'33 Act File No. 333- 182896

'40 Act File No. 811-21697

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-6

REGISTRATION UNDER THE SECURITIES ACT OF 1933
Pre-effective Amendment No. 1	þ
Post-effective Amendment No.	o

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 63	þ

(Check appropriate box or boxes.)

NATIONWIDE VL SEPARATE ACCOUNT-G

(Exact Name of Registrant)

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY

(Name of Depositor)

One Nationwide Plaza

Columbus, Ohio 43215

(Address of Depositor’s Principal Executive Offices)  (Zip Code)

Depositor’s Telephone Number, including Area Code:  (614) 249-7111

Robert W. Horner, III

Vice President Corporate Governance and Secretary

One Nationwide Plaza

Columbus, Ohio 43215

(Name and Address of Agent for Service)

Approximate Date of Proposed Public Offering:  As soon as practicable after effectiveness of registration statement

The Registrant hereby agrees to amend this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

Waddell & Reed Protection VUL II

Individual Flexible Premium Variable Universal Life Insurance Policies

issued by

Nationwide Life and Annuity Insurance Company

through

Nationwide VL Separate Account-G

The date of this prospectus is XXXX, 2012

PLEASE KEEP THIS PROSPECTUS FOR FUTURE REFERENCE

Variable life insurance is complex.  This prospectus is designed to provide you with information about the policy that will assist you when making your decision whether or not to purchase the policy.  We encourage you to take time to understand the policy and its potential benefits and risks.  In consultation with your financial advisor, you should use this prospectus to compare the benefits and risks of this policy against those of other life insurance policies.

To obtain additional information, including free copies of prospectuses for the mutual funds or a copy of the Statement of Additional Information, or to make service or transaction requests, contact us using any of the methods described in the "Contacting the Service Center" section of this prospectus.

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 us to review a copy of the policy and any Riders or endorsements.   This prospectus contains all material rights and features of the policy, including any material variations in the policy, such as availability of certain riders.

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 that you name.  If your primary need is not life insurance protection, then purchasing this policy may not be in your best interest.  We make no claim that the policy is in any way similar or comparable to a systematic investment plan of a mutual fund.

In thinking about buying this policy to replace existing life insurance, carefully consider its advantages versus those of the policy you intend to replace, as well as any replacement costs.  As always, consult your financial advisor.

We offer 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 this policy.  These differences in charges may be attributable to differences in sales and related expenses incurred in one distribution channel versus another.

Table of Contents

	Page
In Summary: Policy Benefits	1
In Summary: Policy Risks	2
In Summary: Fee Tables	4
Policy Investment Options	9
Fixed Investment Options
Variable Investment Options
Valuation of Accumulation Units
How Sub-Account Investment Experience is Determined Unit Value Credit
Transfers Among and Between the Policy Investment Options	11
Sub-Account Transfers
Fixed Investment Option Transfers
Contacting the Service Center	13
The Policy	14
Generally
Policy Owner and Beneficiaries
Purchasing a Policy
Right to Cancel (Examination Right)
Premium Payments
Cash Value
Changing the Amount of Insurance Coverage
Right of Conversion
Exchanging the Policy
Terminating the Policy
Assigning the Policy
Reminders, Reports, and Illustrations
Standard Policy Charges	18
Sales Load
Premium Taxes
Short-Term Trading Fees
Illustration Charge
Partial Surrender Fee
Surrender Charges
Cost of Insurance Charge
Mortality and Expense Risk Charge
Administrative Per Policy Charge
Underwriting and Distribution Charge
Policy Loan Interest Charge
Mutual Fund Operating Expenses
Reduction of Charges
A Note on Charges
Information on Underlying Mutual Fund Payments
Policy Riders and Rider Charges	23
Overloan Lapse Protection Rider
Adjusted Sales Load Life Insurance Rider
Children's Term Insurance Rider
Long-Term Care Rider
Spouse Life Insurance Rider
Accelerated Death Benefit Rider
Accidental Death Benefit Rider
Premium Waiver Rider
Change of Insured Rider
Additional Term Insurance  Rider
Waiver of Monthly Deductions Rider Extended Death Benefit Guarantee Rider
Policy Owner Services	34
Dollar Cost Averaging
Asset Rebalancing
Automated Income Monitor

Table of Contents (continued)

Policy Loans	36
Loan Amount and Interest Charged
Collateral and Interest Earned
Net Effect on Policy Loans
Repayment
Lapse		37
Guaranteed Policy Continuation Provision
Grace Period
Reinstatement
Surrenders		38
Full Surrender
Partial Surrender
The Death Benefit		39
Calculation of the Death Benefit
Death Benefit Options
The Minimum Required Death Benefit
Changes in the Death Benefit Option
Incontestability
Suicide
Policy Maturity		40
Extending the Maturity Date
Payment of Policy Proceeds		41
Life Income with Payments Guaranteed Option
Joint and Survivor Life Option
Life Income Option
Taxes		42
Types of Taxes
Buying the Policy
Investment Gain in the Policy
Periodic Withdrawals, Non-Periodic Withdrawals, and Loans
Surrendering the Policy; Maturity
Additional Medicare Tax
Sale of a Life Insurance Policy
Exchanging the Policy for Another Life Insurance Policy
Taxation of Death Benefits
Terminal Illness
Special Considerations for Corporations
Business Uses of the Policy
Non-Resident Aliens and Other Persons Who are not Citizens of the United States
Withholding and Tax Reporting
Taxes and the Value of Your Policy
Tax Changes
Nationwide Life and Annuity Insurance Company		47
Nationwide VL Separate Account-G		47
Organization, Registration, and Operation
Addition, Deletion, or Substitution of Mutual Funds
Voting Rights
Legal Proceedings		48
Nationwide Life and Annuity Insurance Company
Waddell & Reed, Inc.
Financial Statements		50
Appendix A: Sub-Account Information		51
Appendix B: Definitions		53
Appendix C: Surrender Charge Examples		56
Appendix D: Maximum Surrender Charge Calculation		59

Appendix B defines certain words and phrases used in this prospectus. Defined words will be capitalized.

In Summary: Policy Benefits

Death Benefit

The primary benefit of your policy is life insurance coverage.  We 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

Option 1: The Death Benefit is the greater of the Specified Amount or the Minimum Required Death Benefit under federal tax law.

Option 2: The Death Benefit is the greater of the Specified Amount plus the Cash Value or the Minimum Required Death Benefit under federal tax law.

Option 3: The Death Benefit is the greater of the Specified Amount plus accumulated Premium payments (less any partial surrenders) or the Minimum Required Death Benefit under federal tax law.

Policy Proceeds

You or your beneficiary may choose to receive the Policy Proceeds in a lump sum, or a variety of options that will pay out over time.

Coverage Flexibility

Subject to conditions, you may choose to:

·   change the Death Benefit option;

·   increase or decrease the Specified Amount;

·   change your beneficiaries; and

·   change who owns the policy.

Continuation of Coverage is Guaranteed

Your policy will remain In Force during the policy continuation period as long as you pay sufficient Premium to meet the requirements set forth in the "Guaranteed Policy Continuation Provision" section of the "Lapse" provision.

Access to Cash Value

Subject to conditions, you may:

·   take a policy loan of no more than 90% of the Cash Value allocated to the Sub-Accounts plus 100% of the Cash Value allocated to the fixed investment options less any Surrender Charge.  The minimum loan amount is $200.

·   take a partial surrender of at least $200.

·   surrender the policy for its Cash Surrender Value at any time while the policy is In Force.  The Cash Surrender Value will be the Cash Value, less Indebtedness, and less the Surrender Charge.  You may choose to receive the Cash Surrender Value in a lump sum or over time.

Premium Flexibility

You will select a Premium payment plan for the policy.  Within limits, you may vary the frequency and amount of Premium payments, and you might even be able to skip making a Premium payment.

Investment Options

You may choose to allocate your Net Premiums to fixed or variable investment options.

Where permitted by state law, the policy currently offers two fixed investment options, the Fixed Account and the Long-Term Fixed Account.  Both of these options will earn interest daily at an annual effective rate of at least 3%.  The Long-Term Fixed Account may earn a higher interest rate than the Fixed Account, but will also be subject to greater allocation, transfer, and partial surrender restrictions.  The greater Long-Term Fixed Account restrictions will apply regardless of whether or not it is being credited a higher rate of interest than the Fixed Account.

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The variable investment options offered under the policy are mutual funds designed to be the underlying investment options of variable insurance products.  Nationwide VL Separate Account-G contains one Sub-Account for each of the mutual funds offered in the policy.  Your variable account Cash Value will depend on the Investment Experience of the Sub-Accounts you choose.

Transfers Between and Among Investment Options

You may transfer between the fixed and variable investment options, subject to conditions.  You may transfer among the Sub-Accounts within limits.  We have implemented procedures intended to reduce the potentially detrimental impact that disruptive trading has on Sub-Account Investment Experience.  We also offer dollar cost averaging, an automated investment strategy that spreads out transfers over time to try to reduce the investment risks of market fluctuations.

Taxes

Unless you make a withdrawal, generally, you will not be taxed on any earnings of the policy.  This is known as tax deferral.  Also, your beneficiary generally will not have to include the Proceeds as taxable income.  Unlike other variable insurance products Nationwide offers, these Individual Flexible Premium Variable Universal Life Insurance Policies do not require distributions to be made before the Insured's death.

Assignment

You may assign the policy as collateral for a loan or another obligation while the policy is In Force.

Examination Right

For a limited time, you may cancel the policy and receive a refund.  When you cancel the policy during your examination right, the amount we refund will be Cash Value or, in certain states, the greater of the initial Premium payment or the policy's Cash Value.  If the policy is canceled, we will treat the policy as if it was never issued.

Riders

You 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 individuals being insured.  Operation and benefits of the Riders described in this prospectus may vary by the state where the policy is issued.

·   Overloan Lapse Protection Rider

·   Adjusted Sales Load Life Insurance Rider

·   Children's Term Insurance Rider

·   Long-term Care Rider

·   Spouse Life Insurance Rider

·   Accelerated Death Benefit Rider

·   Accidental Death Benefit Rider

·   Premium Waiver Rider

·   Change of Insured Rider (no charge)

·   Additional Term Insurance Rider

·   Waiver of Monthly Deductions Rider

·   Extended Death Benefit Guarantee Rider

In Summary: Policy Risks

State Regulation of Insurance - Variations in Benefits

Insurance is heavily regulated by state law. Due to variations in state law (which can change at anytime without notice), the insurance benefits 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.  This prospectus describes material information about the insurance benefits and the investments available with the policy including any material variations in the policy, such as availability of certain riders .  However, prospective purchasers and policy owners should carefully review a copy of the specific policy and any Riders or endorsements for the state in which the policy will be issued in order to understand how the insurance benefits or investment options may differ from what is described in this prospectus.

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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.  You should not purchase the policy if you expect that you will need to access its Cash Value in the near future because substantial surrender charges will apply in the first several policy years.

Unfavorable Investment Experience

The Sub-Accounts you choose may not generate a sufficient return to keep the policy from Lapsing.  Poor Investment Experience could cause the Cash Value of your policy to decrease, which could result in a Lapse of insurance coverage.

Effect of Partial Surrenders and Policy Loans on Investment Returns

Partial surrenders or policy loans may accelerate a Lapse in insurance coverage.  When you take a partial surrender or policy loan, the Cash Value of your policy available for allocation to the Sub-Accounts and/or fixed investment options is reduced and you lose the ability to generate Sub-Account investment return on the surrendered/loaned amounts.  Thus, the remainder of your policy's Cash Value would have to generate enough investment return to cover policy and Sub-Account charges to keep the policy In Force (at least until you repay the policy loan or make another Premium payment).  Partial surrenders may also decrease the Death Benefit and Total Specified Amount.  Policy loans do not participate in positive Investment Experience which may increase the risk of Lapse or the need to make additional Premium payments to keep the policy In Force.  The policy does have a Grace Period and the opportunity to reinstate insurance coverage.  Under certain circumstances, however, the policy could terminate without value and insurance coverage would cease.

Reduction of the Death Benefit

A partial surrender could, and a policy loan would, decrease the policy's Death Benefit, depending on how the Death Benefit option relates to the policy's Cash Value.

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 from taxable income of the Proceeds we pay to 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 will be 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 not a return of investment.  For more detailed information, see "Taxes."

The proceeds of a life insurance policy are includible in the insured's gross estate 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, such as the power to change the beneficiary, surrender or cancel the policy, assign (or revoke the assignment of) the policy, pledge the policy for a loan, obtain a loan against the surrender value of the policy, etc.  Consult a qualified tax advisor on all tax matters involving your policy.

Fixed Investment Option Transfer Restrictions and Limitations

We will not honor a request to transfer Cash Value to or from the fixed investment options until after the first policy year.  After the first policy year, we may require transfer requests from the fixed investment options be made within 30 days of the end of a calendar quarter, but not within 12 months of a previous request.  We may also limit what percentage of Cash Value, fixed investment option value, or Sub-Account value that you may transfer to or from a fixed investment option.

