.58%        -12.43%     
2011     0.50%        2,840        11.978398        34,019        2.58%        -12.86%     
2011     0.80%        968        11.883015        11,503        2.58%        -13.12%     

Invesco NVIT Comstock Value Fund - Class I (EIF)

2015     0.00%        371        26.484871        9,826        1.53%        -6.30%     
2015     0.50%        28,958        24.859309        719,876        1.53%        -6.77%     
2015     0.80%        2,775        23.932240        66,412        1.53%        -7.05%     
2014     0.00%        658        28.265120        18,598        1.72%        9.17%     
2014     0.50%        27,630        26.663355        736,708        1.72%        8.62%     
2014     0.80%        3,211        25.746165        82,671        1.72%        8.30%     
2013     0.00%        422        25.891306        10,926        0.00%        35.64%     
2013     0.50%        26,632        24.546498        653,722        0.00%        34.96%     
2013     0.80%        3,761        23.773344        89,412        0.00%        34.56%     
2012     0.00%        4,266        19.088364        81,431        1.07%        18.46%     
2012     0.50%        19,373        18.187529        352,347        1.07%        17.87%     
2012     0.80%        3,872        17.667550        68,409        1.07%        17.52%     
2011     0.00%        3,018        16.113167        48,630        1.30%        -2.32%     
2011     0.50%        31,295        15.429859        482,877        1.30%        -2.81%     
2011     0.80%        5,701        15.033857        85,708        1.30%        -3.10%     

NVIT Real Estate Fund - Class I (NVRE1)

2015     0.00%        49,928        14.907394        744,296        2.62%        -5.36%     
2015     0.50%        441,395        14.346436        6,332,445        2.62%        -5.83%     
2015     0.80%        76,353        14.020049        1,070,473        2.62%        -6.11%     
2015     1.00%        56,787        13.806599        784,035        2.62%        -6.30%     
2014     0.00%        57,416        15.751218        904,372        3.09%        28.88%     
2014     0.50%        502,640        15.234505        7,657,472        3.09%        28.24%     
2014     0.80%        88,638        14.932651        1,323,600        3.09%        27.86%     
2014     1.00%        67,483        14.734758        994,346        3.09%        27.60%     
2013     0.00%        63,337        12.221280        774,059        1.43%        3.05%     
2013     0.50%        476,506        11.879551        5,660,677        1.43%        2.53%     
2013     0.80%        112,015        11.679110        1,308,236        1.43%        2.22%     
2013     1.00%        17,988        11.547381        207,714        1.43%        2.02%     
2012     0.00%        63,489        11.860098        752,986        1.01%        15.79%     
2012     0.50%        541,058        11.586264        6,268,841        1.01%        15.21%     
2012     0.80%        138,767        11.424998        1,585,413        1.01%        14.86%     
2012     1.00%        23,747        11.318740        268,786        1.01%        14.63%     
2011     0.00%        67,393        10.243095        690,313        0.86%        6.50%     
2011     0.50%        676,021        10.056852        6,798,643        0.86%        5.97%     
2011     0.80%        152,282        9.946733        1,514,708        0.86%        5.65%     
2011     1.00%        23,921        9.873993        236,196        0.86%        5.44%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’  Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Loring Ward NVIT Capital Appreciation Fund - Class P (NVLCAP)

2015     0.50%        100      $ 11.315948      $ 1,132        1.18%        -3.49%     
2014     0.50%        627        11.724648        7,351        1.84%        2.82%     

Loring Ward NVIT Moderate Fund - Class P (NVLMP)

2015     0.50%        878        11.141320        9,782        1.90%        -2.19%     

NVIT Small Cap Index Fund Class II (NVSIX2)

2015     0.50%        8,140        12.442841        101,285        1.14%        -5.36%     
2015     0.80%        1,102        12.343655        13,603        1.14%        -5.64%     
2014     0.50%        3,869        13.147003        50,866        0.64%        4.03%     
2014     0.80%        816        13.081404        10,674        0.64%        3.72%     
2013     0.50%        3,474        12.637682        43,903        1.91%        26.38%      5/1/2013
2013     0.80%        717        12.612416        9,043        1.91%        26.12%      5/1/2013

NVIT S&P 500 Index Fund Class I (GVEX1)

2015     0.50%        158,718        13.393605        2,125,806        1.84%        0.66%     
2015     0.80%        7,239        13.286846        96,183        1.84%        0.36%     
2014     0.50%        160,730        13.305974        2,138,669        3.30%        12.80%     
2014     0.80%        3,835        13.239573        50,774        3.30%        12.46%     
2013     0.50%        81,634        11.796496        962,995        2.98%        17.96%      5/1/2013
2013     0.80%        1,118        11.772890        13,162        2.98%        17.73%      5/1/2013

TOPS Managed Risk Growth ETF Portfolio - Class 3 (NOTG3)

2015     0.80%        207        9.811721        2,031        1.29%        -9.94%     
2014     0.80%        215        10.894731        2,342        0.99%        0.38%     
2013     0.80%        223        10.853777        2,420        1.00%        8.54%      5/1/2013

VPS Growth and Income Portfolio - Class A (ALVGIA)

2015     0.00%        1,067        27.338430        29,170        1.36%        1.70%     
2015     0.50%        9,210        25.660568        236,334        1.36%        1.19%     
2015     0.80%        1,958        24.703773        48,370        1.36%        0.89%     
2014     0.00%        531        26.881002        14,274        1.18%        9.54%     
2014     0.50%        12,538        25.357678        317,935        1.18%        9.00%     
2014     0.80%        2,134        24.485510        52,252        1.18%        8.67%     
2013     0.00%        1,123        24.539482        27,558        1.00%        34.96%     
2013     0.50%        28,579        23.264880        664,887        1.00%        34.29%     
2013     0.80%        3,190        22.532174        71,878        1.00%        33.89%     
2012     0.00%        1,144        18.182276        20,801        1.48%        17.52%     
2012     0.50%        13,210        17.324203        228,853        1.48%        16.94%     
2012     0.80%        2,673        16.828957        44,984        1.48%        16.59%     
2011     0.00%        1,168        15.470995        18,070        1.34%        6.32%     
2011     0.50%        15,467        14.814923        229,142        1.34%        5.79%     
2011     0.80%        2,845        14.434748        41,067        1.34%        5.47%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VPS Small/Mid Cap Value Portfolio - Class A (ALVSVA)

  

  
2015     0.00%        2,532      $ 37.073964      $ 93,871        0.77%        -5.49%     
2015     0.50%        24,654        34.798537        857,923        0.77%        -5.96%     
2015     0.80%        3,213        33.500854        107,638        0.77%        -6.24%     
2014     0.00%        2,620        39.225701        102,771        0.72%        9.20%     
2014     0.50%        28,066        37.002837        1,038,522        0.72%        8.65%     
2014     0.80%        4,559        35.730024        162,893        0.72%        8.33%     
2013     0.00%        2,802        35.921574        100,652        0.61%        38.06%     
2013     0.50%        25,928        34.055816        882,999        0.61%        37.37%     
2013     0.80%        4,748        32.983198        156,604        0.61%        36.96%     
2012     0.00%        3,380        26.019263        87,945        0.48%        18.75%     
2012     0.50%        30,458        24.791368        755,095        0.48%        18.15%     
2012     0.80%        6,050        24.082624        145,700        0.48%        17.80%     
2011     0.00%        7,367        21.911401        161,421        0.52%        -8.39%     
2011     0.50%        33,867        20.982250        710,606        0.52%        -8.85%     
2011     0.80%        6,262        20.443783        128,019        0.52%        -9.12%     

VP Balanced Fund - Class I (ACVB)

  

  
2015     0.00%        10,671        32.960923        351,726        1.77%        -2.57%     
2015     0.50%        67,035        39.659779        2,658,593        1.77%        -3.06%     
2015     0.80%        15,512        37.927982        588,339        1.77%        -3.35%     
2015     1.00%        92,521        17.216869        1,592,922        1.77%        -3.54%     
2014     0.00%        10,531        33.831616        356,281        1.53%        9.85%     
2014     0.50%        93,740        40.911494        3,835,043        1.53%        9.31%     
2014     0.80%        17,062        39.242612        669,557        1.53%        8.98%     
2014     1.00%        81,385        17.849288        1,452,664        1.53%        8.76%     
2013     0.00%        15,025        30.797107        462,727        1.61%        17.43%     
2013     0.50%        83,445        37.428588        3,123,229        1.61%        16.84%     
2013     0.80%        19,379        36.009620        697,830        1.61%        16.49%     
2013     1.00%        55,383        16.411564        908,922        1.61%        16.26%     
2013     1.30%        2        32.309012        65        1.61%        15.91%     
2012     0.00%        15,313        26.226727        401,610        2.08%        11.80%     
2012     0.50%        78,313        32.033774        2,508,661        2.08%        11.24%     
2012     0.80%        23,027        30.911891        711,808        2.08%        10.91%     
2012     1.00%        50,790        14.116446        716,974        2.08%        10.69%     
2012     1.30%        6        27.874115        167        2.08%        10.35%     
2011     0.00%        17,832        23.458367        418,310        1.88%        5.33%     
2011     0.50%        70,885        28.796383        2,041,232        1.88%        4.81%     
2011     0.80%        24,908        27.871548        694,225        1.88%        4.49%     
2011     1.00%        50,131        12.753560        639,349        1.88%        4.29%     
2011     1.30%        1        25.258809        25        1.88%        3.97%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VP Capital Appreciation Fund - Class I (ACVCA)

  

  
2015     0.00%        10,612      $ 35.972809      $ 381,743        0.00%        1.93%     
2015     0.50%        484        85.827977        41,541        0.00%        1.42%     
2015     0.80%        405        51.939477        21,035        0.00%        1.12%     
2015     1.00%        71,941        16.644314        1,197,409        0.00%        0.92%     
2014     0.00%        9,725        35.291244        343,207        0.00%        8.14%     
2014     0.50%        487        84.623910        41,212        0.00%        7.60%     
2014     0.80%        379        51.364716        19,467        0.00%        7.28%     
2014     1.00%        87,849        16.493073        1,448,900        0.00%        7.06%     
2013     0.00%        10,970        32.634394        357,999        0.00%        30.92%     
2013     0.50%        490        78.645463        38,536        0.00%        30.27%     
2013     0.80%        590        47.879398        28,249        0.00%        29.88%     
2013     1.00%        88,819        15.404738        1,368,233        0.00%        29.62%     
2013     1.30%        51        46.376355        2,365        0.00%        29.23%     
2012     0.00%        11,127        24.926638        277,359        0.00%        16.00%     
2012     0.50%        492        60.371528        29,703        0.00%        15.42%     
2012     0.80%        545        36.864587        20,091        0.00%        15.08%     
2012     1.00%        95,454        11.884565        1,134,429        0.00%        14.84%     
2012     1.30%        27        35.886221        969        0.00%        14.50%     
2011     0.00%        11,225        21.488190        241,205        0.00%        -6.51%     
2011     0.50%        495        52.305178        25,891        0.00%        -6.97%     
2011     0.80%        461        32.035223        14,768        0.00%        -7.25%     
2011     1.00%        98,038        10.348382        1,014,535        0.00%        -7.44%     
2011     1.30%        3        31.341703        94        0.00%        -7.71%     

VP Income & Growth Fund - Class I (ACVIG)

  

  
2015     0.00%        9,543        22.919562        218,721        2.07%        -5.62%     
2015     0.50%        52,130        20.981637        1,093,773        2.07%        -6.09%     
2015     0.80%        4,946        19.898492        98,418        2.07%        -6.37%     
2015     1.00%        33,466        15.874045        531,241        2.07%        -6.56%     
2014     0.00%        17,764        24.284469        431,389        2.02%        12.50%     
2014     0.50%        62,458        22.342598        1,395,474        2.02%        11.94%     
2014     0.80%        6,068        21.252856        128,962        2.02%        11.61%     
2014     1.00%        41,765        16.988453        709,523        2.02%        11.38%     
2013     0.00%        19,481        21.585591        420,509        2.26%        35.82%     
2013     0.50%        69,689        19.959048        1,390,926        2.26%        35.14%     
2013     0.80%        8,198        19.042593        156,111        2.26%        34.74%     
2013     1.00%        42,265        15.252150        644,632        2.26%        34.47%     
2012     0.00%        19,436        15.892761        308,892        2.03%        14.74%     
2012     0.50%        67,927        14.768780        1,003,199        2.03%        14.17%     
2012     0.80%        8,532        14.132942        120,582        2.03%        13.83%     
2012     1.00%        8,072        11.342396        91,556        2.03%        13.60%     
2011     0.00%        24,364        13.850615        337,456        1.54%        3.11%     
2011     0.50%        91,748        12.935713        1,186,826        1.54%        2.60%     
2011     0.80%        10,171        12.416062        126,284        1.54%        2.29%     
2011     1.00%        8,410        9.984507        83,970        1.54%        2.09%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VP Inflation Protection Fund - Class II (ACVIP2)

  

  
2015     0.00%        17,532      $ 15.568846      $ 272,953        1.96%        -2.47%     
2015     0.50%        48,547        14.611822        709,360        1.96%        -2.95%     
2015     0.80%        6,169        14.064830        86,766        1.96%        -3.25%     
2014     0.00%        17,328        15.962763        276,603        1.26%        3.30%     
2014     0.50%        52,335        15.056647        787,990        1.26%        2.78%     
2014     0.80%        7,336        14.536561        106,640        1.26%        2.48%     
2013     0.00%        18,670        15.452863        288,505        1.65%        -8.48%     
2013     0.50%        63,472        14.648742        929,785        1.65%        -8.94%     
2013     0.80%        11,140        14.185241        158,024        1.65%        -9.21%     
2012     0.00%        26,763        16.884507        451,880        2.37%        7.39%     
2012     0.50%        103,784        16.086145        1,669,484        2.37%        6.85%     
2012     0.80%        13,907        15.623984        217,283        2.37%        6.53%     
2011     0.00%        25,289        15.723236        397,625        4.00%        11.74%     
2011     0.50%        117,480        15.055027        1,768,665        4.00%        11.19%     
2011     0.80%        16,947        14.666531        248,554        4.00%        10.86%     

VP International Fund - Class I (ACVI)

  

  
2015     0.00%        12,646        29.016282        366,940        0.33%        0.76%     
2015     0.80%        572        27.509521        15,735        0.33%        -0.04%     
2015     1.00%        13,057        11.393246        148,762        0.33%        -0.24%     
2014     0.00%        7,668        28.797883        220,822        1.68%        -5.51%     
2014     0.80%        572        27.521800        15,742        1.68%        -6.26%     
2014     1.00%        22,920        11.421160        261,773        1.68%        -6.45%     
2013     0.00%        10,192        30.476017        310,612        1.69%        22.41%     
2013     0.80%        572        29.359593        16,794        1.69%        21.44%     
2013     1.00%        25,351        12.208224        309,491        1.69%        21.19%     
2012     0.00%        13,233        24.896683        329,458        0.85%        21.16%     
2012     0.80%        572        24.177125        13,829        0.85%        20.19%     
2012     1.00%        27,108        10.073381        273,069        0.85%        19.95%     
2011     0.00%        14,027        20.548394        288,232        1.43%        -12.04%     
2011     0.80%        572        20.115095        11,506        1.43%        -12.74%     
2011     1.00%        29,115        8.397753        244,501        1.43%        -12.92%     

VP Mid Cap Value Fund - Class I (ACVMV1)

  

  
2015     0.00%        2,790        26.907721        75,073        1.67%        -1.43%     
2015     0.50%        73,142        25.510479        1,865,887        1.67%        -1.92%     
2015     0.80%        5,044        24.707138        124,623        1.67%        -2.22%     
2014     0.00%        3,549        27.298795        96,883        1.16%        16.42%     
2014     0.50%        75,265        26.010995        1,957,718        1.16%        15.84%     
2014     0.80%        4,954        25.267604        125,176        1.16%        15.50%     
2013     0.00%        3,576        23.448028        83,850        1.27%        30.11%     
2013     0.50%        76,643        22.453819        1,720,928        1.27%        29.47%     
2013     0.80%        5,677        21.877612        124,199        1.27%        29.08%     
2012     0.00%        2,582        18.021035        46,530        1.97%        16.33%     
2012     0.50%        68,118        17.343371        1,181,396        1.97%        15.75%     
2012     0.80%        5,768        16.949046        97,762        1.97%        15.40%     
2011     0.00%        2,657        15.491583        41,161        1.31%        -0.69%     
2011     0.50%        84,192        14.983934        1,261,527        1.31%        -1.19%     
2011     0.80%        7,564        14.687355        111,095        1.31%        -1.48%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VP Ultra(R) Fund - Class I (ACVU1)

2015     0.00%        1,629      $ 22.395341      $ 36,482        0.57%        6.27%     
2015     0.80%        3        20.075726        60        0.57%        5.42%     
2015     1.00%        6,941        19.534291        135,588        0.57%        5.21%     
2014     0.00%        257        21.073734        5,416        0.43%        9.99%     
2014     0.80%        14        19.042711        267        0.43%        9.12%     
2014     1.00%        11,657        18.566230        216,427        0.43%        8.90%     
2013     1.00%        10,891        17.048782        185,678        0.31%        35.71%     
2012     0.00%        2,867        13.977037        40,072        0.00%        13.92%     
2012     1.00%        3,221        12.562574        40,464        0.00%        12.79%     
2011     0.00%        1,197        12.268729        14,686        0.00%        1.07%     
2011     1.00%        2,829        11.138189        31,510        0.00%        0.06%     

Small Cap Stock Index Portfolio - Service Shares (DVSCS)

2015     0.00%        12,781        28.711482        366,961        0.71%        -2.33%     
2015     0.50%        45,825        26.814872        1,228,792        0.71%        -2.82%     
2015     0.80%        5,483        25.737593        141,119        0.71%        -3.11%     
2015     1.00%        11,845        25.043486        296,640        0.71%        -3.30%     
2014     0.00%        15,909        29.396200        467,664        0.59%        5.12%     
2014     0.50%        42,617        27.592005        1,175,888        0.59%        4.60%     
2014     0.80%        6,532        26.563083        173,510        0.59%        4.28%     
2014     1.00%        13,027        25.898481        337,380        0.59%        4.08%     
2013     0.00%        15,916        27.964008        445,075        1.04%        40.71%     
2013     0.50%        59,482        26.379283        1,569,093        1.04%        40.01%     
2013     0.80%        7,470        25.471900        190,275        1.04%        39.59%     
2013     1.00%        15,299        24.884316        380,705        1.04%        39.31%     
2013     1.30%        10        24.028258        240        1.04%        38.90%     
2012     0.00%        18,874        19.873008        375,083        0.48%        15.74%     
2012     0.50%        52,183        18.840668        983,163        0.48%        15.16%     
2012     0.80%        8,047        18.247194        146,835        0.48%        14.82%     
2012     1.00%        16,022        17.861918        286,184        0.48%        14.59%     
2012     1.30%        10        17.299211        173        0.48%        14.24%     
2011     0.00%        20,644        17.170194        354,461        0.57%        0.56%     
2011     0.50%        66,923        16.360013        1,094,861        0.57%        0.06%     
2011     0.80%        9,732        15.892376        154,665        0.57%        -0.24%     
2011     1.00%        19,008        15.588032        296,297        0.57%        -0.44%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Appreciation Portfolio - Initial Shares (DCAP)

2015     0.00%        25,136      $ 28.331820      $ 712,149        1.71%        -2.47%     
2015     0.50%        108,438        25.756732        2,793,009        1.71%        -2.95%     
2015     0.80%        13,087        24.441505        319,866        1.71%        -3.25%     
2015     1.00%        26,468        16.188755        428,484        1.71%        -3.44%     
2014     0.00%        26,530        29.048845        770,666        1.84%        8.09%     
2014     0.50%        122,333        26.540974        3,246,837        1.84%        7.55%     
2014     0.80%        15,607        25.261381        394,254        1.84%        7.23%     
2014     1.00%        27,488        16.765299        460,845        1.84%        7.02%     
2013     0.00%        33,660        26.874296        904,589        1.94%        21.10%     
2013     0.50%        128,801        24.677241        3,178,453        1.94%        20.50%     
2013     0.80%        20,833        23.558053        490,785        1.94%        20.14%     
2013     1.00%        28,821        15.666152        451,514        1.94%        19.90%     
2012     0.00%        37,329        22.191274        828,378        3.67%        10.43%     
2012     0.50%        162,809        20.479145        3,334,189        3.67%        9.88%     
2012     0.80%        25,384        19.609067        497,757        3.67%        9.55%     
2012     1.00%        32,456        13.066159        424,075        3.67%        9.33%     
2011     0.00%        40,442        20.095335        812,696        1.56%        9.01%     
2011     0.50%        173,907        18.638060        3,241,289        1.56%        8.47%     
2011     0.80%        26,334        17.899937        471,377        1.56%        8.15%     
2011     1.00%        80,749        11.951238        965,051        1.56%        7.93%     

Opportunistic Small Cap Portfolio: Initial Shares (DSC)

2015     0.00%        1,319        22.165178        29,236        0.00%        -2.28%     
2015     0.50%        17,347        20.804584        360,897        0.00%        -2.76%     
2015     0.80%        2,413        20.028662        48,329        0.00%        -3.06%     
2014     0.00%        1,154        22.681585        26,175        0.00%        1.59%     
2014     0.50%        10,540        21.396012        225,514        0.00%        1.09%     
2014     0.80%        2,412        20.659925        49,832        0.00%        0.78%     
2013     0.00%        1,210        22.325546        27,014        0.00%        48.55%     
2013     0.50%        23,615        21.165757        499,829        0.00%        47.81%     
2013     0.80%        3,994        20.499021        81,873        0.00%        47.37%     
2012     0.00%        705        15.029274        10,596        0.00%        20.56%     
2012     0.50%        24,300        14.319838        347,972        0.00%        19.96%     
2012     0.80%        4,702        13.910361        65,407        0.00%        19.60%     
2011     0.00%        754        12.465849        9,399        0.40%        -13.85%     
2011     0.50%        13,055        11.937082        155,839        0.40%        -14.27%     
2011     0.80%        3,371        11.630664        39,207        0.40%        -14.53%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Growth and Income Portfolio - Initial Shares (DGI)

2015     0.00%        10,337      $ 28.631217      $ 295,961        0.85%        1.58%     
2015     0.50%        32,948        25.891246        853,065        0.85%        1.08%     
2015     0.80%        9,607        24.589597        236,232        0.85%        0.77%     
2015     1.00%        5,930        16.399896        97,251        0.85%        0.57%     
2014     0.00%        10,508        28.184678        296,165        0.78%        10.07%     
2014     0.50%        34,972        25.615214        895,815        0.78%        9.53%     
2014     0.80%        11,420        24.400541        278,654        0.78%        9.20%     
2014     1.00%        6,174        16.306396        100,676        0.78%        8.98%     
2013     0.00%        11,166        25.605002        285,905        0.91%        36.78%     
2013     0.50%        37,868        23.387364        885,633        0.91%        36.10%     
2013     0.80%        13,026        22.345264        291,069        0.91%        35.69%     
2013     1.00%        8,408        14.962784        125,807        0.91%        35.42%     
2012     0.00%        12,903        18.719510        241,538        1.43%        18.07%     
2012     0.50%        40,511        17.183862        696,135        1.43%        17.48%     
2012     0.80%        14,291        16.467463        235,337        1.43%        17.13%     
2012     1.00%        7,789        11.048962        86,060        1.43%        16.90%     
2011     0.00%        13,600        15.854162        215,617        1.22%        -2.79%     
2011     0.50%        45,849        14.626679        670,619        1.22%        -3.28%     
2011     0.80%        15,440        14.059096        217,072        1.22%        -3.57%     
2011     1.00%        10,648        9.451977        100,645        1.22%        -3.76%     

Managed Tail Risk Fund II: Primary Shares (FVCA2P)

2015     0.00%        4,222        17.216840        72,689        1.66%        -6.29%     
2015     0.50%        4,747        16.160101        76,712        1.66%        -6.76%     
2015     0.80%        73        15.557433        1,136        1.66%        -7.04%     
2014     0.00%        4,275        18.372369        78,542        1.69%        -0.97%     
2014     0.50%        4,713        17.331172        81,682        1.69%        -1.46%     
2014     0.80%        74        16.734989        1,238        1.69%        -1.76%     
2013     0.00%        4,327        18.551848        80,274        1.20%        16.45%     
2013     0.50%        4,563        17.588218        80,255        1.20%        15.87%     
2013     0.80%        82        17.034230        1,397        1.20%        15.52%     
2012     0.00%        4,187        15.930913        66,703        0.34%        10.17%     
2012     0.50%        4,661        15.179088        70,750        0.34%        9.62%     
2012     0.80%        221        14.745134        3,259        0.34%        9.29%     
2011     0.50%        4,897        13.846587        67,807        0.65%        -5.76%     
2011     0.80%        217        13.491250        2,928        0.65%        -6.05%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Quality Bond Fund II - Primary Shares (FQB)

2015     0.00%        11,050      $ 18.488639      $ 204,299        3.79%        -0.24%     
2015     0.50%        30,682        17.267480        529,801        3.79%        -0.74%     
2015     0.80%        5,898        16.573859        97,753        3.79%        -1.04%     
2015     1.00%        21,199        16.126960        341,875        3.79%        -1.24%     
2014     0.00%        10,103        18.533750        187,246        3.97%        3.79%     
2014     0.50%        34,872        17.396370        606,646        3.97%        3.28%     
2014     0.80%        6,748        16.747756        113,014        3.97%        2.97%     
2014     1.00%        22,120        16.328799        361,193        3.97%        2.76%     
2013     0.00%        11,973        17.856455        213,795        4.39%        1.03%     
2013     0.50%        46,659        16.844649        785,954        4.39%        0.53%     
2013     0.80%        7,985        16.265318        129,879        4.39%        0.23%     
2013     1.00%        28,000        15.890171        444,925        4.39%        0.03%     
2012     0.00%        21,760        17.673540        384,576        4.06%        9.72%     
2012     0.50%        56,912        16.755664        953,598        4.06%        9.17%     
2012     0.80%        9,428        16.228008        152,998        4.06%        8.85%     
2012     1.00%        36,141        15.885465        574,117        4.06%        8.63%     
2011     0.00%        26,489        16.107550        426,673        4.81%        2.27%     
2011     0.50%        56,565        15.347745        868,145        4.81%        1.76%     
2011     0.80%        11,285        14.909191        168,250        4.81%        1.46%     
2011     1.00%        40,098        14.623773        586,384        4.81%        1.26%     

Equity-Income Portfolio - Initial Class (FEIP)

2015     0.00%        88,281        35.929931        3,171,930        3.12%        -3.96%     
2015     0.50%        276,356        89.918068        24,849,398        3.12%        -4.44%     
2015     0.80%        87,394        72.039238        6,295,797        3.12%        -4.73%     
2015     1.00%        143,683        18.033332        2,591,083        3.12%        -4.92%     
2014     0.00%        101,112        37.413074        3,782,911        2.74%        8.72%     
2014     0.50%        298,611        94.099220        28,099,062        2.74%        8.18%     
2014     0.80%        98,305        75.615605        7,433,392        2.74%        7.85%     
2014     1.00%        178,942        18.966506        3,393,905        2.74%        7.64%     
2013     0.00%        123,946        34.412915        4,265,343        2.48%        28.15%     
2013     0.50%        321,894        86.987217        28,000,663        2.48%        27.51%     
2013     0.80%        119,758        70.110604        8,396,306        2.48%        27.13%     
2013     1.00%        201,751        17.620899        3,555,034        2.48%        26.87%     
2013     1.30%        190        62.439911        11,864        2.48%        26.49%     
2012     0.00%        136,674        26.854210        3,670,272        3.10%        17.31%     
2012     0.50%        348,829        68.220701        23,797,359        3.10%        16.72%     
2012     0.80%        143,114        55.150112        7,892,753        3.10%        16.37%     
2012     1.00%        251,923        13.888604        3,498,859        3.10%        16.14%     
2012     1.30%        120        49.362236        5,923        3.10%        15.79%     
2011     0.00%        149,096        22.892147        3,413,128        2.36%        0.97%     
2011     0.50%        379,343        58.447557        22,171,672        2.36%        0.47%     
2011     0.80%        160,230        47.391689        7,593,570        2.36%        0.17%     
2011     1.00%        263,003        11.958724        3,145,180        2.36%        -0.03%     
2011     1.30%        1        42.631104        43        2.36%        -0.33%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

High Income Portfolio - Initial Class (FHIP)

2015     0.00%        46,720      $ 23.062721      $ 1,077,490        6.94%        -3.63%     
2015     0.50%        114,994        47.175900        5,424,945        6.94%        -4.11%     
2015     0.80%        37,466        43.148429        1,616,599        6.94%        -4.39%     
2015     1.00%        36,170        16.624787        601,319        6.94%        -4.59%     
2014     0.00%        70,561        23.930632        1,688,569        5.30%        1.16%     
2014     0.50%        74,942        49.196697        3,686,899        5.30%        0.65%     
2014     0.80%        21,845        45.131945        985,907        5.30%        0.35%     
2014     1.00%        39,522        17.423841        688,625        5.30%        0.15%     
2013     0.00%        76,527        23.657339        1,810,425        5.55%        5.95%     
2013     0.50%        84,651        48.878642        4,137,626        5.55%        5.42%     
2013     0.80%        27,795        44.974878        1,250,077        5.55%        5.10%     
2013     1.00%        68,487        17.397965        1,191,534        5.55%        4.89%     
2013     1.30%        20        44.129723        883        5.55%        4.58%     
2012     0.00%        79,361        22.329447        1,772,087        5.44%        14.23%     
2012     0.50%        97,105        46.366278        4,502,397        5.44%        13.66%     
2012     0.80%        35,866        42.791316        1,534,753        5.44%        13.32%     
2012     1.00%        79,435        16.586419        1,317,542        5.44%        13.09%     
2012     1.30%        4        42.197632        169        5.44%        12.75%     
2011     0.00%        71,464        19.548118        1,396,987        6.27%        4.03%     
2011     0.50%        147,031        40.794842        5,998,106        6.27%        3.51%     
2011     0.80%        42,868        37.762814        1,618,816        6.27%        3.20%     
2011     1.00%        63,903        14.666687        937,245        6.27%        3.00%     

VIP Asset Manager Portfolio - Initial Class (FAMP)

2015     0.00%        30,670        32.420886        994,349        1.54%        0.14%     
2015     0.50%        124,124        54.609345        6,778,330        1.54%        -0.36%     
2015     0.80%        38,181        45.910238        1,752,899        1.54%        -0.66%     
2015     1.00%        110,966        16.390335        1,818,770        1.54%        -0.85%     
2014     0.00%        28,326        32.374882        917,051        1.47%        5.83%     
2014     0.50%        137,325        54.805245        7,526,130        1.47%        5.31%     
2014     0.80%        43,426        46.213383        2,006,862        1.47%        4.99%     
2014     1.00%        124,578        16.531597        2,059,473        1.47%        4.78%     
2013     0.00%        22,166        30.590553        678,070        1.55%        15.71%     
2013     0.50%        147,566        52.044253        7,679,962        1.55%        15.13%     
2013     0.80%        49,960        44.017089        2,199,094        1.55%        14.78%     
2013     1.00%        135,008        15.777445        2,130,081        1.55%        14.56%     
2013     1.30%        222        44.605427        9,902        1.55%        14.21%     
2012     0.00%        26,092        26.438122        689,823        1.49%        12.48%     
2012     0.50%        159,628        45.205009        7,215,985        1.49%        11.92%     
2012     0.80%        61,726        38.347550        2,367,041        1.49%        11.58%     
2012     1.00%        141,671        13.772768        1,951,202        1.49%        11.36%     
2012     1.30%        138        39.054823        5,390        1.49%        11.03%     
2011     0.00%        28,280        23.504361        664,703        1.89%        -2.56%     
2011     0.50%        188,094        40.390644        7,597,238        1.89%        -3.05%     
2011     0.80%        68,594        34.366682        2,357,348        1.89%        -3.34%     
2011     1.00%        168,991        12.367780        2,090,044        1.89%        -3.53%     
2011     1.30%        1        35.176377        35        1.89%        -3.82%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VIP Energy Portfolio - Service Class 2 (FNRS2)

2015     0.00%        7,724      $ 15.682940      $ 121,135        0.96%        -20.75%     
2015     0.50%        85,744        14.868006        1,274,842        0.96%        -21.15%     
2015     0.80%        17,730        14.399510        255,303        0.96%        -21.38%     
2014     0.00%        11,909        19.788975        235,667        0.61%        -12.76%     
2014     0.50%        88,884        18.854926        1,675,901        0.61%        -13.20%     
2014     0.80%        20,782        18.315787        380,639        0.61%        -13.46%     
2013     0.00%        11,257        22.684649        255,361        0.70%        24.15%     
2013     0.50%        87,421        21.722450        1,898,998        0.70%        23.53%     
2013     0.80%        25,101        21.164829        531,258        0.70%        23.16%     
2012     0.00%        13,031        18.272664        238,111        0.72%        4.73%     
2012     0.50%        92,636        17.585266        1,629,029        0.72%        4.21%     
2012     0.80%        31,070        17.185312        533,948        0.72%        3.90%     
2011     0.00%        15,797        17.446617        275,604        0.77%        -5.20%     
2011     0.50%        124,550        16.874679        2,101,741        0.77%        -5.67%     
2011     0.80%        38,558        16.540551        637,771        0.77%        -5.95%     

VIP Freedom Fund 2010 Portfolio - Service Class (FF10S)