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.  We have instituted procedures to minimize disruptive transfers.  While we expect these procedures to reduce the adverse effect of disruptive transfers, we cannot ensure that we have eliminated these risks.

Sub-Account Investment Risk

A comprehensive discussion of the risks of the mutual funds held by each Sub-Account may be found in each 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 our Service Center.

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In Summary: Fee Tables

The following tables describe the fees and expenses that you will pay when buying, owning, and surrendering the policy.

The first table describes the fees and expenses that you will pay at the time that you buy the policy, surrender the policy, or transfer Cash Value between investment options.

Transaction Fees
Charge	When Charge is Deducted	Amount Deducted
Sales Load1	Upon making a Premium payment	Maximum: $65 from each $1,000 of Premium		Currently: $65 from each $1,000 of Premium
Premium Taxes1	Upon making a Premium payment	Maximum: $35 from each $1,000 of Premium	Currently: $35 from each $1,000 of Premium
Short-Term Trading Fee	Upon transfer of Sub-Account value out of a Sub-Account within 60 days after allocation to that Sub-Account	Maximum: $10 per $1,000 transferred	Currently: $10 per $1,000 transferred
Illustration Charge	Upon requesting an illustration	Maximum: $25		Currently: $0
Partial Surrender Fee	Upon a partial surrender	Maximum: lesser of $25 or 2% of the amount surrendered, from the policy's Cash Value		Currently: $0
Surrender Charge2 , 15	Upon surrender, policy Lapse, or certain Specified Amount decreases	Maximum: $52.45 per $1,000 of Specified Amount		Minimum: $0.00 per $1,000 of Specified Amount
Representative: an age 35 male preferred non-tobacco with a Specified Amount of $500,000  and a complete surrender of the policy in the first year	Upon surrender or policy Lapse	$9.30 per $1,000 of Specified Amount  from the policy's Cash Value

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The next table describes the fees and expenses that you will pay periodically during the time that you own the policy, not including mutual fund operating expenses.

Periodic Charges Other Than Mutual Fund Operating Expenses
Charge	When Charge is Deducted	Amount Deducted From Cash Value
Cost of Insurance Charge3 , 15	Monthly	Maximum: $83.34 per $1,000 of Net Amount At Risk	Minimum: $0.00 per $1,000 of Net Amount At Risk
Representative: an age 35 male preferred non-tobacco with a Specified Amount of $500,000 and Death Benefit Option 1	Monthly	$0.10 per $1,000 of Net Amount At Risk
Flat Extra4	Monthly	Maximum: $2.08 per $1,000 of Net Amount At Risk for each Flat Extra assessed
Mortality and Expense Risk Charge5	Monthly	Maximum:  $0.67 per $1,000 of all variable Cash Value for all policy years	Currently: $0.67 per $1,000 of all variable Cash Value for all policy years
Administrative Per Policy Charge	Monthly	Maximum: $20 per policy		Currently: $20 per policy
Underwriting and Distribution Charge6 ,   15	Monthly	Maximum: $0.20 per $1,000 of Base Policy Specified Amount		Minimum: $0.00 per $1,000 of Base Policy Specified Amount
Representative: an issue of age 35, in the first policy year, male preferred non-tobacco with a Specified Amount of $500,000 and Death Benefit Option 1	Monthly	$0.15 per $1,000 of Base Policy Specified Amount
Policy Loan Interest Charge	Annually	Maximum: 4.5% of outstanding policy loan	Currently: 4.5% of outstanding policy loan

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Rider Charges
Rider Charge		When Rider Charge is Deducted		Amount Deducted from Cash Value
Overloan Lapse Protection Rider Charge 15		Upon invoking the Rider	Maximum: $42.50 per $1,000 of Cash Value		Minimum: $1.50 per $1,000 of Cash Value
Representative: an Attained Age 85 Insured with a Cash Value of $500,000		Upon invoking the Rider	$32 per $1,000 of Cash Value
Adjusted Sales Load Life Insurance Rider Charge		Monthly		Maximum for each 1% of Premium Load replaced: $0.14 for each $1,000 of aggregate Premiums	Currently: $0.14 for each $1,000 of aggregate Premiums
Children's Term Insurance Rider Charge		Monthly		Maximum: $0.43 per $1,000 of Rider Specified Amount	Currently: $0.43 per $1,000 of Rider Specified Amount
Long-Term Care Rider Charge7 , 15		Monthly		Maximum: $28.65 per $1,000 of Rider Net Amount At Risk	Minimum: $0.00 per $1,000 of Rider Net Amount At Risk
Representative: an Attained Age 35 male preferred non-tobacco		Monthly		$0.02 per $1,000 of Rider Net Amount At Risk
Spouse Life Insurance Rider Charge8 , 15	Monthly			Maximum: $10.23 per $1,000 of Rider Specified Amount	Minimum: $0.10 per $1,000 of Rider Specified Amount
Representative Spouse: an Attained Age 35 female non-tobacco with a Rider Specified Amount of $100,000	Monthly			$0.11 per $1,000 of Rider Specified Amount
Accelerated Death Benefit Rider Charge9 , 15
Administrative Expense Charge	Upon invoking the Rider		Maximum: $250.00		Currently: $250.00
Rider Charge	Upon invoking the Rider		Maximum: $200 per $1,000 of Unadjusted Accelerated Death Benefit Payment		Minimum: $30 per $1,000 of Unadjusted Accelerated Death Benefit Payment
Representative: an Insured of any age or sex, an assumed life expectancy of 1 year, and an assumed interest rate of 5% and a risk charge of 5%.	Upon invoking the Rider		$100 per $1,000 of Cash Value from the policy's Cash Value
Accidental Death Benefit Rider Charge10 , 15	Monthly			Maximum: $0.75 per $1,000 of Rider Specified Amount	Minimum: $0.05 per $1,000 of Rider Specified Amount
Representative: an Attained Age 35 male preferred non-tobacco with a Rider Specified Amount of $100,000	Monthly			$0.06 per $1,000 of Rider Specified Amount
Continued on Next Page

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Riders Charges (continued)
Rider Charge		When Rider Charge is Deducted	Amount Deducted from Cash Value
Premium Waiver Rider Charge11 , 15	Monthly		Maximum: $315 per $1,000 of Premium Waiver Benefit		Minimum: $42 per $1,000 of Premium Waiver Benefit
Representative: an age 35 male preferred  non-tobacco	Monthly		$42 per $1,000 of Premium Waiver Benefit
Additional Term Insurance Rider Charge12 , 15	Monthly		Maximum: $83.34 per $1,000 of Rider Death Benefit	Minimum: $0.02 per $1,000 of Rider Death Benefit
Representative: an issue age 35 male, in the first policy year, preferred non-tobacco with a Rider Specified Amount of $250,000 and a Total Specified Amount of $500,000	Monthly		$0.05 per $1,000 of Rider Death Benefit
Waiver of Monthly Deductions Rider Charge13 , 15	Monthly		Maximum: $855 per $1,000 of Waiver of Monthly Deduction Benefit	Minimum: $85 per $1,000 of Waiver of Monthly Deduction Benefit
Representative: an age 35 male preferred non-tobacco with a Specified Amount of $500,000 and Death Benefit Option 1	Monthly		$85 per $1,000 of Waiver of Monthly Deduction Benefit
Extended Death Benefit Guarantee Rider14 , 15	Monthly		Maximum: $0.16 per $1,000 of Base Policy Specified Amount	Minimum: $0.01 per $1,000 of Base Policy Specified Amount
Representative: an age 35 male preferred non-tobacco with an Extended Death Benefit Guarantee Percentage of 100%, a lifetime Extended Death Benefit Guarantee Duration, and a base Specified Amount of $500,000	Monthly		$0.06 per $1,000 of Base Policy Specified Amount

The next item shows the minimum and maximum total operating expenses, as of December 31, 2011, charged by the underlying mutual funds that you may pay periodically during the time that you own the policy.  More detail concerning each mutual fund's fees and expenses is contained in the mutual fund's prospectus.

Total Annual Mutual Fund Operating Expenses
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)	Minimum 0.47%	Maximum 1.43%

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1 We deduct one charge comprised of the Sales Load and Premium Taxes.  On the Policy Data Page and throughout this prospectus, this combined charge is referred to as the "Premium Load". The maximum the Sales Load and Premium Taxes in the table reflects the maximum that may be charged in any policy year.  Currently, the maximum is only charged during the first five policy years when Premiums paid is less than the Commissionable Target Premium amount attributed to a particular policy.  On a current basis, the Premium Load will decrease the longer your policy remains In Force.

2 The maximum Surrender Charge calculation assumes: the Insured is a male, age 72, standard tobacco, the Specified Amount is $100,000, a full surrender is taken during the first policy year, and the aggregate first year Premium exceeds the surrender target premium. The minimum Surrender Charge calculation assumes the Insured is either male or female, any age, any underwriting classification, any amount of Premium was paid at any time, and a full surrender is taken in policy year 15.  For a detailed description of the Surrender Charges, including examples, see "Surrender Charges" and “Appendix C: Surrender Charge Examples.”

3 The maximum Cost of Insurance Charge assumes: the Insured is a male, issue age 45, policy year 75, standard tobacco, and a Base Policy Specified Amount of $100,000. The minimum charge assumes: the Insured is either male or female, Attained Age 121, any underwriting classification, any Base Policy Specified Amount, and any policy year on or after the policy anniversary the Insured reached Attained Age 121.

4 The Flat Extra Charge is only applicable if certain factors result in an Insured having a Substandard Rating (see "Cost of Insurance Charge").

5 The maximum Mortality and Expense Risk Charge shown in the table reflects the maximum that may be charged in any policy month based on any dollar amount allocated to the Sub-Accounts.  Currently, the maximum is only charged during the first 15 policy years when Cash Value allocated to the variable Sub-Accounts is $250,000 or less. On a current basis, the Mortality and Expense Risk Charge will decrease the longer your policy remains In Force and/or as greater amounts of Cash Value are allocated to the variable Sub-Accounts.

6 The maximum Underwriting and Distribution Charge assumes: policy year 1, an issue age of 85, and Base Policy Specified Amount of $250,000. The minimum charge assumes: a policy in effect in years 8 and thereafter, as measured from the Policy Date for the initial Specified Amount, the Insured is either male or female, any age, any underwriting classification, and any Base Policy Specified Amount.

7 The maximum Long-Term Care Rider Charge assumes: the Insured is a female, Attained Age 99, standard tobacco with a Substandard Rating of table P. The minimum charge assumes: the Insured is either male or female, Attained Age 100, and any underwriting classification.  In some states, the Long-Term Care Rider cost of insurance charge is based on issue age instead of Attained Age.

8 The maximum Spouse Life Insurance Rider Charge assumes: the Insured is a male, Attained Age 69, standard tobacco with a Substandard Rating of table F, a flat extra charge of $1.25 per $1,000 per month, and a Rider Specified Amount of $25,000. The minimum charge assumes: the Insured is female, Attained Age 21, standard non-tobacco, no Substandard Rating or flat extra charge, and a Rider Specified Amount of $100,000.

9 The Accelerated Death Benefit Rider Charge varies based on prevailing interest rates and the life expectancy of the Insured upon payment of the accelerated death benefit. The maximum Accelerated Death Benefit Rider Charge assumes: an interest rate discount of 15%, a risk charge of 5%, and a 1 year life expectancy for the Insured. The minimum charge assumes: an interest rate discount of 4%, a risk charge of 2%, and a life expectancy for the Insured that is less than or equal to 3 months.

10 The maximum Accidental Death Benefit Rider Charge assumes: the Insured is Attained Age 69, with a Substandard Rating of table P. The minimum charge assumes: the Insured is Attained Age 5, with no Substandard Rating.

11 The maximum Premium Waiver Rider Charge assumes: monthly Premium payments of $1,000, the Insured is a female, Attained Age 64, with a Substandard Rating of table H.  The minimum charge assumes: monthly Premium payments of $1,000, the Insured is male, Attained Age 18, and any underwriting classification.

12 The monthly Additional Term Insurance Rider Charge is a product of the Rider's monthly cost of insurance rate and the Rider Death Benefit. The maximum charge assumes: the Insured is either male or female, Attained Age 119, policy year 75, any underwriting classification, and any Total Specified Amount. The minimum charge assumes: the Insured is female, issue age 5, policy year 1, and a Total Specified Amount of $1,000,000.

13 The maximum Waiver of Monthly Deductions Rider Charge assumes: the Insured is Attained Age 64, with a Substandard Rating of table H.  The minimum charge assumes: the Insured is male, Attained Age 18, with no Substandard Rating.

14 The maximum Extended Death Benefit Guarantee Rider Charge assumes: the Insured is either sex, any issue age, any underwriting classification, a lifetime guarantee duration is elected, and 100% of the Base Policy Specified Amount is to be guaranteed by this Rider. The minimum charge assumes: the Insured is female, issue age 18, select preferred non-tobacco, a twenty year guarantee duration is elected, and 50% of the Base Policy Specified Amount is to be guaranteed by this Rider.

15 The charge varies based on individual characteristics.  Representative costs may vary from the cost you would incur.  Ask for an illustration or see the Policy Data Pages for more information on the costs applicable to your policy .

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Policy Investment Options

You designate how your Net Premium payments are allocated among the Sub-Accounts and/or the fixed investment options.  Allocation instructions must be in whole percentages and the sum of the allocations must equal 100%.

Fixed Investment Options

The fixed investment options are not registered as securities under the Securities Act of 1933 ("1933 Act") nor is our general account registered as an investment company under the Investment Company Act of 1940 ("1940 Act").  The fixed investment options are not subject to the provisions or restrictions of the 1933 Act or the 1940 Act and the staff of the SEC has not reviewed the disclosure regarding the fixed investment options.

There are currently two fixed investment options available under the policy: the Fixed Account and the Long-Term Fixed Account.  Net Premium that you allocate to either fixed investment option is held in our general account.  The Long-Term Fixed Account may not be available in the state where the policy is issued.

The general account contains all of our assets, other than those in the separate accounts, and funds the fixed investment options.  These assets are subject to our general liabilities from business operations and are used to support our insurance and annuity obligations.   Subject to our claims paying ability, we guarantee amounts allocated to the fixed investment options and interest credited daily at a net effective annual interest rate of no less than 3%.  Interest crediting rates are set at the beginning of each calendar quarter.  We will credit any interest in excess of the guaranteed interest crediting rate at our sole discretion.

Subject to applicable law, assets of the general account are invested at our sole discretion.  We bear the full investment risk for amounts allocated to the fixed investment options (i.e. the risk that our return on general account assets will not exceed the interest we credit on allocations to the fixed investment options).  Unlike Variable Account allocations where your Investment Experience is determined by the performance of the Sub-Accounts in which you invest, the amounts you allocate to a fixed investment option will not share in the investment performance of our general account.  Rather, the investment income you earn on your allocations will be based on the interest crediting rates that we set.  You assume the risk that the actual interest crediting rate may not exceed the 3% guaranteed annual 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 Premiums versus Sub-Account transfers.

We anticipate that the interest crediting rate for the Long-Term Fixed Account will be higher than the interest crediting rate for the Fixed Account.   This is because assets supporting the Long-Term Fixed Account interest rate are invested for longer durations, which will generally produce higher rates of return, than assets supporting the Fixed Account interest rate.  Because its supporting assets are invested for longer durations, the Long-Term Fixed Account has stricter allocation, partial surrender, and transfer limitations.  However, longer investment durations may not always produce higher returns.  Therefore, the interest rate credited to the Long-Term Fixed Account may be the same as, or lower than, the Fixed Account crediting rate.  The Long-Term Fixed Account limitations will apply regardless of whether or not the Long-Term Fixed Account is credited a higher rate of interest than the Fixed Account.  For more information about the fixed investment option restrictions, see the "Fixed Investment Option Transfers," "Premium Payments," "Policy Loans," and "Partial Surrenders" sections of this prospectus.

Note:  Interest we credit to the fixed investment options may be insufficient to pay the policy's charges.  Therefore additional Premium payments may be required over the life of the Policy to prevent it from lapsing.

It is important to remember any guaranteed benefits or interest crediting associated with the Fixed Account is subject to our claims paying ability.

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 listed are designed primarily as investments for variable annuity contracts and variable life insurance policies issued by insurance companies.

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.

The investment advisors of the underlying mutual funds may manage publicly traded mutual funds with similar namesandinvestment 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.  Policy owners will receive notice of any such changes that affect their policy.

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.

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The Sub-Accounts available through this policy invest in underlying mutual funds of the companies listed below.  For a complete list of available Sub-Accounts, see "Appendix A: Sub-Account Information" Ivy Funds Variable Insurance Portfolios

For more information on the underlying mutual funds, refer to the prospectus for the mutual fund.   Free copies of each mutual fund's prospectus may be obtained by contacting our Service Center .

Valuation of Accumulation Units

We account 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.  We use 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.  We will price Accumulation Units on any day that the NYSE is open for business.  Any transaction submitted on a day when the NYSE is closed or after it has closed for the day, will not be priced until the close of business on the next day that the NYSE is open for business.  Accordingly, we will not price Accumulation Units on these recognized holidays:

·New Year's Day	·Independence Day
·Martin Luther King, Jr. Day	·Labor Day
·Presidents' Day	·Thanksgiving
·Good Friday	·Christmas
·Memorial Day

In addition, we 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 (2) and (3) exist.

Any transactions that we receive after the close of the NYSE will be priced as of the next Valuation Period.

How Sub-Account Investment Experience is Determined

A policy owner's variable account value is based on their allocations to the Sub-Accounts.  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 they own.  The number of Accumulation Units associated with a given Sub-Account allocation is determined by dividing the dollar amount allocated to the Sub-Account by the Accumulation Unit value for the Sub-Account.  The number of Accumulation Units you own in a Sub-Account 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 new Premium and loan repayments.

Initially, we set 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 and the application of any unit value credit.  We account for these performance fluctuations by using a "net investment factor," as described below, in our 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.  If a unit value credit is available, it will be applied each day when we calculate the unit value for the Sub-Account.  Unit value credits are not guaranteed and are available within Nationwide’s sole discretion (see “Unit Value Credit”).

We determine the net investment factor for each Sub-Account on each Valuation Period by dividing (a) by (b) and adding (c),   where:

(a) is the sum of:

(1)   the NAV per share of the mutual fund held in the Sub-Account as of the end of the current Valuation Period; and

(2)   the per share amount of any dividend or income distributions made by the mutual fund (if the date of the dividend or income distribution occurs during the current Valuation Period); plus or minus

(3)   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;

(b) is the NAV per share of the mutual fund determined as of the end of the immediately preceding Valuation Period; and

(c) is the unit value credit.

At the end of each Valuation Period, we determine the Sub-Account's Accumulation Unit value.  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.

Unit Value Credit

A unit value credit is a discretionary amount applied by Nationwide in the calculation of a Sub-Account’s net investment factor resulting in an increase of a Sub-Account’s Accumulation Unit Value.  Unit value credits represent all or a portion of the amount that Waddell &Reed, Inc. (“W&R”) pays to us or our affiliates because of expenses we incur for

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administrative, recordkeeping, shareholder, and certain distribution services we provide when underlying mutual funds are purchased, redeemed or transferred (see “Information on Underlying Mutual Fund Payments”).

We determine annually whether a unit value credit will be applied to each Sub-Account.   If we decide to stop applying a unit value credit to a Sub-Account, we will give the Owner advance notification in writing.   We will continue to pay the unit value credit unless we no longer continue to receive payments from W&R or if the expense (including total compensation), mortality, and investment experience for all policies issued under the prospectus are no longer   as favorable as we assumed when the policies were issued.

Unit value credits vary among Sub-Accounts and some Sub-Accounts are not eligible for a unit value credit.  Since unit value credits are determined at our sole discretion, application or the continued application of unit value credits is not guaranteed, and we may discontinue unit value credits at any time.  When applied, unit value credits are incorporated into the daily unit value calculation for the applicable Sub-Account.

All unit value credits and any gains or losses attributable to such amounts are treated as earnings under the Policy for tax purposes.

The following table lists the current unit value credit that applies to each Sub-Account.  The unit value credit is expressed as a percentage of average annual mutual fund assets held by the Sub-Account.

Ivy Funds Variable Insurance Portfolios	Unit Value Credit
Asset Strategy	0. 45 %
Balanced	0. 45 %
Bond	0. 45 %
Core Equity	0. 45 %
Dividend Opportunities	0. 45 %
Energy	0. 45 %
Global Bond	0. 45 %
Global Natural Resources	0. 45 %
Growth	0. 45 %
High Income	0. 45 %
International Core Equity	0. 45 %
International Growth	0. 45 %
Limited-Term Bond	0. 45 %
Micro Cap Growth	0. 45 %
Mid Cap Growth	0. 45 %
Money Market	0. 20 %
Pathfinder Aggressive	0. 20 %
Pathfinder Conservative	0. 20 %
Pathfinder Moderate	0. 20 %
Pathfinder Moderately Aggressive	0. 20 %
PathfinderModerately Conservative	0. 20 %
Real Estate Securities	0. 45 %
Science and Technology	0. 45 %
Small Cap Growth	0. 45 %
Small Cap Value	0. 45 %
Value	0. 45 %

There is no separate charge for this feature.

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").  If you intend to use an active trading strategy, you should consult your registered representative and request information on other Nationwide policies that offer mutual funds that are designed specifically to support active trading strategies.

We discourage (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, we have implemented, or reserve the right to implement, several processes and/or restrictions aimed at eliminating the negative impact of active trading strategies.  We cannot guarantee that our attempts to deter active trading strategies will be successful.  If active trading strategies are not successfully deterred by our actions, the performance of Sub-Accounts that are actively traded will be adversely impacted.  Policy owners remaining in the affected Sub-Account will bear any resulting increased costs.

Short-Term Trading Fees.  Some 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

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allocation to the Sub-Account.  The fee is assessed against the amount transferred and is paid to the 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."

U.S. Mail Restrictions.  We monitor 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 day, 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, we may restrict the form in which transfer requests will be accepted.  In general, we 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, we 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.  We reserve the right to refuse or limit transfer requests, or take any other action we deem 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 us to constitute harmful trading practices, may be restricted.

Any restrictions that we implement will be applied consistently and uniformly.  In the event a restriction we impose results in a transfer request being rejected, we will notify you that your transfer request has been rejected.  If a short-term trading fee is assessed on your transfer, we will provide you a confirmation of the amount of the fee assessed.

Underlying Mutual Fund Restrictions and Prohibitions.  Pursuant to regulations adopted by the SEC, we are 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 of our policy owners;

(2)   request the amounts and dates of any purchase, redemption, transfer, or exchange request ("transaction information"); and

(3)   instruct us 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 our policies).

We are required to provide such transaction information to the underlying mutual funds upon their request.  In addition, we are required to restrict or prohibit further purchases or requests to exchange into an underlying mutual fund upon instruction from the underlying mutual fund.  We 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 submitted by us, we will keep any affected policy owner in their current underlying mutual fund allocation.

Fixed Investment Option Transfers

Prior to the policy's Maturity Date, you may make transfers involving the fixed investment options (the Fixed Account and the Long-Term Fixed Account).  These transfers will be in dollars.  We reserve the right to limit the dollar amount, number, and frequency of transfers involving the fixed investment options.

In addition to the fixed investment option specific transfer limitations below, we may prohibit you from transferring to or from either of the fixed investment options before the end of the first policy year.  We may also prohibit you from making a transfer to or from a fixed investment option within twelve months of a prior transfer of the same type involving that fixed investment option.

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Limits on Transfers to the Fixed Investment Options:

Fixed Account:

·   we may prohibit you from transferring more than 25% of the policy's Sub-Account value to the Fixed Account as of the close of business on the prior Valuation Period; and

·   we reserve the right to refuse any transfer to the Fixed Account that would cause the policy's Fixed Account value to exceed 30% of the policy's Cash Value.

Long-Term Fixed Account:

·   we will refuse transfers to the Long-Term Fixed Account that would cause the Long-Term Fixed Account value to exceed the lesser of:  30% of the policy's total Cash Value as of the close of business on the prior Valuation Period; or $1,000,000; and

·   we may further limit or refuse transfers to the Long-Term Fixed Account on a prospective basis at any time.  Generally, this right will be invoked when interest rates are low by historical standards.

In addition, we may refuse transfers to either the Fixed Account and/or Long-Term Fixed Account that would cause the total value of amounts allocated to the fixed investment options to exceed 50% of your policy's total Cash Value.

Limits on Transfers from the Fixed Investment Options:

Fixed Account:

·   we may prohibit you from transferring more than 25% of the policy's Fixed Account value as of the end of the previous policy year.

Long-Term Fixed Account:

·   transfers from the Long-Term Fixed Account will be prohibited prior to the end of the first policy year; and

·   after the first policy year, the total of all partial surrenders and transfers from the Long-Term Fixed Account within any twelve month period, determined looking back from the Valuation Period during which we receive your request, is limited to the greater of:

(1)   $5,000; or

(2)   10% of the policy's Long-Term Fixed Account value as of the last monthly policy anniversary twelve months prior to the Valuation Period during which we receive your request.  (If your request is received within one month after the first policy anniversary, the policy's Long-Term Fixed Account value on the Policy Date will be used.)

This limit is cumulative and will be determined on a rolling basis.  This means that any transfers and/or partial surrenders from the Long-Term Fixed Account during the twelve months prior to the Valuation Period during which we receive your request will be deducted from the available amount.  Information need ed to calculate the available amount for transfer can be obtained by contacting our service center using the information on the front page of this prospectus.

·   in addition, we do not allow transfers from the Long-Term Fixed Account as part of the asset rebalancing or dollar cost averaging programs.

Transfers out of the fixed investment options will be on a last-in, first-out basis (LIFO).  Any restrictions that we implement 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 1-866-221-1100 (TDD 1-800-238-3035)

·   by mail to P.O. Box 182835, Columbus, Ohio 43218-2835

·   by fax at 1-888-634-4472

·   by Internet at www.waddell.com.