2015     0.00%        646        17.755390        11,470        1.55%        -0.31%     
2015     0.50%        20,645        16.833439        347,526        1.55%        -0.81%     
2015     0.80%        1,626        16.303369        26,509        1.55%        -1.11%     
2014     0.00%        2,872        17.810892        51,153        1.66%        4.35%     
2014     0.50%        20,978        16.970715        356,012        1.66%        3.83%     
2014     0.80%        2,581        16.485713        42,550        1.66%        3.52%     
2013     0.00%        4,122        17.068509        70,356        1.64%        13.39%     
2013     0.50%        17,248        16.344867        281,916        1.64%        12.83%     
2013     0.80%        3,214        15.925458        51,184        1.64%        12.49%     
2012     0.00%        3,524        15.052634        53,045        1.48%        11.69%     
2012     0.50%        18,952        14.486686        274,552        1.48%        11.13%     
2012     0.80%        2,722        14.157347        38,536        1.48%        10.79%     
2011     0.00%        4,071        13.477731        54,868        2.34%        -0.28%     
2011     0.50%        24,603        13.036152        320,728        2.34%        -0.78%     
2011     0.80%        3,979        12.778157        50,844        2.34%        -1.08%     

VIP Freedom Fund 2020 Portfolio - Service Class (FF20S)

2015     0.00%        3,730        18.391642        68,601        1.75%        -0.37%     
2015     0.50%        54,534        17.436546        950,885        1.75%        -0.86%     
2015     0.80%        10,739        16.887497        181,355        1.75%        -1.16%     
2014     0.00%        3,790        18.459232        69,960        1.64%        4.66%     
2014     0.50%        56,232        17.588378        989,030        1.64%        4.14%     
2014     0.80%        9,126        17.085740        155,924        1.64%        3.83%     
2013     0.00%        3,849        17.636606        67,883        1.67%        15.95%     
2013     0.50%        53,692        16.888806        906,794        1.67%        15.38%     
2013     0.80%        11,810        16.455456        194,339        1.67%        15.03%     
2012     0.00%        3,913        15.209948        59,517        2.11%        13.19%     
2012     0.50%        58,464        14.638015        855,797        2.11%        12.62%     
2012     0.80%        15,219        14.305244        217,712        2.11%        12.28%     
2011     0.00%        1,647        13.437783        22,132        2.04%        -1.12%     
2011     0.50%        48,519        12.997459        630,624        2.04%        -1.62%     
2011     0.80%        18,156        12.740229        231,312        2.04%        -1.91%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VIP Freedom Fund 2030 Portfolio - Service Class (FF30S)

2015     0.00%        407      $ 19.200517      $ 7,815        1.58%        -0.34%     
2015     0.50%        48,081        18.203350        875,235        1.58%        -0.83%     
2015     0.80%        13,133        17.630163        231,537        1.58%        -1.13%     
2014     0.00%        415        19.265178        7,995        1.41%        4.86%     
2014     0.50%        52,282        18.356222        959,700        1.41%        4.34%     
2014     0.80%        13,576        17.831644        242,082        1.41%        4.03%     
2013     0.00%        422        18.372029        7,753        1.64%        21.50%     
2013     0.50%        53,021        17.592960        932,796        1.64%        20.89%     
2013     0.80%        17,577        17.141551        301,297        1.64%        20.53%     
2012     0.00%        430        15.121452        6,502        2.04%        15.48%     
2012     0.50%        58,115        14.552777        845,735        2.04%        14.90%     
2012     0.80%        17,634        14.221942        250,790        2.04%        14.56%     
2011     0.50%        54,142        12.665066        685,712        2.06%        -3.18%     
2011     0.80%        17,536        12.414407        217,699        2.06%        -3.47%     

VIP Growth Portfolio - Initial Class (FGP)

2015     0.00%        129,431        39.284517        5,084,634        0.26%        7.17%     
2015     0.50%        333,825        116.939937        39,037,474        0.26%        6.64%     
2015     0.80%        159,204        78.131041        12,438,774        0.26%        6.32%     
2015     1.00%        290,892        13.433975        3,907,836        0.26%        6.11%     
2015     1.30%        16        69.840591        1,117        0.26%        5.79%     
2014     0.00%        137,759        36.654676        5,049,512        0.18%        11.30%     
2014     0.50%        360,019        109.658461        39,479,129        0.18%        10.74%     
2014     0.80%        181,138        73.486182        13,311,140        0.18%        10.41%     
2014     1.00%        339,475        12.660634        4,297,969        0.18%        10.19%     
2014     1.30%        16        66.017849        1,056        0.18%        9.86%     
2013     0.00%        150,521        32.933927        4,957,248        0.29%        36.34%     
2013     0.50%        372,839        99.021065        36,918,915        0.29%        35.66%     
2013     0.80%        223,483        66.557026        14,874,364        0.29%        35.25%     
2013     1.00%        349,541        11.489795        4,016,154        0.29%        34.98%     
2013     1.30%        213        60.092605        12,800        0.29%        34.58%     
2012     0.00%        161,289        24.156554        3,896,186        0.59%        14.69%     
2012     0.50%        394,207        72.994214        28,774,830        0.59%        14.12%     
2012     0.80%        266,541        49.210357        13,116,578        0.59%        13.77%     
2012     1.00%        385,900        8.512216        3,284,864        0.59%        13.55%     
2012     1.30%        137        44.653281        6,117        0.59%        13.20%     
2011     0.00%        170,592        21.062729        3,593,133        0.35%        0.20%     
2011     0.50%        430,909        63.965181        27,563,172        0.35%        -0.30%     
2011     0.80%        300,253        43.253084        12,986,868        0.35%        -0.59%     
2011     1.00%        455,202        7.496758        3,412,539        0.35%        -0.79%     
2011     1.30%        19        39.444794        749        0.35%        -1.09%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VIP Investment Grade Bond Portfolio - Service Class (FIGBS)

2015     0.00%        16,557      $ 16.632779      $ 275,389        2.49%        -0.71%     
2015     0.50%        103,861        15.612056        1,621,484        2.49%        -1.20%     
2015     0.80%        11,366        15.029934        170,830        2.49%        -1.50%     
2014     0.00%        19,523        16.750978        327,029        1.87%        5.75%     
2014     0.50%        105,027        15.801818        1,659,618        1.87%        5.23%     
2014     0.80%        13,720        15.258338        209,344        1.87%        4.91%     
2013     0.00%        18,225        15.839600        288,677        2.05%        -1.89%     
2013     0.50%        196,708        15.016973        2,953,959        2.05%        -2.38%     
2013     0.80%        15,073        14.544041        219,222        2.05%        -2.67%     
2012     0.00%        28,073        16.144635        453,228        2.07%        5.77%     
2012     0.50%        224,012        15.382891        3,445,952        2.07%        5.24%     
2012     0.80%        21,300        14.943212        318,290        2.07%        4.92%     
2011     0.00%        34,735        15.264055        530,197        3.22%        7.21%     
2011     0.50%        264,186        14.616946        3,861,592        3.22%        6.67%     
2011     0.80%        23,285        14.241922        331,623        3.22%        6.36%     

VIP Mid Cap Portfolio - Service Class (FMCS)

2015     0.00%        9,746        42.935421        418,449        0.37%        -1.50%     
2015     0.50%        144,999        40.300555        5,843,540        0.37%        -1.99%     
2015     0.80%        16,030        38.797932        621,931        0.37%        -2.28%     
2014     0.00%        11,134        43.589036        485,320        0.16%        6.20%     
2014     0.50%        178,602        41.119213        7,343,974        0.16%        5.67%     
2014     0.80%        18,747        39.705024        744,350        0.16%        5.35%     
2013     0.00%        12,172        41.045629        499,607        0.41%        36.06%     
2013     0.50%        180,997        38.914038        7,043,324        0.41%        35.38%     
2013     0.80%        26,480        37.688616        997,995        0.41%        34.98%     
2012     0.00%        16,990        30.166927        512,536        0.49%        14.75%     
2012     0.50%        189,756        28.743525        5,454,256        0.49%        14.18%     
2012     0.80%        32,699        27.921947        913,020        0.49%        13.83%     
2011     0.00%        21,838        26.289170        574,103        0.14%        -10.72%     
2011     0.50%        229,983        25.174584        5,789,726        0.14%        -11.16%     
2011     0.80%        39,066        24.528651        958,236        0.14%        -11.43%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VIP Overseas Portfolio - Initial Class (FOP)

2015     0.00%        36,176      $ 26.124665      $ 945,086        1.30%        3.62%     
2015     0.50%        70,062        43.532466        3,049,972        1.30%        3.11%     
2015     0.80%        14,599        32.235609        470,608        1.30%        2.80%     
2015     1.00%        57,818        13.308916        769,495        1.30%        2.59%     
2014     0.00%        25,877        25.210791        652,380        1.27%        -8.08%     
2014     0.50%        79,348        42.220268        3,350,094        1.27%        -8.54%     
2014     0.80%        17,397        31.357900        545,533        1.27%        -8.81%     
2014     1.00%        77,951        12.972478        1,011,218        1.27%        -8.99%     
2013     0.00%        28,857        27.425919        791,430        1.36%        30.44%     
2013     0.50%        91,720        46.160265        4,233,820        1.36%        29.79%     
2013     0.80%        21,769        34.387281        748,577        1.36%        29.40%     
2013     1.00%        82,304        14.254206        1,173,178        1.36%        29.14%     
2013     1.30%        542        29.175220        15,813        1.36%        28.75%     
2012     0.00%        30,798        21.026341        647,569        1.93%        20.74%     
2012     0.50%        104,930        35.566403        3,731,983        1.93%        20.14%     
2012     0.80%        26,621        26.574860        707,449        1.93%        19.78%     
2012     1.00%        83,926        11.037832        926,361        1.93%        19.54%     
2012     1.30%        328        22.659824        7,432        1.93%        19.18%     
2011     0.00%        33,271        17.414491        579,398        1.29%        -17.16%     
2011     0.50%        118,017        29.604824        3,493,873        1.29%        -17.58%     
2011     0.80%        30,982        22.187015        687,398        1.29%        -17.82%     
2011     1.00%        94,368        9.233835        871,379        1.29%        -17.99%     
2011     1.30%        5        19.013413        95        1.29%        -18.23%     

VIP Overseas Portfolio - Service Class (FOS)

2015     0.00%        7,048        9.455787        66,644        1.33%        -5.44%      4/30/2015
2015     0.50%        340,119        9.424071        3,205,306        1.33%        -5.76%      4/30/2015
2015     0.80%        66,203        9.405088        622,645        1.33%        -5.95%      4/30/2015

VIP Value Strategies Portfolio - Service Class (FVSS)

2015     0.00%        6,890        25.818706        177,891        0.97%        -3.05%     
2015     0.50%        18,586        24.112865        448,162        0.97%        -3.54%     
2015     0.80%        3,091        23.143966        71,538        0.97%        -3.83%     
2015     1.00%        4,532        22.519793        102,060        0.97%        -4.02%     
2014     0.00%        8,274        26.632186        220,355        0.80%        6.69%     
2014     0.50%        23,118        24.997315        577,888        0.80%        6.16%     
2014     0.80%        3,724        24.064985        89,618        0.80%        5.84%     
2014     1.00%        6,587        23.462855        154,550        0.80%        5.63%     
2013     0.00%        9,006        24.961619        224,804        0.74%        30.44%     
2013     0.50%        26,777        23.546747        630,511        0.74%        29.79%     
2013     0.80%        4,896        22.736642        111,319        0.74%        29.41%     
2013     1.00%        10,442        22.212133        231,939        0.74%        29.15%     
2012     0.00%        9,336        19.135795        178,652        0.58%        27.10%     
2012     0.50%        46,104        18.141557        836,398        0.58%        26.47%     
2012     0.80%        6,450        17.570001        113,327        0.58%        26.09%     
2012     1.00%        9,572        17.199023        164,629        0.58%        25.83%     
2011     0.00%        19,441        15.055580        292,696        0.80%        -8.85%     
2011     0.50%        36,543        14.345026        524,210        0.80%        -9.30%     
2011     0.80%        5,608        13.934920        78,147        0.80%        -9.57%     
2011     1.00%        6,604        13.668049        90,264        0.80%        -9.75%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Franklin Income Securities Fund - Class 2 (FTVIS2)

2015     0.00%        9,849      $ 15.982130      $ 157,408        4.53%        -7.05%     
2015     0.50%        87,495        15.227931        1,332,368        4.53%        -7.52%     
2015     0.80%        10,851        14.792676        160,515        4.53%        -7.79%     
2014     0.00%        10,790        17.195058        185,535        5.34%        4.62%     
2014     0.50%        88,212        16.465766        1,452,478        5.34%        4.09%     
2014     0.80%        12,451        16.043213        199,754        5.34%        3.78%     
2013     0.00%        11,930        16.436367        196,086        6.46%        13.94%     
2013     0.50%        89,778        15.818160        1,420,123        6.46%        13.37%     
2013     0.80%        14,539        15.458527        224,752        6.46%        13.03%     
2012     0.00%        12,161        14.425332        175,426        6.60%        12.65%     
2012     0.50%        68,091        13.952339        950,029        6.60%        12.09%     
2012     0.80%        12,946        13.676069        177,050        6.60%        11.75%     
2011     0.00%        11,961        12.805162        153,163        6.21%        2.38%     
2011     0.50%        70,842        12.447515        881,807        6.21%        1.87%     
2011     0.80%        13,328        12.237789        163,105        6.21%        1.57%     

Rising Dividends Securities Fund - Class 1 (FTVRDI)

2015     0.00%        12,212        27.611133        337,187        1.70%        -3.42%     
2015     0.50%        141,907        25.916612        3,677,749        1.70%        -3.90%     
2015     0.80%        9,694        24.950251        241,868        1.70%        -4.19%     
2014     0.00%        14,184        28.587626        405,487        1.58%        9.01%     
2014     0.50%        148,833        26.967693        4,013,683        1.58%        8.46%     
2014     0.80%        10,615        26.040144        276,416        1.58%        8.14%     
2013     0.00%        13,999        26.225783        367,135        1.83%        30.05%     
2013     0.50%        159,701        24.863682        3,970,755        1.83%        29.40%     
2013     0.80%        14,322        24.080637        344,883        1.83%        29.02%     
2012     0.00%        14,390        20.165763        290,185        1.95%        12.18%     
2012     0.50%        171,328        19.214168        3,291,925        1.95%        11.61%     
2012     0.80%        15,177        18.664910        283,277        1.95%        11.28%     
2011     0.00%        27,085        17.976970        486,906        1.64%        6.29%     
2011     0.50%        171,680        17.214712        2,955,422        1.64%        5.76%     
2011     0.80%        17,101        16.772979        286,835        1.64%        5.45%     

Small Cap Value Securities Fund - Class 1 (FTVSVI)

2015     0.00%        4,486        33.932255        152,220        0.90%        -7.18%     
2015     0.50%        60,975        31.849584        1,942,028        0.90%        -7.65%     
2015     0.80%        5,918        30.661824        181,457        0.90%        -7.92%     
2014     0.00%        6,537        36.558447        238,983        0.80%        0.88%     
2014     0.50%        79,931        34.486659        2,756,553        0.80%        0.38%     
2014     0.80%        7,270        33.300359        242,094        0.80%        0.08%     
2013     0.00%        6,811        36.238435        246,820        1.48%        36.50%     
2013     0.50%        104,422        34.356208        3,587,544        1.48%        35.82%     
2013     0.80%        10,409        33.274117        346,350        1.48%        35.42%     
2012     0.00%        6,825        26.547381        181,186        1.03%        18.75%     
2012     0.50%        111,680        25.294569        2,824,897        1.03%        18.16%     
2012     0.80%        12,551        24.571434        308,396        1.03%        17.80%     
2011     0.00%        9,471        22.355324        211,727        0.95%        -3.53%     
2011     0.50%        124,783        21.407336        2,671,272        0.95%        -4.01%     
2011     0.80%        14,035        20.857943        292,741        0.95%        -4.29%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Templeton Developing Markets Securities Fund - Class 2 (FTVDM2)

2015     0.00%        6,443      $ 7.580957      $ 48,844        2.03%        -19.60%     
2015     0.50%        79,565        7.517796        598,153        2.03%        -20.00%     
2015     0.80%        7,707        7.480158        57,650        2.03%        -20.24%     
2014     0.00%        6,412        9.429267        60,460        1.52%        -5.71%      4/30/2014
2014     0.50%        79,121        9.397664        743,553        1.52%        -6.02%      4/30/2014
2014     0.80%        10,088        9.378753        94,613        1.52%        -6.21%      4/30/2014

Templeton Foreign Securities Fund - Class 1 (TIF)

2015     0.00%        157        23.944197        3,759        3.53%        -6.31%     
2015     0.50%        4,217        22.474517        94,775        3.53%        -6.78%     
2015     0.80%        138        21.636386        2,986        3.53%        -7.05%     
2014     0.00%        160        25.556124        4,089        2.00%        -10.89%     
2014     0.50%        5,669        24.107860        136,667        2.00%        -11.33%     
2014     0.80%        454        23.278595        10,568        2.00%        -11.60%     
2013     0.00%        163        28.677989        4,675        2.54%        23.27%     
2013     0.50%        6,799        27.188535        184,855        2.54%        22.66%     
2013     0.80%        545        26.332251        14,351        2.54%        22.29%     
2012     0.00%        166        23.263845        3,862        3.71%        18.60%     
2012     0.50%        7,020        22.166042        155,606        3.71%        18.00%     
2012     0.80%        621        21.532384        13,372        3.71%        17.65%     
2011     0.00%        169        19.616024        3,315        1.90%        -10.44%     
2011     0.50%        12,325        18.784240        231,516        1.90%        -10.89%     
2011     0.80%        683        18.302200        12,500        1.90%        -11.16%     

Templeton Foreign Securities Fund - Class 2 (TIF2)

2015     0.00%        9,284        8.167860        75,830        3.28%        -6.49%     
2015     0.50%        107,904        8.099836        874,005        3.28%        -6.96%     
2015     0.80%        8,391        8.059284        67,625        3.28%        -7.24%     
2014     0.00%        9,163        8.734905        80,038        1.90%        -12.65%      4/30/2014
2014     0.50%        130,161        8.705622        1,133,132        1.90%        -12.94%      4/30/2014
2014     0.80%        9,869        8.688088        85,743        1.90%        -13.12%      4/30/2014

Templeton Global Bond Securities Fund - Class 2 (FTVGI2)

2015     0.00%        25,050        9.651615        241,773        7.79%        -4.30%     
2015     0.50%        179,618        9.571266        1,719,172        7.79%        -4.78%     
2015     0.80%        14,071        9.523371        134,003        7.79%        -5.07%     
2014     0.00%        27,636        10.085726        278,729        5.04%        0.86%      4/30/2014
2014     0.50%        189,728        10.051926        1,907,132        5.04%        0.52%      4/30/2014
2014     0.80%        16,441        10.031694        164,931        5.04%        0.32%      4/30/2014

VIP Founding Funds Allocation Fund - Class 2 (FTVFA2)

2015     0.00%        1,861        12.958538        24,116        3.09%        -6.21%     
2015     0.50%        16,651        12.471164        207,657        3.09%        -6.68%     
2015     0.80%        1,457        12.187593        17,757        3.09%        -6.96%     
2014     0.00%        1,899        13.816935        26,238        2.91%        2.85%     
2014     0.50%        12,325        13.363967        164,711        2.91%        2.34%     
2014     0.80%        1,484        13.099354        19,439        2.91%        2.03%     
2013     0.00%        5,110        13.434293        68,649        11.80%        23.77%     
2013     0.50%        4,833        13.059007        63,114        11.80%        23.15%     
2013     0.80%        1,921        12.838902        24,664        11.80%        22.78%     
2012     0.00%        959        10.854248        10,409        3.11%        15.33%     
2012     0.50%        4,840        10.603889        51,323        3.11%        14.76%     
2012     0.80%        1,840        10.456468        19,240        3.11%        14.41%     
2011     0.00%        977        9.411247        9,195        0.01%        -1.54%     
2011     0.50%        9,398        9.240357        86,841        0.01%        -2.03%     
2011     0.80%        1,897        9.139329        17,337        0.01%        -2.32%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Short Duration Bond Portfolio - I Class Shares (AMTB)

2015     0.00%        33,957      $ 18.212183      $ 618,431        1.48%        0.18%     
2015     0.50%        37,870        25.838210        978,493        1.48%        -0.32%     
2015     0.80%        8,860        20.234451        179,277        1.48%        -0.61%     
2015     1.00%        58,030        12.656942        734,482        1.48%        -0.81%     
2014     0.00%        34,818        18.178772        632,948        1.68%        0.61%     
2014     0.50%        44,680        25.920092        1,158,110        1.68%        0.11%     
2014     0.80%        8,780        20.359563        178,757        1.68%        -0.19%     
2014     1.00%        63,202        12.760705        806,502        1.68%        -0.39%     
2013     0.00%        35,883        18.068566        648,354        2.13%        0.62%     
2013     0.50%        39,560        25.892092        1,024,291        2.13%        0.11%     
2013     0.80%        11,902        20.398673        242,785        2.13%        -0.18%     
2013     1.00%        74,230        12.810813        950,947        2.13%        -0.38%     
2013     1.30%        184        19.479537        3,584        2.13%        -0.68%     
2012     0.00%        39,865        17.957800        715,888        3.05%        4.61%     
2012     0.50%        46,960        25.862355        1,214,496        3.05%        4.08%     
2012     0.80%        12,214        20.436462        249,611        3.05%        3.77%     
2012     1.00%        69,717        12.860239        896,577        3.05%        3.56%     
2012     1.30%        97        19.613461        1,903        3.05%        3.25%     
2011     0.00%        40,577        17.167186        696,593        3.92%        0.29%     
2011     0.50%        44,848        24.847995        1,114,383        3.92%        -0.21%     
2011     0.80%        14,684        19.694057        289,188        3.92%        -0.51%     
2011     1.00%        51,341        12.417925        637,549        3.92%        -0.71%     
2011     1.30%        17        18.995943        323        3.92%        -1.00%     

Guardian Portfolio - I Class Shares (AMGP)

2015     0.00%        3,534        24.202603        85,532        0.70%        -4.97%     
2015     0.80%        2        21.012092        42        0.70%        -5.73%     
2015     1.00%        3,330        18.232087        60,713        0.70%        -5.91%     
2014     0.00%        3,691        25.467775        94,002        0.43%        9.03%     
2014     0.80%        2        22.288104        45        0.43%        8.16%     
2014     1.00%        3,825        19.378004        74,121        0.43%        7.94%     
2013     0.00%        3,816        23.358987        89,138        0.80%        38.81%     
2013     0.80%        2        20.606782        41        0.80%        37.71%     
2013     1.00%        6,693        17.952067        120,153        0.80%        37.43%     
2012     0.00%        6,748        16.827470        113,552        0.27%        12.73%     
2012     0.80%        2        14.963947        30        0.27%        11.83%     
2012     1.00%        3,505        13.062262        45,783        0.27%        11.60%     
2011     0.00%        7,106        14.927741        106,077        0.45%        -2.94%     
2011     0.80%        2        13.381489        27        0.45%        -3.71%     
2011     1.00%        5,218        11.704343        61,073        0.45%        -3.90%     

International Portfolio - S Class Shares (AMINS)

2015     0.00%        1,304        15.819981        20,629        0.97%        1.53%     
2014     0.00%        1,255        15.581872        19,555        0.35%        -3.27%     
2013     0.00%        1,213        16.109309        19,541        1.16%        17.83%     
2012     0.00%        1,723        13.671294        23,556        0.82%        18.48%     
2011     0.00%        1,202        11.539024        13,870        12.26%        -12.33%     

Mid-Cap Growth Portfolio - I Class Shares (AMCG)

2015     0.00%        86,273        9.602877        828,469        0.00%        -3.97%      11/4/2015
2015     0.50%        5,084        9.595371        48,783        0.00%        -4.05%      11/4/2015
2015     0.80%        1,844        9.590871        17,686        0.00%        -4.09%      11/4/2015
2015     1.00%        87,612        9.587871        840,013        0.00%        -4.12%      11/4/2015

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Mid-Cap Growth Portfolio - S Class Shares (AMMCGS)

2015     0.50%        5,307      $ 32.774504      $ 173,934        0.00%        0.49%     
2015     0.80%        881        31.552382        27,798        0.00%        0.19%     
2014     0.00%        530        34.573606        18,324        0.00%        7.31%     
2013     0.00%        537        32.217787        17,301        0.00%        32.28%     
2012     0.00%        68        24.354864        1,656        0.00%        12.10%     
2011     0.00%        63        21.725830        1,369        0.00%        0.26%     

Advisers Management Trust: Large Cap Value Portfolio - Class I (AMTP)

2015     0.00%        65,901        32.872625        2,166,339        0.78%        -11.80%     
2015     0.80%        56        42.981855        2,407        0.78%        -12.51%     
2015     1.00%        23,926        16.721091        400,069        0.78%        -12.68%     
2014     0.00%        69,362        37.272351        2,585,285        0.75%        9.85%     
2014     0.80%        56        49.126371        2,751        0.75%        8.98%     
2014     1.00%        27,195        19.149762        520,778        0.75%        8.76%     
2013     0.00%        76,029        33.929461        2,579,623        1.19%        31.14%     
2013     0.80%        56        45.079527        2,524        1.19%        30.09%     
2013     1.00%        29,271        17.607455        515,388        1.19%        29.83%     
2012     0.00%        84,168        25.873568        2,177,726        0.42%        16.60%     
2012     0.80%        56        34.652161        1,941        0.42%        15.67%     
2012     1.00%        30,453        13.561747        412,996        0.42%        15.44%     
2011     0.00%        86,633        22.190216        1,922,405        0.00%        -11.36%     
2011     0.80%        56        29.958324        1,678        0.00%        -12.06%     
2011     1.00%        35,996        11.748254        422,890        0.00%        -12.24%     

Advisers Management Trust: Mid Cap Intrinsic Value Portfolio - Class S (AMRS)

2015     0.00%        1,061        20.285547        21,523        0.37%        -8.52%     
2014     0.00%        1,220        22.175231        27,054        0.68%        13.56%     
2013     0.00%        1,376        19.528070        26,871        0.82%        36.71%     
2012     0.00%        1,543        14.284382        22,041        0.30%        15.37%     
2011     0.00%        2,941        12.380922        36,412        0.40%        -6.70%     

Socially Responsive Portfolio - I Class Shares (AMSRS)

2015     0.00%        460        29.142833        13,406        0.55%        -0.46%     
2015     0.50%        23,109        27.354252        632,129        0.55%        -0.96%     
2015     0.80%        1,464        26.334197        38,553        0.55%        -1.26%     
2014     0.00%        1,211        29.278575        35,456        0.37%        10.38%     
2014     0.50%        25,368        27.619420        700,649        0.37%        9.83%     
2014     0.80%        2,069        26.669361        55,179        0.37%        9.50%     
2013     0.00%        1,293        26.524850        34,297        0.78%        37.60%     
2013     0.50%        27,419        25.147151        689,510        0.78%        36.92%     
2013     0.80%        3,040        24.355078        74,039        0.78%        36.51%     
2012     0.00%        898        19.276454        17,310        0.21%        10.98%     
2012     0.50%        20,471        18.366751        375,986        0.21%        10.42%     
2012     0.80%        3,063        17.841641        54,649        0.21%        10.09%     
2011     0.00%        902        17.369356        15,667        0.36%        -3.08%     
2011     0.50%        26,477        16.632806        440,387        0.36%        -3.56%     
2011     0.80%        4,463        16.205928        72,327        0.36%        -3.85%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Capital Income Fund/VA - Non-Service Shares (OVMS)

2015     0.00%        20,811      $ 26.706120      $ 555,781        2.24%        0.83%     
2015     0.50%        83,659        42.100530        3,522,088        2.24%        0.33%     
2015     0.80%        28,601        38.689117        1,106,547        2.24%        0.03%     
2015     1.00%        25,534        14.014239        357,840        2.24%        -0.17%     
2014     0.00%        20,975        26.485875        555,541        2.05%        8.20%     
2014     0.50%        88,630        41.962635        3,719,148        2.05%        7.66%     
2014     0.80%        31,454        38.678263        1,216,586        2.05%        7.34%     
2014     1.00%        42,043        14.038358        590,215        2.05%        7.12%     
2013     0.00%        23,362        24.479189        571,883        2.38%        13.17%     
2013     0.50%        91,522        38.977736        3,567,320        2.38%        12.60%     
2013     0.80%        35,610        36.034905        1,283,203        2.38%        12.27%     
2013     1.00%        47,341        13.105120        620,409        2.38%        12.04%     
2013     1.30%        48        33.555465        1,611        2.38%        11.71%     
2012     0.00%        25,505        21.630621        551,689        1.33%        12.34%     
2012     0.50%        96,541        34.614598        3,341,728        1.33%        11.78%     
2012     0.80%        40,574        32.097298        1,302,316        1.33%        11.44%     
2012     1.00%        63,128        11.696460        738,374        1.33%        11.22%     
2012     1.30%        4        30.038576        120        1.33%        10.89%     
2011     0.00%        28,648        19.254563        551,605        2.29%        0.72%     
2011     0.50%        109,322        30.967082        3,385,383        2.29%        0.22%     
2011     0.80%        44,239        28.801503        1,274,150        2.29%        -0.08%     
2011     1.00%        68,952        10.516516        725,135        2.29%        -0.28%     

Core Bond Fund/VA - Non-Service Shares (OVB)

2015     0.00%        31,610        18.634409        589,034        4.04%        0.96%     
2015     0.50%        71,934        26.926807        1,936,953        4.04%        0.46%     
2015     0.80%        23,785        23.706576        563,861        4.04%        0.16%     
2015     1.00%        33,381        12.596149        420,472        4.04%        -0.04%     
2014     0.00%        31,891        18.457037        588,613        4.76%        7.27%     
2014     0.50%        75,579        26.804199        2,025,835        4.76%        6.73%     
2014     0.80%        26,194        23.669529        620,000        4.76%        6.41%     
2014     1.00%        34,890        12.601657        439,672        4.76%        6.20%     
2013     0.00%        35,901        17.206945        617,747        5.06%        -0.10%     
2013     0.50%        128,564        25.113977        3,228,753        5.06%        -0.60%     
2013     0.80%        29,928        22.243594        665,706        5.06%        -0.90%     
2013     1.00%        40,654        11.866194        482,408        5.06%        -1.09%     
2013     1.30%        87        21.524233        1,873        5.06%        -1.39%     
2012     0.00%        41,017        17.224007        706,477        4.88%        10.29%     
2012     0.50%        128,505        25.264893        3,246,665        4.88%        9.74%     
2012     0.80%        34,873        22.444505        782,707        4.88%        9.41%     
2012     1.00%        50,794        11.997337        609,393        4.88%        9.19%     
2012     1.30%        76        21.827521        1,659        4.88%        8.86%     
2011     0.00%        45,210        15.616793        706,035        5.94%        8.27%     
2011     0.50%        129,643        23.022454        2,984,700        5.94%        7.73%     
2011     0.80%        38,953        20.513983        799,081        5.94%        7.41%     
2011     1.00%        54,684        10.987424        600,836        5.94%        7.19%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Global Securities Fund/VA - Non-Service Shares (OVGS)

2015     0.00%        30,305      $ 61.416670      $ 1,861,232        1.31%        3.94%     
2015     0.50%        244,405        68.823160        16,820,724        1.31%        3.43%     
2015     0.80%        35,673        65.680242        2,343,011        1.31%        3.12%     
2015     1.00%        50,382        20.186817        1,017,052        1.31%        2.91%     
2014     0.00%        31,581        59.086198        1,866,001        1.24%        2.29%     
2014     0.50%        256,527        66.543578        17,070,224        1.24%        1.78%     
2014     0.80%        41,216        63.695578        2,625,277        1.24%        1.48%     
2014     1.00%        48,669        19.616036        954,693        1.24%        1.27%     
2013     0.00%        25,705        57.762074        1,484,774        1.38%        27.31%     
2013     0.50%        164,315        65.378449        10,742,660        1.38%        26.67%     
2013     0.80%        26,742        62.768366        1,678,552        1.38%        26.29%     
2013     1.00%        52,368        19.369184        1,014,325        1.38%        26.04%     
2013     1.30%        10        56.724747        567        1.38%        25.66%     
2012     0.00%        27,835        45.372528        1,262,944        2.15%        21.26%     
2012     0.50%        179,840        51.612469        9,281,986        2.15%        20.66%     
2012     0.80%        36,797        49.700720        1,828,837        2.15%        20.30%     
2012     1.00%        62,172        15.367427        955,424        2.15%        20.06%     
2012     1.30%        3        45.140290        135        2.15%        19.70%     
2011     0.00%        30,723        37.416119        1,149,535        1.32%        -8.29%     
2011     0.50%        208,594        42.775604        8,922,734        1.32%        -8.75%     
2011     0.80%        43,138        41.315188        1,782,255        1.32%        -9.02%     
2011     1.00%        69,574        12.800257        890,565        1.32%        -9.20%     

International Growth Fund/VA - Non-Service Shares (OVIG)

2015     0.50%        2,804        9.335199        26,176        1.48%        2.92%     
2015     0.80%        296        9.288573        2,749        1.48%        2.61%     

Main Street Fund(R)/VA - Non-Service Shares (OVGI)