We reserve the right to restrict or remove the ability to submit service requests via Internet, phone, or fax upon written notice.

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 on the Valuation Period they are received at the Service Center as long as the request is in good order (see “Valuation of Accumulation Units” for more information about processing transactions when the NYSE is closed) .  Good order generally means that all necessary information to process the request is complete and in a form acceptable to us.  If a request is not in good order, we 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.  We reserve the right to process any transaction request sent to a location other than the Service Center on the Valuation Period it is received at the Service Center.

We may be required to provide information about your policy to government regulators.  If mandated under applicable law, we may be required to reject a Premium payment and to refuse to process transaction requests for transfers, surrenders, loans, and/or death benefits until instructed otherwise by the appropriate regulator.

We will use reasonable procedures to confirm that instructions are genuine and we will not be liable for following instructions that we reasonably determined to be genuine.  We may record telephone requests.  Telephone and computer

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systems may not always be available.  Any telephone system or computer, whether yours or ours, can experience outages or slowdowns for a variety of reasons.  The outages or slowdowns could prevent or delay processing.  Although we have 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

Generally

The policy is a legal contract.  It will comprise and be evidenced by: a written contract; any Riders; any endorsements; the Policy Data Page; and the application, including any supplemental application.   This prospectus discloses all material provisions of the policy.  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.   The benefits described in the policy and this prospectus, including any optional riders or modifications in coverage, may be subject to our underwriting and approval.  We will consider the statements you make in the application as representations, and we will rely on them as being true and complete.  However, we will not void the policy or deny a claim unless a statement is a material misrepresentation.  If you make an error or misstatement on the application, we will adjust the Death Benefit and Cash Value accordingly.

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.  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, please contact our Service Center.

Any modification (or waiver) of our rights or requirements under the policy must be in writing and signed by our president or corporate secretary.  No agent may bind us by making any promise not contained in the policy.

We may modify the policy, our 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, our company, or the separate account is subject.  We may modify the policy to assure that it continues to qualify as a life insurance policy under the federal tax laws.  We will notify you of all modifications and we will make appropriate endorsements to the policy.  The policy is nonparticipating, meaning that we will not be contributing any operating profits or surplus earnings toward the policy Proceeds.

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 the portion of any amounts allocated to our general account and any guaranteed benefits we may provide under the policy exceeding the value of amounts held in the separate account are subject to our claims paying ability.

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.

Policy Owner and Beneficiaries

Policy Owner.  The policy belongs to the owner named in the application.  You, as policy owner, may exercise all policy rights and options while the policy is In Force.  You may also change the policy, but only in accordance with its terms.  You 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.  Subject to our approval, the policy owner may exercise all policy rights in accordance with policy terms while the policy is In Force.  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.

You may name different policy owners or contingent owners (so long as the policy is In Force) by submitting a written request to our Service Center.  Any such change request will become effective as of the date signed.  There may be adverse tax consequences to changing parties of the policy.

Beneficiaries.  The principal right of a beneficiary is to receive the Death Benefit upon the Insured's death while the policy is In Force.  As long as the policy is In Force, you may name more than one beneficiary, designate primary and contingent beneficiaries, change or add beneficiaries, and/or direct us to distribute Proceeds other than described below.

If a primary beneficiary dies before the Insured, we will pay the Death Benefit to the remaining primary beneficiaries.  Unless you specify otherwise, we 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.  You may name more than one contingent beneficiary.  Unless you specify otherwise, we will also pay multiple contingent beneficiaries in equal shares.

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To change or add beneficiaries, you must submit a written request to our Service Center.  A change request is effective as of the date we record it at our Service Center.

Purchasing a Policy

The policy is available for Insureds between the age of zero and Attained Age 85.  To purchase the policy, you must submit a completed application and the required initial Premium payment as stated on the Policy Data Page.

We must receive evidence of insurability that satisfies our underwriting standards (this may require a medical examination) before we will issue a policy.  We can provide you with the details of our underwriting standards.  We reserve the right to reject any application for any reason permitted by law.  Additionally, we reserve the right to modify our underwriting standards on a prospective basis to newly issued policies at any time.

The minimum initial Specified Amount is $100,000.  We reserve the right to modify the minimum Specified Amount on a prospective basis to newly issued policies at any time.

Initial Premium Payment.  The amount of your required initial Premium payment will depend on the following factors: the initial Specified Amount, Death Benefit option elected, any Riders elected, and the Insured's age, sex, health, and activities.  You may pay the initial Premium to our Service Center or to our authorized representative.  The initial Premium payment must be at least $50.  The initial Premium payment will not be applied to the policy until the underwriting process is complete.

Insurance Coverage.  Issuance of full insurance coverage requires that the Insured meet all underwriting requirements, the required initial Premium is paid, and the policy is delivered while the Insured is alive.  We will not delay delivery of the policy to increase the likelihood that the Insured is not living at the time of policy delivery.  Depending on the outcome of our underwriting process, more or less Premium may be necessary for us to issue the policy.  We also have the right to reject any application for insurance, in which case we will return your Premium payment within two business days of the date we make the decision to reject your application.

After we approve an application, insurance coverage will begin and will be In Force on the Policy Date shown on the Policy Data Page.  Changes in the Specified Amount (which may only be requested after the first policy year) will be effective on the next monthly policy anniversary after we approve the change request.

Insurance coverage will end upon the Insured's death, when we begin to pay the Proceeds, or when the policy reaches the Maturity Date, unless it is extended.  Coverage will also end if the policy Lapses.

Temporary Insurance Coverage.  Temporary insurance coverage (of an amount equal to the Specified Amount, up to $1,000,000) may be available for no charge before full insurance coverage takes effect.  You must submit a temporary insurance agreement and make an initial Premium payment.  The amount of this initial Premium payment will depend on the initial Specified Amount, your choice of Death Benefit option, and any Riders you elect.  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 we mail a termination notice (accompanied by a refund equal to the Premium payment you submitted).  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.

Right to Cancel (Examination Right)

Under state law, you may for a limited time, cancel the policy and receive a refund (commonly referred to as the "free look" period).  The length of this time period depends on state law and may vary depending on whether your purchase is replacing another policy you own.   The minimum “free look” period is 10 days.

If you decide to cancel the policy during the free look period, return the policy to the sales representative who sold it or to our Service Center, along with your written cancellation request.  Your written request must be received, if returned by means other than U.S. mail, or post-marked, if returned by U.S. mail, by the last day of the free look period.  If we do not receive your policy at our Service Center by the close of business on the date the free look period expires, you will not be permitted to cancel your policy free of charge.  If the policy is canceled, we will treat the policy as if it was never issued.

Within seven days of a cancellation request, we will refund the amount prescribed by law.  Depending upon the law in the state in which the policy is issued, the amount we refund will be Cash Value or, in certain states, the greater of the initial Premium payment or the policy's Cash Value.

If the policy was issued in a state that requires us to refund the initial Premium payment, we will allocate initial Net Premium to the fixed accounts as instructed, but hold all of the initial Net Premium designated to be allocated to the Sub-Accounts in the available money market Sub-Account until the free look period expires.  At the expiration of the free look period, we will transfer the variable account Cash Value to the Sub-Accounts based on the allocation instructions in effect at the time of the transfer.

If the policy was issued in a state that requires us to refund the Cash Value, we will allocate all of the initial Net Premium to the designated Sub-Accounts and fixed accounts based upon the allocation instructions in effect at that time, at the price next determined.

Premium Payments

This policy does not require a payment of a scheduled Premium amount to keep it In Force.  It will remain In Force as long as the conditions that cause a policy to Lapse do not exist.  However, we will send scheduled Premium payment reminder notices to you according to the Premium payment

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schedule shown on the Policy Data Page.  If you decide to make an additional Premium payment, you must send it to our Service Center.  Each Premium payment must be at least $50.  Upon request, we will furnish Premium payment receipts.  You may make additional Premium payments at any time while the policy is In Force, subject to the following:

·   We 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.

·   We will refund Premium payments that exceed the applicable premium limit established by the IRS to qualify the policy as a contract for life insurance.

·   We will monitor Premiums paid and will notify you when the policy is in jeopardy of becoming a modified endowment contract.   For more information regarding modified endowment contracts, see "Periodic Withdrawals, Non-Periodic Withdrawals and Loans” in “Taxes.”

·   We may require that policy Indebtedness be repaid before we accept any additional Premium payments.

Premium payments will be allocated according to the allocation instructions in effect at the time the Premium is received, subject to the following limitations on fixed investment option allocations:

1.   We may refuse Premium allocations, including initial Premium, to the Fixed Account and/or Long-Term Fixed Account that would cause the total value of amounts allocated to the fixed investment options to exceed 50% of your policy's total Cash Value; and

2.   Net Premium allocations to the Long-Term Fixed Account, including initial Premium, will not be permitted:

a.   to exceed $500,000 in any twelve month period (determined on a rolling basis considering any Premium payment allocations during the twelve months prior to the Valuation Period during which we receive a Premium payment); and/or

b.   if, at the time the Premium is received, it would cause the policy's Long-Term Fixed Account value to exceed $1,000,000.

We may further limit or refuse Premium payments to the Long-Term Fixed Account on a prospective basis at any time.  Generally, this right will be invoked when interest rates are low by historical standards.

Cash Value

We will determine the Cash Value at least monthly.  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;

·   amounts allocated to the fixed investment options, including credited interest; and

·   amounts allocated to the policy loan account, including credited interest.

Surrenders and policy charges and deductions will reduce the Cash Value.  Thus, the Cash Value will fluctuate daily and there is no guaranteed Cash Value.  Accordingly, if the Cash Value is a factor in calculating a benefit associated with the policy, the value of that benefit will also fluctuate.  The loan account is part of our general account and will not be affected by the Investment Experience of the Sub-Accounts.  While they are each part of our general account, the fixed investment options and the loan account may be credited interest at different rates.  If the policy is surrendered, the Cash Value will be reduced by the amount of any outstanding policy loans and unpaid charged interest in the loan account to calculate the Cash Surrender Value.

Changing the Amount of Insurance Coverage

After the first policy year, you may request to change the Specified Amount.  However, no change will take effect unless the new Cash Surrender Value would be sufficient to keep the policy In Force for at least three months.  Changes to the Specified Amount will typically alter the Death Benefit (see "Changes in the Death Benefit Option").

Any request to increase the Specified Amount must be at least $50,000 and the Insured must be Attained Age 85 or younger at the time of the request.  An increase in the 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 Specified Amount may require you to make larger or additional Premium payments in order to avoid Lapsing the policy.  An additional Underwriting and Distribution Charge and Surrender Charge schedule will also apply whenever you increase the Base Policy Specified Amount.  To increase the Specified Amount, you must submit a written request to our Service Center and you must provide evidence of insurability that satisfies our underwriting standards.

You may request to decrease the Specified Amount.  We apply Specified Amount decreases to the most recent Specified Amount increase, and continue applying the decrease backwards, ending with the original Specified Amount.  Decreases to the Specified Amount may decrease the dollar amount of policy charges calculated per $1,000 of Specified Amount or Net Amount At Risk (including any Rider charges so calculated), depending on the death benefit option elected and the amount of the Cash Value.  Decreases may also result in a surrender charge being assessed (see "Surrender Charges").

We will deny any request to reduce the Specified Amount below the minimum Specified Amount shown on the Policy Data Page.  We will also deny any request that would disqualify the policy as a contract for life insurance.  To decrease the Specified Amount, you must submit a written request to our Service Center.

Changes to the Specified Amount will become effective on the next monthly policy anniversary after we approve the request unless you request and we approve a different date.  We

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reserve the right to limit the number of Specified Amount changes to one increase and one decrease each policy year.

Right of Conversion

Within 24 months of the Policy Date, or longer if required by state law, you may elect by written request to transfer 100% of your Cash Value in the Sub-Accounts and Long-Term Fixed Account into the Fixed Account without regard to any restrictions otherwise applicable to such transfers.  To invoke this right, you must submit your request to our Service Center on our specified forms.  This election is irrevocable.

Once your request has been processed your policy will in effect become a fixed life insurance policy, and the policy's Cash Value will be credited with the Fixed Account's interest rate.  In addition, the following will apply after conversion:

·   transfers out of the Fixed Account will no longer be available and your policy will no longer be able to participate in the Investment Experience of the Sub-Accounts or the interest crediting rate of the Long-Term Fixed Account;

·   the asset rebalancing service and dollar cost averaging programs will no longer be available for election.  If asset rebalancing and/or dollar cost averaging were elected prior to your request these programs will terminate;

·   Mortality and Expense Risk Charges will no longer be deducted after conversion because they are only deducted from Cash Value allocated to the Sub-Accounts; and

·   all other benefits, services, Riders, and charges, including loans and full and partial surrenders, will continue and/or continue to be available after your request for conversion, subject to the terms applicable prior to your request for conversion.