2015     0.00%        18,073        18.826860        340,258        0.92%        3.33%     
2015     0.50%        45,674        17.408284        795,106        0.92%        2.81%     
2015     0.80%        5,535        16.608972        91,931        0.92%        2.50%     
2015     1.00%        2,564        16.087715        41,249        0.92%        2.30%     
2014     0.00%        21,173        18.220430        385,781        0.81%        10.70%     
2014     0.50%        47,078        16.932003        797,125        0.81%        10.15%     
2014     0.80%        7,321        16.203092        118,623        0.81%        9.82%     
2014     1.00%        10,278        15.725988        161,632        0.81%        9.60%     
2013     0.00%        21,539        16.458811        354,506        1.10%        31.77%     
2013     0.50%        45,618        15.371629        701,223        1.10%        31.12%     
2013     0.80%        10,025        14.754067        147,910        1.10%        30.72%     
2013     1.00%        4,106        14.348295        58,914        1.10%        30.46%     
2012     0.00%        24,343        12.490314        304,052        1.07%        16.87%     
2012     0.50%        50,353        11.723693        590,323        1.07%        16.29%     
2012     0.80%        11,568        11.286461        130,562        1.07%        15.94%     
2012     1.00%        4,226        10.998010        46,478        1.07%        15.71%     
2011     0.00%        19,438        10.687265        207,739        0.86%        -0.01%     
2011     0.50%        59,890        10.081693        603,793        0.86%        -0.51%     
2011     0.80%        12,913        9.734919        125,707        0.86%        -0.81%     
2011     1.00%        2,423        9.505148        23,031        0.86%        -1.01%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Main Street Small- & Mid-Cap Fund(R)/VA - Non-Service Shares (OVSC)

2015     0.00%        3,968      $ 37.311330      $ 148,051        0.85%        -5.90%     
2015     0.50%        36,075        35.021459        1,263,399        0.85%        -6.37%     
2015     0.80%        4,543        33.715552        153,170        0.85%        -6.65%     
2014     0.00%        2,745        39.650231        108,840        0.86%        11.93%     
2014     0.50%        28,891        37.403435        1,080,623        0.86%        11.38%     
2014     0.80%        4,004        36.116929        144,612        0.86%        11.04%     
2013     0.00%        3,573        35.423066        126,567        0.95%        41.01%     
2013     0.50%        34,448        33.583284        1,156,877        0.95%        40.31%     
2013     0.80%        7,508        32.525596        244,202        0.95%        39.89%     
2012     0.00%        1,538        25.120110        38,635        0.60%        17.99%     
2012     0.50%        27,760        23.934670        664,426        0.60%        17.40%     
2012     0.80%        6,485        23.250430        150,779        0.60%        17.04%     
2011     0.00%        2,898        21.290587        61,700        0.63%        -2.21%     
2011     0.50%        27,732        20.387760        565,393        0.63%        -2.70%     
2011     0.80%        6,787        19.864554        134,821        0.63%        -2.99%     

Discovery Mid Cap Growth Fund/VA - Non-Service Shares (OVAG)

2015     0.00%        3,609        11.164569        40,293        0.00%        6.61%     
2015     0.50%        68,736        10.323152        709,572        0.00%        6.07%     
2015     0.80%        20,717        9.849020        204,042        0.00%        5.76%     
2015     1.00%        25,537        8.450352        215,797        0.00%        5.55%     
2014     0.00%        5,294        10.472729        55,443        0.00%        5.78%     
2014     0.50%        61,812        9.731996        601,554        0.00%        5.26%     
2014     0.80%        21,120        9.312908        196,689        0.00%        4.94%     
2014     1.00%        26,040        8.006363        208,486        0.00%        4.73%     
2013     0.00%        7,017        9.900062        69,469        0.01%        35.98%     
2013     0.50%        67,291        9.245959        622,170        0.01%        35.31%     
2013     0.80%        24,938        8.874402        221,310        0.01%        34.90%     
2013     1.00%        24,456        7.644653        186,958        0.01%        34.63%     
2012     0.00%        7,137        7.280329        51,960        0.00%        16.45%     
2012     0.50%        78,625        6.833364        537,273        0.00%        15.86%     
2012     0.80%        27,812        6.578454        182,960        0.00%        15.52%     
2012     1.00%        27,106        5.678189        153,913        0.00%        15.29%     
2011     0.00%        7,149        6.252049        44,696        0.00%        1.10%     
2011     0.50%        88,996        5.897695        524,871        0.00%        0.59%     
2011     0.80%        30,607        5.694788        174,300        0.00%        0.29%     
2011     1.00%        42,359        4.925320        208,632        0.00%        0.09%     

Global Strategic Income Fund/VA: Non-service Shares (OVSB)

2015     0.00%        2,090        10.218354        21,356        5.75%        -2.26%     
2015     0.50%        16,292        10.057176        163,852        5.75%        -2.75%     
2015     0.80%        2,725        9.961625        27,145        5.75%        -3.04%     
2014     0.00%        3,514        10.454655        36,738        4.12%        2.84%     
2014     0.50%        16,193        10.341321        167,457        4.12%        2.33%     
2014     0.80%        1,964        10.273885        20,178        4.12%        2.02%     
2013     0.00%        4,623        10.166070        46,998        4.89%        -0.13%     
2013     0.50%        10,314        10.106259        104,236        4.89%        -0.63%     
2013     0.80%        2,809        10.070537        28,288        4.89%        -0.93%     
2012     0.00%        4,557        10.179532        46,388        0.00%        1.80%      10/26/2012
2012     0.50%        8,166        10.170366        83,051        0.00%        1.70%      10/26/2012
2012     0.80%        3,560        10.164863        36,187        0.00%        1.65%      10/26/2012

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

All Asset Portfolio - Administrative Class (PMVAAA)

2015     0.50%        19,619      $ 9.652156      $ 189,366        3.46%        -9.44%     
2015     0.80%        2,205        9.546539        21,050        3.46%        -9.71%     
2014     0.50%        17,361        10.658413        185,041        4.03%        -0.03%     
2014     0.80%        2,633        10.573486        27,840        4.03%        -0.33%     
2013     0.50%        42,586        10.661336        454,024        4.32%        -0.23%     
2013     0.80%        4,166        10.608164        44,194        4.32%        -0.53%     
2012     0.50%        66,356        10.685592        709,053        5.75%        6.86%      5/1/2012
2012     0.80%        3,037        10.664248        32,387        5.75%        6.64%      5/1/2012

CommodityRealReturn(R) Strategy Portfolio - Administrative Class (PMVRSA)

2015     0.50%        1,195        5.474462        6,542        5.56%        -26.08%     
2014     0.50%        298        7.405558        2,207        0.22%        -25.94%      5/1/2014
2014     0.80%        301        7.390691        2,225        0.22%        -26.09%      5/1/2014

Foreign Bond Portfolio (Unhedged) - Administrative Class (PMVFBA)

2015     0.50%        24,645        11.598080        285,835        1.52%        -7.55%     
2015     0.80%        395        11.366789        4,490        1.52%        -7.83%     
2014     0.50%        26,282        12.544818        329,703        2.05%        -0.10%     
2014     0.80%        955        12.331826        11,777        2.05%        -0.40%     
2013     0.00%        517        12.854946        6,646        1.79%        -6.47%     
2013     0.50%        42,182        12.557432        529,698        1.79%        -6.94%     
2013     0.80%        1,172        12.381567        14,511        1.79%        -7.22%     
2012     0.00%        2,260        13.744711        31,063        5.63%        5.50%     
2012     0.50%        42,282        13.494082        570,557        5.63%        4.97%     
2012     0.80%        1,719        13.345323        22,941        5.63%        4.65%     
2011     0.00%        2,159        13.028098        28,128        1.99%        8.52%     
2011     0.50%        56,209        12.854999        722,567        1.99%        7.98%     
2011     0.80%        5,015        12.751830        63,950        1.99%        7.66%     

Low Duration Portfolio - Administrative Class (PMVLDA)

2015     0.00%        29,449        12.575667        370,341        3.42%        0.31%     
2015     0.50%        89,541        12.162088        1,089,006        3.42%        -0.19%     
2015     0.80%        8,205        11.919542        97,800        3.42%        -0.49%     
2014     0.00%        30,065        12.536937        376,923        1.12%        0.85%     
2014     0.50%        97,346        12.185567        1,186,216        1.12%        0.34%     
2014     0.80%        8,703        11.978669        104,250        1.12%        0.04%     
2013     0.00%        31,197        12.431406        387,823        1.47%        -0.13%     
2013     0.50%        118,845        12.143708        1,443,219        1.47%        -0.63%     
2013     0.80%        9,183        11.973624        109,954        1.47%        -0.93%     
2012     0.00%        34,675        12.447911        431,631        1.90%        5.86%     
2012     0.50%        150,562        12.220936        1,840,009        1.90%        5.33%     
2012     0.80%        11,713        12.086211        141,566        1.90%        5.01%     
2011     0.00%        36,471        11.759209        428,870        1.68%        1.11%     
2011     0.50%        147,186        11.602960        1,707,793        1.68%        0.60%     
2011     0.80%        14,960        11.509840        172,187        1.68%        0.30%     

Total Return Portfolio - Administrative Class (PMVTRA)

2015     0.50%        86,402        11.111948        960,095        5.07%        -0.07%     
2015     0.80%        2,404        10.956210        26,339        5.07%        -0.37%     
2014     0.50%        82,384        11.119351        916,057        2.10%        3.75%     
2014     0.80%        3,635        10.996665        39,973        2.10%        3.44%     
2013     0.50%        111,647        10.717485        1,196,575        2.18%        -2.45%     
2013     0.80%        5,095        10.631288        54,166        2.18%        -2.74%     
2012     0.50%        127,731        10.986175        1,403,275        2.57%        9.05%     
2012     0.80%        5,884        10.930788        64,317        2.57%        8.72%     
2011     0.50%        27,221        10.074350        274,234        1.29%        0.74%      4/29/2011
2011     0.80%        4,660        10.053955        46,851        1.29%        0.54%      4/29/2011

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VT Growth & Income Fund: Class IB (PVGIB)

2015     0.00%        344      $ 22.730794      $ 7,819        2.83%        -7.53%     
2015     0.50%        3,052        21.335597        65,116        2.83%        -7.99%     
2015     0.80%        927        20.539923        19,041        2.83%        -8.26%     
2014     0.00%        354        24.581005        8,702        1.13%        10.73%     
2014     0.50%        8,422        23.187961        195,289        1.13%        10.18%     
2014     0.80%        1,124        22.390312        25,167        1.13%        9.85%     
2013     0.00%        363        22.198468        8,058        2.08%        35.68%     
2013     0.50%        4,959        21.045411        104,364        2.08%        35.00%     
2013     0.80%        1,126        20.382519        22,951        2.08%        34.60%     
2012     0.00%        55        16.361335        900        1.72%        19.14%     
2012     0.50%        5,062        15.589153        78,912        1.72%        18.54%     
2012     0.80%        906        15.143447        13,720        1.72%        18.19%     
2011     0.00%        60        13.733218        824        1.50%        -4.64%     
2011     0.50%        4,875        13.150793        64,110        1.50%        -5.12%     
2011     0.80%        931        12.813268        11,929        1.50%        -5.40%     

VT International Equity Fund: Class IB (PVTIGB)

2015     0.00%        995        21.491137        21,384        1.15%        0.14%     
2015     0.50%        9,233        20.171936        186,247        1.15%        -0.36%     
2015     0.80%        1,704        19.419607        33,091        1.15%        -0.66%     
2014     0.00%        218        21.460987        4,678        0.90%        -6.78%     
2014     0.50%        11,540        20.244640        233,623        0.90%        -7.24%     
2014     0.80%        1,760        19.548168        34,405        0.90%        -7.52%     
2013     0.00%        224        23.021172        5,157        1.39%        28.07%     
2013     0.50%        11,936        21.825300        260,507        1.39%        27.43%     
2013     0.80%        1,673        21.137809        35,364        1.39%        27.05%     
2012     0.00%        230        17.975464        4,134        2.14%        21.92%     
2012     0.50%        11,969        17.127054        204,994        2.14%        21.31%     
2012     0.80%        1,824        16.637352        30,347        2.14%        20.94%     
2011     0.00%        238        14.744148        3,509        3.11%        -16.93%     
2011     0.50%        9,922        14.118815        140,087        3.11%        -17.35%     
2011     0.80%        1,807        13.756422        24,858        3.11%        -17.59%     

VT Voyager Fund: Class IB (PVTVB)

2015     0.00%        313        25.358465        7,937        1.09%        -6.11%     
2015     0.50%        21,675        23.802033        515,909        1.09%        -6.58%     
2015     0.80%        1,426        22.914372        32,676        1.09%        -6.86%     
2014     0.00%        695        27.009337        18,771        0.80%        9.72%     
2014     0.50%        16,323        25.478744        415,890        0.80%        9.17%     
2014     0.80%        1,754        24.602302        43,152        0.80%        8.85%     
2013     0.00%        793        24.616350        19,521        0.77%        43.72%     
2013     0.50%        18,702        23.337763        436,463        0.77%        43.01%     
2013     0.80%        2,505        22.602678        56,620        0.77%        42.58%     
2012     0.00%        1,061        17.127486        18,172        0.38%        14.23%     
2012     0.50%        19,100        16.319175        311,696        0.38%        13.66%     
2012     0.80%        2,910        15.852589        46,131        0.38%        13.32%     
2011     0.00%        2,304        14.994106        34,546        0.00%        -17.85%     
2011     0.50%        32,398        14.358253        465,179        0.00%        -18.26%     
2011     0.80%        3,611        13.989739        50,517        0.00%        -18.50%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VI American Franchise Fund - Series I Shares (ACEG)

2015     0.00%        2,858      $ 15.558361      $ 44,466        0.00%        5.01%     
2015     0.50%        910        15.274958        13,900        0.00%        4.48%     
2015     0.80%        550        15.107367        8,309        0.00%        4.17%     
2014     0.00%        3,043        14.816518        45,087        0.06%        8.44%     
2014     0.50%        1,115        14.619541        16,301        0.06%        7.90%     
2014     0.80%        793        14.502589        11,501        0.06%        7.58%     
2013     0.50%        1,211        13.549301        16,408        0.38%        39.44%     
2013     0.80%        616        13.481308        8,304        0.38%        39.02%     
2012     0.50%        794        9.717084        7,715        0.00%        -2.83%      4/27/2012
2012     0.80%        426        9.697354        4,131        0.00%        -3.03%      4/27/2012

VI Value Opportunities Fund - Series I Shares (AVBVI)

2015     0.00%        202        19.711771        3,982        2.58%        -10.40%     
2014     0.00%        242        22.000815        5,324        1.34%        6.62%     
2013     0.00%        306        20.634996        6,314        0.67%        33.75%     
2012     0.00%        1,028        15.427533        15,860        1.75%        17.70%     
2011     0.00%        842        13.107128        11,036        0.80%        -3.05%     

VI Mid Cap Core Equity Fund: Series I Shares (AVMCCI)

2015     0.50%        66        12.752183        842        0.10%        -4.51%     
2014     0.50%        2,314        13.354025        30,901        0.05%        3.91%     
2013     0.50%        96        12.851090        1,234        0.43%        28.17%     

Variable Fund - Multi-Hedge Strategies (RVARS)

2015     0.50%        4,756        10.513528        50,002        0.48%        1.34%     
2015     0.80%        39        10.429711        407        0.48%        1.04%     
2014     0.50%        637        10.374436        6,609        0.00%        4.14%     
2014     0.80%        35        10.322638        361        0.00%        3.83%     
2013     0.80%        29        9.942289        288        0.00%        -0.58%      5/1/2013

Health Sciences Portfolio - II (TRHS2)

2015     0.00%        16,283        34.165533        556,317        0.00%        12.47%     
2015     0.50%        155,869        33.212254        5,176,761        0.00%        11.91%     
2015     0.80%        16,049        32.653058        524,049        0.00%        11.57%     
2014     0.00%        18,416        30.377400        559,430        0.00%        31.22%     
2014     0.50%        150,405        29.677828        4,463,694        0.00%        30.57%     
2014     0.80%        15,601        29.265799        456,576        0.00%        30.18%     
2013     0.00%        19,954        23.149472        461,925        0.00%        50.51%     
2013     0.50%        153,298        22.729602        3,484,403        0.00%        49.76%     
2013     0.80%        20,374        22.481324        458,034        0.00%        49.31%     
2012     0.00%        15,998        15.380592        246,059        0.00%        31.00%     
2012     0.50%        114,233        15.177218        1,733,739        0.00%        30.34%     
2012     0.80%        19,506        15.056482        293,692        0.00%        29.95%     
2011     0.00%        2,592        11.741045        30,433        0.00%        10.39%     
2011     0.50%        53,213        11.643960        619,610        0.00%        9.84%     
2011     0.80%        7,084        11.586088        82,076        0.00%        9.51%     

Limited-Term Bond Portfolio - II (TRLT2)

2015     0.00%        4,821        12.895459        62,169        0.92%        0.06%     
2014     0.00%        2,898        12.888029        37,350        1.01%        0.39%     
2013     0.00%        2,608        12.837345        33,480        1.36%        -0.12%     
2012     0.00%        10,329        12.852172        132,750        1.90%        2.44%     
2011     0.00%        6,793        12.545962        85,225        2.15%        1.16%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VIP Trust - Unconstrained Emerging Markets Bond Fund - Initial Class (VWBF)

2015     0.00%        3,374      $ 20.647939      $ 69,666        6.78%        -13.09%     
2015     0.50%        18,368        26.073834        478,924        6.78%        -13.52%     
2015     0.80%        6,197        22.732631        140,874        6.78%        -13.78%     
2015     1.00%        21,614        16.353825        353,472        6.78%        -13.95%     
2014     0.00%        5,016        23.756928        119,165        4.92%        2.18%     
2014     0.50%        19,801        30.150289        597,006        4.92%        1.67%     
2014     0.80%        6,704        26.365744        176,756        4.92%        1.37%     
2014     1.00%        26,879        19.005477        510,848        4.92%        1.17%     
2013     0.00%        5,096        23.249070        118,477        2.33%        -9.17%     
2013     0.50%        20,817        29.653654        617,300        2.33%        -9.62%     
2013     0.80%        7,163        26.009363        186,305        2.33%        -9.89%     
2013     1.00%        28,068        18.786130        527,289        2.33%        -10.07%     
2013     1.30%        79        25.415144        2,008        2.33%        -10.34%     
2012     0.00%        5,549        25.595762        142,031        2.29%        5.55%     
2012     0.50%        24,266        32.810536        796,180        2.29%        5.02%     
2012     0.80%        8,173        28.864790        235,912        2.29%        4.71%     
2012     1.00%        31,066        20.890316        648,979        2.29%        4.50%     
2012     1.30%        34        28.346804        964        2.29%        4.18%     
2011     0.00%        6,926        24.249965        167,955        7.78%        8.14%     
2011     0.50%        29,106        31.241583        909,318        7.78%        7.60%     
2011     0.80%        10,022        27.567293        276,279        7.78%        7.28%     
2011     1.00%        37,712        19.991316        753,913        7.78%        7.07%     

VIP Trust Emerging Markets Fund - Initial Class (VWEM)

2015     0.00%        14,381        28.228045        405,948        0.58%        -13.99%     
2015     0.50%        120,838        25.525784        3,084,485        0.58%        -14.42%     
2015     0.80%        14,479        24.242135        351,002        0.58%        -14.68%     
2015     1.00%        7,115        27.268729        194,017        0.58%        -14.85%     
2014     0.00%        28,222        32.820007        926,246        0.51%        -0.41%     
2014     0.50%        132,065        29.827116        3,939,118        0.51%        -0.91%     
2014     0.80%        17,426        28.412384        495,114        0.51%        -1.21%     
2014     1.00%        17,100        32.023690        547,605        0.51%        -1.41%     
2013     0.00%        31,368        32.956519        1,033,780        1.56%        12.02%     
2013     0.50%        142,175        30.101401        4,279,667        1.56%        11.46%     
2013     0.80%        19,831        28.759870        570,337        1.56%        11.13%     
2013     1.00%        18,575        32.480271        603,321        1.56%        10.91%     
2012     0.00%        33,427        29.420205        983,429        0.00%        29.81%     
2012     0.50%        156,688        27.006103        4,231,532        0.00%        29.16%     
2012     0.80%        26,610        25.880034        688,668        0.00%        28.77%     
2012     1.00%        19,965        29.286403        584,703        0.00%        28.51%     
2011     0.00%        45,284        22.664458        1,026,337        1.14%        -25.74%     
2011     0.50%        170,495        20.909178        3,564,910        1.14%        -26.11%     
2011     0.80%        29,321        20.097645        589,283        1.14%        -26.33%     
2011     1.00%        30,102        22.788544        685,981        1.14%        -26.48%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

VIP Trust Global Hard Assets Fund - Initial Class (VWHA)

2015     0.00%        12,537      $ 22.284810      $ 279,385        0.03%        -33.45%     
2015     0.50%        75,634        30.093846        2,276,118        0.03%        -33.78%     
2015     0.80%        9,399        34.803749        327,120        0.03%        -33.98%     
2015     1.00%        14,896        21.305167        317,362        0.03%        -34.11%     
2014     0.00%        16,021        33.483626        536,441        0.09%        -19.10%     
2014     0.50%        80,111        45.444258        3,640,585        0.09%        -19.51%     
2014     0.80%        10,439        52.714985        550,292        0.09%        -19.75%     
2014     1.00%        25,649        32.334355        829,344        0.09%        -19.91%     
2013     0.00%        17,973        41.390053        743,903        0.71%        10.53%     
2013     0.50%        86,950        56.457132        4,908,948        0.71%        9.98%     
2013     0.80%        12,955        65.687029        850,975        0.71%        9.65%     
2013     1.00%        27,875        40.372010        1,125,370        0.71%        9.43%     
2013     1.30%        9        54.718336        492        0.71%        9.11%     
2012     0.00%        19,950        37.445535        747,038        0.59%        3.39%     
2012     0.50%        100,766        51.332730        5,172,594        0.59%        2.87%     
2012     0.80%        15,442        59.904317        925,042        0.59%        2.56%     
2012     1.00%        33,842        36.891599        1,248,485        0.59%        2.36%     
2011     0.00%        26,799        36.218953        970,632        1.22%        -16.45%     
2011     0.50%        121,930        49.900813        6,084,406        1.22%        -16.87%     
2011     0.80%        18,243        58.408750        1,065,551        1.22%        -17.12%     
2011     1.00%        47,335        36.042787        1,706,085        1.22%        -17.28%     

Variable Insurance Portfolios - Asset Strategy (WRASP)

2015     0.00%        9,375        15.624397        146,479        0.37%        -8.35%     
2015     0.50%        118,444        15.112112        1,789,939        0.37%        -8.80%     
2015     0.80%        13,796        14.812786        204,357        0.37%        -9.08%     
2014     0.00%        9,468        17.047121        161,402        0.50%        -5.26%     
2014     0.50%        138,670        16.570896        2,297,886        0.50%        -5.74%     
2014     0.80%        16,678        16.291499        271,710        0.50%        -6.02%     
2013     0.00%        10,896        17.994414        196,067        1.27%        25.13%     
2013     0.50%        144,031        17.579459        2,531,987        1.27%        24.51%     
2013     0.80%        17,448        17.335032        302,462        1.27%        24.13%     
2012     0.00%        12,697        14.380435        182,588        1.16%        19.18%     
2012     0.50%        170,634        14.119186        2,409,213        1.16%        18.58%     
2012     0.80%        19,979        13.964683        279,000        1.16%        18.22%     
2011     0.00%        23,924        12.066588        288,681        1.03%        -7.21%     
2011     0.50%        154,370        11.906878        1,838,065        1.03%        -7.67%     
2011     0.80%        20,266        11.812045        239,383        1.03%        -7.94%     

Variable Insurance Portfolios - High Income (WRHIP)

2015     0.50%        48,961        11.277210        552,143        8.06%        -6.97%     
2015     0.80%        4,840        11.153855        53,985        8.06%        -7.25%     
2014     0.50%        54,003        12.122263        654,639        4.18%        1.40%     
2014     0.80%        5,736        12.025707        68,979        4.18%        1.09%     
2013     0.50%        80,665        11.955327        964,376        4.88%        9.95%     
2013     0.80%        7,636        11.895726        90,836        4.88%        9.62%     
2012     0.50%        64,758        10.873621        704,154        0.00%        8.74%      5/1/2012
2012     0.80%        6,632        10.851908        71,970        0.00%        8.52%      5/1/2012

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Variable Insurance Portfolios - Mid Cap Growth (WRMCG)

2015     0.50%        21,261      $ 13.168901      $ 279,984        0.00%        -6.25%     
2015     0.80%        1,492        13.024842        19,433        0.00%        -6.53%     
2014     0.50%        22,599        14.046779        317,443        0.00%        7.33%     
2014     0.80%        1,882        13.934874        26,225        0.00%        7.01%     
2013     0.50%        25,515        13.087276        333,922        0.00%        29.29%     
2013     0.80%        1,664        13.022032        21,669        0.00%        28.90%     
2012     0.50%        16,373        10.122465        165,735        0.00%        1.22%      5/1/2012
2012     0.80%        497        10.102240        5,021        0.00%        1.02%      5/1/2012

Advantage VT Discovery Fund (SVDF)

2015     0.00%        3,547        51.712010        183,422        0.00%        -1.46%     
2015     1.00%        17,415        32.154709        559,974        0.00%        -2.44%     
2014     0.00%        3,666        52.479577        192,390        0.00%        0.36%     
2014     1.00%        19,034        32.960048        627,362        0.00%        -0.64%     
2013     0.00%        3,753        52.293829        196,259        0.01%        43.80%     
2013     1.00%        19,578        33.173614        649,473        0.01%        42.37%     
2013     1.30%        75        68.427642        5,132        0.01%        41.94%     
2012     0.00%        3,369        36.365713        122,516        0.00%        17.74%     
2012     1.00%        19,854        23.300886        462,616        0.00%        16.56%     
2012     1.30%        44        48.207298        2,121        0.00%        16.21%     
2011     0.00%        3,336        30.887729        103,041        0.00%        0.42%     
2011     1.00%        26,660        19.990260        532,940        0.00%        -0.57%     

Advantage VT Opportunity Fund - Class 2 (SVOF)

2015     0.00%        10,160        54.329888        551,992        0.13%        -3.08%     
2015     0.50%        404        97.792605        39,508        0.13%        -3.57%     
2015     0.80%        131        93.518492        12,251        0.13%        -3.86%     
2015     1.00%        39,214        21.305415        835,471        0.13%        -4.05%     
2014     0.00%        10,959        56.058764        614,348        0.06%        10.42%     
2014     0.50%        405        101.410513        41,071        0.06%        9.87%     
2014     0.80%        132        97.269761        12,840        0.06%        9.54%     
2014     1.00%        40,736        22.204418        904,519        0.06%        9.33%     
2013     0.00%        12,232        50.766884        620,981        0.19%        30.68%     
2013     0.50%        407        92.297867        37,565        0.19%        30.03%     
2013     0.80%        130        88.795213        11,543        0.19%        29.64%     
2013     1.00%        41,935        20.310451        851,719        0.19%        29.38%     
2013     1.30%        62        79.677043        4,940        0.19%        28.99%     
2012     0.00%        13,164        38.848890        511,407        0.10%        15.52%     
2012     0.50%        409        70.983886        29,032        0.10%        14.94%     
2012     0.80%        133        68.495126        9,110        0.10%        14.60%     
2012     1.00%        66,443        15.698476        1,043,054        0.10%        14.37%     
2012     1.30%        35        61.769399        2,162        0.10%        14.03%     
2011     0.00%        14,523        33.629016        488,394        0.14%        -5.52%     
2011     0.50%        411        61.754991        25,381        0.14%        -5.99%     
2011     0.80%        133        59.769284        7,949        0.14%        -6.27%     
2011     1.00%        70,223        13.726081        963,887        0.14%        -6.46%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Advantage VT Small Cap Growth Fund - Class 2 (WFVSCG)

2015     0.00%        1,066      $ 24.657341      $ 26,285        0.00%        -2.88%     
2015     0.50%        14,408        23.849029        343,617        0.00%        -3.37%     
2015     0.80%        1,872        23.376783        43,761        0.00%        -3.66%     
2014     0.00%        691        25.389071        17,544        0.00%        -1.88%     
2014     0.50%        12,148        24.679909        299,812        0.00%        -2.37%     
2014     0.80%        1,874        24.263932        45,471        0.00%        -2.66%     
2013     0.00%        546        25.874760        14,128        0.00%        50.23%     
2013     0.50%        20,549        25.278178        519,441        0.00%        49.48%     
2013     0.80%        2,707        24.926824        67,477        0.00%        49.03%     
2012     0.00%        141        17.223573        2,429        0.00%        7.87%     
2012     0.50%        15,807        16.910692        267,307        0.00%        7.33%     
2012     0.80%        4,080        16.725680        68,241        0.00%        7.01%     
2011     0.00%        144        15.966729        2,299        0.00%        -4.60%     
2011     0.50%        25,486        15.755473        401,544        0.00%        -5.07%     
2011     0.80%        5,183        15.630041        81,011        0.00%        -5.36%     

Global Securities Fund/VA - Class 3 (obsolete) (OVGS3)

2013     0.00%        24,114        20.707226        499,334        1.38%        27.34%     
2013     0.50%        359,779        19.829099        7,134,093        1.38%        26.70%     
2013     0.80%        79,174        19.320265        1,529,663        1.38%        26.32%     
2012     0.00%        27,569        16.261792        448,321        2.14%        21.23%     
2012     0.50%        348,574        15.650185        5,455,248        2.14%        20.62%     
2012     0.80%        97,044        15.294367        1,484,227        2.14%        20.26%     
2011     0.00%        26,357        13.414448        353,565        1.27%        -8.27%     
2011     0.50%        386,331        12.974764        5,012,554        1.27%        -8.72%     
2011     0.80%        104,174        12.717946        1,324,879        1.27%        -9.00%     

Janus Aspen Series - Global Technology Portfolio - Service II Shares (obsolete) (JAGTS2)

2011     0.00%        634        10.352942        6,564        0.00%        -8.81%     
2011     0.50%        29,181        10.267311        299,610        0.00%        -9.26%     
2011     0.80%        2,499        10.216274        25,530        0.00%        -9.53%     

Janus Aspen Series - Overseas Portfolio - Service II Shares (obsolete) (JAIGS2)

2011     0.00%        12,274        10.783470        132,356        0.35%        -32.33%     
2011     0.50%        327,060        10.482039        3,428,256        0.35%        -32.67%     
2011     0.80%        56,163        10.305239        578,773        0.35%        -32.87%     

Templeton Developing Markets Securities Fund - Class 3 (obsolete) (FTVDM3)

2013     0.00%        4,965        19.119582        94,929        1.94%        -0.97%     
2013     0.50%        45,657        18.308816        835,926        1.94%        -1.47%     
2013     0.80%        7,143        17.838977        127,424        1.94%        -1.76%     
2012     0.00%        6,582        19.307248        127,080        1.46%        13.16%     
2012     0.50%        50,583        18.581214        939,894        1.46%        12.59%     
2012     0.80%        9,824        18.158794        178,392        1.46%        12.25%     
2011     0.00%        10,223        17.062376        174,429        0.99%        -15.86%     
2011     0.50%        63,119        16.503252        1,041,669        0.99%        -16.28%     
2011     0.80%        11,210        16.176657        181,340        0.99%        -16.53%     

Templeton Foreign Securities Fund - Class 3 (obsolete) (TIF3)

2013     0.00%        4,947        18.236527        90,216        2.22%        22.98%     
2013     0.50%        73,327        17.463266        1,280,529        2.22%        22.37%     
2013     0.80%        7,835        17.015082        133,313        2.22%        22.00%     
2012     0.00%        5,081        14.829007        75,346        2.99%        18.30%     
2012     0.50%        56,458        14.271362        805,733        2.99%        17.71%     
2012     0.80%        9,020        13.946827        125,800        2.99%        17.36%     
2011     0.00%        6,118        12.534749        76,688        1.73%        -10.68%     
2011     0.50%        73,808        12.123973        894,846        1.73%        -11.12%     
2011     0.80%        9,570        11.883946        113,729        1.73%        -11.39%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Templeton Global Bond Securities Fund - Class 3 (obsolete) (FTVGI3)

2013     0.00%        12,756      $ 20.700503      $ 264,056        4.53%        1.64%     
2013     0.50%        95,008        19.822913        1,883,335        4.53%        1.13%     
2013     0.80%        10,281        19.314319        198,571        4.53%        0.83%     
2012     0.00%        14,188        20.367363        288,972        6.12%        15.06%     
2012     0.50%        135,920        19.601667        2,664,259        6.12%        14.49%     
2012     0.80%        15,489        19.156120        296,709        6.12%        14.14%     
2011     0.00%        20,700        17.701343        366,418        5.58%        -0.83%     
2011     0.50%        161,058        17.121471        2,757,550        5.58%        -1.32%     
2011     0.80%        15,838        16.782688        265,804        5.58%        -1.62%     

Investors Growth Stock Series - Initial Class (obsolete) (MIGIC)

2014     0.00%        606        26.831723        16,260        0.51%        11.45%     
2014     0.50%        8,162        25.311375        206,591        0.51%        10.90%     
2014     0.80%        700        24.440744        17,109        0.51%        10.56%     
2013     0.00%        622        24.074646        14,974        0.67%        30.29%     
2013     0.50%        7,834        22.824329        178,806        0.67%        29.64%     
2013     0.80%        1,011        22.105451        22,349        0.67%        29.25%     
2012     0.00%        911        18.477561        16,833        0.46%        16.97%     
2012     0.50%        8,376        17.605660        147,465        0.46%        16.39%     
2012     0.80%        1,369        17.102335        23,413        0.46%        16.04%     
2011     0.00%        884        15.796502        13,964        0.55%        0.58%     
2011     0.50%        8,677        15.126718        131,255        0.55%        0.08%     
2011     0.80%        1,613        14.738500        23,773        0.55%        -0.22%     