Exchanging the Policy

You may request to exchange the policy for another policy offered by us at the time that is a plan of permanent fixed life insurance.  This is not a contractual right of the policy in all states and where permitted by law, we may refuse such a request.  To make an exchange with us you will surrender this policy and use its Cash Surrender Value to purchase the new policy we underwrite on the Insured's life.  Policy exchanges are subject to our approval, you paying all the costs associated with the exchange, and the Insured satisfying our underwriting standards of insurability.  You may transfer Indebtedness to the new policy.

You must submit your exchange request to our Service Center on our specified forms.  The policy must be In Force and not in a Grace Period.  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.  A surrender charge may be assessed at the time of the exchange (see "Surrender Charges").

Terminating the Policy

There are several ways that the policy can terminate.  You may surrender the policy for its Cash Surrender Value (which may result in adverse tax consequences).  Coverage under the policy will end when we receive your written request to surrender the policy at our Service Center.  The policy will automatically terminate when the Insured dies, the policy matures, or the Grace Period ends.

Assigning the Policy

You may assign any rights under the policy while the policy is In Force, subject to our approval.  If you do, your beneficiary's interest will be subject to the person(s) to whom you have assigned rights.  Your assignment must be in writing and will become effective on the date we record it at our Service Center.  Your assignment will be subject to any outstanding policy loans, policy liens, garnishments, court orders, or any previous assignments.

Reminders, Reports, and Illustrations

Upon request, we will send you scheduled Premium payment reminders and transaction confirmations.  We will also send you semi-annual and annual reports that show:

·   the Specified Amount;

·   minimum monthly Premiums;

·   Premiums paid;

·   all charges since the last report;

·   the current Cash Value;

·   the Cash Surrender Value; and

·   Indebtedness.

Confirmations of individual financial transactions, such as transfers, partial Surrenders, loans, etc., are generated and mailed automatically.  Copies may be obtained by contacting our Service Center.  You may receive information faster from us and reduce the amount of mail you receive by signing up for our eDelivery program.  We will notify you by e-mail when important documents, like statements and prospectuses, are ready for you to view, print, or download from our secure server.  If you would like to choose this option, go to www.nationwide.com/login.

We will send these reminders and reports to the address you provide on the application unless directed otherwise.  At any time after the first policy year, you may ask for an illustration of future benefits and values under the policy.

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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 our Service Center.  We will reinstitute individual delivery within 30 days after receiving such notification.

Standard Policy Charges

We will take deductions from Premium payments and/or the Cash Value to compensate us for the services and benefits we provide, the costs and expenses we incur, and the risks we assume.  We may generate a profit from any of the charges assessed under the policy.  We begin to deduct monthly charges from your policy's Cash Value on the Policy Date.  These charges 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.  If you have a policy loan, a complete description of how interest credited and charged results in costs to you is described in the "Policy Loans" section of this prospectus.

Sales Load

We deduct the Sales Load (as part of the Premium Load) from each Premium payment to compensate us for our sales expenses.  The guaranteed maximum Sales Load is equal to an annualized rate of $65 per $1,000 of Premium.  Currently, the amount of the Sales Load is based on the following schedule:

Policy Year	Premium up to the Commissionable  Target Premium amount	Premium in excess of the Commissionable Target Premium amount
1-5	6.5%	2.5%
6-15	4.5%	1.5%
16+	1.5%	1.5%

We may waive the Sales Load on the initial Premium paid into this Policy as part of a sponsored exchange program to another policy we offer through Nationwide Life and Annuity Insurance Company or our parent company, Nationwide Life Insurance Company, as permitted under the securities laws and/or rules or by order of the SEC.

Commissionable Target Premium.   The Commissionable Target Premium referred to above is the amount of premium Nationwide needs to recoup the cost of the initial sales expense and the future maintenance costs of the policy.  The Commissionable Target Premium varies by issue age, sex, and

risk classification and ranges from $3 per $1,000 of Specified Amount to $65 per $1,000 of Specified Amount.  For more specific information, request an illustration and consult with your registered representative, or contact our Service Center.

Premium Taxes

We deduct Premium Taxes (as part of the Premium Load) from each Premium payment to reimburse us 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 we incur.  It is an estimated amount.  If the actual tax liability is more or less, we will not adjust the charge retroactively.

A Note on the Premium Load. We deduct a Premium Load from each Premium payment to partially reimburse us for our sales expenses and Premium taxes, and certain actual expenses, including acquisition costs.  The Premium Load also provides revenue to compensate us for assuming risks associated with the policy, and revenue that may be a profit to us.

Short-Term Trading Fees

Some mutual funds offered in 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.  We 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" in this prospectus.

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

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owner's Sub-Account value.  All such fees will be remitted to the mutual fund; none of the fee proceeds will be retained by us 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.

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;

·   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

Currently, we do not assess an Illustration Charge, which would compensate us for the administrative costs of generating the illustration.  We may elect in the future to assess an Illustration Charge which will not exceed $25 per illustration requested.  Any Illustration Charge must be paid at the time of the illustration request.  The Illustration Charge will not be deducted from the policy's Cash Value.

Partial Surrender Fee

Currently, we do not deduct a Partial Surrender Fee, which would compensate us for the administrative costs associated with calculating and generating the surrender amount.  We may elect in the future to assess a Partial Surrender Fee which will not exceed the lesser of $25 or 2% of the amount surrendered.  Any Partial Surrender Fee assessed will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.

Surrender Charges

We deduct a Surrender Charge from the Cash Value if you surrender or Lapse the policy.  Also, if you increase the Specified Amount, and then reduce the Specified Amount to less than it was before the increase, we will deduct a Surrender Charge from the Cash Value.

The Surrender Charge is assessed to compensate us for policy underwriting expenses and sales expenses, including processing applications, conducting medical exams, determining insurability (and the Insured's underwriting class), and establishing policy records.  Thus, the Surrender Charge is comprised of two components: the underwriting component and the sales component.

The underwriting component equals the product of the Specified Amount and the administrative target factor.  (The administrative target factor is actuarially derived and is used to determine how much we should charge per Premium payment for underwriting expenses.)  The administrative target factor varies by the Specified Amount and the Insured's age when the policy was issued.  A table showing the administrative target factors can be found in Appendix D to this prospectus.

The sales component is the lesser of the following two amounts: (1) the product of the Specified Amount, divided by 1,000, and the surrender target premium; and (2) the sum of all Premium payments you made during the first policy year.  The surrender target premium is actuarially derived and is used to determine how much we should charge per Premium payment for sales expenses.  The surrender target premium varies by the Insured's sex, the Insured's age when the policy was issued, and the Insured's underwriting class.  A table showing the surrender target factors can be found in Appendix D to this prospectus.

The initial Surrender Charge is the sum of the underwriting component and a percentage (that varies by age and sex ) ) of the sales component.  A table showing the applicable Surrender Charge percentage can be found in Appendix D to this prospectus.

Generally, surrender charges will be greater for Insureds who are older or in poor health and less for Insureds who are younger or in good health.  For a given Insured, larger Specified Amounts will produce greater surrender charges.  In addition, surrender charges will increase with the amount of Premium you pay in the first policy year, or first year after a Specified Amount increase, up to the dollar amount produced by the calculation in (1) of the sales component description above, which represents the maximum surrender charge we are permitted by law for this policy.  Beyond this point increasing the first year Premium you pay will not impact your surrender charges.

When considering the potential impact of surrender charges, you should remember that variable universal life insurance is not suitable as an investment vehicle for short-term savings.  It is designed for long-term financial planning.  Attempting to minimize your surrender charges by choosing a lower Specified Amount may result in inadequate death benefit coverage, and paying less first year Premium to minimize surrender charges may result in higher cost of insurance charges and a greater chance your policy could Lapse.  You should consult with your registered representative and carefully weigh all relevant benefit and charge factors together with your goals in purchasing this policy.

Depending on the policy year of the surrender and the Insured's age at the time of policy issuance or at the time an increase becomes effective, the actual Surrender Charge paid will be a decreasing percentage of the initial Surrender Charge, as set forth in the following table:

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Reduction of Surrender Charges

Policy year calculated from the Policy Date or effective date of Specified Amount Increase*:	Surrender Charge, as a percentage of the initial Surrender Charge:
	Issue Ages 0-49	Issue Ages 50+
1	100%	100%
2	100%	100%
3	100%	92.5%
4	95.0%	85.0%
5	87.5%	77.5%
6	80.0%	70.0%
7	72.5%	60.0%
8	65.0%	50.0%
9	57.5%	40.0%
10	50.0%	30.0%
11	40.0%	20.0%
12	30.0%	10.0%
13	20.0%	0%
14	10.0%	0%
15 and thereafter	0%	0%

*The Surrender charge duration may vary based on the law in the state where the policy is issued.

Each increase to the Specified Amount (referred to as Specified Amount segments) will have its own Surrender Charge.  Surrender charges for an increase are only 81% of the surrender charge for a corresponding initial segment.  The Surrender Charge for each Specified Amount segment, when added together, will equal your total Surrender Charge.

See “Appendix C: Surrender Charge Examples” for more information and examples showing how the Surrender Charge is calculated.

Any Surrender Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.

We will waive the surrender charge of your policy if you elect to surrender it in exchange for a plan of permanent fixed life insurance offered by us, as described in the "Exchanging the Policy" section, subject to the following:

·   the exchange and waiver are be subject to your providing us new evidence of insurability and our underwriting approval; and

·   you have not invoked any of these Riders:

1.      Premium Waiver Rider;

2.      Waiver of Monthly Deductions Rider; or3.Long-term Care Rider.

Cost of Insurance Charge

We deduct a Cost of Insurance Charge from the policy's Cash Value on the Policy Date and on each monthly anniversary of the Policy Date to compensate us for providing expected

mortality benefits, and to reimburse us for certain actual expenses, including acquisition costs and state and federal taxes.  This charge also provides revenue to compensate us for assuming certain risks associated with the policy, and revenue that may be profit to us.  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, issue age, underwriting class, any Substandard Ratings, how long the policy has been In Force, and the Total Specified Amount.  The cost of insurance rates are based on our expectations as to future mortality and expense experience.

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 rates will never be greater than those shown on the Policy Data Pages.

Flat Extras and Substandard Ratings.  As part of our underwriting process, we may inquire about the occupation and activities of the Insured.  If the activities or occupation of an Insured cause an increased health or accident risk, it may result in the Insured receiving a Substandard Rating.  If this is the case, we may add an additional component to the Cost of Insurance Charge called a "Flat Extra."  The Flat Extra accounts for the increased risk of providing life insurance when one or more of these factors apply to the Insured.  The Flat Extra is a component of the total Cost of Insurance Charge, so if applied it will be deducted from the policy's Cash Value on the Policy Date and the monthly anniversary of the Policy Date.  The monthly Flat Extra is between $0.00 and $2.08 per $1,000 of the Net Amount At Risk.  If a Flat Extra is applied, it is shown in the Policy Data Pages.  In no event will the Flat Extra result in the Cost of Insurance Charge exceeding the maximum charge listed in the Fee Table of this prospectus.

We will uniformly apply a change in any cost of insurance rate for Insureds of the same age, sex, underwriting class, and any Substandard Ratings and Specified Amount, if their policies have been In Force for the same length of time.  If a change in the cost of insurance rates causes an increase to your Cost of Insurance Charge, your policy's Cash Value could decrease.  If a change in the cost of insurance rates causes a decrease to your Cost of Insurance Charge, your policy's Cash Value could increase.

The Cost of Insurance Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.

Mortality and Expense Risk Charge

We deduct a monthly Mortality and Expense Risk Charge from the policy's Cash Value allocated to the Sub-Accounts on each monthly anniversary of the Policy Date to compensate us for assuming the risk associated with mortality and expense costs.  This charge also provides revenues to compensate us for assuming certain risks associated with the policy, and

revenues that may be profit to us.  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

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more than expected.  The Mortality and Expense Risk Charge will be deducted proportionally from your Sub-Account allocations.

The maximum guaranteed Mortality and Expense Risk Charge is equal to an annualized rate of $8.00 per $1,000 of all variable account Cash Value for policy years 1-15, and $3.00 per $1,000 of all variable account Cash Value for policy years 16 and later.  Currently, the amount of the Mortality and Expense Risk Charge that is assessed is based on the following schedule:

Cash Value	Policy Years 1 – 15	Policy Years 16+
Charge for first $250,000 of Variable Cash Value	$8.00 per $1,000	$3.00 per $1,000
Charge for Variable Cash Value in excess of $250,000	$3.00 per $1,000	$2.00 per $1,000

This means that on a current basis, the Mortality and Expense Risk Charge rate will decrease the longer your policy remains In Force and as greater amounts of Cash Value are allocated to the variable Sub-Accounts, subject to allocation of sufficient dollar amounts to qualify for the lower current rates.

Administrative Per Policy Charge

We deduct a monthly Administrative Per Policy Charge from the policy's Cash Value to reimburse us for the costs of maintaining the policy, including accounting and record-keeping.  Currently, the Administrative Per Policy Charge is $20 per month in the first policy year and $5 per month thereafter.  The maximum guaranteed Administrative Per Policy Charge is $20 per month in the first policy year and $10 per month thereafter.