VIP High Income Portfolio - Initial Class R (obsolete) (FHIPR)

2014     0.00%        13,768        15.513944        213,596        5.90%        1.18%     
2014     0.50%        166,560        14.930500        2,486,824        5.90%        0.67%     
2014     0.80%        62,827        14.591037        916,711        5.90%        0.37%     
2013     0.00%        13,767        15.333544        211,097        5.83%        5.97%     
2013     0.50%        163,325        14.830856        2,422,250        5.83%        5.44%     
2013     0.80%        70,495        14.537202        1,024,800        5.83%        5.12%     
2012     0.00%        16,543        14.470056        239,378        5.71%        14.30%     
2012     0.50%        165,561        14.065803        2,328,748        5.71%        13.73%     
2012     0.80%        79,055        13.828722        1,093,230        5.71%        13.39%     
2011     0.00%        17,595        12.659718        222,748        6.99%        4.05%     
2011     0.50%        197,547        12.367874        2,443,236        6.99%        3.53%     
2011     0.80%        79,720        12.196027        972,267        6.99%        3.22%     

Federated NVIT High Income Bond Fund - Class III (obsolete) (HIBF3)

2013     0.00%        15,332        18.202636        279,083        6.11%        6.94%     
2013     0.50%        60,057        17.431017        1,046,855        6.11%        6.40%     
2013     0.80%        6,318        16.983857        107,304        6.11%        6.09%     
2012     0.00%        14,697        17.021800        250,169        7.64%        14.71%     
2012     0.50%        83,641        16.381922        1,370,200        7.64%        14.13%     
2012     0.80%        6,493        16.009620        103,950        7.64%        13.79%     
2011     0.00%        11,678        14.839228        173,293        8.22%        3.81%     
2011     0.50%        116,173        14.353153        1,667,449        8.22%        3.29%     
2011     0.80%        6,081        14.069186        85,555        8.22%        2.98%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Emerging Markets Fund - Class III (obsolete) (GEM3)

2013     0.00%        21,484      $ 19.481483      $ 418,540        1.16%        0.75%     
2013     0.50%        89,902        18.655252        1,677,144        1.16%        0.25%     
2013     0.80%        18,368        18.176470        333,865        1.16%        -0.05%     
2012     0.00%        24,409        19.336082        471,974        0.45%        17.24%     
2012     0.50%        93,486        18.608853        1,739,667        0.45%        16.65%     
2012     0.80%        22,464        18.185755        408,525        0.45%        16.30%     
2011     0.00%        28,288        16.493303        466,563        0.71%        -22.39%     
2011     0.50%        121,016        15.952745        1,930,537        0.71%        -22.78%     
2011     0.80%        26,612        15.636987        416,131        0.71%        -23.01%     

NVIT International Equity Fund - Class III (obsolete) (GIG3)

2013     0.00%        28,099        9.956257        279,761        0.53%        17.81%     
2013     0.50%        315,286        9.678019        3,051,344        0.53%        17.23%     
2013     0.80%        58,774        9.514826        559,224        0.53%        16.87%     
2012     0.00%        31,591        8.450909        266,973        0.85%        15.58%     
2012     0.50%        330,469        8.255888        2,728,315        0.85%        15.00%     
2012     0.80%        72,099        8.141051        586,962        0.85%        14.65%     
2011     0.00%        32,972        7.311920        241,089        1.26%        -9.76%     
2011     0.50%        360,822        7.179063        2,590,364        1.26%        -10.21%     
2011     0.80%        79,102        7.100526        561,666        1.26%        -10.48%     

VIP Overseas Portfolio - Service Class R (obsolete) (FOSR)

2014     0.00%        29,539        16.555209        489,024        1.25%        -8.18%     
2014     0.50%        191,088        15.774084        3,014,238        1.25%        -8.63%     
2014     0.80%        41,075        15.323165        629,399        1.25%        -8.91%     
2013     0.00%        32,000        18.029345        576,939        1.32%        30.30%     
2013     0.50%        200,439        17.264814        3,460,542        1.32%        29.65%     
2013     0.80%        46,798        16.821709        787,222        1.32%        29.26%     
2012     0.00%        35,975        13.836689        497,775        1.91%        20.67%     
2012     0.50%        216,949        13.316294        2,888,957        1.91%        20.07%     
2012     0.80%        54,239        13.013481        705,838        1.91%        19.71%     
2011     0.00%        24,016        11.466618        275,382        1.12%        -17.30%     
2011     0.50%        207,184        11.090775        2,297,831        1.12%        -17.71%     
2011     0.80%        53,755        10.871192        584,381        1.12%        -17.96%     

V.I. Capital Appreciation Fund - Series I (obsolete) (AVCA)

2011     0.00%        975        12.681863        12,365        0.11%        -7.91%     
2011     0.50%        1,186        12.144062        14,403        0.11%        -8.37%     
2011     0.80%        332        11.832421        3,928        0.11%        -8.64%     

V.I. Capital Development Fund - Series I (obsolete) (AVCDI)

2011     0.00%        1,934        17.690502        34,213        0.00%        -7.16%     
2011     0.50%        5,587        16.940285        94,645        0.00%        -7.62%     
2011     0.80%        2,090        16.505466        34,496        0.00%        -7.90%     

NVIT International Index Fund - Class VI (obsolete) (GVIX6)

2013     0.00%        13,690        11.841416        162,109        2.52%        21.27%     
2013     0.50%        29,809        11.395830        339,698        2.52%        20.67%     
2013     0.80%        539        11.136536        6,003        2.52%        20.31%     
2012     0.00%        13,989        9.764428        136,595        2.66%        18.29%     
2012     0.50%        44,277        9.444081        418,156        2.66%        17.70%     
2012     0.80%        104        9.256914        963        2.66%        17.35%     
2011     0.00%        17,130        8.254444        141,399        2.90%        -12.72%     
2011     0.50%        45,497        8.023727        365,056        2.90%        -13.15%     
2011     0.80%        102        7.888392        805        2.90%        -13.41%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

NVIT Multi-Manager International Growth Fund - Class III (obsolete) (NVMIG3)

2013     0.00%        16,184      $ 12.166606      $ 196,904        1.24%        21.34%     
2013     0.50%        299,439        11.826670        3,541,366        1.24%        20.74%     
2013     0.80%        61,094        11.627292        710,358        1.24%        20.37%     
2013     1.00%        8,856        18.812997        166,608        1.24%        20.13%     
2012     0.00%        18,564        10.026765        186,137        0.58%        15.78%     
2012     0.50%        325,197        9.795449        3,185,451        0.58%        15.20%     
2012     0.80%        70,859        9.659227        684,443        0.58%        14.85%     
2012     1.00%        9,316        15.659940        145,888        0.58%        14.62%     
2011     0.00%        20,098        8.660251        174,054        1.30%        -9.37%     
2011     0.50%        372,824        8.502961        3,170,108        1.30%        -9.82%     
2011     0.80%        83,371        8.409948        701,146        1.30%        -10.09%     
2011     1.00%        9,785        13.661922        133,682        1.30%        -10.27%     

NVIT Multi-Manager International Value Fund - Class III (obsolete) (GVDIV3)

2013     0.00%        8,619        12.775201        110,109        2.31%        21.42%     
2013     0.50%        25,764        12.233332        315,180        2.31%        20.82%     
2013     0.80%        5,724        11.919240        68,226        2.31%        20.45%     
2012     0.00%        8,328        10.521355        87,622        0.38%        17.24%     
2012     0.50%        29,494        10.125555        298,643        0.38%        16.65%     
2012     0.80%        7,133        9.895215        70,583        0.38%        16.30%     
2011     0.00%        8,096        8.974574        72,658        1.70%        -16.11%     
2011     0.50%        37,989        8.680344        329,758        1.70%        -16.53%     
2011     0.80%        7,957        8.508430        67,702        1.70%        -16.78%     

High Income Fund/VA - Class 3 (obsolete) (OVHI3)

2011     0.00%        3,739        2.908819        10,876        11.87%        -1.88%     
2011     0.50%        16,503        2.841668        46,896        11.87%        -2.37%     
2011     0.80%        8,693        2.802120        24,359        11.87%        -2.66%     

High Income Fund/VA - Non-Service Shares (obsolete) (OVHI)

2011     0.00%        6,730        4.084054        27,486        9.44%        -2.34%     
2011     0.50%        5,992        3.910839        23,434        9.44%        -2.82%     
2011     0.80%        1,889        3.810426        7,198        9.44%        -3.11%     

VP International Fund - Class III (obsolete) (ACVI3)

2014     0.00%        9,678        17.760638        171,887        1.62%        -5.51%     
2013     0.00%        10,941        18.795597        205,643        1.61%        22.41%     
2012     0.00%        13,657        15.354631        209,698        0.81%        21.16%     
2011     0.00%        16,408        12.672898        207,937        1.42%        -12.04%     

VP Vista(SM) Fund - Class I (obsolete) (ACVVS1)

2013     0.00%        2,561        18.872253        48,332        0.00%        30.17%     
2012     0.00%        2,628        14.497885        38,100        0.00%        15.61%     
2011     0.00%        2,700        12.539840        33,858        0.00%        -7.89%     

Balanced Portfolio - I Class Shares (obsolete) (AMBP)

2014     0.50%        1,621        16.697421        27,067        0.00%        3.66%     
2014     0.80%        319        35.320106        11,267        0.00%        3.35%     
2013     0.50%        1,279        16.107370        20,601        0.00%        17.89%     
2013     0.80%        534        34.174349        18,249        0.00%        17.54%     
2012     0.50%        903        13.662782        12,337        0.00%        8.80%     
2012     0.80%        698        29.074823        20,294        0.00%        8.47%     
2011     0.50%        899        12.558209        11,290        0.31%        -1.13%     
2011     0.80%        744        26.804764        19,943        0.31%        -1.42%     

NATIONWIDE VLI SEPARATE ACCOUNT-2 NOTES TO FINANCIAL STATEMENTS December 31, 2015

 

    Contract
Expense
Rate*		     Units     Unit
Fair Value		     Contract
Owners’ Equity		     Investment
Income
Ratio**		     Total
Return***		    

Inception

Date****

Growth Portfolio - I Class Shares (obsolete) (AMTG)

2014     0.00%        24,769      $ 34.817796      $ 862,402        0.00%        6.89%     
2014     0.50%        1,195        79.648266        95,180        0.00%        6.36%     
2014     0.80%        405        52.787243        21,379        0.00%        6.04%     
2014     1.00%        84,657        11.051834        935,615        0.00%        5.83%     
2013     0.00%        28,006        32.573007        912,240        0.00%        31.85%     
2013     0.50%        1,258        74.886699        94,207        0.00%        31.19%     
2013     0.80%        413        49.780631        20,559        0.00%        30.80%     
2013     1.00%        96,782        10.443227        1,010,716        0.00%        30.54%     
2013     1.30%        223        46.355252        10,337        0.00%        30.15%     
2012     0.00%        30,131        24.704444        744,370        0.00%        12.60%     
2012     0.50%        1,416        57.081042        80,827        0.00%        12.04%     
2012     0.80%        492        38.058319        18,725        0.00%        11.70%     
2012     1.00%        102,324        8.000039        818,596        0.00%        11.48%     
2012     1.30%        119        35.617069        4,238        0.00%        11.14%     
2011     0.00%        32,280        21.939823        708,217        0.00%        -0.21%     
2011     0.50%        1,676        50.947928        85,389        0.00%        -0.71%     
2011     0.80%        506        34.071422        17,240        0.00%        -1.01%     
2011     1.00%        110,903        7.176346        795,878        0.00%        -1.21%     

Small-Cap Growth Portfolio - S Class Shares (obsolete) (AMFAS)

2014     0.00%        274        22.169924        6,075        0.00%        3.47%     
2014     0.50%        8,407        20.913605        175,821        0.00%        2.95%     
2014     0.80%        881        20.194182        17,791        0.00%        2.65%     
2013     0.00%        843        21.426193        18,062        0.00%        45.83%     
2013     0.50%        7,637        20.313368        155,133        0.00%        45.11%     
2013     0.80%        708        19.673555        13,929        0.00%        44.67%     
2012     0.00%        856        14.692238        12,577        0.00%        8.82%     
2012     0.50%        5,453        13.998892        76,336        0.00%        8.28%     
2012     0.80%        689        13.598663        9,369        0.00%        7.95%     
2011     0.00%        1,577        13.501272        21,292        0.00%        -1.06%     
2011     0.50%        26,395        12.928758        341,255        0.00%        -1.55%     
2011     0.80%        3,105        12.596940        39,113        0.00%        -1.85%     
2015     Contract owners equity:      $ 600,557,383       
2014     Contract owners equity:      $ 659,613,121       
2013     Contract owners equity:      $ 677,429,029       
2012     Contract owners equity:      $ 598,222,370       
2011     Contract owners equity:      $ 589,437,248       
* This represents the annual contract expense rate of the variable account at the period end indicated and includes only those expenses that are charged through a reduction in the unit values. Excluded are expenses of the underlying mutual funds and charges made directly to contract owner accounts through the redemption of units.
** This represents the ratio of dividends for the period indicated, excluding distributions of capital gains, received by the subaccount from the underlying mutual fund, net of management fees assessed by the fund manager, divided by monthly average net assets (excluding months where net assets are zero). The investment income ratio for subaccounts initially funded during the period presented has not been annualized. The ratios exclude those expenses that result in direct reductions to the contract owner accounts through reductions in unit values. The recognition of investment income by the subaccount is affected by the timing of the declaration of dividends by the underlying fund in which the subaccounts invest.
*** This represents the total return for the period. The total returns do not include any expenses assessed through the redemption of units; inclusion of these expenses in the calculation would result in a reduction in the total return presented. Total return is not annualized if the underlying mutual fund option is initially offered, funded, or both during the period presented.
**** This represents the date the underlying mutual fund option was initially added and funded.

LOGO    KPMG LLP
  

Suite 500

191 West Nationwide Blvd.

Columbus, OH 43215-2568

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholder

Nationwide Life Insurance Company:

We have audited the accompanying consolidated balance sheets of Nationwide Life Insurance Company and subsidiaries (the Company) as of December 31, 2015 and 2014, and the related consolidated statements of operations, comprehensive income, equity, and cash flows for each of the years in the three-year period ended December 31, 2015. In connection with our audits of the consolidated financial statements, we also have audited the financial statement schedules as listed in the accompanying table of contents. These consolidated financial statements and financial statement schedules are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and financial statement schedules based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Nationwide Life Insurance Company and subsidiaries as of December 31, 2015 and 2014, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2015, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related financial statement schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

/s/ KPMG LLP

Columbus, Ohio

February 23, 2016

 

1

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Consolidated Statements of Operations

 

     Year ended December 31,  

(in millions)

    2015      2014     2013  

Revenues

        

Policy charges

    $ 2,216       $ 2,065      $ 1,849   

Premiums

      786         831        724   

Net investment income

      1,982         1,900        1,849   

Net realized investment gains (losses), including other-than-temporary impairment losses

      82         (1,078 )      678   

Other revenues

      14         11        17   
  

 

 

     

 

 

    

 

 

  

Total revenues

    $ 5,080       $ 3,729      $ 5,117   
  

 

 

     

 

 

    

 

 

  

Benefits and expenses

        

Interest credited to policyholder account values

    $ 1,078       $ 1,096      $ 1,067   

Benefits and claims

      1,662         1,502        1,354   

Amortization of deferred policy acquisition costs

      68         207        374   

Other expenses, net of deferrals

      1,044         1,055        981   
  

 

 

     

 

 

    

 

 

  

Total benefits and expenses

    $ 3,852       $ 3,860      $ 3,776   
  

 

 

     

 

 

    

 

 

  

Income (loss) before federal income taxes and noncontrolling interests

    $ 1,228       $ (131 )    $ 1,341   

Federal income tax expense (benefit)

      293         (147 )      313   
  

 

 

     

 

 

    

 

 

  

Net income

    $ 935       $ 16      $ 1,028   

Noncontrolling interest adjustment for consolidated net expenses, net of tax

      96         94        82   
  

 

 

     

 

 

    

 

 

  

Net income attributable to Nationwide Life Insurance Company

    $ 1,031       $ 110      $ 1,110   
  

 

 

     

 

 

    

 

 

  

See accompanying notes to consolidated financial statements.

 

2

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Consolidated Statements of Comprehensive Income

 

     Year ended December 31,  

(in millions)

        2015         2014      2013  

Net income

    $ 935      $ 16       $ 1,028   
  

 

 

    

 

 

     

 

 

  

Other comprehensive (loss) income, net of tax

        

Changes in:

        

Net unrealized (losses) gains on available-for-sale securities

    $ (720 )    $ 435       $ (663 ) 

Other

      43        27         (7 ) 
  

 

 

    

 

 

     

 

 

  

Total other comprehensive (loss) income, net of tax

    $ (677 )    $ 462       $ (670 ) 
  

 

 

    

 

 

     

 

 

  

Total comprehensive income

    $ 258      $ 478       $ 358   

Noncontrolling interest adjustment for consolidated net expenses, net of tax

      96        94         82   
  

 

 

    

 

 

     

 

 

  

Total comprehensive income attributable to Nationwide Life Insurance Company

    $ 354      $ 572       $ 440   
  

 

 

    

 

 

     

 

 

  

See accompanying notes to consolidated financial statements.

 

3

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Consolidated Balance Sheets

 

     December 31,  

(in millions, except for share and per share amounts)

    2015      2014  

Assets

      

Investments:

      

Fixed maturity securities, available-for-sale

    $ 37,570       $ 35,418   

Mortgage loans, net of allowance

      8,396         7,270   

Policy loans

      993         992   

Short-term investments

      766         935   

Other investments

      943         822   
  

 

 

     

 

 

  

Total investments

    $ 48,668       $ 45,437   

Cash and cash equivalents

      67         77   

Accrued investment income

      477         670   

Deferred policy acquisition costs

      5,200         4,063   

Goodwill

      200         200   

Other assets

      2,328         5,001   

Separate account assets

      87,238         88,076   
  

 

 

     

 

 

  

Total assets

    $ 144,178       $ 143,524   
  

 

 

     

 

 

  

Liabilities and equity

      

Liabilities

      

Future policy benefits and claims

    $ 45,397       $ 40,730   

Short-term debt

      400         660   

Long-term debt

      707         709   

Other liabilities

      2,042         5,313   

Separate account liabilities

      87,238         88,076   
  

 

 

     

 

 

  

Total liabilities

    $ 135,784       $ 135,488   
  

 

 

     

 

 

  

Shareholder’s equity

      

Common stock ($1 par value; authorized - 5,000,000 shares, issued and outstanding - 3,814,779 shares)

    $ 4       $ 4   

Additional paid-in capital

      1,718         1,718   

Retained earnings

      5,661         4,630   

Accumulated other comprehensive income

      367         1,044   
  

 

 

     

 

 

  

Total shareholder’s equity

    $ 7,750       $ 7,396   

Noncontrolling interests

      644         640   
  

 

 

     

 

 

  

Total equity

    $ 8,394       $ 8,036   
  

 

 

     

 

 

  

Total liabilities and equity

    $ 144,178       $ 143,524   
  

 

 

     

 

 

  

See accompanying notes to consolidated financial statements.

 

4

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Consolidated Statements of Equity

 

(in millions)

    Common
stock		      Additional
paid-in
capital		      Retained
earnings		      Accumulated
other
comprehensive
income		     Total
shareholder’s
equity		     Non-
controlling
interest		     Total
equity		  

Balance as of December 31, 2012

    $ 4       $ 1,718       $ 3,410       $ 1,252      $ 6,384      $ 347      $ 6,731   

Comprehensive income (loss):

                  

Net income (loss)

    $ —         $ —         $ 1,110       $ —        $ 1,110      $ (82 )    $ 1,028   

Other comprehensive income

      —           —           —           (670 )      (670 )      —          (670 ) 
  

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total comprehensive income (loss)

    $ —         $ —         $ 1,110       $ (670 )    $ 440      $ (82 )    $ 358   

Change in noncontrolling interest

      —           —           —           —          —          415        415   
  

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Balance as of December 31, 2013

    $ 4       $ 1,718       $ 4,520       $ 582      $ 6,824      $ 680      $ 7,504   
  

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Comprehensive income (loss):

                  

Net income (loss)

    $ —         $ —         $ 110       $ —        $ 110      $ (94 )    $ 16   

Other comprehensive loss

      —           —           —           462        462        —          462   
  

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total comprehensive income (loss)

    $ —         $ —         $ 110       $ 462      $ 572      $ (94 )    $ 478   

Change in noncontrolling interest

      —           —           —           —          —          54        54   
  

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Balance as of December 31, 2014

    $ 4       $ 1,718       $ 4,630       $ 1,044      $ 7,396      $ 640      $ 8,036   
  

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Comprehensive income (loss):

                  

Net income (loss)

    $ —         $ —         $ 1,031       $ —        $ 1,031      $ (96 )    $ 935   

Other comprehensive loss

      —           —           —           (677 )      (677 )      —          (677 ) 
  

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total comprehensive income (loss)

    $ —         $ —         $ 1,031       $ (677 )    $ 354      $ (96 )    $ 258   

Change in noncontrolling interest

      —           —           —           —          —          100        100   
  

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Balance as of December 31, 2015

    $ 4       $ 1,718       $ 5,661       $ 367      $ 7,750      $ 644      $ 8,394   
  

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

See accompanying notes to consolidated financial statements.

 

5

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Consolidated Statements of Cash Flows

 

     Year ended December 31,  

(in millions)

    2015     2014     2013  

Cash flows from operating activities

       

Net income

    $ 935      $ 16      $ 1,028   

Adjustments to net income:

       

Net realized investment (gains) losses, including other-than-temporary impairment losses

      (82 )      1,078        (678 ) 

Interest credited to policyholder account values

      1,078        1,096        1,067   

Capitalization of deferred policy acquisition costs

      (870 )      (685 )      (604 ) 

Amortization of deferred policy acquisition costs

      68        207        374   

Amortization and depreciation

      107        128        77   

Deferred tax expense (benefit)

      217        (152 )      346   

Changes in:

       

Policy liabilities

      (249 )      (421 )      (475 ) 

Derivatives, net

      (141 )      (181 )      (483 ) 

Other, net

      (280 )      (59 )      88   
  

 

 

    

 

 

    

 

 

  

Net cash provided by operating activities

    $ 783      $ 1,027      $ 740   
  

 

 

    

 

 

    

 

 

  

Cash flows from investing activities

       

Proceeds from maturities of available-for-sale securities

    $ 2,828      $ 2,798      $ 3,689   

Proceeds from sales of available-for-sale securities

      466        647        1,091   

Purchases of available-for-sale securities

      (7,106 )      (5,640 )      (6,842 ) 

Proceeds from repayments and sales of mortgage loans

      1,027        920        1,091   

Issuances of mortgage loans

      (2,155 )      (1,837 )      (1,593 ) 

Net sales (purchases) of short-term investments

      169        (524 )      654   

Collateral received (paid), net

      48        399        (637 ) 

Other, net

      (136 )      (94 )      42   
  

 

 

    

 

 

    

 

 

  

Net cash used in investing activities

    $ (4,859 )    $ (3,331 )    $ (2,505 ) 
  

 

 

    

 

 

    

 

 

  

Cash flows from financing activities

       

Net change in short-term debt

    $ (260 )    $ 382      $ (22 ) 

Proceeds from issuance of long-term debt

      —          —          2   

Repayments of long-term debt

      (2 )      —          (299 ) 

Investment and universal life insurance product deposits

      8,224        6,037        6,139   

Investment and universal life insurance product withdrawals

      (3,884 )      (4,095 )      (4,034 ) 

Other, net

      (12 )      (4 )      (22 ) 
  

 

 

    

 

 

    

 

 

  

Net cash provided by financing activities

    $ 4,066      $ 2,320      $ 1,764   
  

 

 

    

 

 

    

 

 

  

Net (decrease) increase in cash and cash equivalents

    $ (10 )    $ 16      $ (1 ) 

Cash and cash equivalents at beginning of year

      77        61        62   
  

 

 

    

 

 

    

 

 

  

Cash and cash equivalents at end of year

    $ 67      $ 77      $ 61   
  

 

 

    

 

 

    

 

 

  

See accompanying notes to consolidated financial statements.

 

6

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

(1) Nature of Operations

Nationwide Life Insurance Company (“NLIC,” or collectively with its subsidiaries, “the Company”) was incorporated in 1929 and is an Ohio domiciled stock life insurance company. The Company is a member of the Nationwide group of companies (“Nationwide”), which is comprised of Nationwide Mutual Insurance Company (“NMIC”) and all of its subsidiaries and affiliates.

All of the outstanding shares of NLIC’s common stock are owned by Nationwide Financial Services, Inc. (“NFS”), a holding company formed by Nationwide Corporation (“Nationwide Corp.”), a majority-owned subsidiary of NMIC.

The Company is a leading provider of long-term savings and retirement products in the United States of America (“U.S.”). The Company develops and sells a wide range of products and services, which include fixed and variable individual annuities, private and public sector group retirement plans, life insurance, investment advisory services, banking products and services, mutual funds and other investment products.

The Company sells its products through a diverse distribution network. Unaffiliated entities that sell the Company’s products to their own customer bases include independent broker-dealers, financial institutions, wirehouse and regional firms, pension plan administrators and life insurance specialists. Representatives of affiliates who market products directly to a customer base include Nationwide Retirement Solutions, Inc. (“NRS”) and Nationwide Financial Network (“NFN”) producers, which includes the agency distribution force of the Company’s ultimate parent company, NMIC.

Wholly-owned subsidiaries of NLIC as of December 31, 2015 include Nationwide Life and Annuity Insurance Company (“NLAIC”), Nationwide Investment Services Corporation (“NISC”), Nationwide Investment Advisor (“NIA”) and Eagle Captive Reinsurance, LLC (“Eagle”). NLAIC primarily offers universal life insurance, variable universal life insurance, term life insurance, corporate-owned life insurance (“COLI”) and individual annuity contracts on a non-participating basis. NISC is a registered broker-dealer. NIA is a registered investment advisor.

Eagle is an Ohio domiciled special purpose financial captive insurance company, and a member of the Nationwide group of companies, which is comprised of NMIC and all of its subsidiaries and affiliates. Eagle is a wholly-owned subsidiary of NLIC. Eagle commenced operations effective October 1, 2015, following surplus contributions of $50 million by NLIC for the purpose of assuming net of third party reinsurance, 100% of NLIC’s liability with respect to specified guaranteed minimum death benefits (“GMDB”) and guaranteed lifetime withdrawal benefits (“GLWB”) provided under substantially all of the variable annuity contracts issued and to be issued by NLIC. The base annuity contracts and any non-reinsured risks will be retained by NLIC.

As of December 31, 2015 and 2014, the Company did not have a significant concentration of financial instruments in a single investee, industry or geographic region. Also, the Company did not have a concentration of business transactions with a particular customer, lender, distribution source, market or geographic region in which a single event could cause a severe impact on the Company’s financial position.

 

(2) Summary of Significant Accounting Policies

Basis of Presentation

The consolidated financial statements include the accounts of NLIC and companies in which NLIC directly or indirectly has a controlling financial interest. The consolidated financial statements include majority-owned subsidiaries and consolidated variable interest entities (“VIEs”). All intercompany accounts and transactions have been eliminated.

Use of Estimates

The Company’s consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The preparation of the consolidated financial statements in accordance with GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Significant estimates include the balance and amortization of deferred policy acquisition costs (“DAC”), legal and regulatory reserves, certain investment and derivative valuations, future policy benefits and claims including the valuation of embedded derivatives resulting from living benefit guarantees on variable annuity contracts expected to net settle, goodwill, provision for income taxes and valuation of deferred tax assets. Actual results could differ significantly from those estimates.

 

7

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Revenues and Benefits

Investment and universal life insurance products. Investment products are long-duration contracts that do not subject the Company to significant risk arising from mortality (the incidence of death) or morbidity (the incidence of disability resulting from disease or physical impairment). These include variable and fixed deferred annuity contracts in the accumulation phase with individuals and groups, as well as certain annuities without life contingencies. Universal life insurance products include long-duration insurance contracts that do not have fixed or guaranteed terms. These include universal life insurance, variable universal life insurance, COLI, bank-owned life insurance (“BOLI”) and other interest-sensitive life insurance policies. Revenues for investment products and universal life insurance products consist of net investment income, surrender charges and other policy charges earned and assessed against policy account balances during the period. Policy charges are assessed on a daily or monthly basis and are recognized as revenue when assessed and earned. Assessments for services provided in future periods are recorded as unearned revenue and recognized as revenue over the periods benefited. Surrender charges are recognized as revenue upon surrender of a contract in accordance with contractual terms. Policy benefits and claims that are charged to expense include interest credited to policyholder accounts and benefits and claims incurred in the period in excess of related policyholder accounts.

Traditional life insurance products. Traditional life insurance products include those products with fixed and guaranteed terms, primarily consisting of whole life insurance, term life insurance and certain annuities with life contingencies. Premiums for traditional life insurance products are generally recognized as revenue when due. For certain annuities with life contingencies, any excess of gross premium over the net premium is deferred and recognized with the amount of expected future benefits. Benefits and expenses are associated with earned premiums so that profits are recognized over the life of the contract. This association is accomplished through the provision for future policy benefits and the deferral and amortization of policy acquisition costs.

Future Policy Benefits and Claims

Investment and universal life insurance products. The Company calculates its liability for future policy benefits and claims for investment products in the accumulation phase and for universal life insurance policies at the policy accrued account balance, which represents participants’ net deposits adjusted for investment performance, interest credited and applicable contract charges.

The Company offers guarantees which can include a return of no less than the total deposits made on the contract less any customer withdrawals, total deposits made on the contract less any customer withdrawals plus a minimum return, or the highest contract value on a specified anniversary date minus any customer withdrawals following the contract anniversary. These guarantees can also include benefits payable in the event of death, upon annuitization, upon periodic withdrawal or at specified dates during the accumulation period. Refer to Note 4 for further discussion of these guarantees.

As part of its valuation procedures, the Company makes an assumption of the expected utilization of guarantee benefits by participants. Guarantees that include a benefit that is wholly life contingent or is expected to be exercised upon annuitization are accounted for as insurance liabilities that accumulate over time. Guarantees that are expected to be exercised using a net settlement option are accounted for as embedded derivatives, which are required to be separated from, and valued apart from, the host variable annuity contracts.

Guarantees on variable annuity and fixed annuity products accounted for as insurance liabilities primarily include GMDB and certain GLWB. Liabilities for these guarantees are calculated by multiplying the current benefit ratio by the cumulative assessments recorded from contract inception through the balance sheet date, less the cumulative guaranteed benefit payments plus interest. The Company annually evaluates its experience and assumptions and adjusts the benefit ratio as appropriate. If experience or assumption changes result in a new benefit ratio, the reserves are adjusted to reflect the changes, with a related charge or credit to benefits and claims in the period of evaluation. Determination of the expected benefit payments and assessments are based on a range of scenarios and assumptions, including those related to market rates of return and volatility, contract surrenders and mortality experience. The accounting for these guarantees impacts estimated gross profits used to calculate the balance and amortization of DAC and other expenses. Refer to Note 4 for further discussion of these guarantees.

 

8

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Certain guaranteed minimum accumulation benefits (“GMAB”) and the GLWB that are expected to net settle on variable annuity products represent embedded derivatives which are held at fair value and include the present value of attributed fees. Subsequent changes in the fair value of the embedded derivatives are recognized in earnings as a component of net realized investment gains and losses. The fair value of the embedded derivatives is calculated based on a combination of capital market and actuarial assumptions. Projections of cash flows inherent in the valuation of the embedded derivatives incorporate numerous, unobservable assumptions including, but not limited to, mortality, lapse rates, index volatility, benefit utilization and discounting. Benefit utilization includes a wait period (the number of years the policyholder is assumed to wait prior to beginning withdrawals once eligible) and efficiency of benefit utilization (the percent of the maximum permitted withdrawal that a policyholder takes). Discounting includes liquidity and non-performance risk (the risk that the liability will not be fulfilled) and affects the value at which the liability is transferred. The Company derives these inputs, which vary widely by product, attained age, policy duration, benefits in the money and the existence of surrender charges, from experience and industry data.

The Company offers certain indexed life insurance and annuity products for which the policyholders’ interest credits are based on market performance with caps and floors. The interest credits represent embedded derivatives within the insurance contract and therefore are required to be separated, and valued apart from, the host contracts. The embedded derivatives are held at fair value. Subsequent changes in the fair value of the embedded derivatives are recognized in earnings as a component of interest credited. The fair value of the embedded derivatives is calculated based on a combination of capital market and actuarial assumptions. Projections of cash flows inherent in the valuation of the embedded derivatives incorporate numerous unobservable assumptions including, but not limited to, mortality, lapse rates and index volatility.

The assumptions used to calculate the fair value of embedded derivatives are reviewed as part of an annual comprehensive study of assumptions. Quarterly, consideration is given as to whether adjustments to these assumptions are necessary.

The Company offers certain universal life and variable universal life insurance products with no-lapse guarantees. Liabilities for these guarantees are calculated by multiplying the current benefit ratio by the cumulative assessments recorded from contract inception through the balance sheet date, less the cumulative guaranteed benefit payments plus interest. The Company annually evaluates its experience and assumptions and adjusts the benefit ratio as appropriate. If experience or assumption changes result in a new benefit ratio, the reserves are adjusted to reflect the changes with a related charge or credit to other benefits and claims in the period of evaluation. Determination of the expected benefit payments and assessments are based on a range of scenarios and assumptions, including those related to market rates of return and volatility, contract surrenders and mortality experience. The accounting for these guarantees impacts estimated gross profits used to calculate the balance and amortization of DAC and other expenses. Refer to Note 4 for further discussion of these guarantees.

Traditional life and other insurance products. The process of calculating reserve amounts for traditional life insurance products involves the use of a number of assumptions, including those related to persistency (the percentage of insurance policies remaining in-force from year to year), mortality, morbidity, interest rates (the rates expected to be paid or received on financial instruments) and certain other expenses.

The liability for future policy benefits and claims for traditional life insurance policies was determined using the net level premium method, with weighted average interest rates of 6.6% and estimates of mortality, morbidity, investment yields and persistency that were used or being experienced at the time the policies were issued, with a provision for adverse deviation.

The liability for future policy benefits for certain annuities with life contingencies was calculated using the present value of future benefits and certain expenses, discounted using weighted average interest rates of 4.7% with a provision for adverse deviation.

The Company issues fixed and floating rate funding agreements to the Federal Home Loan Bank of Cincinnati (“FHLB”). The liability for such funding agreements is recorded in future policy benefits and claims. The amount of collateralized funding agreements outstanding with the FHLB as of December 31, 2015 and 2014 was $2.3 billion and $1.8 billion, respectively. In connection with an FHLB requirement for funding agreements, the Company held $46 million and $35 million of FHLB stock as of December 31, 2015 and 2014, respectively.

 

9

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Reinsurance Ceded

The Company cedes insurance to other companies in order to limit potential losses and to diversify its exposures. Such agreements do not relieve the original insurer from its primary obligation to the policyholder in the event the reinsurer is unable to meet the obligations it has assumed. Reinsurance premiums ceded and reinsurance recoveries on benefits and claims incurred are deducted from the respective income and expense accounts. Assets and liabilities related to reinsurance ceded are reported in the consolidated balance sheets on a gross basis, separately from the related future policy benefits and claims of the Company.

Deferred Policy Acquisition Costs

The Company has deferred certain acquisition costs that are directly related to the successful acquisition of new and renewal insurance and investment contracts. The methods and assumptions used to amortize and assess recoverability of the DAC balance depend on the type of product.

Investment and universal life insurance products. For certain investment and universal life insurance products, DAC is amortized with interest over the lives of the policies in relation to the present value of estimated gross profits, which is determined primarily from projected interest margins, policy charges and net realized investment gains and losses, less policy benefits and other expenses. The DAC asset related to investment and universal life insurance products is adjusted to reflect the impact of unrealized gains and losses on available-for-sale securities, with the corresponding adjustment recorded in accumulated other comprehensive income (“AOCI”). This adjustment to DAC represents the change in amortization that would have been required as a charge or credit to earnings had such unrealized amounts been realized. DAC for investment and universal life insurance products is subject to recoverability testing in the year of policy issuance, and DAC for universal life insurance products is also subject to loss recognition testing at the end of each reporting period.

The assumptions used in the estimation of gross profits are based on the Company’s current best estimates of future events and are reviewed as part of an annual comprehensive study of assumptions. The most significant assumptions that are involved in the estimation of future gross profits include future net general and separate account investment performance, surrender/lapse rates, interest margins, renewal premiums and mortality. Quarterly, consideration is given as to whether adjustments to these assumptions are necessary. The Company uses a reversion to the mean process to determine the assumption for the future net separate account investment performance. This process assumes different performance levels over the next three years, such that the separate account mean return, measured from the anchor date to the end of the life of the product, equals the long-term assumption. The Company’s long-term assumptions for net separate account investment performance consist of assumed gross returns of 10.5% for equity funds and 5.0% for fixed funds.

Changes in assumptions can have a significant impact on the amount of DAC reported for investment and universal life insurance products and on their related amortization patterns. In the event actual experience differs from assumptions or future assumptions are revised, the Company will record an increase or decrease in DAC amortization expense, which could be significant.

Traditional life insurance products. DAC is amortized with interest over the premium-paying period of the related policies in proportion to premium revenue recognized. These assumptions are consistent with those used in the calculation of liabilities for future policy benefits at issuance. DAC is evaluated for recoverability in the year of policy issuance, and loss recognition testing is conducted each reporting period.

Refer to Note 5 for discussion regarding DAC amortization and related balances.

Investments

Available-for-sale securities. Available-for-sale securities are reported at fair value, with unrealized gains and losses reported as a separate component of other comprehensive income, net of adjustments for DAC, future policy benefits and claims, policyholder dividend obligations and deferred federal income taxes. Realized gains and losses on sales of available-for-sale securities are recognized in income based on the specific identification method. Interest and dividend income is recognized when earned.

As of December 31, 2015 and 2014, 99% of fixed maturity securities were priced using externally sourced data. Independent pricing services are most often utilized (86% and 87% as of December 31, 2015 and 2014, respectively) to determine the fair value of securities for which market quotations are available. For these securities, the Company obtains the pricing services’ methodologies, pricing from additional sources, and classifies the investments accordingly in the fair value hierarchy.

 

10

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

A corporate pricing matrix is used in valuing certain corporate debt securities. The corporate pricing matrix was developed using publicly and privately available spreads for privately placed corporate securities with varying weighted average lives and credit quality ratings. The weighted average life and credit quality rating of a particular fixed maturity security to be priced using the corporate pricing matrix are important inputs into the model and are used to determine a corresponding spread that is added to the appropriate U.S. Treasury yield to create an estimated market yield for that security. The estimated market yield and other relevant factors are then used to estimate the fair value of the particular security.

Non-binding broker quotes are also utilized to determine the fair value of certain fixed maturity securities when deemed appropriate or when quotes are not available from independent pricing services or a corporate pricing matrix. These securities, consisting primarily of private placement corporate bonds, are classified with the lowest priority in the fair value hierarchy as only one broker quote is ordinarily obtained, the investment is not traded on an exchange, the pricing is not available to other entities and/or the transaction volume in the same or similar investments has decreased. Inputs used in the development of prices are not provided to the Company by the brokers, as the brokers often do not provide the necessary transparency into their quotes and methodologies. At least annually, the Company performs reviews and tests to ensure that quotes are a reasonable estimate of the investments’ fair value. Price movements of broker quotes are subject to validation and require approval from the Company’s management. Management uses its knowledge of the investment and current market conditions to determine if the price is indicative of the investment’s fair value.

When the collectability of contractual interest payments on fixed maturity securities is considered doubtful, such securities are placed in non-accrual status and any accrued interest is excluded from investment income. These securities are not restored to accrual status until the Company determines that future payment of principal and interest is probable.

The Company has entered into securities lending agreements with a custodial bank whereby eligible securities are loaned to third parties, primarily major brokerage firms. These transactions are used to generate additional income in the securities portfolio. The Company is entitled to receive from the borrower any payments of interest and dividends received on loaned securities during the loan term. The agreements require a minimum of 102% of the fair value of the loaned securities to be held as collateral. Cash collateral is invested by the custodial bank in investment-grade securities, which are included in the total investments of the Company. Additionally, the Company may receive non-cash collateral, which would be recorded off-balance sheet. As of December 31, 2015 and December 31, 2014, the fair value of the securities received as collateral and recorded off balance sheet is $167 million and $0, respectively. The Company recognizes loaned securities in available-for-sale investments. A securities lending payable is recorded in other liabilities for the amount of cash collateral received. Net income received from securities lending activities is included in net investment income. As of December 31, 2015 and 2014, the fair value of loaned securities was $389 million and $254 million, respectively.

For investments in certain residential and commercial mortgage-backed securities, the Company recognizes income and amortizes discounts and premiums using the effective-yield method, based on prepayment assumptions and the estimated economic life of the securities. When actual prepayments differ significantly from estimated prepayments, the effective-yield is recalculated to reflect actual payments to date and anticipated future payments. Any resulting adjustment is included in net investment income in the period the estimates are revised. All other investment income is recorded using the effective-yield method without anticipating the impact of prepayments.

The Company periodically reviews its available-for-sale securities to determine if any decline in fair value to below amortized cost is other-than-temporary. Factors considered in determining whether a decline is other-than-temporary include the length of time a security has been in an unrealized loss position, the severity of the unrealized loss, reasons for the decline in value and expectations for the amount and timing of a recovery in fair value.

In assessing corporate debt securities for other-than-temporary impairment, the Company evaluates the ability of the issuer to meet its debt obligations, the value of the company or specific collateral securing the debt, the Company’s intent to sell the security and whether it is more likely than not the Company will be required to sell the security before the recovery of its amortized cost basis. The Company evaluates U.S. government, agencies and obligations of states and political subdivisions securities for other-than-temporary impairment by examining similar characteristics.

Mortgage-backed securities are assessed for impairment using default estimates based on loan level data, where available. Where loan level data is not available, a proxy based on collateral characteristics is used. The impairment assessment considers loss severity as a function of multiple factors, including unpaid balance, interest rate, mortgage insurance ratios, assessed property value at origination, change in property value, loan-to-value (“LTV”) ratio at origination and prepayment speeds. Cash flows generated by the collateral are then utilized, along with consideration of the instrument’s position in the overall structure, to determine cash flows associated with the security.

 

11

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Certain asset-backed securities are assessed for impairment using expected cash flows based on various inputs, including default estimates based on the underlying corporate securities, historical and forecasted loss severities or other market inputs when recovery estimates are not feasible. When the collateral is regional bank and insurance company trust preferred securities, default estimates used to estimate cash flows are based on U.S. Bank Rating service data and broker research.

The Company evaluates its intent to sell on an individual security basis. Other-than-temporary impairment losses on securities when the Company does not intend to sell the security and it is not more likely than not it will be required to sell the security prior to recovery of the security’s amortized cost basis are bifurcated, with the credit related portion of the impairment loss being recognized in earnings and the non-credit related portion of the impairment loss and any subsequent changes in the fair value of those debt securities being recognized in other comprehensive income, net of applicable taxes and other offsets. To estimate the credit related portion of an impairment loss recognized in earnings, the Company considers the present value of the cash flows. To the extent that the present value of cash flows generated by a debt security is less than the amortized cost, an other-than-temporary impairment is recognized through earnings.

It is possible that further declines in fair values of such investments, or changes in assumptions or estimates of anticipated recoveries and/or cash flows, may cause further other-than-temporary impairments, which could be significant.

The Company invests in fixed maturity securities that could qualify as variable interest entities (“VIEs”), including corporate securities, mortgage-backed securities and asset-backed securities. The Company is not the primary beneficiary of these securities as the Company does not have the power to direct the activities that most significantly impact the entities’ performance. The Company’s potential loss is limited to the carrying values of these securities. There are no liquidity arrangements, guarantees or other commitments by third parties that affect the fair value of the Company’s interest in these assets.

Mortgage loans, net of allowance. The Company holds commercial mortgage loans that are collateralized by properties throughout the U.S. These mortgage loans are further segregated into the following classes based on the unique risk profiles of the underlying property types: office, industrial, retail, apartment, hotel and other. Mortgage loans held-for-investment are held at amortized cost less a valuation allowance.

As part of the underwriting process, specific guidelines are followed to ensure the initial quality of a new mortgage loan. Third-party appraisals are obtained to support loaned amounts, as the loans are usually collateral dependent.

The collectability and value of a mortgage loan are based on the ability of the borrower to repay and/or the value of the underlying collateral. Many of the commercial mortgage loans are structured with balloon payment maturities, exposing the Company to risks associated with the borrowers’ ability to make the balloon payment or refinance the property.

Mortgage loans require a loan-specific reserve when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. When management determines that a loan requires a loan-specific reserve, a provision for loss is established equal to the difference between the carrying value and either the fair value of the collateral less costs to sell or the present value of expected future cash flows, discounted at the loan’s market interest rate. Loan-specific reserve charges are recorded in net realized investment gains and losses. In the event a loan-specific reserve charge is reversed, the recovery is also recorded in net realized investment gains and losses.

In addition to the loan-specific reserves, the Company maintains a non-specific reserve based primarily on loan surveillance categories and property type classes, which reflects management’s best estimates of probable credit losses inherent in the portfolio of loans without specific reserves as of the balance sheet date. Management’s periodic evaluation of the adequacy of the non-specific reserve is based on past loan loss experience, known and inherent risks in the portfolio, adverse situations that may affect a borrower’s ability to repay, the estimated value of the underlying collateral, the composition of the loan portfolio, current economic conditions and other relevant factors. Non-specific reserve changes are recorded in net realized investment gains and losses.

Management evaluates the credit quality of individual commercial mortgage loans and the portfolio as a whole through a number of loan quality measurements, including but not limited to LTV and debt service coverage (“DSC”) ratios. The LTV ratio is calculated as a ratio of the amortized cost of a loan to the estimated value of the underlying collateral. DSC is the amount of cash flow generated by the underlying collateral of the mortgage loan available to meet periodic interest and principal payments of the loan. This process identifies commercial mortgage loans representing the lowest risk profile and lowest potential for loss and those representing the highest risk profile and highest potential for loss. These factors are updated and evaluated at least annually.

 

12

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Interest income on performing mortgage loans is recognized over the life of the loan using the effective-yield method. Loans in default or in the process of foreclosure are placed on non-accrual status. Interest received on non-accrual status mortgage loans is included in net investment income in the period received. Loans are restored to accrual status when the principal and interest is current and it is determined the future principal and interest payments are probable or the loan is modified. Loans are considered delinquent when contractual payments are 90 days past due.

Policy loans. Policy loans, which are collateralized by the related insurance policy, are held at the outstanding principal balance and do not exceed the net cash surrender value of the policy. As such, no valuation allowance for policy loans is required.

Short-term investments. Short-term investments consist primarily of highly liquid mutual funds and government agency discount notes with maturities of twelve months or less at acquisition. The Company and various affiliates maintain agreements with Nationwide Cash Management Company (“NCMC”), an affiliate, under which NCMC acts as a common agent in handling the purchase and sale of short-term securities for the respective accounts of the participants. Amounts on deposit with NCMC for the benefit of the Company are included in short-term investments on the consolidated balance sheets. The Company carries short-term investments at fair value.

Other investments. Other investments consist primarily of alternative investments in private equity, purchased tax credit funds and partnerships accounted for under the equity method, trading securities, equity securities and capital stock with the FHLB. The Company applies mark-to-market accounting to trading securities and recognizes changes in fair value in net realized investment gains and losses.

The Company holds investments in limited partnerships and similar entities including private equity funds, tax credit funds and real estate related funds. The Company applies the equity method of accounting to these investments as it does not have a controlling financial interest. The Company recognizes the change in equity method investments in net investment income. The Company’s unfunded commitments related to these investments were $315 million and $123 million as of December 31, 2015 and 2014, respectively. The carrying value of these investments was $199 million and $141 million as of December 31, 2015 and 2014, respectively.

The Company has sold $1.4 billion and $1.3 billion in Tax Credit Funds to unrelated third parties as of December 31, 2015 and 2014, respectively. The Company has guaranteed after-tax benefits to the third party investors through periods ending in 2031. These guarantees are in effect for periods of approximately 15 years each. The Tax Credit Funds provide a stream of tax benefits to the investors that will generate a yield and return of capital. If the tax benefits are not sufficient to provide these cumulative after-tax yields, the Company must fund any shortfall. The maximum amount of undiscounted future payments that the Company could be required to pay the investors under the terms of the guarantees is $720 million, but the Company does not anticipate making any material payments related to the guarantees. The Company’s risks are mitigated in the following ways: (1) the Company has the right to buyout the equity related to the guarantee under certain circumstances, (2) the Company may replace underperforming properties to mitigate exposure to guarantee payments and (3) the Company oversees the asset management of the deals.

In the normal course of business, the Company has relationships with VIEs. If the Company determines that it has a variable interest and is the primary beneficiary, it consolidates the VIE. The Company is the primary beneficiary if the Company has the power to direct the activities of the VIE that most significantly impact the economic performance of the entity and the obligation to absorb losses or receive benefits from the entity that could be potentially significant to the VIE. This determination is based on a review of the entity’s contract and other deal-related information, such as the entity’s equity investment at risk, decision-making abilities, obligations to absorb economic risks and right to receive economic rewards of the entity. These consolidated VIEs are primarily made up of the Tax Credit Funds discussed above.

Net assets (controlling and noncontrolling interests) of all consolidated VIEs totaled $644 million and $640 million as of December 31, 2015 and 2014, respectively, and are included within the balance sheet primarily as other investments of $585 million, other assets of $113 million and other liabilities of $67 million as of December 31, 2015, and other investments of $580 million, other assets of $109 million and other liabilities of $75 million as of December 31, 2014. The Company’s general credit is not exposed to the creditors or beneficial interest holders of these consolidated VIEs. The results of operations and financial positions of each VIE for which the Company is the primary beneficiary, as well as the corresponding noncontrolling interests, are recorded in the consolidated financial statements. Ownership interests held by unrelated third parties in the consolidated VIEs are presented as noncontrolling interests in the equity section of the consolidated financial statements. Losses attributable to noncontrolling interests are excluded from the net income attributable to the Company on the consolidated statements of operations.

The Company is not required and does not intend to provide financial or other support outside of contractual requirements to any VIE.

 

13

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Derivative Instruments

The Company uses derivative instruments to manage exposures and mitigate risks primarily associated with interest rates, equity markets and foreign currency. These derivative instruments primarily include interest rate swaps, futures contracts and options. Certain features embedded in the Company’s indexed products and certain variable annuity contracts require derivative accounting. All derivative instruments are held at fair value and are reflected as other assets or liabilities in the consolidated balance sheets.

The fair value of derivative instruments is determined using various valuation techniques relying predominantly on observable market inputs. These inputs include interest rate swap curves, credit spreads, interest rates, counterparty credit risk, equity volatility and equity index levels. In cases where observable inputs are not available, the Company will utilize non-binding broker quotes to determine fair value, and these instruments are classified accordingly in the fair value hierarchy. Price movements of these broker quotes are subject to validation and require approval from the Company’s management. Management uses models to internally value the instruments for comparison to the values received through broker quotes.

For derivatives that are not designated for hedge accounting, the gain or loss on the derivative is recognized in net realized investment gains and losses.

For derivative instruments that are designated and qualify for cash flow hedge accounting, the effective portion of the gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive income and reclassified into earnings in the same period or periods that the hedged transaction impacts earnings. The ineffective portion of the derivative’s change in value, if any, along with any of the derivative’s change in value that is excluded from the assessment of hedge effectiveness, are recorded in net realized investment gains and losses.

The Company’s derivative transaction counterparties are generally financial institutions. To reduce the credit risk associated with open contracts, the Company enters into master netting agreements, which permit the closeout and netting of transactions with the same counterparty upon the occurrence of certain events. In addition, the Company attempts to reduce credit risk by obtaining collateral from counterparties. The determination of the need for and the levels of collateral vary based on an assessment of the credit risk of the counterparty. The Company accepts collateral in the forms of cash and marketable securities.

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s view of market assumptions in the absence of observable market information. The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. In determining fair value, the Company uses various methods, including market, income and cost approaches.

The Company categorizes its financial instruments into a three-level hierarchy based on the priority of the inputs to the valuation technique. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument in its entirety.

The Company categorizes assets and liabilities held at fair value in the consolidated balance sheets as follows:

Level 1. Unadjusted quoted prices accessible in active markets for identical assets or liabilities at the measurement date and mutual funds, where the value per share (unit) is determined and published daily and is the basis for current transactions.

Level 2. Unadjusted quoted prices for similar assets or liabilities in active markets or inputs (other than quoted prices) that are observable or that are derived principally from or corroborated by observable market data through correlation or other means. Primary inputs to this valuation technique may include comparative trades, bid/asks, interest rate movements, U.S. Treasury rates, London Interbank Offered Rate (“LIBOR”), prime rates, cash flows, maturity dates, call ability, estimated prepayments and/or underlying collateral values.

Level 3. Prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management’s best estimates of the assumptions market participants would use at the measurement date in pricing the asset or liability. Consideration is given to the risk inherent in both the method of valuation and the valuation inputs.

 

14

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The Company reviews its fair value hierarchy classifications for assets and liabilities quarterly. Changes in the observability of significant valuation inputs identified during these reviews may trigger reclassifications. Reclassifications are reported as transfers at the beginning of the period in which the change occurs.

Fair Value Option. The Company assesses the fair value option election for newly acquired assets or liabilities on a prospective basis. There are no material assets or liabilities for which the Company has elected the fair value option.

Cash and Cash Equivalents

Cash and cash equivalents include highly liquid investments with original maturities of less than three months.

Goodwill

In connection with business acquisitions, the Company recognizes goodwill as the excess of the purchase price or fair value of consideration exchanged over the fair values of tangible assets acquired, liabilities assumed and separately identified intangible assets. Goodwill is not amortized, but is evaluated for impairment at the reporting unit level annually. Goodwill of a reporting unit is tested for impairment on an interim basis, in addition to the annual evaluation, if an event occurs or circumstances change which would more likely than not reduce the fair value of a reporting unit below its carrying amount. If a reporting unit’s fair value is less than its carrying value, the Company will calculate implied goodwill. Goodwill is impaired at the reporting unit level if its carrying value exceeds the implied value of its goodwill.

The process of evaluating goodwill for impairment requires several judgments and assumptions to be made to determine the fair value of the reporting units, including the method used to determine fair value, discount rates, expected levels of cash flows, revenues and earnings and the selection of comparable companies used to develop market-based assumptions. The Company performed its 2015 annual impairment test and determined that no impairment was required. As of December 31, 2015 and 2014, there were no accumulated impairments.

Closed Block

In connection with the sponsored demutualization of Provident Mutual Life Insurance Company (“Provident”) prior to its acquisition by the Company, Provident established a closed block for the benefit of certain classes of individual participating policies that had a dividend scale payable in 2001. Assets were allocated to the closed block in an amount that produces cash flows which, together with anticipated revenues from closed block business, is reasonably expected to be sufficient to provide for (1) payment of policy benefits, specified expenses and taxes, and (2) the continuation of dividends throughout the life of the Provident policies included in the closed block based upon the dividend scales payable for 2001, if the experience underlying such dividend scales continues.

Assets allocated to the closed block benefit only the holders of the policies included in the closed block and will not revert to the benefit of the Company. No reallocation, transfer, borrowing or lending of assets can be made between the closed block and other portions of the Company’s general account, any of its separate accounts, or any affiliate of the Company without the approval of the Pennsylvania Insurance Department and ODI. The closed block will remain in effect as long as any policy in the closed block is in force.

If, over time, the aggregate performance of the closed block assets and policies is better than was assumed in funding the closed block, dividends to policyholders will increase. If, over time, the aggregate performance of the closed block assets and policies is less favorable than was assumed in the funding, dividends to policyholders could be reduced. If the closed block has insufficient funds to make guaranteed policy benefit payments, such payments will be made from the Company’s assets outside of the closed block, which are general account assets.

The assets and liabilities allocated to the closed block are recorded in the Company’s consolidated financial statements on the same basis as other similar assets and liabilities. The carrying amount of closed block liabilities in excess of the carrying amount of closed block assets at the date Provident was acquired by the Company represents the maximum future earnings from the assets and liabilities designated to the closed block that can be recognized in income, for the benefit of stockholders, over the period the policies in the closed block remain in force.

If actual cumulative earnings exceed expected cumulative earnings, the expected earnings are recognized in income. This is because the excess actual cumulative earnings over expected cumulative earnings, which represents undistributed accumulated earnings attributable to policyholders, is recorded as a policyholder dividend obligation. Therefore, the excess will be paid to closed block policyholders as an additional policyholder dividend expense in the future unless it is otherwise offset by future performance of the closed block that is less favorable than originally expected. If actual cumulative performance is less favorable than expected, actual earnings will be recognized in income.

 

15

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The principal cash flow items that affect the amount of closed block assets and liabilities are premiums, net investment income, purchases and sales of investments, policyholder benefits, policyholder dividends, premium taxes and income taxes. The principal income and expense items excluded from the closed block are management and maintenance expenses, commissions and net investment income and realized gains and losses on investments held outside of the closed block that support the closed block business, all of which enter into the determination of total gross margins of closed block policies. See Note 10 for further disclosure.

Separate Accounts

Separate account assets and liabilities represent contractholders’ funds that have been legally segregated into accounts with specific investment objectives. In the separate account, investment income and gains and losses on investments accrue directly to, and investment risk is borne by, the contractholder. Separate account assets are primarily comprised of public, privately-registered and non-registered mutual funds. Separate account assets are recorded at fair value based on the methodology that would be applicable to the underlying assets. The value of separate account liabilities is set to equal the fair value for separate account assets.

Federal Income Taxes

The Company recognizes deferred tax assets and liabilities for the expected future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, net operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income or loss in the years in which those temporary differences are expected to be recovered or settled. Under this method, the effect on deferred tax assets and liabilities due to a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are recorded to reduce a deferred tax asset to the amount expected to be realized. Interest expense and any associated penalties which relate to tax years still subject to review by the Internal Revenue Service (“IRS”) are recorded as income tax expenses.

The Company provides for federal income taxes based on amounts the Company believes it ultimately will owe. Inherent in the provision for federal income taxes are estimates regarding the deductibility of certain items and the realization of certain tax credits. In the event the ultimate deductibility of certain items or the realization of certain tax credits differs from estimates, the Company may be required to change the provision for federal income taxes recorded in the consolidated financial statements, which could be significant.

Tax reserves are reviewed regularly and are adjusted as events occur that the Company believes impact its liability for additional taxes, such as the lapsing of applicable statutes of limitations, conclusion of tax audits or substantial agreement with taxing authorities on the deductibility/nondeductibility of uncertain items, additional exposure based on current calculations, identification of new issues, release of administrative guidance or rendering of a court decision affecting a particular tax issue. The Company believes its tax reserves reasonably provide for potential assessments that may result from IRS examinations and other tax-related matters for all open tax years.

Effective January 1, 2015, the Company is included in the NMIC consolidated federal income tax return. Prior to 2015, NLIC filed a separate consolidated federal income tax return with its subsidiaries.

Participating Business

Participating business, which refers to policies that participate in profits through policyholder dividends, represented approximately 3% of the Company’s life insurance in force in 2015 (4% in 2014 and 2013) and 35% of the number of life insurance policies in force in 2015 (37% in 2014 and 38% in 2013). The provision for policyholder dividends was based on the respective year’s dividend scales and has been included in future policy benefits and claims in the consolidated balance sheets.

Subsequent Events

The Company evaluated subsequent events through February 23, 2016, the date the consolidated financial statements were issued.

 

(3) Recently Issued Accounting Standards

Adopted Accounting Standards

On January 1, 2015, the Company adopted ASU 2014-04, which amends existing guidance in ASC 310, Receivables and ASC 360, Property, Plant and Equipment. The amended guidance provides clarification on the accounting for situations in which a creditor obtains collateral assets in satisfaction of all or part of a receivable. The adoption of this guidance had no impact on the Company’s consolidated financial statements.

 

16

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

On January 1, 2015, the Company adopted ASU 2014-11, which amends existing guidance in ASC 860, Transfers and Servicing. The amended guidance amends certain criteria when evaluating effective control in certain repurchase agreement transactions and eliminates specific guidance on repurchase financing and requires that these transactions be treated in the same manner as repurchase transactions. Additionally, the amended guidance requires additional disclosures for repurchase agreements. The adoption of this guidance had no impact on the Company’s consolidated financial statements.

On January 1, 2015, the Company adopted ASU 2014-14, which amends ASC 310, Receivables. The amended guidance requires creditors to classify certain foreclosed government guaranteed mortgage loans as a receivable from the guarantor that is measured at the amount expected to be recovered under the guarantee, without treating the guarantee as a separate unit of account. The adoption of this guidance had no impact on the Company’s consolidated financial statements.

On January 1, 2015, the Company adopted ASU 2014-17, which amends ASC 805, Business Combinations. The amended guidance gives an acquired entity the option to apply pushdown accounting in its stand-alone financial statements. The adoption of this guidance had no impact on the Company’s consolidated financial statements.

On January 1, 2015, the Company adopted ASU 2015-02, which amends existing guidance in ASC 810, Consolidation. The amended guidance changes the way reporting enterprises evaluate whether (a) they should consolidate limited partnerships and similar entities, (b) fees paid to a decision maker or service provider are variable interests in a variable interest entity (VIE), and (c) variable interests in a VIE held by related parties of the reporting enterprise require the reporting enterprise to consolidate the VIE. The adoption of this guidance had no impact on the Company’s consolidated financial statements.

Pending Accounting Standards

In January 2015, the FASB issued ASU 2015-01, which amends existing guidance in ASC 225, Income Statement. The amended guidance eliminates the concept of extraordinary items. The Company will adopt the ASU for annual periods beginning January 1, 2016. The guidance will have no material impact to the Company upon adoption.

In April 2015, the FASB issued ASU 2015-03, which amends existing guidance in ASC 835, Interest. The amended guidance presents debt issuance costs in the balance sheet as a direct deduction from the carrying amount of the corresponding debt liability. The Company will adopt the ASU for annual periods beginning January 1, 2016. The guidance will have no material impact to the Company upon adoption.

In May 2015, the FASB issued ASU 2015-07, which amends ASC 820, Fair Value Measurements. The amended guidance eliminates the requirement to categorize investments using net asset value as fair value within the fair value hierarchy. The Company will adopt the ASU for annual periods beginning January 1, 2016. The adoption of this guidance will result in changes to disclosures only.

In May 2015, the FASB issued ASU 2015-09, which amends ASC 944, Financial Services-Insurance. The amended guidance requires additional disclosures for short duration insurance contracts. The Company will adopt the ASU for annual periods beginning January 1, 2016. The guidance will have no material impact to the Company upon adoption.

In August 2015, the FASB issued ASU 2015-14, which amends ASC 606, Revenue from Contracts from Customers. The amended guidance defers the effective date of ASU 2014-09 for all entities by one year. The Company does not expect the adoption of this guidance to have any impact on the Company’s consolidated financial statements.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Liabilities. The amended guidance primarily affects the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, the FASB clarified guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The Company will adopt the ASU for interim and annual periods beginning January 1, 2018. The Company is currently in the process of determining the impact of adoption.

 

(4) Certain Long-Duration Contracts

Variable Annuity Contracts

The Company provides various forms of guarantees to benefit the related contractholders of variable annuity contracts issued through separate accounts. The Company provides four primary guarantee types: (1) GMDB, (2) GLWB, (3) GMAB and (4) guaranteed minimum income benefits (“GMIB”).

 

17

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The GMDB, offered on variable annuity contracts, provides a specified minimum return upon death. Many of these death benefits are spousal, whereby a death benefit will be paid upon death of the first spouse. The survivor has the option to terminate the contract or continue it by having the death benefit paid into the contract and having a second death benefit paid upon the survivor’s death.

The GLWB, primarily offered in the Company’s Lifetime Income products, are living benefits that provide for enhanced retirement income security without the liquidity loss associated with annuitization. The withdrawal rates vary based on the age when withdrawals begin and are applied to a benefit base to determine the guaranteed lifetime income amount available to a contractholder. The benefit base is equal to the variable annuity premium at contract issuance and may increase as a result of a feature driven by minimum return and policy duration.

The GMAB, which was offered in the Company’s Capital Preservation Plus product, is a living benefit that provides the contractholder with a guaranteed return of deposits, adjusted proportionately for withdrawals, after a specified time period (5, 7 or 10 years) selected by the contractholder at the issuance of the variable annuity contract. In some cases, the contractholder also has the option, after a specified time period, to drop the guarantee and continue the variable annuity contract without the GMAB. In general, the GMAB requires a minimum allocation to guaranteed term options or adherence to limitations required by an approved asset allocation strategy.

The GMIB, which was offered with several variable annuity contracts, is a living benefit that provides the contractholder with a guaranteed annuitization stream of income.

The following table summarizes information regarding variable annuity contracts with guarantees invested in general and separate accounts, as of the dates indicated (a contract may contain multiple guarantees):

 

     December 31, 2015      December 31, 2014  

(in millions)

    General
account
value		      Separate
account
value		      Net
amount
at risk1		      Average
age2		      General
account
value		      Separate
account
value		      Net
amount
at risk1		      Average
age2		  

Contracts with GMDB:

                        

Return of net deposits

    $ 885       $ 24,452       $ 208         66       $ 872       $ 23,079       $ 21         65   

Minimum return or anniversary contract value

      1,817         31,511         1,133         70         1,918         33,662         292         69   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total contracts with GMDB

    $ 2,702       $ 55,963       $ 1,341         68       $ 2,790       $ 56,741       $ 313         68   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

GLWB Minimum return or anniversary contract value3

    $ 141       $ 32,187       $ 142         67       $ 135       $ 31,406       $ 195         66   

GMAB Return of net deposits3

    $ 19       $ 496       $ 2         66       $ 43       $ 1,177       $ —           67   

GMIB Minimum return or anniversary contract value

    $ 46       $ 380       $ 1         67       $ 45       $ 451       $ 1         66   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

 

1 Net amount at risk is calculated on a policy-level basis and equals the respective guaranteed benefit less the account value (or zero if the account value exceeds the guaranteed benefit).
2 Represents the weighted average attained age of contractholders at the respective date.
3 Certain prior period amounts related to contracts with a hybrid accumulation/withdrawal benefit have been reclassified to conform with current period presentation.

 

18

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The following table summarizes the reserve balances for guarantees on variable annuity contracts, as of the dates indicated:

 

     December 31,  

(in millions)

    2015      2014  

GMDB

    $ 148       $ 76   

GLWB1

    $ 180       $ 185   

GMAB1

    $ —         $ (8 ) 

GMIB

    $ 2       $ 1   

 

1 Certain prior period amounts related to contracts with a hybrid accumulation/withdrawal benefit have been reclassified to conform with current period presentation.