The Administrative Per Policy Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.

Underwriting and Distribution Charge

We deduct a monthly Underwriting and Distribution Charge from the policy's Cash Value to compensate us for sales, underwriting, distribution, and issuance of the policy.  The current Underwriting and Distribution Charge is $0.20 per $1,000 of the first $250,000 of Base Policy Specified Amount and $0.05 per $1,000 of Base Policy Specified Amount in excess of $250,000.  The maximum guaranteed Underwriting and Distribution Charge is $0.20 per $1,000 of the first $250,000 of Base Policy Specified Amount, and $0.10 per $1,000 of Base Policy Specified Amount in excess of $250,000.  The Underwriting and Distribution Charge will be assessed for seven years for Specified Amounts issued at ages 0-39, and five years for Specified Amounts issued at age 40 or higher, as measured from the Policy Date for the initial Specified Amount, and from the effective date of any increase

in the Specified Amount. Currently, the amount of the Underwriting and Distribution Charge is assessed based on the following schedule:

Issue Age	Per $1,000 Charge for the first $250,000 of Base Policy Specified Amount	Per $1,000 Charge for Base Policy Specified Amount in excess of $250,000
0-35	$ 0.15	$0.05
36-39	$0.16	$0.05
40-50	$0.17	$0.05
51-55	$0.18	$0.05
56-60	$0.19	$0.05
61+	$0.20	$0.05

The Underwriting and Distribution Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.

Policy Loan Interest Charge

We charge interest on the amount of Indebtedness at the maximum guaranteed rate of 4.50% per annum.  The interest will accrue daily and is payable at the end of each policy year, or at the time of a new loan, a loan repayment, the Insured's death, a policy Lapse, or a full surrender.  If the interest is not paid when due, we will add it to the outstanding loan amount by transferring a corresponding amount of Cash Value from each Sub-Account to the loan account in the same proportion as your Sub-Account allocations.

Mutual Fund Operating Expenses

In addition to the charges listed above, there are also charges associated with the mutual funds in which the Sub-Accounts invest.  While you will not pay these charges directly, they will affect the value of the assets you have allocated to the Sub-Accounts because these charges are reflected in the underlying mutual fund prices that we subsequently use to value your Sub-Account units.  Please see the underlying mutual funds' prospectuses for additional information about these charges.  Contact our Service Center to receive, free of charge, copies of the prospectuses for any of the underlying mutual fundsavailable under the policy.

Reduction of Charges

The policy may be purchased by individuals, corporations, and other entities.  We 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 us to realize savings with respect to sales, underwriting, administrative, or other costs.  Where prohibited by state law, we will not reduce charges associated with the policy.

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We determine 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 we expect 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 we expect the individual policies to be In Force; and any other circumstances which are rationally related to the expected reduction in expenses.

We may lower commissions to the selling broker-dealer and/or increase charge back of commissions paid for policies sold with reduced or eliminated charges.  If you have questions about whether your policy is eligible for reduction of any charges, please consult with your registered representative for more specific information.  Your registered representative can answer your questions and where appropriate can provide you with illustrations demonstrating the impact of any reduced charges for which you may be eligible.

We 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 we provide.

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 that we use non-sex distinct tables.  Thus 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 this policy.

A Note on Charges

During a policy's early years, the expenses we incur in distributing and establishing the policy exceed the deductions we take.  Nevertheless, we expect to make a profit over time because variable life insurance is intended to be a long-term financial investment.  Accordingly, we have designed the policy with features and investment options that we believe support and encourage long-term ownership.

We make many assumptions and account for many economic and financial factors when we establish 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 we pay to broker-dealer firms as commissions, expense allowances, and marketing allowances.  We refer to these expenses collectively as "total compensation."  The maximum total compensation we pay to any broker-dealer firm in conjunction with policy sales is 135% of first year Premiums and 3% of renewal Premium after the first year.

We have the ability to customize the total compensation package of our broker-dealer firms.  We may vary the form of compensation paid or the amounts paid as commission, expense allowance, or marketing allowance; however, the total compensation will not exceed the maximum (135% of first year Premiums and 3% of renewal Premium after the first year).  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 0.20% of the non-loaned Cash Value per year.

The actual amount and/or forms of total compensation we pay depend on factors such as the level of premiums we receive from respective broker-dealer firms and the scope of services they provide.  Some broker-dealer firms may not receive maximum total compensation.

Individual registered representatives typically receive a portion of the commissions/total compensation we pay, depending on their arrangement with their broker-dealer firm.  If you would like to know the exact compensation arrangement associated with this product, you should consult your registered representative.

Information on Underlying Mutual Fund Payments

Our 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.  We incur these expenses instead.

We also incur 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 us or our affiliates with wholesaling services that assist in the distribution of the policy and may pay us or our 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 We Receive.  In light of the above, the underlying mutual funds or their affiliates make certain payments to us or our 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 we and our affiliates issue, but in some cases may involve a flat fee.  These payments may be used by us for any corporate purpose, which include reducing the prices of the policies, paying expenses that we or our affiliates incur in promoting, marketing, and administering

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the policies and the underlying mutual funds, and achieving a profit.

We or our 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, we benefit from assets invested in our affiliated underlying mutual funds (i.e., Nationwide Variable Insurance Trust) because our affiliates also receive compensation from the underlying mutual funds for investment advisory, administrative, transfer agency, distribution, and/or other services.  Thus, we may receive more revenue with respect to affiliated underlying mutual funds than unaffiliated underlying mutual funds.

We took into consideration the anticipated payments from the underlying mutual funds when we determined the charges imposed under the policies (apart from fees and expenses imposed by the underlying mutual funds).  Without these payments, we would have imposed higher charges under the policy.

Amount of Payments We Receive.  For the year ended December 31, 2011, the underlying mutual fund payments we and our affiliates received from the underlying mutual funds did not exceed 0.60% (as a percentage of the average daily net assets invested in the underlying mutual funds) offered through this policy or other variable policies that we and our affiliates issue.  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 us or our 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 we or our affiliates receive depends on the assets of the underlying mutual funds attributable to the policy, we and our 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).

Identification of Underlying Mutual Funds.  We 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.  Another factor we consider during the identification process is whether the underlying mutual fund's advisor or subadvisor is one of our affiliates or whether the underlying mutual fund, its advisor, its subadvisor(s), or an affiliate will make payments to us or our affiliates.

There may be underlying mutual funds with lower fees, as well as other variable policies that offer underlying mutual funds with lower fees.  You should consider all of the fees and charges of the policy in relation to its features and benefits when making your decision to invest.  Please note that higher policy and underlying mutual fund fees and charges have a direct effect on your investment performance.

Policy Riders and Rider Charges

You may purchase one or more of the Riders listed below.  There may be additional charges assessed for elected Riders.  The availability, operation, and benefits of the Riders described in this prospectus may vary by the state where the policy is issued.

We will assess any Rider charge by taking deductions from the Cash Value to compensate us for the services and benefits we provide, the costs and expenses we incur, and the risks we assume.  We may generate a profit from any of the Rider charges.  We begin to deduct monthly Rider charges from your policy's Cash Value on the Policy Date or on the first monthly policy anniversary after the Rider is elected.

Note: The charge for certain Riders may be treated as a distribution from the policy for income tax purposes (see "Taxes, Periodic Withdrawals, Non-Periodic Withdrawals, and Loans").  Consult with your tax advisor.

Overloan Lapse Protection Rider

The Overloan Lapse Protection Rider prevents the policy from Lapsing due to Indebtedness by providing a guaranteed paid-up insurance benefit.  The Rider is designed to enable the policy owner of a policy with a substantially depleted Cash Value, due to outstanding Indebtedness, to potentially avoid the negative tax consequences associated with Lapsing the policy.

Neither the IRS nor the courts have ruled on the tax consequences of invoking the Overloan Lapse Protection Rider.  It is possible that the IRS or a court could assert that the Indebtedness should be treated as a distribution, all or a portion of which could be taxable when you elect to invoke the benefits under the Rider.  You should consult with a tax advisor regarding the risks associated with invoking this Rider.

Availability. All policies for which the guideline premium/cash value corridor life insurance qualification test is elected will automatically receive the Overloan Lapse Protection Rider (state law permitting).  The Rider is dormant until specifically invoked by the policy owner, at which time the policy is assessed a one-time charge.

This Rider is not available for policies for which the cash value accumulation life insurance qualification test was elected.

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Eligibility. The policy owner is eligible to invoke the Overloan Lapse Protection Rider upon meeting the following conditions:

·   Indebtedness reaches a certain percentage of the policy's Cash Value (the percentage will vary based upon the Insured's Attained Age);

·   The Insured is Attained Age 75 or older;

·   The policy is currently In Force and has been In Force for at least 15 years;

·   The policy's Cash Value is at least $100,000; and

·   All amounts available to be withdrawn without the imposition of federal income tax have been withdrawn.

The first time the policy's Indebtedness reaches the percentage that makes the policy eligible for the Rider, Nationwide will send a letter to the policy owner notifying them of the policy's eligibility to invoke the Rider.  The letter will also describe the Rider, its cost, and its guaranteed benefits.

You need not invoke the Rider immediately upon notification of eligibility.  The Rider may be invoked at any time, provided that the above conditions are met.

Note: Election of this Rider may impact other provisions of your policy including certain other riders.

After Nationwide receives your request to invoke the Rider, Nationwide will adjust the policy, as follows:

1.   If not already in effect, the Death Benefit option will be changed to Death Benefit Option 1.

2.   The Specified Amount will be adjusted to equal the lesser of: (1) the Specified Amount immediately before you invoked the Rider, or (2) the Specified Amount that will cause the Death Benefit to equal the Minimum Required Death Benefit immediately after the charge for the Rider is deducted.

3.   Any non-loaned Cash Value (after deduction of the Overloan Lapse Protection Rider charge) will be transferred to the Fixed Account, where it will earn the minimum guaranteed fixed interest rate of the base policy (shown on the Policy Data Page).

After the above adjustments are made, the Indebtedness will continue to grow at the policy's loan charged rate, and the amount in the policy loan account will continue to earn interest at the policy's loan crediting rate.  No policy charges will be assessed.  No further loans may be taken from the policy and no withdrawals may be taken from the policy (except for a full policy surrender).  Cash Value may not be transferred out of the Fixed Account.  The Death Benefit will be the greater of the Specified Amount or the Minimum Required Death Benefit.  The policy will remain as described above for the duration of the policy.

Upon invocation of this Rider, the following riders, if also elected, will terminate:

·   Long-Term Care Rider

·   Spouse Life Insurance Rider

·   Waiver of Monthly Deductions

·   Extended Death Benefit Guarantee Rider

Invocation of the Overloan Lapse Protection Rider is irrevocable.

Overloan Lapse Protection Rider Charge.  We deduct a one-time Overloan Lapse Protection Rider Charge at the time you invoke the Rider to cover the administrative costs and to compensate us for the risks associated with the Rider's guaranteed paid-up death benefit.  The Overloan Lapse Protection Rider Charge is the product of the policy's Cash Value and an age-based factor shown in the Rider.  The Rider charge varies by the Insured's age and the Cash Value. The maximum charge for this Rider is $42.50 per $1,000 of Cash Value and the minimum charge is $1.50 per $1,000 of Cash Value.

The Overloan Lapse Protection Rider Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.  If the Cash Value less Indebtedness is insufficient to satisfy the Overloan Lapse Protection Rider Charge, you cannot invoke the Rider without repaying enough Indebtedness to cover the Overloan Lapse Protection Rider Charge.  Because we deduct the Rider charge from the Cash Value, purchase of this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value.  Additionally, any benefits paid pursuant to this Rider will reduce the Cash Surrender Value.

Adjusted Sales Load Life Insurance Rider

The benefit associated with the Adjusted Sales Load Life Insurance Rider is the replacement of all or a portion of the up-front Premium Load (comprised of the Sales Load and Premium Taxes) with a monthly Rider charge.  You may elect the number of years (from one to seven) that you want the Premium Load replaced.  You will pay a Premium Load on any amount that you do not elect to be replaced by the Rider.  This Rider is only available to purchase at the time of application.

To better understand how this Rider might benefit you, ask for an illustration of future benefits and rights under the policy with and without the purchase of this Rider.

Adjusted Sales Load Life Insurance Rider Charge.  If you elect this Rider,we will deduct a monthly Adjusted Sales Load Life Insurance Rider Charge to compensate us for the sales and premium tax expenses that we will not collect in the

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form of Premium Load.   Currently, the charge is $0.14 for each $1,000 of aggregate Premiums.   You should expect the aggregate monthly Rider charges to be greater than the amount we would have deducted as Premium Load.  The monthly charge is the product of your aggregate Premiums since the Policy Date, the portion of Premium Load you choose to replace (expressed as a whole percentage of Premiums paid), and the factor of 0.0001354.  The Rider's charge may vary.  Each Premium payment you make will cause the Rider's charge to increase.  How long the Rider charge is assessed will also vary.  The Rider charge will be assessed for nine policy years, plus the number of years (from one to seven) that you want the Premium Load replaced (with a maximum Rider charge period of 15 years).  However, if you stop making Premium payments during that one to seven-year period, the Rider charge will only be assessed for nine policy years, plus the number of years that you actually made Premium payments.