During 2015, the Company recognized a net decrease in the liability for future policy benefits and claims in conjunction with the annual comprehensive review of assumptions, primarily related to the Company’s assumption for participant benefit utilization of the net settlement option within the GLWB. The Company changed its estimate to reduce expected utilization of the net settlement option. For the year ended December 31, 2015, the change in estimate resulted in net realized investment gains of $187 million, an increase to benefits and claims of $164 million and lower amortization of deferred policy acquisition costs of $28 million.

Paid claims for GMDBs were $20 million and $11 million for the years ended December 31, 2015 and 2014, respectively.

Paid claims for GLWBs, GMABs and GMIBs were immaterial for the years ended December 31, 2015 and 2014.

The following table summarizes the account balances of deferred variable annuity contracts with guarantees invested in separate accounts, as of the dates indicated:

 

     December 31,  

(in millions)

    2015      2014  

Mutual funds:

      

Bond

    $ 5,371       $ 5,280   

Domestic equity

      46,469         47,316   

International equity

      3,001         2,969   
  

 

 

     

 

 

  

Total mutual funds

    $ 54,841       $ 55,565   

Money market funds

      1,122         1,176   
  

 

 

     

 

 

  

Total1

    $ 55,963       $ 56,741   
  

 

 

     

 

 

  

 

1 Excludes $31.3 billion as of December 31, 2015 and 2014 of separate account assets not related to deferred variable annuity contracts with guarantees, primarily attributable to retirement plan, variable universal life and COLI products.

Fixed Annuity Contracts

The Company offers certain fixed annuity products with GMDB and GLWB. As of December 31, 2015 and 2014, the general account value for contracts with GMDB was $2.7 billion and $351 million, respectively, which includes $1.4 billion and $185 million, respectively, of general account value relating to contracts that also have GLWB. The net amount at risk and reserve balances on these guarantees were immaterial as of December 31, 2015 and 2014. Paid claims for GMDB were immaterial for the years ended December 31, 2015 and 2014. There were no paid claims for GLWB during the years ended December 31, 2015 and 2014.

Universal and Variable Universal Life Insurance Contracts

The Company offers certain universal life and variable universal life insurance products with no-lapse guarantees. These no-lapse guarantees provide that a policy will not lapse so long as the policyholder makes minimum premium payments. The reserve balances on these guarantees were $548 million and $401 million as of December 31, 2015 and 2014, respectively. Paid claims on these guarantees were immaterial for the years ended December 31, 2015 and 2014.

 

19

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The following table summarizes information regarding universal and variable universal life insurance contracts with no-lapse guarantees invested in general and separate accounts, as of the dates indicated:

 

(in millions)

    General
account
value		      Separate
account
value		      Adjusted
insurance
in force1		      Average
age2		  

December 31, 2015

    $ 2,473       $ 2,053       $ 48,140         51   

December 31, 2014

    $ 1,954       $ 2,191       $ 41,484         51   

 

1 The adjusted insurance in force is calculated on a policy-level basis and equals the respective guaranteed death benefit less the account value and reinsurance.
2 Represents the weighted average attained age of contractholders at the respective date.

 

(5) Deferred Policy Acquisition Costs

The following table summarizes changes in the DAC balance, as of the dates indicated:

 

     December 31,  

(in millions)

    2015      2014      2013  

Balance at beginning of year

    $ 4,063       $ 3,778       $ 3,249   

Capitalization of DAC

      870         685         604   

Amortization of DAC, excluding unlocks

      (326 )       (397 )       (373 ) 

Amortization of DAC related to unlocks

      258         190         (1 ) 

Adjustments to DAC related to unrealized gains and losses on available-for-sale securities

      335         (193 )       299   
  

 

 

     

 

 

     

 

 

  

Balance at end of year

    $ 5,200       $ 4,063       $ 3,778   
  

 

 

     

 

 

     

 

 

  

During 2015, the Company recognized a decrease in DAC amortization of $258 million as a result of the annual comprehensive review of model assumptions and enhancements. The impact was primarily related to revisions made to the Company’s economic hedging strategies in conjunction with the change in estimate discussed in Note 4, as well as a decrease in the expected lapse rates for certain variable annuity products.

During 2014, the Company recognized a decrease in DAC amortization of $190 million as a result of the annual comprehensive review of model assumptions and enhancements. The updated assumptions were primarily related to the actual performance of the block of business since the prior year review and the expectations for lapses, partially offset by an update to the Company’s long-term assumptions for separate account investment performance.

During 2013, the net change in DAC amortization as a result of the annual comprehensive review of model assumptions was immaterial.

 

20

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

(6) Investments

Available-for-Sale Securities

The following table summarizes the amortized cost, unrealized gains and losses and fair value of available-for-sale securities, as of the dates indicated:

 

(in millions)

    Amortized
cost		      Unrealized
gains		      Unrealized
losses		      Fair value  

December 31, 2015

            

Fixed maturity securities:

            

U.S. government and agencies

    $ 343       $ 59       $ —         $ 402   

Obligations of states, political subdivisions and foreign governments

      2,137         241         11         2,367   

Corporate public securities

      23,174         868         752         23,290   

Corporate private securities

      5,082         203         115         5,170   

Residential mortgage-backed securities

      3,036         152         42         3,146   

Commercial mortgage-backed securities

      1,539         37         11         1,565   

Asset-backed securities

      1,685         19         74         1,630   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total fixed maturity securities

    $ 36,996       $ 1,579       $ 1,005       $ 37,570   

Equity securities

      7         14         —           21   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total available-for-sale securities

    $ 37,003       $ 1,593       $ 1,005       $ 37,591   
  

 

 

     

 

 

     

 

 

     

 

 

  

December 31, 2014

            

Fixed maturity securities:

            

U.S. government and agencies

    $ 448       $ 79       $ —         $ 527   

Obligations of states, political subdivisions and foreign governments

      1,966         320         1         2,285   

Corporate public securities

      19,851         1,519         120         21,250   

Corporate private securities

      4,398         286         34         4,650   

Residential mortgage-backed securities

      3,694         190         45         3,839   

Commercial mortgage-backed securities

      1,431         74         3         1,502   

Asset-backed securities

      1,410         27         72         1,365   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total fixed maturity securities

    $ 33,198       $ 2,495       $ 275       $ 35,418   

Equity securities

      6         15         —           21   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total available-for-sale securities

    $ 33,204       $ 2,510       $ 275       $ 35,439   
  

 

 

     

 

 

     

 

 

     

 

 

  

The fair value of the Company’s available-for-sale securities may fluctuate significantly in response to changes in interest rates, investment quality ratings and credit spreads. The Company has the ability and intent to hold equity securities until recovery. The Company does not have the intent to sell, nor is it more likely than not that it will be required to sell, fixed maturity securities in an unrealized loss position.

 

21

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The following table summarizes the amortized cost and fair value of fixed maturity securities, by contractual maturity, as of December 31, 2015. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without early redemption penalties.

 

(in millions)

    Amortized
cost		      Fair
value		  

Fixed maturity securities:

      

Due in one year or less

    $ 977       $ 982   

Due after one year through five years

      10,512         10,861   

Due after five years through ten years

      9,302         9,295   

Due after ten years

      9,945         10,091   
  

 

 

     

 

 

  

Subtotal

    $ 30,736       $ 31,229   

Residential mortgage-backed securities

      3,036         3,146   

Commercial mortgage-backed securities

      1,539         1,565   

Asset-backed securities

      1,685         1,630   
  

 

 

     

 

 

  

Total fixed maturity securities

    $ 36,996       $ 37,570   
  

 

 

     

 

 

  

The following table summarizes the components of net unrealized gains and losses, as of the dates indicated:

 

     December 31,  

(in millions)

    2015      2014  

Net unrealized gains on available-for-sale securities, before adjustments and taxes1

    $ 588       $ 2,235   

Adjustment to DAC and other expense

      (33 )       (372 ) 

Adjustment to future policy benefits and claims

      (16 )       (159 ) 

Adjustment to policyholder dividend obligations

      (67 )       (120 ) 

Deferred federal income tax expense

      (156 )       (548 ) 
  

 

 

     

 

 

  

Net unrealized gains on available-for-sale securities

    $ 316       $ 1,036   
  

 

 

     

 

 

  

 

1 Includes net unrealized losses of $20 million and $9 million as of December 31, 2015 and 2014, respectively, related to the non-credit portion of other-than-temporarily impaired securities.

The following table summarizes the change in net unrealized gains and losses reported in accumulated other comprehensive income, for the years ended:

 

     December 31,  

(in millions)

    2015      2014  

Balance at beginning of year

    $ 1,036       $ 601   

Unrealized gains and losses arising during the year:

      

Net unrealized (losses) gains on available-for-sale securities before adjustments

      (1,662 )       939   

Non-credit impairments and subsequent changes in fair value of impaired debt securities

      (11 )       31   

Net adjustment to DAC and other expense

      339         (196 ) 

Net adjustment to future policy benefits and claims

      143         (70 ) 

Net adjustment to policyholder dividend obligations

      53         (35 ) 

Related federal income tax benefit (expense)

      401         (234 ) 
  

 

 

     

 

 

  

Unrealized (losses) gains on available-for-sale securities

    $ (737 )     $ 435   

Less: Reclassification adjustment for net losses realized on available-for-sale securities, net of tax benefit ($9 and $0 as of

      

December 31, 2015 and 2014, respectively)

      (17 )       —     
  

 

 

     

 

 

  

Net unrealized (losses) gains on available-for-sale securities

    $ (720 )     $ 435   
  

 

 

     

 

 

  

Balance at end of year

    $ 316       $ 1,036   
  

 

 

     

 

 

  

 

22

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The following table summarizes, by asset class, available-for-sale securities, in an unrealized loss position based on the amount of time each type of security has been in an unrealized loss position, as well as the related fair value, as of the dates indicated:

 

     Less than or equal to one year      More than one year      Total  

(in millions)

    Fair
value		      Unrealized
losses		      Fair
value		      Unrealized
losses		      Unrealized
losses1		  

December 31, 2015

               

Fixed maturity securities:

               

Corporate public securities

    $ 8,170       $ 455       $ 975       $ 297       $ 752   

Corporate private securities

      1,642         56         418         59         115   

Asset-backed securities

      654         7         756         67         74   

Other

      1,271         23         504         41         64   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total2

    $ 11,737       $ 541       $ 2,653       $ 464       $ 1,005   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

December 31, 2014

               

Fixed maturity securities:

               

Corporate public securities

    $ 1,642       $ 63       $ 1,578       $ 57       $ 120   

Corporate private securities

      589         27         256         7         34   

Asset-backed securities

      662         5         493         67         72   

Other

      268         2         688         47         49   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total2

    $ 3,161       $ 97       $ 3,015       $ 178       $ 275   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

 

1 As of December 31, 2015 and 2014, there were $448 million and $66 million, respectively, of unrealized losses related to available-for-sale securities with a fair value to amortized cost ratio of less than 80%.
2 Represents 1,059 and 541 available-for-sale securities in an unrealized loss position as of December 31, 2015 and 2014, respectively.

The Company believes the unrealized losses on these available-for-sale securities represent temporary fluctuations in economic factors that are not indicative of other-than-temporary-impairment.

Mortgage Loans, Net of Allowance

The following table summarizes the amortized cost of mortgage loans by method of evaluation for credit loss, and the related valuation allowances by type of credit loss, as of the dates indicated:

 

     December 31,  

(in millions)

    2015      2014  

Amortized cost:

      

Loans with non-specific reserves

    $ 8,403       $ 7,279   

Loans with specific reserves

      19         17   
  

 

 

     

 

 

  

Total amortized cost

    $ 8,422       $ 7,296   
  

 

 

     

 

 

  

Valuation allowance:

      

Non-specific reserves

    $ 23       $ 21   

Specific reserves

      3         5   
  

 

 

     

 

 

  

Total valuation allowance

    $ 26       $ 26   
  

 

 

     

 

 

  

Mortgage loans, net of allowance

    $ 8,396       $ 7,270   
  

 

 

     

 

 

  

The following table summarizes activity in the valuation allowance for mortgage loans, for the years ended:

 

     December 31,  

(in millions)

    2015      2014      2013  

Balance at beginning of year

    $ 26       $ 35       $ 44   

Current period provision1

      2         (8 )       (4 ) 

Recoveries2

      (2 )       (1 )       (5 ) 
  

 

 

     

 

 

     

 

 

  

Balance at end of year

    $ 26       $ 26       $ 35   
  

 

 

     

 

 

     

 

 

  

 

23

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

1 Includes specific reserve provisions and all changes in non-specific reserves.
2 Includes recoveries on sales and increases in the valuation of loans with specific reserves.

Interest income recognized on commercial mortgage loans with a specific reserve was $2 million, $1 million and $3 million for the years ended December 31, 2015, 2014 and 2013, respectively. The average recorded investment was $14 million, $16 million and $30 million for the years ended December 31, 2015, 2014 and 2013, respectively.

As of December 31, 2015 and 2014, the Company’s mortgage loans classified as delinquent and/or in non-accrual status were immaterial in relation to the total mortgage loan portfolio. The Company had no mortgage loans 90 days or more past due and still accruing interest.

The following table summarizes the LTV ratio and DSC ratios of the mortgage loan portfolio, as of the dates indicated:

 

     LTV ratio      DSC ratio  

(in millions)

    Less
than
90%		      90%
or
greater		      Total1      Greater
than
1.00		      Less
than
1.00		      Total1  

December 31, 2015

                  

Apartment

    $ 2,791       $ —         $ 2,791       $ 2,791       $ —         $ 2,791   

Industrial

      1,221         25         1,246         1,193         53         1,246   

Office

      1,318         3         1,321         1,286         35         1,321   

Retail

      2,765         2         2,767         2,756         11         2,767   

Other

      297         —           297         297         —           297   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total2

    $ 8,392       $ 30       $ 8,422       $ 8,323       $ 99       $ 8,422   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

December 31, 2014

                  

Apartment

    $ 2,267       $ 17       $ 2,284       $ 2,278       $ 6       $ 2,284   

Industrial

      1,165         35         1,200         1,137         63         1,200   

Office

      1,020         20         1,040         994         46         1,040   

Retail

      2,570         11         2,581         2,549         32         2,581   

Other

      191         —           191         191         —           191   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total3

    $ 7,213       $ 83       $ 7,296       $ 7,149       $ 147       $ 7,296   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

 

1 While these loan quality measurements contribute to management’s assessment of relative credit risk in the commercial mortgage loan portfolio for the dates indicated, based on underwriting criteria and ongoing assessment of the properties’ performance, management believes the amounts, net of valuation allowance, are collectible.
2 As of December 31, 2015, the weighted average DSC ratios for the respective LTV ratio ranges above were 2.02 and 0.83, with a total weighted average DSC ratio of 2.02. As of December 31, 2015, the weighted average LTV ratios for the respective DSC ratio ranges above were 60% and 85%, with a total weighted average LTV ratio of 60%.
3 As of December 31, 2014, the weighted average DSC ratios for the respective LTV ratio ranges above were 1.94 and 0.90, with a total weighted average DSC ratio of 1.93. As of December 31, 2014, the weighted average LTV ratios for the respective DSC ratio ranges above were 60% and 90%, with a total weighted average LTV ratio of 60%.

While these loan quality measurements contribute to management’s assessment of relative credit risk in the mortgage loan portfolio for the dates indicated, based on underwriting criteria and ongoing assessment of the properties’ performance, management believes the amounts, net of valuation allowance, are collectible.

Available-For-Sale Securities on Deposit, Held in Trust and Pledged as Collateral

Available-for-sale securities with a carrying value of $8 million were on deposit with various regulatory agencies as required by law as of December 31, 2015 and 2014. Additionally, available-for-sale securities with a carrying value of $538 million and $683 million were pledged as collateral to secure recoveries under reinsurance contracts and other funding agreements as of December 31, 2015 and 2014, respectively. These securities are primarily included in fixed maturity securities in the consolidated balance sheets.

 

24

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Net Investment Income

The following table summarizes net investment income, by investment type, for the years ended:

 

     December 31,  

(in millions)

    2015      2014      2013  

Fixed maturity securities, available-for-sale

    $ 1,646       $ 1,575       $ 1,565   

Mortgage loans

      390         362         348   

Alternative Investments

      (56 )       (32 )       (68 ) 

Policy loans

      51         51         52   

Other

      12         3         11   
  

 

 

     

 

 

     

 

 

  

Gross investment income

    $ 2,043       $ 1,959       $ 1,908   

Investment expenses

      61         59         59   
  

 

 

     

 

 

     

 

 

  

Net investment income

    $ 1,982       $ 1,900       $ 1,849   
  

 

 

     

 

 

     

 

 

  

Net Realized Investment Gains and Losses, Including Other-Than-Temporary Impairments

The following table summarizes net realized investment gains and losses, including other-than-temporary impairments, by source, for the years ended:

 

     December 31,  

(in millions)

    2015      2014      2013  

Net realized derivative gains (losses)

    $ 120       $ (1,087 )     $ 705   

Realized gains on sales

      11         31         32   

Realized losses on sales

      (37 )       (19 )       (54 ) 

Other

      (11 )       2         —     
  

 

 

     

 

 

     

 

 

  

Net realized investment gains (losses) before other-than-temporary-impairments on fixed maturity securities

    $ 83       $ (1,073 )     $ 683   

Other-than-temporary-impairments on fixed maturity securities1

      (1 )       (5 )       (5 ) 
  

 

 

     

 

 

     

 

 

  

Net realized investment gains (losses), including other-than-temporary-impairments

    $ 82       $ (1,078 )     $ 678   
  

 

 

     

 

 

     

 

 

  

 

1 Other-than-temporary impairments on fixed maturity securities are net $2 million, $1 million and $6 million of non-credit losses included in other comprehensive income for the years ended December 31, 2015, 2014 and 2013, respectively.

Proceeds from the sale of available-for-sale securities were $466 million, $647 million and $1.1 billion during the years ended December 31, 2015, 2014 and 2013, respectively. Gross gains of $11 million, $17 million and $31 million and gross losses of $36 million, $10 million and $50 million were realized on sales of available-for-sale securities during the years ended December 31, 2015, 2014 and 2013, respectively.

The following table summarizes the cumulative credits losses, for the years ended:

 

(in millions)

    December 31,  
   2015      2014      2013  

Cumulative credit losses at beginning of year1

    $ (254 )     $ (272 )     $ (289 ) 

New credit losses

      (1 )       (2 )       (3 ) 

Incremental credit losses

      —           (4 )       (3 ) 

Losses related to securities included in the beginning balance sold or paid down during the period

      31         24         23   
  

 

 

     

 

 

     

 

 

  

Cumulative credit losses at end of year1

    $ (224 )     $ (254 )     $ (272 ) 
  

 

 

     

 

 

     

 

 

  

 

1 Cumulative credit losses are defined as amounts related to the Company’s credit portion of the other-than-temporary impairment losses on debt securities that the Company does not intend to sell and that it is not more likely than not the Company will be required to sell prior to recovery of the amortized cost basis.

 

(7) Derivative Instruments

The Company is exposed to certain risks related to its ongoing business operations which are managed using derivative instruments.

 

25

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Interest rate risk management. In the normal course of business, the Company enters into transactions that expose it to interest rate risk arising from mismatches between assets and liabilities. The Company uses interest rate swaps and futures to reduce or alter interest rate exposure.

Interest rate contracts are used by the Company in association with fixed and variable rate investments to achieve cash flow streams that support certain financial obligations of the Company and to produce desired investment returns. As such, interest rate contracts are generally used to convert fixed rate cash flow streams to variable rate cash flow streams or vice versa. In addition, prior to expiry in June 2015, the Company engaged in an interest rate swap program, which was structured to provide an offset against the negative impact of higher interest rates on the Company’s statutory surplus position and to mitigate the negative impact of lower interest rates on certain guarantees related to variable annuity contracts.

Equity market risk management. The Company issues a variety of insurance products that expose it to equity risks. To mitigate these risks, the Company enters into a variety of derivatives including equity index futures, options and total return swaps.

Other risk management. As part of its regular investing activities, the Company may purchase foreign currency denominated investments. These investments and the associated income expose the Company to volatility associated with movements in foreign exchange rates. As foreign exchange rates change, the increase or decrease in the cash flows of the derivative instrument are intended to mitigate the changes in the functional-currency equivalent cash flows of the hedged item. To mitigate this risk, the Company uses cross-currency swaps, which are included in other derivative contracts in the following tables.

Credit risk associated with derivatives transactions. The Company periodically evaluates the risks within the derivative portfolios due to credit exposure. When evaluating these risks, the Company considers several factors which include, but are not limited to, the counterparty credit risk associated with derivative receivables, the Company’s own credit as it relates to derivative payables, the collateral thresholds associated with each counterparty and changes in relevant market data in order to gain insight into the probability of default by the counterparty. In addition, the impact the Company’s exposure to credit risk could have on the effectiveness of the Company’s hedging relationships is considered. As of December 31, 2015 and 2014, the impact of the exposure to credit risk on the fair value measurement of derivatives and the effectiveness of the Company’s hedging relationships was immaterial.

The following table summarizes the fair value and related notional amounts of derivative instruments, as of the dates indicated:

 

     Derivative assets      Derivative liabilities  

(in millions)

    Fair value      Notional      Fair value      Notional  

December 31, 2015

            

Derivatives designated and qualifying as hedging instruments

    $ 86       $ 725       $ 2       $ 89   

Derivatives not designated as hedging instruments:

            

Interest rate contracts1

    $ 39       $ 875       $ 98       $ 1,059   

Equity contracts

      445         7,329         —           —     

Total return swaps and other derivative contracts

      —           77         6         2   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total derivatives2

    $ 570       $ 9,006       $ 106       $ 1,150   
  

 

 

     

 

 

     

 

 

     

 

 

  

December 31, 2014

            

Derivatives designated and qualifying as hedging instruments

    $ 29       $ 381       $ 9       $ 176   

Derivatives not designated as hedging instruments:

            

Interest rate contracts1

    $ 2,602       $ 32,829       $ 2,611       $ 32,756   

Equity contracts

      411         5,990         —           —     

Total return swaps and other derivative contracts

      —           —           44         2,810   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total derivatives2

    $ 3,042       $ 39,200       $ 2,664       $ 35,742   
  

 

 

     

 

 

     

 

 

     

 

 

  

 

1 The decreases in the fair value and notional amounts of interest rate contracts are primarily a result of revisions made to the Company’s economic hedging strategies in conjunction with the change in estimate discussed in Note 4.
2 Fair value balance excludes accrued interest on derivative assets and liabilities of $10 and $11 million, respectively, for the year ended December 31, 2015. Fair value balance excludes accrued interest on derivative assets and liabilities of $243 million and $244 million, respectively, for the year ended December 31, 2014.

 

26

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Of the $570 million and $3.0 billion of fair value of total derivative assets at December 31, 2015 and 2014, $48 million and $2.6 billion, respectively, are subject to master netting agreements. The Company received $374 million and $535 million of cash collateral and held $99 million and $64 million, respectively, of securities as off-balance sheet collateral, resulting in an immaterial uncollateralized position as of December 31, 2015 and 2014. Of the $106 million and $2.7 billion of fair value of total derivative liabilities at December 31, 2015 and 2014, $48 million and $2.6 billion, respectively, are subject to master netting agreements. The Company posted $92 million and $330 million of cash collateral and pledged securities with a fair value of $64 million and $174 million, respectively, resulting in an immaterial uncollateralized position as of December 31, 2015 and 2014.

The following table summarizes gains and losses for derivative instruments recognized in net realized investment gains and losses in the consolidated statements of operations, for the years ended:

 

     December 31,  

(in millions)

    2015      2014      2013  

Derivatives designated and qualifying as hedging instruments

    $ —         $ —         $ (1 ) 

Derivatives not designated as hedging instruments:

         

Interest rate contracts

    $ (141 )     $ 142       $ (209 ) 

Equity contracts

      (257 )       (79 )       (776 ) 

Total return swaps

      (44 )       (195 )       (321 ) 

Other derivative contracts

      (6 )       4         (9 ) 

Net interest settlements

      32         20         14   
  

 

 

     

 

 

     

 

 

  

Total derivative losses1

    $ (416 )     $ (108 )     $ (1,302 ) 

Change in embedded derivative liabilities and related fees2

    $ 536       $ (979 )     $ 2,007   
  

 

 

     

 

 

     

 

 

  

Net realized derivative gains (losses)

    $ 120       $ (1,087 )     $ 705   
  

 

 

     

 

 

     

 

 

  

 

1 Included in total derivative losses are economic hedging (losses) gains of $(402) million, $941 million and $(1.8) billion related to the guaranteed benefit annuity programs for the years ended December 31, 2015, 2014 and 2013, respectively. Also included are economic hedging gains (losses) of $52 million, $(1.0) billion and $645 million, respectively, related to the program that protects against the negative impact of higher interest rates on the Company’s statutory surplus position through expiry.
2 During 2015, the annual comprehensive review of model assumptions for the individual variable annuity business produced a favorable impact of $187 million for the year ended December 31, 2015, attributable to the change in estimate discussed in Note 4. During 2014 and 2013, the annual comprehensive review of model assumptions for the individual variable annuity business included a favorable impact for the years ended December 31, 2014 and 2013, primarily due to model enhancements and updated assumptions for discounting and benefit utilization, partially offset by mortality and lapse rates.

 

27

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

(8) Fair Value Measurements

The following table summarizes assets and liabilities held at fair value on a recurring basis as of December 31, 2015:

 

(in millions)

    Level 1      Level 2      Level 3      Total  

Assets

            

Investments:

            

Fixed maturity securities, available-for-sale:

            

U.S. government and agencies

    $ 399       $ 1       $ 2       $ 402   

Obligations of states, political subdivisions and foreign governments

      63         2,304         —           2,367   

Corporate public securities

      —           23,142         148         23,290   

Corporate private securities

      —           4,226         944         5,170   

Residential mortgage-backed securities

      846         2,291         9         3,146   

Commercial mortgage-backed securities

      —           1,565         —           1,565   

Asset-backed securities

      —           1,505         125         1,630   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total fixed maturity securities, available-for-sale, at fair value

    $ 1,308       $ 35,034       $ 1,228       $ 37,570   

Other investments at fair value1

      270         546         37         853   
  

 

 

     

 

 

     

 

 

     

 

 

  

Investments at fair value

    $ 1,578       $ 35,580       $ 1,265       $ 38,423   
  

 

 

     

 

 

     

 

 

     

 

 

  

Derivative instruments - assets

      —           125         445         570   

Separate account assets

      83,466         1,323         2,449         87,238   
  

 

 

     

 

 

     

 

 

     

 

 

  

Assets at fair value

    $ 85,044       $ 37,028       $ 4,159       $ 126,231   
  

 

 

     

 

 

     

 

 

     

 

 

  

Liabilities

            

Future policy benefits and claims

    $ —         $ —         $ (65 )     $ (65 ) 

Derivative instruments - liabilities

      —           (100 )       (6 )       (106 ) 
  

 

 

     

 

 

     

 

 

     

 

 

  

Liabilities at fair value

    $ —         $ (100 )     $ (71 )     $ (171 ) 
  

 

 

     

 

 

     

 

 

     

 

 

  

 

1 Other investments at fair value includes $66 million of trading securities as of December 31, 2015.

The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis during the year ended December 31, 2015:

 

(in millions)

    Fixed
maturity
securities2		     Other
investments		      Derivative
assets3		     Separate
account
assets		      Total assets
at fair value		     Liabilities at
fair value3		  

Balance as of December 31, 2014

    $ 1,267      $ 36       $ 411      $ 2,106       $ 3,820      $ (264 ) 

Net (losses) gains

               

In operations1

      (6 )      —           (46 )      18         (34 )      313   

In other comprehensive income

      (44 )      —           —          —           (44 )      —     

Purchases

      142        1         104        325         572        (144 ) 

Sales

      (162 )      —           (24 )      —           (186 )      24   

Transfers into Level 3

      201        —           —          —           201        —     

Transfers out of Level 3

      (170 )      —           —          —           (170 )      —     
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Balance as of December 31, 2015

    $ 1,228      $ 37       $ 445      $ 2,449       $ 4,159      $ (71 ) 
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

 

1 Net gains and losses included in operations are reported in net realized investment gains and losses and interest credited to policyholder accounts. The net unrealized gains on separate account assets are attributable to contractholders and therefore are not included in the Company’s earnings. The change in unrealized gains (losses) included in operations on assets and liabilities still held at the end of the year was $316 million for future policy benefits and claims, $(9) million for derivative assets, and $2 million for derivative liabilities.
2 Non-binding broker quotes were utilized to determine a fair value of $1.1 billion of total fixed maturity securities as of December 31, 2015.
3 Non-binding broker quotes were utilized to determine a fair value of all Level 3 derivative assets and liabilities.

Transfers into and out of Level 3 during the year ended December 31, 2015 are primarily due to certain corporate private securities priced using unobservable inputs to priced using observable inputs. There were no material transfers between Levels 1 and 2 during the year ended December 31, 2015.

 

28

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Living Benefit Guarantees

The following table summarizes significant unobservable inputs used for fair value measurements for living benefits liabilities, included in future policy benefits and claims and classified as Level 3 as of December 31, 2015:

 

Unobservable Inputs

    Range

Mortality

    0.1% - 8%2

Lapse

    0% - 35%

Wait period

    0 yrs - 30 yrs3

Efficiency of benefit utilization1

    60% - 100%

Discount rate4

    See note 4 below

Index volatility

    15% - 25%

 

1 The unobservable input is not applicable to GMABs.
2 Represents the mortality for the majority of business with living benefits, with policyholders ranging from 45 to 85.
3 A portion of the contractholders could never use the benefit, which would extend the range to an indeterminate period.
4 Incorporates the liquidity and non-performance risk adjustment. The liquidity spread takes into consideration market observables for spreads in illiquid assets. The non-performance risk adjustment reflects an additional spread over LIBOR determined by market observables for similarly rated public bonds.

The following changes in any of the significant unobservable inputs presented in the table above may result in a change in the fair value measurements of the living benefits liability:

Higher mortality rates tend to decrease the value of the liability and lower mortality rates tend to increase the value of the liability.

Higher lapse rates tend to decrease the value of the liability and lower lapse rates tend to increase the value of the liability. Factors that impact the predicted lapse rate can include: age, policy duration, policy size, benefit in-the-moneyness, tax status (i.e. qualified or non-qualified), interest rate levels, short-term equity market performance, partial withdrawal behavior and applicable surrender charges. All else being equal, policies that are in-the-money will have lower lapse rates than policies that are out-of-the-money, and policies that have a surrender charge present will have lower lapse rates than policies without a surrender charge.

The assumed wait period and the efficiency of utilization determine the timing and amount of living benefits withdrawals. These assumptions vary by the product type, age of the policyholder, policy size and policy duration. Many products have a bonus feature which enhances the guarantee on every policy anniversary for the first ten years so long as withdrawals have not commenced. All else being equal, policies commencing withdrawals at a time around the year ten bonus will have higher liability values than policies commencing withdrawals 20 years after issue or policies commencing withdrawals only one year after issue. In addition, policies that are assumed to withdraw the maximum permitted amount will have a higher liability value than a policy that is assumed to withdraw less than the maximum allowed amount.

A higher discount rate tends to decrease the value of the liability and a lower discount rate tends to increase the value of the liability.

Higher index volatility tends to increase the value of the liability and lower index volatility tends to decrease the value of the liability.

Indexed Products

The following table summarizes significant unobservable inputs used for fair value measurements for indexed universal life and indexed annuity products classified as Level 3 as of December 31, 2015:

 

Unobservable Inputs

    Range

Mortality

    0% - 4%¹

Lapse

    0% -10%

Index volatility

    15% - 25%

 

1 Represents the mortality for the majority of business, with policyholders ranging from 0 to 75.

The following changes in any of the significant unobservable inputs presented in the table above may result in a change in the fair value measurements of the indexed products:

Higher mortality rates tend to decrease the value of the liability and lower mortality rates tend to increase the value of the liability.

 

29

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Higher lapse rates tend to decrease the value of the liability and lower lapse rates tend to increase the value of the liability. Factors that impact the predicted lapse rate can include: age, policy duration, policy size, and applicable surrender charges. All else being equal, policies with a surrender charge present will have lower lapse rates than policies without a surrender charge.

Higher index volatility tends to increase the value of the liability and lower index volatility tends to decrease the value of the liability.

Separate Accounts

The Company’s separate account assets include an investment in a mutual fund with a non-readily determinable fair value. Net asset value has been used to estimate the fair value of this investment as a practical expedient. The investments are included in Level 3 as they may not be redeemed until the guarantee period expires in 2016. The investment strategy of this fund is to build a portfolio where the assets shall be sufficient to achieve a target portfolio value by the end of the guarantee period. The net asset value of this fund reported in separate account assets was $1.7 billion as of December 31, 2015 and 2014.

The following table summarizes assets and liabilities held at fair value on a recurring basis as of December 31, 2014:

 

(in millions)

    Level 1      Level 2     Level 3     Total  

Assets

          

Investments:

          

Fixed maturity securities, available-for-sale:

          

U.S. government and agencies

    $ 523       $ 1      $ 3      $ 527   

Obligations of states, political subdivisions and foreign governments

      66         2,219        —          2,285   

Corporate public securities

      —           21,158        92        21,250   

Corporate private securities

      —           3,659        991        4,650   

Residential mortgage-backed securities

      1,034         2,796        9        3,839   

Commercial mortgage-backed securities

      —           1,499        3        1,502   

Other asset-backed securities

      —           1,196        169        1,365   
  

 

 

     

 

 

    

 

 

    

 

 

  

Total fixed maturity securities, available-for-sale, at fair value

    $ 1,623       $ 32,528      $ 1,267      $ 35,418   

Other investments at fair value1

      42         899        36        977   
  

 

 

     

 

 

    

 

 

    

 

 

  

Investments at fair value

    $ 1,665       $ 33,427      $ 1,303      $ 36,395   
  

 

 

     

 

 

    

 

 

    

 

 

  

Derivative instruments - assets

      —           2,631        411        3,042   

Separate account assets

      84,583         1,387        2,106        88,076   
  

 

 

     

 

 

    

 

 

    

 

 

  

Assets at fair value

    $ 86,248       $ 37,445      $ 3,820      $ 127,513   
  

 

 

     

 

 

    

 

 

    

 

 

  

Liabilities

          

Future policy benefits and claims at fair value

    $ —         $ —        $ (261 )    $ (261 ) 

Derivative instruments - liabilities

      —           (2,661 )      (3 )      (2,664 ) 
  

 

 

     

 

 

    

 

 

    

 

 

  

Liabilities at fair value

    $ —         $ (2,661 )    $ (264 )    $ (2,925 ) 
  

 

 

     

 

 

    

 

 

    

 

 

  

 

1 Other investments at fair value includes $21 million of trading securities as of December 31, 2014.

 

30

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis during the year ended December 31, 2014:

 

(in millions)

    Fixed
maturity
securities2		     Other
investments		     Derivative
assets3		     Separate
account
assets		      Total assets
at fair value		     Liabilities at
fair value3		  

Balance as of December 31, 2013

    $ 1,088      $ 45      $ 343      $ 2,083       $ 3,559      $ 1,005   

Net gains (losses)

              

In operations1

      (5 )      6        40        23         64        (1,269 ) 

In other comprehensive income

      21        1        —          —           22        —     

Purchases

      121        —          46        —           167        —     

Sales

      (241 )      (16 )      (18 )      —           (275 )      —     

Transfers into Level 3

      400        —          —          —           400        —     

Transfers out of Level 3

      (117 )      —          —          —           (117 )      —     
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Balance as of December 31, 2014

    $ 1,267      $ 36      $ 411      $ 2,106       $ 3,820      $ (264 ) 
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

 

1 Net gains and losses included in operations are reported in net realized investment gains and losses and interest credited to policyholder accounts. The net unrealized gains on separate account assets are attributable to contractholders and therefore are not included in the Company’s earnings. The change in unrealized (losses) gains included in operations on assets and liabilities still held as of the end of the year was $(1.3) billion for future policy benefits and claims, $154 million for derivative assets and $6 million for other investments at fair value.
2 Non-binding broker quotes were utilized to determine a fair value of $1.1 billion of total fixed maturity securities as of December 31, 2014.
3 Non-binding broker quotes were utilized to determine a fair value of all Level 3 derivative assets and liabilities.

Transfers into and out of Level 3 during the year ended December 31, 2014 are primarily due to certain corporate private securities and other asset-backed securities, which changed pricing sources between broker quotes and independent pricing services. There were no transfers between Levels 1 and 2 during the year ended December 31, 2014.

Financial Instruments Not Carried at Fair Value

The following table summarizes the carrying value and fair value of the Company’s financial instruments not carried at fair value as of the dates indicated. The valuation techniques used to estimate these fair values are described below.

 

     December 31, 2015      December 31, 2014  

(in millions)

    Carrying
value		      Fair
value		      Level 2      Level 3      Carrying
value		      Fair
value		      Level 2      Level 3  

Assets

                        

Investments:

                        

Mortgage loans, net of allowance

    $ 8,396       $ 8,462       $ —         $ 8,462       $ 7,270       $ 7,616       $ —         $ 7,616   

Policy loans

    $ 993       $ 993       $ —         $ 993       $ 992       $ 992       $ —         $ 992   

Other investments

    $ 71       $ 71       $ —         $ 71       $ 60       $ 60       $ —         $ 60   

Liabilities

                        

Investment contracts

    $ 27,301       $ 25,822       $ —         $ 25,822       $ 23,470       $ 21,742       $ —         $ 21,742   

Short-term debt

    $ 400       $ 400       $ —         $ 400       $ 660       $ 660       $ —         $ 660   

Long-term debt

    $ 707       $ 941       $ 934       $ 7       $ 709       $ 1,069       $ 1,060       $ 9   

Mortgage loans, net of allowance. The fair values of mortgage loans are estimated using discounted cash flow analyses based on interest rates currently being offered for similar loans to borrowers with similar credit ratings.

Policy loans. The carrying amount reported in the consolidated balance sheets approximates fair value.

Other investments. Other investments not held at fair value consist of FHLB stock. The carrying amount reported in the consolidated balance sheets approximates fair value.

 

31

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Investment contracts. For investment contracts without defined maturities, fair value is the amount payable on demand, net of surrender charges. For investment contracts with known or determined maturities, fair value is estimated using discounted cash flow analysis. Interest rates used in this analysis are similar to currently offered contracts with maturities consistent with those remaining for the contracts being valued. The fair value of adjustable rate contracts approximates their carrying value.

Short-term debt. The carrying amount reported in the consolidated balance sheets approximates fair value.

Long-term debt. The fair values for long-term debt are based on estimated market prices using observable inputs from similar debt instruments.

 

(9) Goodwill

The following table summarizes changes in the carrying value of goodwill by segment for the years indicated:

 

(in millions)

    Retirement
Plans		      Individual
Products &
Solutions - Life
and NBSG		      Total  

Balance as of December 31, 20131

    $ 25       $ 175       $ 200   

Adjustments

      —           —           —     
  

 

 

     

 

 

     

 

 

  

Balance as of December 31, 20141

    $ 25       $ 175       $ 200   

Adjustments

      —           —           —     
  

 

 

     

 

 

     

 

 

  

Balance as of December 31, 20151

    $ 25       $ 175       $ 200   
  

 

 

     

 

 

     

 

 

  

 

1 The goodwill balances have not been previously impaired.

 

32

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

(10) Closed Block

The amounts shown in the following tables for assets, liabilities, revenues and expenses of the closed block are those that enter into the determination of amounts that are to be paid to policyholders.

The following table summarizes financial information for the closed block, as of the dates indicated:

 

     December 31,  

(in millions)

    2015      2014  

Liabilities:

      

Future policyholder benefits

    $ 1,637       $ 1,669   

Policyholder funds and accumulated dividends

      138         139   

Policyholder dividends payable

      21         22   

Policyholder dividend obligation

      99         152   

Other policy obligations and liabilities

      35         33   
  

 

 

     

 

 

  

Total liabilities

    $ 1,930       $ 2,015   
  

 

 

     

 

 

  

Assets:

      

Fixed maturity securities, available-for-sale

    $ 1,316       $ 1,336   

Mortgage loans, net of allowance

      235         272   

Policy loans

      146         149   

Other assets

      71         86   
  

 

 

     

 

 

  

Total assets

    $ 1,768       $ 1,843   
  

 

 

     

 

 

  

Excess of reported liabilities over assets

      162         172   
  

 

 

     

 

 

  

Portion of above representing other comprehensive income:

      

(Decrease) increase in unrealized gain on fixed maturity securities, available-for-sale

    $ (53 )     $ 35   

Adjustment to policyholder dividend obligation

      53         (35 ) 
  

 

 

     

 

 

  

Total

    $ —         $ —     
  

 

 

     

 

 

  

Maximum future earnings to be recognized from assets and liabilities

    $ 162       $ 172   
  

 

 

     

 

 

  

Other comprehensive income:

      

Fixed maturity securities, available-for-sale:

      

Fair value

    $ 1,316       $ 1,336   

Amortized cost

      1,249         1,216   

Shadow policyholder dividend obligation

      (67 )       (120 ) 
  

 

 

     

 

 

  

Net unrealized appreciation

    $ —         $ —     
  

 

 

     

 

 

  

 

33

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The following table summarizes closed block operations for the years ended:

 

     December 31,  

(in millions)

    2015      2014      2013  

Revenues:

         

Premiums

    $ 58       $ 61       $ 66   

Net investment income

      87         93         94   

Realized investment gains

      1         1         —     

Realized losses credited to policyholder benefit obligation

      (5 )       (5 )       (4 ) 
  

 

 

     

 

 

     

 

 

  

Total revenues

    $ 141       $ 150       $ 156   
  

 

 

     

 

 

     

 

 

  

Benefits and expenses:

         

Policy and contract benefits

    $ 122       $ 124       $ 123   

Change in future policyholder benefits and interest credited to policyholder accounts

      (33 )       (34 )       (29 ) 

Policyholder dividends

      40         43         44   

Change in policyholder dividend obligation

      (4 )       (1 )       3   

Other expenses

      1         2         (2 ) 
  

 

 

     

 

 

     

 

 

  

Total benefits and expenses

    $ 126       $ 134       $ 139   
  

 

 

     

 

 

     

 

 

  

Total revenues, net of benefits and expenses, before federal income tax expense

    $ 15       $ 16       $ 17   

Federal income tax expense

      5         6         6   
  

 

 

     

 

 

     

 

 

  

Revenues, net of benefits and expenses and federal income tax expense

    $ 10       $ 10       $ 11   
  

 

 

     

 

 

     

 

 

  

Maximum future earnings from assets and liabilities:

         

Beginning of period

    $ 172       $ 182       $ 193   

Change during period

      (10 )       (10 )       (11 ) 
  

 

 

     

 

 

     

 

 

  

End of period

    $ 162       $ 172       $ 182   
  

 

 

     

 

 

     

 

 

  

Cumulative closed block earnings from inception through December 31, 2015, 2014 and 2013 were higher than expected as determined in the actuarial calculation. Therefore, policyholder dividend obligations (excluding the adjustment for unrealized gains on available-for-sale securities) were $32 million, $32 million and $28 million as of December 31, 2015, 2014 and 2013, respectively.

 

(11) Short-Term Debt

The Company classifies debt as short-term if the maturity date at inception is less than one year.

The following table summarizes the carrying value of short-term debt and weighted average annual interest rates, as of the dates indicated:

 

     December 31,  

(in millions)

    2015      2014  

$750 million commercial paper program (0.45% and 0.00%, respectively)1

    $ 400       $ —     

$600 million commercial paper program (0.00% and 0.20%, respectively)1

      —           264   

$400 million revolving variable rate line of credit (0.00% and 1.57%, respectively)

      —           396   
  

 

 

     

 

 

  

Total short-term debt

    $ 400       $ 660   
  

 

 

     

 

 

  

 

1 On December 4, 2015, the Company renewed an agreement to increase its $600 million commercial paper program to $750 million.

In November 2015, the Company terminated its $400 million unsecured revolving promissory note and line of credit agreement with its parent company.

 

34

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

In March 2015, the Company renewed an agreement to extend its ability to borrow with the FHLB. This extension, which expires on March 25, 2016, allows the Company access to borrow up to $250 million, which would be collateralized by pledged securities. The Company had $6.7 billion and $8.5 billion in eligible collateral and no amounts outstanding under the agreement as of December 31, 2015 and 2014, respectively. Additionally, in connection with the agreement, NLIC purchased $10 million in capital stock with the FHLB.

On April 2, 2015, Nationwide Mutual Insurance Company (“NMIC”) and NLIC replaced their previous $600 million revolving credit facility with a new credit facility of $750 million, which expires on April 2, 2020. The Company had no amounts outstanding under this agreement as of December 31, 2015 and 2014.

The Company has entered into an agreement with its custodial bank to borrow against the cash collateral that is posted in connection with its securities lending program. The maximum amount available under the agreement is $350 million. The borrowing rate on this program is equal to one-month U.S. LIBOR. The Company had no amounts outstanding under this agreement as of December 31, 2015 and 2014.

The terms of certain debt instruments contain various restrictive covenants, including, but not limited to, minimum statutory surplus defined in the agreements. The Company was in compliance with all covenants as of December 31, 2015 and 2014.

The amount of interest paid on short-term debt was immaterial in 2015, 2014 and 2013.

 

(12) Long-Term Debt

The following table summarizes the carrying value of long-term debt, as of the dates indicated:

 

     December 31,  

(in millions)

    2015      2014  

8.15% surplus note, due June 26, 2032, payable to NFS

    $ 300       $ 300   

7.50% surplus note, due December 17, 2031, payable to NFS

      300         300   

6.75% surplus note, due December 23, 2033, payable to NFS

      100         100   

Other

      7         9   
  

 

 

     

 

 

  

Total long-term debt

    $ 707       $ 709   
  

 

 

     

 

 

  

The Company made interest payments to NFS on surplus notes totaling $54 million for the years ended December 31, 2015, 2014 and 2013. Payments of interest and principal under the notes require the prior approval of the ODI.

 

35

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

(13) Federal Income Taxes

The following table summarizes the components of federal income tax expense (benefit) for the years ended:

 

     December 31,  

(in millions)

    2015      2014      2013  

Current tax expense (benefit)

    $ 76       $ 5       $ (33 ) 

Deferred tax expense (benefit)

      217         (152 )       346   
  

 

 

     

 

 

     

 

 

  

Total tax expense (benefit)

    $ 293       $ (147 )     $ 313   
  

 

 

     

 

 

     

 

 

  

The following table summarizes how the total federal income tax expense (benefit) differs from the amount computed by applying the U.S. federal income tax rate to net income for the years ended:

 

     December 31,  
     2015     2014     2013  

(in millions)

    Amount     %     Amount     %     Amount     %  

Rate reconciliation:

             

Computed (expected tax expense (benefit))

    $ 430        35  %    $ (46 )      35  %    $ 469        35  % 

Dividends received deduction

      (118 )      (10 )%      (87 )      66  %      (112 )      (8 )% 

Tax credits

      (63 )      (5 )%      (53 )      41  %      (82 )      (6 )% 

Other, net

      44        4  %      39        (30 )%      38        2  % 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 293        24  %    $ (147 )      112  %    $ 313        23  % 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

The Company’s current federal income tax liability was $61 million and $18 million as of December 31, 2015 and 2014, respectively.

The Company made $33 million and immaterial payments for the years ended December 31, 2015 and 2014, respectively, and received a refund of $107 million for the year ended 2013.

During 2015 and 2014, the Company recorded a tax (benefit) expense of $(1) million and $16 million, respectively. These changes in estimates were primarily driven by differences in the Company’s separate account dividends received deduction (“DRD”) between the previous year’s estimate and the amount reported on the previous year’s tax return.

As of December 31, 2015, the Company had gross federal net operating loss carryforwards of $248 million, which expire in 2028. In addition, the Company had $218 million in low-income-housing credit carryforwards, which expire between 2024 and 2035, and $197 million in alternative minimum tax credit carryforwards, which have an unlimited carryforward. In addition, the Company had $68 million in foreign tax credit carryforwards which expire between 2019 and 2025. The Company expects to fully utilize all carryforwards.

 

36

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The following table summarizes the tax effects of temporary differences that gave rise to significant components of the net deferred tax liability included in other liabilities in the consolidated balance sheets, as of the dates indicated:

 

     December 31,  

(in millions)

    2015      20141  

Deferred tax assets

      

Future policy benefits and claims

    $ 825       $ 839   

Tax credit carryforwards

      483         355   

Derivatives, including embedded derivatives

      120         147   

Other

      411         439   
  

 

 

     

 

 

  

Gross deferred tax assets

    $ 1,839       $ 1,780   

Valuation allowance

      (17 )       (17 ) 
  

 

 

     

 

 

  

Gross deferred tax assets, net of valuation allowance

    $ 1,822       $ 1,763   
  

 

 

     

 

 

  

Deferred tax liabilities

      

Deferred policy acquisition costs

    $ 1,502       $ 1,113   

Available-for-sale securities

      315         839   

Other

      249         209   
  

 

 

     

 

 

  

Gross deferred tax liabilities

    $ 2,066       $ 2,161   
  

 

 

     

 

 

  

Net deferred tax liability

    $ 244       $ 398   
  

 

 

     

 

 

  

 

1 Prior year amounts primarily related to certain annuity and life insurance balances have been reclassified between future policy benefits, available-for-sale securities, derivatives, other assets and other liabilities to conform with current year presentation.

In assessing the realizability of deferred tax assets, the Company considers whether it is more likely than not that some portion of the total gross deferred tax assets will not be realized. Based on the Company’s analysis, it is more likely than not that the results of future operations and the implementation of tax planning strategies will generate sufficient taxable income to enable the Company to realize the deferred tax assets for which the Company has not established valuation allowances.

The following table is a rollforward of the beginning and ending uncertain tax positions, including permanent and temporary differences, but excluding interest and penalties:

 

(in millions)

    2015      2014      2013  

Balance at beginning of period

    $ 38       $ 36       $ 36   

Additions for current year tax positions

      1         3         2   

Reductions for prior years tax positions

      (3 )       (1 )       (2 ) 
  

 

 

     

 

 

     

 

 

  

Balance at end of period

    $ 36       $ 38       $ 36   
  

 

 

     

 

 

     

 

 

  

The Company believes it is reasonably possible that the 2006 to 2010 IRS audit for the NLIC’s consolidated tax returns will be effectively settled within the next 12 months and as a result the liability for unrecognized tax benefits could decrease $15 million.

The Company files income tax returns in the U.S. federal jurisdiction and various state jurisdictions. The Company is no longer subject to U.S. federal, state or local income tax examinations by tax authorities through the 2010 tax year. In 2015, the IRS commenced an examination of the Company’s U.S. income tax returns for the years 2011 through 2012. Any adjustments that may result from IRS examination of tax returns are not expected to have a material effect on the results of operations, cash flows or financial position of the Company.

 

37

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

(14) Statutory Financial Information

Statutory Results

The Company’s life insurance subsidiaries prepare their statutory financial statements in conformity with the statutory accounting practices prescribed and permitted by insurance regulatory authorities, subject to any deviations prescribed or permitted by the applicable state departments of insurance.

Olentangy Reinsurance, LLC (“Olentangy”), a special purpose financial captive insurance company subsidiary of NLAIC domiciled in the State of Vermont, was granted a permitted practice from the State of Vermont that increased NLAIC’s valuation of this subsidiary by $56 million and $66 million as of December 31, 2015 and 2014, respectively, which also allowed NLIC to admit additional deferred tax assets of $8 million and $10 million as of December 31, 2015 and 2014, respectively.

Eagle applies a prescribed practice from the State of Ohio that allows an alternative reserve basis on assumed liabilities, net of third party reinsurance, with respect to specified GMDB and GLWB obligations provided under substantially all of the variable annuity contracts issued and to be issued by NLIC. This prescribed practice decreased NLIC’s valuation of this subsidiary by $64 million as of December 31, 2015 and also reduced NLIC’s admitted deferred tax assets by $10 million.

Statutory accounting practices focus on insurer solvency and differ materially from GAAP primarily due to charging policy acquisition and other costs to expense as incurred, establishing future policy benefits and claims reserves based on different actuarial assumptions, excluding certain assets from statutory admitted assets and valuing investments and establishing deferred taxes on a different basis.

The following table summarizes the statutory net income (loss) and statutory capital and surplus for the Company’s primary life insurance subsidiaries for the years ended:

 

     December 31,  

(in millions)

    2015      2014      2013  

Statutory net income (loss)

         

NLIC

    $ 167       $ 341       $ 262   

NLAIC

    $ (99 )     $ (122 )     $ (103 ) 

Statutory capital and surplus

         

NLIC

    $ 4,567       $ 4,408       $ 3,550   

NLAIC

    $ 735       $ 691       $ 534   
  

 

 

     

 

 

     

 

 

  

Dividend Restrictions

The payment of dividends by NLIC is subject to restrictions set forth in the insurance laws and regulations of the State of Ohio, its domiciliary state. The State of Ohio insurance laws require Ohio-domiciled life insurance companies to notify the Ohio Superintendent of Insurance of all dividends prior to payment and must seek prior regulatory approval to pay a dividend or distribute cash or other property if the fair market value thereof, together with that of other dividends or distributions made in the preceding twelve months, exceeds the greater of (1) 10% of statutory-basis policyholders’ surplus as of the prior December 31 or (2) the statutory-basis net income of the insurer as of the prior December 31. During the years ended December 31, 2015, 2014 and 2013 NLIC did not pay any dividends to NFS. As of January 1, 2016, NLIC has the ability to pay dividends to NFS totaling $457 million without obtaining prior approval.

The State of Ohio insurance laws also require insurers to seek prior regulatory approval for any dividend paid from other than earned surplus. Earned surplus is defined under the State of Ohio insurance laws as the amount equal to the Company’s unassigned funds as set forth in its most recent statutory financial statements, including net unrealized capital gains and losses or revaluation of assets. Additionally, following any dividend, an insurer’s policyholder surplus must be reasonable in relation to the insurer’s outstanding liabilities and adequate for its financial needs. The payment of dividends by the Company may also be subject to restrictions set forth in the insurance laws of the State of New York that limit the amount of statutory profits on the Company’s participating policies (measured before dividends to policyholders) available for the benefit of the Company and its stockholders.

The Company currently does not expect such regulatory requirements to impair the ability to pay operating expenses and dividends in the future.

 

38

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Regulatory Risk-Based Capital

The National Association of Insurance Commissioners’ (“NAIC”) Risk-Based Capital (“RBC”) model law requires every insurer to calculate its total adjusted capital and RBC requirement to ensure insurer solvency. Regulatory guidelines provide for an insurance commissioner to intervene if the insurer experiences financial difficulty, as evidenced by a company’s total adjusted capital falling below established relationships to required RBC. The model includes components for asset risk, liability risk, interest rate exposure and other factors. The State of Ohio imposes minimum RBC requirements that are developed by the NAIC. The formulas in the model for determining the amount of RBC specify various weighting factors that are applied to financial balances or various levels of activity based on the perceived degree of risk. Regulatory compliance is determined by a ratio of total adjusted capital to authorized control level RBC, as defined by the NAIC. Companies below specific trigger points or ratios are classified within certain levels, all of which require specified corrective action. NLIC, NLAIC, Olentangy and Eagle each exceeded the minimum RBC requirements for all periods presented.

 

(15) Related Party Transactions

The Company has entered into significant, recurring transactions and agreements with NMIC, other affiliates and subsidiaries as a part of its ongoing operations. These include annuity and life insurance contracts, agreements related to reinsurance, cost sharing, tax sharing, administrative services, marketing, intercompany loans, intercompany repurchases, cash management services and software licensing. In addition, employees of the company participate in several benefit plans sponsored by NMIC, for which the Company has no legal obligations. Measures used to allocate expenses among companies include individual employee estimates of time spent, special cost studies, claims counts, policies in force, direct written premium, paid losses, pro rate share of employees or their salaries, the number of full-time employees, commission expense and other methods agreed to by the participating companies.

Effective January 1, 2015, the Company became party to a revised tax sharing agreement that reflects the new NMIC consolidated federal return group which includes its eligible life and non-life insurance company subsidiaries. The method of allocation among the companies is based upon separate return calculations with current benefit for tax losses and credits utilized in the consolidated return

In addition, Nationwide Services Company, LLC (“NSC”), a subsidiary of NMIC, provides data processing, systems development, hardware and software support, telephone, mail and other services to the Company, based on specified rates for units of service consumed pursuant to the enterprise cost sharing agreement. For the years ended December 31, 2015, 2014 and 2013, the Company was allocated costs from NMIC and NSC totaling $289 million, $275 million and $277 million, respectively.

The Company has issued group annuity and life insurance contracts and performs administrative services for various employee benefit plans sponsored by NMIC or its affiliates. Total account values of these contracts were $3.3 billion as of December 31, 2015 and 2014. Total revenues from these contracts were $129 million, $131 million and $137 million for the years ended December 31, 2015, 2014 and 2013, respectively, and include policy charges, net investment income from investments backing the contracts and administrative fees. Total interest credited to the account balances was $106 million for the year ended December 31, 2015 and $109 million for the years ended December 31, 2014 and 2013.

The Company may underwrite insurance policies for its agents, employees, officers and/or directors. The Company may offer discounts on certain products that are subject to applicable state insurance laws and approvals.

Under the enterprise cost sharing agreement, the Company has a cost sharing arrangement with NMIC to occupy office space. The Company made payments to NMIC of $18 million for the year ended December 31, 2015 and $16 million for the years ended December 31, 2014 and 2013.

NLIC has a reinsurance agreement with NMIC whereby all of NLIC’s accident and health business not ceded to unaffiliated reinsurers is ceded to NMIC on a modified coinsurance basis. Either party may terminate the agreement on January 1 of any year with prior notice. Under a modified coinsurance agreement, the ceding company retains invested assets, and investment earnings are paid to the reinsurer. Under the terms of NLIC’s agreements, the investment risk associated with changes in interest rates is borne by the reinsurer. The ceding of risk does not discharge the original insurer from its primary obligation to the policyholder. Revenues ceded to NMIC for the years ended December 31, 2015, 2014 and 2013 were $209 million, $208 million and $179 million, respectively, while benefits, claims and expenses ceded during these years were $207 million, $217 million and $178 million, respectively.

 

39

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Funds of Nationwide Funds Group (“NFG”), a group of Nationwide businesses that develops, sells and services mutual funds, are offered to the Company’s customers as investment options in certain of the Company’s products. As of December 31, 2015 and 2014, customer allocations to NFG funds totaled $59.1 billion and $58.1 billion, respectively. For the years ended December 31, 2015, 2014 and 2013, NFG paid the Company $196 million, $185 million and $163 million, respectively, for the distribution and servicing of these funds.

Amounts on deposit with NCMC for the benefit of the Company were $501 million and $636 million as of December 31, 2015 and 2014, respectively.

Nationwide Bank has a line of credit agreement with NLIC that allows the Bank access to borrow up to $50 million from NLIC. The borrowing rate on the line of credit is equal to the daily Prime Rate. The Bank had no amounts outstanding under this agreement as of December 31, 2015 and 2014.

Certain annuity products are sold through affiliated companies, which are also subsidiaries of NFS. Total commissions and fees paid to these affiliates were $63 million, $57 million and $54 million for the years ended December 31, 2015, 2014 and 2013, respectively.

The Company provides financing to subsidiaries Nationwide Realty Investors, LTD, a subsidiary of NMIC. As of December 31, 2015 and 2014, the Company had notes receivable outstanding of $238 million and $142 million, respectively.

 

(16) Contingencies

Legal and Regulatory Matters

The Company is subject to legal and regulatory proceedings in the ordinary course of its business. The Company’s legal and regulatory matters include proceedings specific to the Company and other proceedings generally applicable to business practices in the industries in which the Company operates. These matters are subject to many uncertainties, and given their complexity and scope, their outcomes cannot be predicted. Regulatory proceedings could also affect the outcome of one or more of the Company’s litigation matters. Furthermore, it is often not possible to determine the ultimate outcomes of the pending regulatory investigations and legal proceedings or to provide reasonable ranges of potential losses with any degree of certainty. Some matters, including certain of those referred to below, are in very preliminary stages, and the Company does not have sufficient information to make an assessment of the plaintiffs’ claims for liability or damages. In some of the cases seeking to be certified as class actions, the court has not yet decided whether a class will be certified or (in the event of certification) the size of the class and class period. In many of the cases, the plaintiffs are seeking undefined amounts of damages or other relief, including punitive damages and equitable remedies, which are difficult to quantify and cannot be defined based on the information currently available. The Company believes, however, that based on currently known information, the ultimate outcome of all pending legal and regulatory matters is not likely to have a material adverse effect on the Company’s consolidated financial position. Nonetheless, given the large or indeterminate amounts sought in certain of these matters and the inherent unpredictability of litigation, it is possible that such outcomes could materially affect the Company’s consolidated financial position or results of operations.

The various businesses conducted by the Company are subject to oversight by numerous federal and state regulatory entities, including but not limited to the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority, the Department of Labor, the IRS and state insurance authorities. Such regulatory entities may, in the normal course, be engaged in general or targeted inquiries, examinations and investigations of the Company and/or its affiliates. The financial services industry has been the subject of increasing scrutiny in connection with a broad spectrum of regulatory issues; with respect to all such scrutiny directed at the Company and/or its affiliates, the Company is cooperating with regulators. The Company will cooperate with NMIC insofar as any inquiry, examination or investigation encompasses NMIC’s operations.

On August 15, 2001, NFS and NLIC were named in a lawsuit filed in the United States District Court for the District of Connecticut entitled Lou Haddock, as trustee of the Flyte Tool & Die, Incorporated Deferred Compensation Plan, et al v. Nationwide Financial Services, Inc. and Nationwide Life Insurance Company. On November 18, 2009, the plaintiffs filed a sixth amended complaint amending the list of named plaintiffs and claiming to represent a class of qualified retirement plan trustees under the Employee Retirement Income Security Act of 1974 (ERISA) that purchased variable annuities from NLIC. The plaintiffs allege that they invested ERISA plan assets in their variable annuity contracts and that NLIC and NFS breached ERISA fiduciary duties by allegedly accepting service payments from certain mutual funds. The complaint seeks damages in an amount equivalent to some or all of the payments allegedly received by NFS and NLIC, other unspecified relief for restitution, declaratory and injunctive relief and attorneys’ fees. On November 6, 2009, the Court granted the plaintiffs’ motion for class certification. On October 21, 2010, the District Court dismissed NFS from the lawsuit. On February 6, 2012, the Second Circuit Court of Appeals vacated the November 6, 2009 order granting class certification and remanded the case back to the District Court for further consideration. On September 6, 2013, the District

 

40

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Court granted the plaintiffs’ motion for class certification. On December 11, 2014, the plaintiffs filed a 7th Amended Complaint adding another sub class of defendants that held trust platform products. On December 11, 2014 plaintiffs filed a motion for preliminary approval of settlement. On January 5, 2015, the Court signed the Order Preliminarily Approving Settlement and Approving Form and Manner of Notice. On March 31, 2015, the Court held a Fairness Hearing. On April 9, 2015, the Court entered the Final Order and Consent Judgment. The Company has paid the loss amount. In November 2015, the settlement administrator mailed settlement checks to class members. NFS has made adequate provision for all probable and reasonably estimable losses associated with this settlement.

Indemnifications

In the normal course of business, the Company provides standard indemnifications to contractual counterparties. The types of indemnifications typically provided include breaches of representations and warranties, taxes and certain other liabilities, such as third party lawsuits. The indemnification clauses are often standard contractual terms and are entered into in the normal course of business based on an assessment that the risk of loss would be remote. The terms of the indemnifications vary in duration and nature. In many cases, the maximum obligation is not explicitly stated, and the contingencies triggering the obligation to indemnify have not occurred and are not expected to occur. Consequently, the amount of the obligation under such indemnifications is not determinable. Historically, the Company has not made any material payments pursuant to these obligations.

 

(17) Reinsurance

The following table summarizes the effects of reinsurance on life, accident and health insurance in force and premiums for the years ended:

 

     December 31,  

(in millions)

    2015      2014      2013  

Premiums

         

Direct

    $ 1,144       $ 1,178       $ 1,015   

Assumed from other companies

      —           —           —     

Ceded to other companies

      (358 )       (347 )       (291 ) 
  

 

 

     

 

 

     

 

 

  

Net

    $ 786       $ 831       $ 724   
  

 

 

     

 

 

     

 

 

  

Life, accident and health insurance in force

         

Direct

    $ 260,465       $ 241,936       $ 228,095   

Assumed from other companies

      5         5         6   

Ceded to other companies

      (60,976 )       (59,588 )       (58,310 ) 
  

 

 

     

 

 

     

 

 

  

Net

    $ 199,494       $ 182,353       $ 169,791   
  

 

 

     

 

 

     

 

 

  

Amounts recoverable under reinsurance contracts totaled $647 million, $704 million and $675 million as of December 31, 2015, 2014 and 2013, respectively, and are included in other assets in the consolidated balance sheets.

 

(18) Segment Information

Management views the Company’s business primarily based on its underlying products and uses this basis to define its four reportable segments: Individual Products and Solutions-Annuity, Retirement Plans, Individual Products and Solutions-Life and NBSG and Corporate and Other.

The primary segment profitability measure that management uses is a non-GAAP financial measure called pre-tax operating earnings (loss), which is calculated by adjusting income before federal income taxes to exclude: (1) certain changes in variable annuity liabilities and net realized investment gains and losses, except for operating items (trading portfolio realized gains and losses, trading portfolio valuation changes and net realized gains and losses related to certain product hedges); (2) the adjustment to amortization of DAC related to certain changes in variable annuity liabilities and net realized investment gains and losses; and (3) net losses attributable to noncontrolling interest.

 

41

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

Individual Products and Solutions-Annuity

The Individual Products & Solutions - Annuity segment consists of individual annuity products marketed under the Nationwide DestinationSM and other Nationwide-specific or private label brands. Deferred annuity contracts provide the customer with tax-deferred accumulation of savings and flexible payout options including lump sum, systematic withdrawal or a stream of payments for life. In addition, deferred variable annuity contracts provide the customer with access to a wide range of investment options and asset protection features, while deferred fixed annuity contracts generate a return for the customer at a specified interest rate fixed for prescribed periods. Immediate annuities differ from deferred annuities in that the initial premium is exchanged for a stream of income for a certain period and/or for the owner’s lifetime without future access to the original investment. The majority of assets and recent sales for the Individual Products & Solutions - Annuity segment consist of deferred variable annuities.

Retirement Plans

The Retirement Plans segment is comprised of the private and public sector retirement plans businesses. The private sector business primarily includes Internal Revenue Code (“IRC”) Section 401 qualified plans funded through fixed and variable group annuity contracts issued through NLIC. The public sector business primarily includes IRC Section 457 (b) and Section 401(a) governmental plans, both in the form of full-service arrangements that provide plan administration along with fixed and variable group annuities, as well as administration-only business. Across the public and private sector business Nationwide Investment Advisors managed account services are also available. The Retirement Plans segment also includes stable value wrap products and solutions.