For example, upon election, you anticipated making Premium payments for five years.  Therefore, you expect to have the Rider charge assessed for 14 years (nine years plus five years).  However, you actually make your last Premium payment in policy year three, and do not make any additional Premium payments.  Since you did not get full "use" of the Rider (you only received three years worth of Premium Load replacement), we will only assess the Rider charge for 12 policy years (nine years plus the three years' worth of benefit you received).

If the policy terminates within the first 10 policy years, we will deduct from the Cash Surrender Value an amount to compensate us for the Premium Load we waived, but were unable to recover as a Rider charge.  The amount deducted from the Cash Surrender Value will equal the product of the actual Premium Load replaced by the Rider (in dollars) and the percentage from the following table that corresponds to thenumber of years the policy has been In Force.

Policy Year	Percentage
1	100%
2	90%
3	80%
4	70%
5	60%
6	50%
7	40%
8	30%
9	20%
10	10%
11 and Later	0%

For example, at the time you elected the Rider, you elected to replace the Premium Load for seven years.  During the fifth policy year, you terminate the policy.  During the five years the policy was In Force, you paid $10,000 of Premium.  The amount of Premium Load that the Rider replaced is $400 ($40 for each $1,000 of Premium).  Therefore, we will deduct $240 (60% of $400) from your Cash Surrender Value.

The Adjusted Sales Load Life Insurance Rider Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.  Because we deduct the charge for this benefit from the policy's Cash Value, your purchase of this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value.

Children's Term Insurance Rider

Subject to our underwriting approval, you may purchase term life insurance on any and all of the Insured's children at any time.  If an insured child dies before the Insured dies 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 after the date the Insured's childturns age 22; or (2) the policy anniversary on which the Insured reaches 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 we pay the benefit, or until you terminate the Rider by written request to our Service Center.

Children's Insurance Rider Charge.  If you elect this Rider, we willdeduct a monthly Children's Insurance Rider Charge to compensate us for providing term insurance on the lives of each and all of the Insured's children.  The Rider charge is $0.43 per $1,000 of the Rider's Specified Amount and 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 you request to change the number of children covered under the Rider.  However, we may decline your request to add another child based on our underwriting standards.

The Children's Insurance Rider Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.  Because we deduct the charge for this benefit from the policy's Cash Value, your purchase of this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value.

Long-Term CareRider

State regulation of long-term care benefits will result in differences in this Rider's name, covered services, criteria for eligibility of benefit payment, cost of insurance charge factors, and maximum monthly benefit amounts.  State variations are subject to change without notice at any time.  To review and fully understand the Rider approved in your state, contact our Service Center.

The benefit associated with the Long-Term Care Rider is that, upon meeting certain requirements, the policy owner is paid a monthly benefit to assist them with the expenses associated with their nursing home care or home health care.  To be able to invoke this Rider, the Insured must be: (1) cognitively impaired or (2) unable to do at least two of the following activities of daily living: bathing, continence, dressing, eating, using the toilet facilities, or transferring (moving into or out of bed, chair, or wheelchair).  In addition, a 90-day waiting period, referred to as an “elimination period,” must be satisfied before benefits are paid.  Benefits will not be

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retrospectively paid for the elimination period.  The elimination period can be satisfied by any combination of days of Long-Term Care Facility stay or days of Home Health Care, as those terms are defined in the Rider.  These days of care or services need not be continuous, but must be accumulated within a continuous period of 730 days.  The elimination period has to be satisfied only once while this Rider is in effect.  The benefit associated with this Rider may not cover all your prospective long-term care costs.  The benefits paid in association with the Rider are intended to be "qualified long-term care insurance" under federal tax law, and generally will not be taxable to the policy owner.  See your tax advisor about the use of this Rider.

Subject to our underwriting approval, you may purchase this Rider at any time.  If you purchase it after the Policy Date, we will require evidence of insurability.  There is a free-look period associated with this Rider.  Within 30 days of receipt of the Rider, you may return it to the sales representative who sold it to you, or to us at our Service Center, and we will void the Rider and refund the related charges.

Decreases in the Base Policy Specified Amount, and/or Additional Term Insurance Rider Specified Amount, if elected, will result in a corresponding decrease in Long-Term Care Rider Specified Amount only if the total Specified Amount is less than the Long-Term Care Rider Specified Amount after the decrease.

When you submit a request for benefits under this Rider, we will determine the amount of your benefit as a monthly amount.  The maximum monthly benefit will be the lesser of:

·    2% of Long-Term Care Specified Amount in effect; or

·   the per diem amount allowed by the Health Insurance Portability and Accountability Act times the number of days in the month.

The maximum lifetime benefit under any combination of Home Health Care benefits and Long-Term Care Facility benefits is equal to the lesser of the Long-Term Care Specified Amount or the Base Policy Specified Amount (including coverage under the Additional Term Insurance Rider) minus policy Indebtedness.

You may request to receive a monthly benefit less than the maximum we determine.  Choosing a lesser amount could extend the length of the benefit period.

This Rider will terminate when the policy matures, the insured dies, you invoke the Overloan Lapse Protection Rider, you terminate the Rider by written request to our Service Center, or you terminate your policy.

While benefits are being paid under the Rider, the Long-Term Care Rider Charges will be waived for the duration of the Rider benefit payment period.  While receiving Rider benefits, loans or partial withdrawals are not permitted.

Long-Term Care Rider Charge.  If you elect this Rider,we will deduct a monthly Long-Term Care Rider Charge to compensate us for providing long-term care benefits upon the Insured meeting certain eligibility requirements.  The Rider charge is the product of the Rider's Net Amount At Risk and a long-term care cost of insurance rate.  Because this Rider has no Cash Value, we define its Net Amount At Risk as the lesser of the Rider's Specified Amount and the policy's Net Amount At Risk.  The long-term care cost of insurance rate is based on our expectations as to your need for long-term care over time and will vary by the Insured's sex, Attained Age (in some states issue age), underwriting class, and any Substandard Ratings.   The maximum charge for this Rider is $28.65 per $1,000 of Rider Net Amount at Risk and the minimum charge is $0.00 per $1,000 of Rider Net Amount at Risk.

The Long-Term Care Rider Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.  Because we deduct the Rider charge from the Cash Value, purchase of this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value.  Additionally, any benefits paid pursuant to this Rider will reduce the Cash Surrender Value.

Long-Term Care Referral Service.  If this Rider is elected, the Insured will have access to a national long-term care services referral network via a toll-free telephone number.  Services include free consultation and tailored information to assist in planning and implementing a care plan.  These services are currently provided through a third party.  There is no separate additional charge for this service.  This service is subject to availability and may be modified, suspended, or discontinued at any time upon thirty 30 days written notice.

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.

You may purchase this Rider 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 the Attained Age 18 and 69 at the time this Rider is elected.

Coverage continues until the Rider anniversary on which the Insured Spouse reaches Attained Age 70, or until the Maturity Date, whichever is earliest.  This Rider will be effective until the Rider's term expires, until we have paid the benefit, until you invoke the Overloan Lapse Protection Rider, or until you decide to terminate this Rider by written request to our Service Center.

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.  Upon conversion, the Cash Value of the policy to

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which this Rider is attached will not be affected.  No evidence of the Insured Spouse’s insurability is required for conversion.  The following are required to exercise this conversion right:

(1) conversion must be applied for in writing;

(2) you must exercise your conversion right while both:

a. the policy and Rider are In Force and not in a Grace Period (if the Insured under the policy dies anytime while this policy and Rider are In Force, conversion must be applied for within 90 days after we receive proof of death for the Insured); and

b. prior to the Rider anniversary date on which the Insured Spouse reaches Attained Age 66;

(3) the amount of coverage available for any new policy purchased under this right of conversion is subject to the following:

a. the coverage amount of the new policy must be for the greater of $10,000 or the minimum amount available for the new policy under our issue rules at the time; but

b. no more than 100% of the Rider Specified Amount.

(4) the new policy must be for a plan of insurance we are issuing on the date of conversion;

(5) the Premium for the new policy will be based on the rates in effect on the date of conversion;

(6) the Premium rate for the new policy will be based on the Attained Age of the Insured Spouse on the date of conversion, the same class of risk as this Rider, if available, and the rates in use at that time.  If this

Rider's risk class is not available for the new policy, the next best risk class available will apply; and

(7) no supplemental benefits or additional coverage may be added without evidence of the Insured Spouse's insurability and our consent.

The effective date of the new policy will be the date of conversion.  The incontestability and suicide periods of the new policy will start on the effective date of this Rider.

Spouse Life Insurance Rider Charge.  If you elect this Rider,we will deduct a monthly Rider charge to compensate us for providing term insurance on the life of the Insured Spouse.  The Rider charge is the product of the Rider's Specified Amount and the Insured Spouse life insurance cost of insurance rate.  We base the Insured Spouse life insurance cost of insurance rate on our 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 Rider's Specified Amount.   The maximum charge for this Rider is $10.23 per $1,000 of Rider Specified Amount and the minimum charge is $0.10 per $1,000 of Rider Specified Amount.

The Spouse Life Insurance Rider Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.  Because we deduct the charge associated with this Rider from the Cash Value, purchase of 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 Rider's Specified Amount.

Accelerated Death Benefit Rider

The benefit associated with the Accelerated Death Benefit Rider is the ability to accelerate receipt of the Base Policy Specified Amount if the Insured has a terminal illness that results in the Insured's remaining life expectancy being 12 months or less.

Note: The receipt of accelerated death benefits may be taxable.  The eligibility of the recipient of the accelerated death benefits to receive Medicaid or other government provided benefits may be adversely impacted.  Prior to accepting accelerated death benefits, you should consult a tax advisor and any social service agencies from which you may be eligible for benefits.

The Rider is elected and attached to the policy at the time the claim is made and accepted by us.  The date the Rider is effective is the date we accept the claim.  Coverage under the Rider is only applied to the Base Policy Specified Amount.  Decreases in the Base Policy Specified Amount may result in a corresponding decrease in Rider Specified Amount.  Accelerated benefits under the Rider are not available on any other Riders that may be part of the policy.

The following restrictions on coverage apply to the Rider:

·   The Rider only applies to coverage on the Insured under the base policy.  It does not apply to any available Riders or insureds named under such Riders.

·   This Rider cannot be elected while your policy is being kept In Force by the Extended Death Benefit Guarantee Rider, if you also elected it.

·   The effective date of the Rider must be at least two years before the Maturity Date.

·   Benefit amounts to be accelerated must not be subject to the policy's incontestability period (two years from the date coverage is effective).

·   The Base Policy Specified Amount as of the Rider effective date must be at least $50,000.

·   The accelerated death benefit may not be used if it is subject to the claims of any creditors.

Charges Associated with the Rider.  We assess two charges in connection with the Rider, an Administrative Expense Charge and a Rider Charge.  The Administrative Expense Charge will be deducted from the benefit payment to compensate us for claims processing and other administrative expenses. The maximum Administrative Expense Charge is $250.

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The Rider charge has two components.  The first component is an interest rate discount.  The interest rate discount compensates us for acceleration of the payment of the Base Policy Specified Amount.  It adjusts the Base Policy Specified Amount to its present value.  We show the interest rate discount on the Rider data page.

The interest rate used for the interest rate discount will never be greater than 15%.  When we calculate the interest rate, we will use the greater of: (1) the current yield on 90 day treasury bills; or (2) the maximum statutory adjustable loan interest rate which is the greater of the Moody's Corporate Bond Yield – Monthly Average Corporates or the Guaranteed Cash Surrender Value Interest Rate plus 1%.  In the event that Moody's Corporate Bond Yield - Monthly Average Corporates is no longer published, we will use a substantially similar average, established by your state's insurance Commissioner.

The risk charge component of the Rider charge reflects the premature payment of a portion of the policy's Death Benefit, cost of insurance, and other policy charges that would have been due during the 12-month period following the Rider effective date for coverage corresponding to the accelerated death benefit payment.  The risk charge also covers the risk that the Insured might live longer than a 12-month period.  The risk charge is equal to the Unadjusted Accelerated Death Benefit Payment times the risk charge percentage shown on the Rider data page.  The maximum risk charge percentage is 5%.  Nationwide may earn a profit from the charges associated with this Rider.

Calculation of the Accelerated Death Benefit.  When you make a claim for acceleration of the Death Benefit, you must elect a percentage of the Base Policy Specified Amount you wish to receive.  This elected percentage of the Base Policy Specified Amount is referred to as the Accelerated Death Benefit Rider Percentage, or Rider Percentage.  The net amount of the accelerated Death Benefit is determined by taking the product of the Rider Percentage and Base Policy Specified Amount and then subtracting: (1) the Rider charge; (2) Administrative Expense Charge; and (3) the product of the Rider Percentage and the sum of all outstanding policy loans.