Individual Products and Solutions-Life and NBSG

The Individual Products & Solutions - Life and NBSG segment consists of life insurance products, including individual variable universal life, COLI and BOLI products, traditional life insurance products, fixed universal life insurance products and indexed universal life insurance products. Life insurance products provide a death benefit and, for certain products, allow the customer to build cash value on a tax-advantaged basis.

Corporate and Other

The Corporate and Other segment includes certain non-operating changes in variable annuity liabilities and non-operating realized gains and losses, related amortization and other revenues and expenses not allocated to other segments. Additionally, this segment includes the funding agreements with the FHLB.

 

42

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

The following tables summarize the Company’s business segment operating results for the years ended:

 

(in millions)

    Individual
Products
and
Solutions-
Annuity		     Retirement
Plans		      Individual
Products
and
Solutions-
Life and
NBSG		     Corporate
and Other		     Total  

December 31, 2015

            

Revenues:

            

Policy charges

    $ 1,259        111         846        —        $ 2,216   

Premiums

      459        —           292        35        786   

Net investment income

      591        752         602        37        1,982   

Non-operating changes in variable annuity liabilities and net realized investment losses1

      —          —           —          (56 )      (56 ) 

Other revenues2

      (76 )      —           (7 )      7        (76 ) 
  

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

Total revenues

    $ 2,233      $ 863       $ 1,733      $ 23      $ 4,852   

Benefits and expenses:

            

Interest credited to policyholder accounts

    $ 328        494         236        20      $ 1,078   

Benefits and claims3

      700        —           705        29        1,434   

Amortization of DAC

      13        7         115        (67 )      68   

Other expenses, net of deferrals

      334        163         371        176        1,044   
  

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

Total benefits and expenses

    $ 1,375      $ 664       $ 1,427      $ 158      $ 3,624   
  

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

Income before federal income taxes and noncontrolling interests

    $ 858        199         306        (135 )    $ 1,228   
           

 

 

  

Less: certain non-operating changes in variable annuity liabilities and net realized investment gains (losses)1

      —          —           —          56     

Less: adjustment to amortization of DAC and other related expenses related to non-operating items above

      —          —           —          (74 )   

Less: net loss attributable to noncontrolling interest

      —          —           —          96     
  

 

 

    

 

 

     

 

 

    

 

 

    

Pre-tax operating earnings (loss)

    $ 858      $ 199       $ 306      $ (57 )   
  

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

Assets as of year end

    $ 73,370      $ 30,524       $ 30,650      $ 9,634      $ 144,178   
  

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

 

1 Excluding operating items (trading portfolio realized gains and losses, trading portfolio valuation changes and net realized gains and losses related to certain product hedges).
2 Includes operating items discussed above.
3 Excludes certain non-operating changes in variable annuity liabilities.

 

43

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

(in millions)

    Individual
Products
and
Solutions-
Annuity		     Retirement
Plans		     Individual
Products
and
Solutions-
Life and
NBSG		      Corporate
and Other		     Total  

December 31, 2014

            

Revenues:

            

Policy charges

    $ 1,175      $ 107      $ 783       $ —        $ 2,065   

Premiums

      518        —          284         29        831   

Net investment income

      546        750        565         39        1,900   

Non-operating net realized investment gains, including other-than-temporary impairment losses1

      —          —          —           (1,051 )      (1,051 ) 

Other revenues2

      (38 )      —          12         10        (16 ) 
  

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Total revenues

    $ 2,201      $ 857      $ 1,644       $ (973 )    $ 3,729   

Benefits and expenses:

            

Interest credited to policyholder accounts

    $ 370      $ 482      $ 231       $ 13      $ 1,096   

Benefits and claims

      828        —          644         30        1,502   

Amortization of DAC

      120        (28 )      122         (7 )      207   

Other expenses, net of deferrals

      300        153        348         254        1,055   
  

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Total benefits and expenses

    $ 1,618      $ 607      $ 1,345       $ 290      $ 3,860   
  

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Income before federal income taxes and noncontrolling interests

    $ 583      $ 250      $ 299       $ (1,263 )    $ (131 ) 

Less: non-operating net realized investment gains, including other-than-temporary impairment losses1

      —          —          —           1,051     

Less: adjustment to amortization of DAC and other related expenses related to net realized investment gains and losses

      —          —          —           (11 )   

Less: net loss attributable to noncontrolling interest

      —          —          —           94     
  

 

 

    

 

 

    

 

 

     

 

 

    

Pre-tax operating earnings (loss)

    $ 583      $ 250      $ 299       $ (129 )   
  

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Assets as of year end

    $ 72,429      $ 30,744      $ 29,322       $ 11,029      $ 143,524   
  

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

 

1 Excluding operating items (trading portfolio realized gains and losses, trading portfolio valuation changes and net realized gains and losses related to certain product hedges).
2 Includes operating items discussed above.

 

44

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to December 31, 2015, 2014 and 2013 Consolidated Financial Statements

 

 

 

(in millions)

    Individual
Products
and
Solutions-
Annuity		     Retirement
Plans		     Individual
Products
and
Solutions-
Life and
NBSG		      Corporate
and Other		     Total  

December 31, 2013

            

Revenues:

            

Policy charges

    $ 1,021      $ 101      $ 727       $ —        $ 1,849   

Premiums

      416        —          282         26        724   

Net investment income

      546        743        544         16        1,849   

Non-operating net realized investment gains, including of other-than-temporary impairment losses1

      —          —          —           783        783   

Other revenues2

      (109 )      —          6         15        (88 ) 
  

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Total revenues

    $ 1,874      $ 844      $ 1,559       $ 840      $ 5,117   

Benefits and expenses:

            

Interest credited to policyholder accounts

    $ 377      $ 473      $ 213       $ 4      $ 1,067   

Benefits and claims

      694        —          636         24        1,354   

Amortization of DAC

      185        (2 )      125         66        374   

Other expenses, net of deferrals

      295        151        347         188        981   
  

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Total benefits and expenses

    $ 1,551      $ 622      $ 1,321       $ 282      $ 3,776   
  

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Income before federal income taxes and noncontrolling interests

    $ 323      $ 222      $ 238       $ 558      $ 1,341   

Less: non-operating net realized investment gains, including other-than-temporary impairment losses1

      —          —          —           (783 )   

Less: adjustment to amortization of DAC and other related expenses related to net realized investment gains and losses

      —          —          —           70     

Less: net loss attributable to noncontrolling interest

      —          —          —           82     
  

 

 

    

 

 

    

 

 

     

 

 

    

Pre-tax operating earnings (loss)

    $ 323      $ 222      $ 238       $ (73 )   
  

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Assets as of year end

    $ 68,805      $ 29,904      $ 27,183       $ 7,553      $ 133,445   
  

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

 

1 Excluding operating items (trading portfolio realized gains and losses, trading portfolio valuation changes and net realized gains and losses related to certain product hedges).
2 Includes operating items discussed above.

 

45

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

 

 

Schedule I        Consolidated Summary of Investments – Other Than Investments in Related Parties

As of December 31, 2015 (in millions)

 

Column A

    Column B      Column C      Column D  

Type of investment

    Cost      Fair
value		      Amount at
which shown
in the
consolidated
balance sheet		  

Fixed maturity securities, available-for-sale:

         

Bonds:

         

U.S. government and agencies

    $ 343       $ 402       $ 402   

Obligations of states, political subdivisions and foreign governments

      2,136         2,367         2,367   

Public utilities

      3,411         3,495         3,495   

All other corporate, mortgage-backed and asset-backed securities

      31,106         31,306         31,306   
  

 

 

     

 

 

     

 

 

  

Total fixed maturity securities, available-for-sale

    $ 36,996       $ 37,570       $ 37,570   

Equity securities, available-for-sale:

         

Common stocks:

         

Industrial, miscellaneous and all other

    $ 7       $ 17       $ 17   

Nonredeemable preferred stocks

      —           4         4   
  

 

 

     

 

 

     

 

 

  

Total equity securities, available-for-sale

    $ 7       $ 21       $ 21   

Trading assets

      72         67         67   

Mortgage loans, net of allowance

      8,422            8,396 1 

Policy loans

      993            993   

Other investments

      855            855   

Short-term investments

      766            766   
  

 

 

        

 

 

  

Total investments

    $ 48,111          $ 48,668   
  

 

 

        

 

 

  

 

1 Difference from Column B primarily is attributable to valuation allowances due to impairments on mortgage loans (see Note 6 to the audited consolidated financial statements).

See accompanying notes to consolidated financial statements and report of independent registered public accounting firm.

 

46

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

 

 

 

 

Schedule III        Supplementary Insurance Information

As of December 31, 2015, 2014 and 2013 and for each of the years then ended (in millions)

 

Column A

    Column B     Column C      Column D     Column E      Column F  

Year: Segment

    Deferred policy
acquisition
costs		     Future policy benefits,
losses, claims and
loss expenses		      Unearned
premiums1		     Other policy
claims and
benefits payable1		      Premium
revenue		  

2015

             

IPS - Annuity

    $ 3,070      $ 15,160            $ 459   

Retirement Plans

      222        15,940              —     

IPS - Life and NBSG

      1,937        11,582              292   

Corporate and Other

      (29 )      2,715              35   
  

 

 

    

 

 

          

 

 

  

Total

    $ 5,200      $ 45,397            $ 786   
  

 

 

    

 

 

          

 

 

  

2014

             

IPS - Annuity

    $ 2,495      $ 12,619            $ 518   

Retirement Plans

      216        14,905              —     

IPS - Life and NBSG

      1,717        10,763              284   

Corporate and Other

      (365 )      2,443              29   
  

 

 

    

 

 

          

 

 

  

Total

    $ 4,063      $ 40,730            $ 831   
  

 

 

    

 

 

          

 

 

  

2013

             

IPS - Annuity

    $ 2,214      $ 10,985            $ 416   

Retirement Plans

      179        14,313              —     

IPS - Life and NBSG

      1,557        10,068              282   

Corporate and Other

      (172 )      1,399              26   
  

 

 

    

 

 

          

 

 

  

Total

    $ 3,778      $ 36,765            $ 724   
  

 

 

    

 

 

          

 

 

  

Column A

    Column G     Column H      Column I     Column J      Column K  

Year: Segment

    Net
investment
income2		     Benefits, claims,
losses and
settlement expenses		      Amortization
of deferred policy
acquisition costs		     Other
operating
expenses2		      Premiums
written		  

2015

             

IPS - Annuity

    $ 591      $ 1,257       $ 13        334      

Retirement Plans

      752        494         7        163      

IPS - Life and NBSG

      602        941         115        371      

Corporate and Other

      37        48         (67 )      176      
  

 

 

    

 

 

     

 

 

    

 

 

     

Total

    $ 1,982      $ 2,740       $ 68      $ 1,044      
  

 

 

    

 

 

     

 

 

    

 

 

     

2014

             

IPS - Annuity

    $ 546      $ 1,198       $ 120      $ 300      

Retirement Plans

      750        482         (28 )      153      

IPS - Life and NBSG

      565        875         122        348      

Corporate and Other

      39        43         (7 )      254      
  

 

 

    

 

 

     

 

 

    

 

 

     

Total

    $ 1,900      $ 2,598       $ 207      $ 1,055      
  

 

 

    

 

 

     

 

 

    

 

 

     

2013

             

IPS - Annuity

    $ 546      $ 1,071       $ 185      $ 295      

Retirement Plans

      743        473         (2 )      151      

IPS - Life and NBSG

      544        849         125        347      

Corporate and Other

      16        28         66        188      
  

 

 

    

 

 

     

 

 

    

 

 

     

Total

    $ 1,849      $ 2,421       $ 374      $ 981      
  

 

 

    

 

 

     

 

 

    

 

 

     

 

1 Unearned premiums and other policy claims and benefits payable are included in Column C amounts.
2 Allocations of net investment income and certain operating expenses are based on numerous assumptions and estimates, and reported segment operating results would change if different methods were applied.

See accompanying notes to consolidated financial statements and report of independent registered public accounting firm.

 

47

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

 

 

 

 

Schedule IV        Reinsurance

As of December 31, 2015, 2014 and 2013 and for each of the years then ended (in millions)

 

Column A

    Column B      Column C     Column D      Column E  
     Gross
amount		      Ceded to
other
companies		     Assumed
from other
companies		      Net amount  

2015

           

Life, accident and health insurance in force

    $ 260,465       $ (60,976 )    $ 5       $ 199,494   

Premiums:

           

Life insurance1

    $ 842       $ (56 )    $ —         $ 786   

Accident and health insurance

      302         (302 )      —           —     
  

 

 

     

 

 

    

 

 

     

 

 

  

Total

    $ 1,144       $ (358 )    $ —         $ 786   
  

 

 

     

 

 

    

 

 

     

 

 

  

2014

           

Life, accident and health insurance in force

    $ 241,936       $ (59,588 )    $ 5       $ 182,353   

Premiums:

           

Life insurance1

    $ 888       $ (57 )    $ —         $ 831   

Accident and health insurance

      290         (290 )      —           —     
  

 

 

     

 

 

    

 

 

     

 

 

  

Total

    $ 1,178       $ (347 )    $ —         $ 831   
  

 

 

     

 

 

    

 

 

     

 

 

  

2013

           

Life, accident and health insurance in force

    $ 228,095       $ (58,310 )    $ 6       $ 169,791   

Premiums:

           

Life insurance1

    $ 783       $ (59 )    $ —         $ 724   

Accident and health insurance

      232         (232 )      —           —     
  

 

 

     

 

 

    

 

 

     

 

 

  

Total

    $ 1,015       $ (291 )    $ —         $ 724   
  

 

 

     

 

 

    

 

 

     

 

 

  

 

1 Primarily represents premiums from traditional life insurance and life-contingent immediate annuities and excludes deposits on investment and universal life insurance products.

See accompanying notes to consolidated financial statements and report of independent registered public accounting firm.

 

48

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

 

 

 

 

Schedule V        Valuation and Qualifying Accounts

Years ended December 31, 2015, 2014 and 2013 (in millions)

 

Column A

    Column B      Column C      Column D     Column E  

Description

    Balance at
beginning
of period		      Charged to
costs and
expenses		     Charged to
other
accounts		      Deductions1     Balance at
end of
period		  

2015

             

Valuation allowances - mortgage loans

    $ 26       $ 2      $ —         $ (2 )    $ 26   
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

2014

             

Valuation allowances - mortgage loans

    $ 35       $ (8 )    $ —         $ (1 )    $ 26   
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

2013

             

Valuation allowances - mortgage loans

    $ 44       $ (4 )    $ —         $ (5 )    $ 35   
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

 

1 Amounts generally represent payoffs, sales and recoveries.

See accompanying notes to consolidated financial statements and report of independent registered public accounting firm.

 

49

PART C. OTHER INFORMATION
Item 26. Exhibits
(a) Resolution of the Depositor's Board of Directors authorizing the establishment of the Registrant – Filed previously on Form N8B-2 for the NW VLI Separate Account – 2 (033-62795) and hereby incorporated by reference.
(b) Not Applicable
(c) Underwriting or Distribution of contracts between the Depositor and Principal Underwriter – Filed previously with the Post-Effective Amendment No. 18 (033-42180) and hereby incorporated by reference.
(d) The form of the contract – Filed previously with initial registration statement (033-42180) and hereby incorporated by reference.
(e) The form of the contract application – Filed previously with initial registration statement (033-42180) and hereby incorporated by reference.
(f) Depositor's Certificate of Incorporation and By-Laws.
(1) Amended Articles of Incorporation for Nationwide Life Insurance Company. Filed previously with initial registration statement (333-164119) on January 4, 2010 as document "exhibitf1.htm" and hereby incorporated by reference.
(2) Amended and Restated Code of Regulations of Nationwide Life Insurance Company. Filed previously with initial registration statement (333-164119) on January 4, 2010 as document "exhibitf2.htm" and hereby incorporated by reference.
(3) Articles of Merger of Nationwide Life Insurance Company of America with and into Nationwide Life Insurance Company, effective December 31, 2009. Filed previously with initial registration statement (333-164119) on January 4, 2010 as document "exhibitf3.htm" and hereby incorporated by reference.
(g) Reinsurance Contracts -Filed previously with registration statement (333-31725) and hereby incorporated by reference.
(h) Participation Agreements - The following Fund Participation Agreements were previously filed on July 17, 2007 with pre-effective amendment number 1 of registration statement (333-140608) under Exhibit 26(h), and are hereby incorporated by reference.
(1) Fund Participation Agreement with AIM Variable Insurance Funds, AIM Advisors, Inc., and AIM Distributors dated January 6, 2003, under document "aimfpa99h1.htm".
(2) Amended and Restated Fund Participation and Shareholder Services Agreement with American Century Investment Services, Inc. dated September 15, 2004, as amended, under document "amcentfpa99h2"
(3) Restated and Amended Fund Participation Agreement with The Dreyfus Corporation dated January 27, 2000, as amended, under document "dreyfusfpa99h3.htm".
(4) Fund Participation Agreement with Federated Insurance Series and Federated Securities Corp. dated April 1, 2006, as amended, under document "fedfpa99h4.htm".
(5) Fund Participation Agreement with Fidelity Variable Insurance Products Fund dated May 1, 1988, as amended, including Fidelity Variable Insurance Products Fund IV and Fidelity Variable Insurance Products Fund V, under document "fidifpa99h5.htm".
(6) Amended and Restated Fund Participation Agreement with Franklin Templeton Variable Insurance Products Trust and Franklin/Templeton Distributors, Inc. dated May 1, 2003; as amended, under document "frankfpa99h8.htm".
(7) Fund Participation Agreement, Service and Institutional Shares, with Janus Aspen Series, dated December 31, 1999, under document "janusfpa99h9a.htm".
(8) Fund Participation Agreement, Service II Shares, with Janus Aspen Series, dated May 5, 2002, under document "janusfpa99h9b.htm".
(9) Fund Participation Agreement with Nationwide Variable Insurance Trust (formerly, Gartmore Variable Insurance Trust) dated May 2, 2005, as amended, under document "nwfpa99h12a.htm".

 

(10) Fund Participation Agreement with Nationwide Variable Insurance Trust (formerly, Gartmore Variable Insurance Trust), American Funds Insurance Series, and Capital Research and Management Company dated May 1, 2007, as amended, under document "nwfpa99h12b.htm".
(11) Fund Participation Agreement with Neuberger Berman Management, Inc. dated January 1, 2006, under document "neuberfpa99h13.htm".
(12) Fund Participation Agreement with Oppenheimer Variable Account Funds and Oppenheimer Funds, Inc. dated April 13, 2007, under document "oppenfpa99h14.htm".
(13) Fund Participation Agreement with T. Rowe Price Equity Series, Inc., T. Rowe Price International Series, Inc., T. Rowe Price Fixed Income Series, Inc., and T. Rowe Price Investment Services, Inc. dated October 1, 2002, as amended, under document "trowefpa99h15.htm".
(14) Fund Participation Agreement with The Universal Institutional Funds, Inc., Morgan Stanley & Co., Inc., and Morgan Stanley Investment Management, Inc. dated February 1, 2002, as amended, under document "univfpa99h16.htm".
The following Fund Participation Agreements were previously filed on September 27, 2007 with pre-effective amendment number 3 of registration statement (333-137202) under Exhibit 26(h), and are hereby incorporated by reference.
(15) Fund Participation Agreement (Amended and Restated) with Alliance Capital Management L.P. and Alliance-Bernstein Investment Research and Management, Inc. dated June 1, 2003, as document "alliancebernsteinfpa.htm".
(16) Fund Participation Agreement with BlackRock (formerly FAM Distributors, Inc. and FAM Variable Series Funds, Inc.) dated April 13, 2004, as amended, as document "blackrockfpa.htm".
(17) Fund Participation Agreement with PIMCO Variable Insurance Trust and PIMCO Fund Distributors, LLC dated March 28, 2002, as amended, as document "pimcofpa.htm".
(18) Fund Participation Agreement with Putnam Variable Trust and Putnam Retail Management, L.P., dated February 1, 2002, as document "putnamfpa.htm".
(19) Fund Participation Agreement Van Eck Investment Trust, Van Eck Associates Corporation, Van Eck Securities Corporation dated September 1, 1989, as amended, as document "vaneckfpa.htm".
(20) Fund Participation Agreement with Waddell & Reed Services Company, Waddell & Reed, Inc., and W&R Target Funds, Inc. dated December 1, 2000, as amended, as document "waddellreedfpa.htm".
(21) Administrative Services Agreement with Wells Fargo Management, LLC, Stephens, Inc. dated November 15, 2004, as amended, as document "wellsfargofpa.htm".
The following Fund Participation Agreement was previously filed on April 18, 2008 with post-effective amendment number 20 of registration statement (333-62692) under Exhibit (26)(h), and is hereby incorporated by reference.
(22) Fund Participation Agreement with Rydex Variable Trust & Rydex Distributors, Inc., dated September 10, 2001, as document "rydexfundpartagreement.htm".
The following Fund Participation Agreement was previously filed on April 12, 2011 with Post-Effective Amendment No. 43 of registration statement (333-43671) under Exhibit 26(h), and is hereby incorporated by reference.
(23) Fund Participation Agreement with Delaware Management Company and Delaware Distributors, L.P., as amended, dated February 5, 2008, as document "delawarefpa.htm".
(24) Fund Participation Agreement with Goldman Sachs Variable Insurance Trust, and Goldman Sachs & Co. dated December 22, 1998, under document "goldmansachsfpa.htm".
The following Fund Participation Agreement was previously filed on June 11, 2012 with post-effective amendment number 28 of registration statement (333-62692) under Exhibit (26)(h), and is hereby incorporated by reference.
(25) Fund Participation Agreement with Fund Participation Agreement with Northern Lights Variable Trust and Northern Lights Distributors, LLC., dated February 8, 2012, as document "northernlightsfpa.htm".

 

The following Fund Participation Agreement was previously filed on April 16, 2015, with Post-Effective Amendment No. 15 to the registration statement associated with 1933 Act File No. 333-149213 under Exhibit 24(b), and is hereby incorporated by reference.
(26) Participation Agreement Among MFS Variable Insurance Trust, MFS Variable Insurance Trust II, Nationwide Financial Services, Inc., and MFS Fund Distributors, Inc., dated May 2, 2011, under document "mfsfpa.htm".
(i) Not Applicable
(j) Not Applicable
(k) Opinion of Counsel – Filed previously with the registration statement on Form S-6 (033-42180) and hereby incorporated by reference.
(l) Not Applicable
(m) Not Applicable
(n) Consent of Independent Registered Public Accounting Firm – Attached hereto.
(o) Not Applicable
(p) Not Applicable
(q) Redeemability Exemption – Filed previously with registration statement (333-31725) on December 21, 2009 under document "exhibit_26q.htm" and is hereby incorporated by reference.
(99) Power of Attorney – Attached hereto.

 

Item 27. Directors and Officers of the Depositor
The business address of the Directors and Officers of the Depositor is:
One Nationwide Plaza, Columbus, Ohio 43215
President and Chief Operating Officer and Director Kirt A. Walker
Executive Vice President-Chief Legal and Governance Officer Mark Howard
Senior Vice President-President, Nationwide Growth Solutions Terri L. Hill
Executive Vice President-Chief Information Officer Michael C. Keller
Executive Vice President-Chief Human Resources Officer Gale V. King
Executive Vice President Mark A. Pizzi
Executive Vice President and Director Mark R. Thresher
Senior Vice President Harry H. Hallowell
Senior Vice President and Treasurer David LaPaul
Senior Vice President-Chief Compliance Officer Sandra L. Rich
Senior Vice President-Chief Financial Officer and Director Timothy G. Frommeyer
Senior Vice President-CIO Enterprise Applications Michael A. Richardson
Senior Vice President-CIO NF Systems Susan J. Gueli
Senior Vice President-NW Retirement Plans and Director John L. Carter
Senior Vice President-Head of Taxation Pamela A. Biesecker
Senior Vice President-Individual Products & Solutions and Director Eric S. Henderson
Senior Vice President-Investment Management Group Michael S. Spangler
Senior Vice President-CIO CL & Agency Tammy Craig
Senior Vice President-Nationwide Financial Steven C. Power
Senior Vice President-Nationwide Financial Network Peter A. Golato
Senior Vice President-NF Legal Rae Ann Dankovic
Senior Vice President-NF Distribution and Sales David L. Giertz
Senior Vice President-NI Enterprise Brand Marketing Michael A. Boyd
Senior Vice President- NF Marketing Jennifer B. MacKenzie
Senior Vice President-Marketing Services Tiffanie Hiibner
Director Stephen S. Rasmussen
Item 28. Persons Controlled by or Under Common Control with the Depositor or Registrant.
Following is a list of entities directly or indirectly controlled by or under common control with the depositor or registrant. Ownership is indicated through indentation. Unless otherwise indicated, each subsidiary is either wholly-owned or majority-owned by the parent company immediately preceding it. (For example, Nationwide Fund Distributors, LLC is either wholly-owned or majority owned by NFS Distributors, Inc.) Separate accounts that have been established pursuant to board resolution but are not, and have never been, active are omitted.
Company Jurisdiction
of Domicile 		Brief Description of Business
Nationwide Financial Services, Inc. Delaware The company acts primarily as a holding company for companies within the Nationwide organization that offer or distribute life insurance, long-term savings and retirement products.
NFS Distributors, Inc. Delaware The company acts primarily as a holding company for Nationwide Financial Services, Inc. companies.
Nationwide Financial General Agency, Inc. Pennsylvania The company is a multi-state licensed insurance agency.
Nationwide Financial Institution Distributors Agency, Inc. Delaware The company is an insurance agency.
Nationwide Fund Distributors, LLC Delaware The company is a limited purpose broker-dealer.
Nationwide Fund Management, LLC Delaware The company provides administration, transfer and dividend disbursing agent services to various mutual fund entities.
Nationwide Retirement Solutions, Inc. Delaware The company markets and administers deferred compensation plans for public employees.
Nationwide Securities, LLC Delaware The company is a registered broker-dealer.

 

Company Jurisdiction
of Domicile 		Brief Description of Business
Nationwide Bank Federal This is a federally savings bank chartered by the Office of Thrift Supervision in the United States Department of Treasury to exercise deposit, lending, agency, custody and fiduciary powers and to engage in activities permissible for federal savings banks under the Home Owners’ Loan Act of 1933.
Nationwide Financial Services Capital Trust Delaware The trust’s sole purpose is to issue and sell certain securities representing individual beneficial interests in the assets of the trust
Nationwide Life Insurance Company2 Ohio A stock corporation. The corporation provides individual life insurance, group and health insurance, fixed and variable annuity products and other life insurance products.
MFS Variable Account2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Multi-Flex Variable Account2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-II2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-32,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-42,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-52,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-62,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-72,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-82,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-92,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-102,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-112,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-122,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-132,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-142,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Provident VA Separate Account 12,3 Pennsylvania A separate account issuing variable annuity contracts.
Nationwide VLI Separate Account2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-22,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-32,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-42,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-52,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-62,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-72,3 Ohio A separate account issuing variable life insurance policies.
Nationwide Provident VLI Separate Account 12,3 Pennsylvania A separate account issuing variable life insurance policies.
Nationwide Investment Services Corporation3 Oklahoma This is a limited purpose broker-dealer and distributor of variable annuities and variable life products for Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company. The company also provides educational services to retirement plan sponsors and its participants.
Nationwide Financial Assignment Company3 Ohio The company is an administrator of structured settlements.
Nationwide Investment Advisors, LLC3 Ohio The company provides investment advisory services.
Life Reo Holdings, LLC3 Ohio The company is an investment holding company.
Eagle Captive Reinsurance, LLC3 Ohio The company is engaged in the business of insurance

 

Company Jurisdiction
of Domicile 		Brief Description of Business
Nationwide Life and Annuity Insurance Company2,3 Ohio The company engages in underwriting life insurance and granting, purchasing and disposing of annuities.
Nationwide VA Separate Account-A2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide VA Separate Account-B2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide VA Separate Account-C2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide VA Separate Account-D2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Provident VA Separate Account A2,3 Delaware A separate account issuing variable annuity contracts.
Nationwide VL Separate Account-A2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VL Separate Account-B2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VL Separate Account-C2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VL Separate Account-D2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VL Separate Account-G2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide Provident VLI Separate Account A2,3 Delaware A separate account issuing variable life insurance policies.
Olentangy Reinsurance, LLC3 Vermont The company is a captive life reinsurance company.
Registered Investment Advisors Services, Inc.3 Texas The company is a technology company that facilitates third-party money management services for registered investment advisors
Nationwide Fund Advisors3,4 Delaware The trust acts as a registered investment advisor.
1 This subsidiary/entity is controlled by its immediate parent through contractual association.
2 This subsidiary/entity files separate financial statements.
3 Information for this subsidiary/entity is included in the consolidated financial statements of its immediate parent.
4 This subsidiary/entity is a business trust.
Item 29. Indemnification
Provision is made in Nationwide’s Amended and Restated Code of Regulations and expressly authorized by the General Corporation Law of the State of Ohio, for indemnification by Nationwide of any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative by reason of the fact that such person is or was a director, officer or employee of Nationwide, against expenses, including attorneys fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, to the extent and under the circumstances permitted by the General Corporation Law of the State of Ohio.
Insofar as indemnification for liabilities arising under the Securities Act of 1933 ("Act") may be permitted to directors, officers or persons controlling Nationwide pursuant to the foregoing provisions, Nationwide has been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
Item 30. Principal Underwriter
Nationwide Investment Services Corporation ("NISC")
(a) NISC serves as principal underwriter and general distributor for the following separate investment accounts of Nationwide or its affiliates:
   
MFS Variable Account Nationwide VA Separate Account-C

 

Multi-Flex Variable Account Nationwide VA Separate Account-D
Nationwide Variable Account Nationwide VLI Separate Account
Nationwide Variable Account-II Nationwide VLI Separate Account-2
Nationwide Variable Account-3 Nationwide VLI Separate Account-3
Nationwide Variable Account-4 Nationwide VLI Separate Account-4
Nationwide Variable Account-5 Nationwide VLI Separate Account-5
Nationwide Variable Account-6 Nationwide VLI Separate Account-6
Nationwide Variable Account-7 Nationwide VLI Separate Account-7
Nationwide Variable Account-8 Nationwide VL Separate Account-A
Nationwide Variable Account-9 Nationwide VL Separate Account-C
Nationwide Variable Account-10 Nationwide VL Separate Account-D
Nationwide Variable Account-11 Nationwide VL Separate Account-G
Nationwide Variable Account-12 Nationwide Provident VA Separate Account 1
Nationwide Variable Account-13 Nationwide Provident VA Separate Account A
Nationwide Variable Account-14 Nationwide Provident VLI Separate Account 1
Nationwide VA Separate Account-A Nationwide Provident VLI Separate Account A
Nationwide VA Separate Account-B  
(b) Directors and Officers of NISC:
   
President Robert O. Cline
Vice President-Chief Compliance Officer James J. Rabenstine
Vice President and Treasurer John A. Reese
Vice President-Tax Daniel P. Eppley
Associate Vice President and Secretary Kathy R. Richards
Associate Vice President and Assistant Secretary Parag H. Shah
Associate Vice President-Nationwide Financial Services Distribution Compliance Valerie Hamilton
Associate Vice President and Assistant Treasurer J. Morgan Elliott
Associate Vice President and Assistant Treasurer David A. Connor
Director John L. Carter
Director Eric S. Henderson
Director David L. Giertz
The business address of the Directors and Officers of NISC is:
One Nationwide Plaza, Columbus, Ohio 43215.
(c)
Name of Principal Underwriter   Net Underwriting
Discounts and
Commissions 		  Compensation on
Redemption or
Annuitization 		  Brokerage
Commissions 		  Compensation
Nationwide Investment Services Corporation
   N/A   N/A   N/A   N/A
Item 31. Location of Accounts and Records
Timothy G. Frommeyer
Nationwide Life Insurance Company
One Nationwide Plaza
Columbus, OH 43215
Item 32. Management Services
Not Applicable
Item 33. Fee Representation
Nationwide Life Insurance Company represents that the fees and charges deducted under the contract in the aggregate are reasonable in relation to the services rendered, the expenses expected to be incurred and risks assumed by Nationwide Life Insurance Company.

 

SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets the requirements of Rule 485(b) under the Securities Act of 1933 for effectiveness of the Registration Statement and has caused this Registration Statement to be signed by the undersigned, duly authorized, in the City of Columbus, and State of Ohio, on April 14, 2016.
Nationwide VLI Separate Account-2
(Registrant)
Nationwide Life Insurance Company
(Depositor)
By: /s/ JAMIE RUFF CASTO
Jamie Ruff Casto
Attorney-in-Fact
As required by the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated, on April 14, 2016.
KIRT A. WALKER  
Kirt A. Walker, President and Chief Operating Officer, and Director  
MARK R. THRESHER  
Mark R. Thresher, Executive Vice President and Director  
TIMOTHY G. FROMMEYER  
Timothy G. Frommeyer, Senior Vice President-Chief Financial Officer and Director  
ERIC S. HENDERSON  
Eric S. Henderson, Senior Vice President - Individual Products & Solutions and Director  
JOHN L. CARTER  
John L. Carter, Senior Vice President – Nationwide Retirement Plans and Director  
STEPHEN S. RASMUSSEN  
Stephen S. Rasmussen, Director  
  By /s/ JAMIE RUFF CASTO
  Jamie Ruff Casto
Attorney-in-Fact