The benefit is calculated in accordance with the formula below:

ADB = [RP (SA)] – [RC + (RP x OPL) + UP + AEC]

Where:

ADB = accelerated Death Benefit

RP = Rider Percentage

SA = Base Policy Specified Amount at the time the benefit is calculated

RC = Rider charge

OPL = outstanding policy loans on the date the benefit is calculated

UP = any unpaid Premium, which is the amount of any Premium that might be due or payable if your policy is in a Grace Period on the date the benefit is calculated

AEC = Administrative Expense Charge

Example of How the Accelerated Death Benefit Is Calculated.  Assume the Base Policy Specified Amount is $100,000 and the Rider Percentage of the Specified Amount is 50%.  Also assume that there are aggregate outstanding policy loans in the amount of $10,000 and there is unpaid Premium of $500.  The charges in this example are: (1) $3,500 aggregate for the Rider charge; and (2) $250 for the Administrative Expense Charge.

Using the above assumptions, here is how the accelerated Death Benefit would be calculated.

ADB = [50% x $100,000)] – [$3,500 + (50% x $10,000) + $500 + $250]

ADB = [$50,000] – [$3,500 + $5,000 + $500 + $250]

ADB = [$50,000] – [$9,250]

ADB = $41,750

Eligibility and Conditions for Payment.  The following eligibility and conditions apply for payment under the Rider.

·   The Rider only applies to the single Insured under the base policy.  The accelerated Death Benefit coverage does not apply to any insurance elected via Rider under the policy.

·   We must receive your application for benefits under the Rider at our Service Center in a written form that is satisfactory to us.

·   We must receive evidence that is satisfactory to us that the Insured has a terminal illness resulting in the Insured having a remaining life expectancy of 12 months or less.  Satisfactory evidence includes a certification from a physician licensed in the United States that the Insured has a terminal illness resulting in a remaining life expectancy of 12 months or less.  A certifying physician cannot be the Insured, owner, beneficiary, or a relative of any of these parties.  We may also rely on additional expert medical opinions we obtain at our expense and we may choose to rely on these opinions to the exclusion of the certifying physician in making a payment determination.

Accidental Death Benefit Rider

The benefit associated with the Accidental Death Benefit Rider is the payment of a benefit, in addition to the Death Benefit, to the named beneficiary upon the Insured's accidental death.  Accidental death means the Insured died within 90 days of sustaining, and as a result of, bodily injury caused by external, violent, and accidental means from a cause other than a risk not assumed.  Risks not assumed vary by state.  For specific information regarding Rider conditions and risks not assumed in the state where your policy was issued, refer to your Rider form and/or consult with your registered representative or call our Service Center.

Subject to our underwriting approval, you may purchase this Rider at any time on or after the policy anniversary on which the Insured reaches Attained Age 5 and before the policy

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anniversary on which the Insured reaches Attained Age 65 (while the policy is In Force).  The Rider coverage continues until the Insured reaches Attained Age 70.  This Rider will be effective until the Rider's term expires, until we have paid the benefit, or until you terminate the Rider by written request to our Service Center.

Accidental Death Benefit Rider Charge.  If you elect this Rider,we will deduct a monthly Accidental Death Benefit Rider Charge to compensate us for providing coverage in the event of the Insured's accidental death.  The Rider charge is the product of the Rider's Specified Amount and the accidental death benefit cost of insurance rate.  We base the accidental death benefit cost of insurance rate on our 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 Attained Age and any Substandard Ratings.   The maximum charge for this Rider is $0.75 per $1,000 of Rider Specified Amount and the minimum charge is $0.05 per $1,000 of Rider Specified Amount.

The Accidental Death Benefit Rider Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.  Because we deduct the Rider charge from the Cash Value, purchase of this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value.

Premium Waiver Rider

Subject to our underwriting approval, you may purchase this Rider at any time on or after the policy anniversary on which the Insured reaches Attained Age 21 and before the policy anniversary on which the Insured reaches Attained Age 59 (while the policy is In Force).  You may not purchase both this Rider and the Waiver of Monthly Deductions Rider.

The benefit associated with the Premium Waiver Rider is a monthly credit to the policy upon the Insured's total disability for six consecutive months not caused by a risk not assumed.  Risks not assumed vary by state.  For specific information regarding Rider conditions and risks not assumed in the state where your policy was issued, refer to your Rider form and/or consult with your registered representative or call our Service Center.

The amount credited to the policy is the lesser of:

·   the Premium you specified; or

·   the average actual monthly Premiums you paid over the last 36 months prior to the disability (or such shorter period of time that the policy has been In Force).

The monthly credit applied pursuant to the Rider may not be sufficient to keep your policy from Lapsing.

Purchasing this Rider could help preserve the Death Benefit.

If the Insured is younger than Attained Age 63 at the time of the total disability, the Rider coverage continues until the

Insured reaches Attained Age 65.   If the Insured is Attained Age 63 or older at the time of the total disability, the Rider coverage continues for two years.  This Rider is effective until the Rider's term expires (unless we are paying a benefit under the Rider) or until you terminate the Rider by written request to our Service Center.

Premium Waiver Rider Charge.  If you elect this Rider, we will begin deducting a monthly Premium Waiver Rider Charge to compensate us for crediting the policy with the amount of scheduled due and payable Premium payments upon the Insured's total disability for six consecutive months.  The Rider charge is the product of the Rider's benefit (the monthly policy credit) and the premium waiver cost rate.  We base the premium waiver cost rate on our expectations as to likelihood of the Insured's total disability for six consecutive months.  The premium waiver rider monthly rates are established at issue and will not change while the Rider remains In Force.  At issue or upon reinstatement, rates will vary by policy based on the Insured's sex, Attained Age, underwriting class, and any Substandard Ratings.   The maximum charge for this Rider is $315 per $1,000 of Premium waiver benefit and the minimum charge is $42 per $1,000 of Premium waiver benefit.

The Premium Waiver Rider Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.  Because we deduct the Rider charge from the Cash Value, purchase of this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value.

Change of Insured Rider

The benefit associated with the Change of Insured Rider is that you may designate a new Insured, subject to insurability and other conditions.  This 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 costs and benefits under the policy after the change of Insured will be based on the underwriting classification and characteristics of the new Insured.  

The amount of insurance coverage after the date the Insured is changed shall 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 specified amount equals or exceeds the minimum total Specified Amount shown on the Policy Data Pages.  You may elect this Rider at the time of application or at any time while the policy is In Force.  Coverage on the new Insured will become effective on the change date.  Coverage on 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.

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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 evidence of insurability to us.

3.   The new Insured must satisfy our 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.

The costs and benefits under the policy after the change will be based on the underwriting classification and characteristics of the new Insured.  However, it will have no impact on the policy's Specified Amount.  You may elect this Rider at any time except, if you also elected the Extended Death Benefit Guarantee Rider, while your policy is being kept In Force by it.  

Change of Insured Rider Charge.  There is no charge associated with the Change of Insurance Rider.

Additional Term Insurance Rider

The benefit associated with the Additional Term Insurance Rider is term life insurance on the Insured, in addition to the Death Benefit, payable to the beneficiary upon the Insured's death.

Subject to our underwriting approval, you may purchase this Rider at any time while the policy is In Force until the Insured reaches Attained Age 85.  If you purchase this Rider after the Policy Date, we will require evidence of insurability.  The Rider benefit amount may vary monthly and is based on the chosen Death Benefit.  You may renew coverage annually until the Insured reaches Attained Age 120, when this Rider's term expires.

Before deciding whether to purchase the Additional Term Insurance Rider it is important for you to know that when you purchase this Rider, the compensation received by your 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 this Rider will be lower for a significant period of time.  There are instances where the Additional Term Insurance Rider may require lower Premium to maintain the total Death Benefit over the life of the policy or may require increased Premium when compared to not purchasing the Rider at all.

There are also some distinct disadvantages to purchasing the Rider, such as not being able to extend the Maturity Date for coverage under the Rider (resulting in a loss of coverage at maturity).  Another disadvantage is the base policy guaranteed policy continuation provision will only cover the Additional Term Insurance Rider for the first five policy years.  In comparison, the base policy allows longer coverage for issue ages under Attained Age 70.  In addition, the Extended Death Benefit Guarantee Rider does not cover the Additional Term Insurance Rider at all, and invoking it will terminate the Additional Term Insurance Rider (see "Lapse" and "Extended Death Benefit Guarantee Rider").

If you have questions about whether the Rider is appropriate for you, consult your registered representative for more specific information on this Rider and its potential benefits.  Your registered representative can answer your questions and provide you with illustrations demonstrating the impact of purchasing coverage under the Rider.

Additional Term Insurance Rider Charge.  If you elect this Rider,we will deduct a monthly Additional Term Insurance Rider Charge to compensate us for providing term life insurance on the Insured.  The monthly cost of insurance charge for this Rider is determined by multiplying the Rider monthly cost of insurance rate by the Rider death benefit.  The Rider death benefit will be equal to the difference between the total Death Benefit and the base policy death benefit.  We base the Additional Term Insurance Rider cost of insurance rate on our expectation as to the Insured's mortality.  The Additional Term Insurance Rider cost of insurance rate will vary by the Insured's sex, Attained Age, underwriting class, any Substandard Ratings, and the Total Specified Amount.   The maximum charge for this Rider is $83.34 per $1,000 of Rider Death Benefit and the minimum charge is $0.01 per $1,000 of Rider Death Benefit.

The Additional Term Insurance Rider Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.  Because we deduct the Rider charge from the Cash Value, purchase of this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on the Cash Value.

Waiver of Monthly Deductions Rider

Subject to our underwriting approval, you may purchase this Rider at any time on or after the policy anniversary on which the Insured reaches Attained Age 21 and before the policy anniversary on which the Insured reaches Attained Age 59 (as long as the policy is In Force).  You may not purchase both this Rider and the Premium Waiver Rider.

The benefit associated with the Waiver of Monthly Deductions Rider is a benefit (in the form of a credit or expense waiver) to assist the policy owner with policy expenses upon the Insured's disability for six consecutive months not caused by a risk not assumed.  Risks not assumed vary by state.  For specific information regarding Rider conditions and risks not assumed in the state where your policy was issued, refer to your Rider form and/or consult with your registered representative or call our Service Center.

The benefit takes the form of a waiver of the policy's monthly charges.

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Note:  This Rider's benefit alone may not be sufficient to keep your policy from Lapsing.  Therefore, you may need to make additional Premium payments to prevent Lapse even while the Rider's benefit is being paid.  However, while the Rider's benefit is being paid, it will cost you less on a monthly basis to keep the policy In Force.

How long the benefit lasts depends on the Insured's Attained Age at the beginning of the total disability.  If the Insured's total disability begins before the Insured reaches Attained Age 60, the benefit continues for as long as the Insured is totally disabled (even if that disability extends past when the Insured reaches Attained Age 65) or until you invoke the Overloan Lapse Protection Rider.  If the Insured's total disability begins when the Insured is between the Attained Ages of 60 and 63, the benefit continues until the Insured reaches Attained Age 65.  If the Insured's total disability begins after the Insured reaches Attained Age 63, the benefit continues for two years.

Waiver of Monthly Deductions Rider Charge.  If you elect this Rider,we will deduct a monthly Waiver of Monthly Deductions Rider Charge to compensate us for waiving the policy's monthly charges upon the Insured's total disability for six consecutive months.  The Rider charge is the product of the monthly policy charges (excluding the cost for this Rider) and the deduction waiver cost rate.  We base the waiver of monthly deductions cost rate on our 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 Attained Age and any Substandard Ratings. The maximum charge for this Rider is $855 per $1,000 of Waiver of Monthly Deduction benefit and the minimum charge is $85 per $1,000 of Waiver of Monthly Deduction benefit .

The Waiver of Monthly Deductions Rider Charge will be deducted proportionally from your Sub-Account allocations, Fixed Account allocations, and Long-Term Fixed Account allocations.  Because we deduct the Rider charge from the Cash Value, purchase of this Rider could reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value.

Extended Death Benefit Guarantee Rider

General Information about this Rider.  This Rider is only available for election at the time of application for the policy.

This Rider provides additional Lapse protection beyond the protection provided under the "Guaranteed Policy Continuation Provision" section of the base policy.  Lapse protection lasts for a maximum of 10 years under the base policy.  Lapse protection is designed to provide you the potential long-term benefits of investing in a variable

universal life policy while protecting you from losing the life insurance coverage under the policy due to adverse or unfavorable Investment Experience.

Before electing this Rider, carefully review the "Guaranteed Policy Continuation Provision" section of this prospectus.  If you are satisfied that the Lapse protection afforded under this provision of the base policy meets your needs, you should not purchase this Rider.

It is important to remember that you will be paying the Rider charge while the Guaranteed Policy Continuation Provision of the base policy is in effect.  In the event Lapse protection benefits become payable during the guaranteed policy continuation period of the base policy, the benefits provided will be greater than or equal to the benefits provided under the Rider.

If this Rider is elected, and while it remains In Force, the investment options available will be limited (see "Allocation Restrictions" below).  In addition, interaction of this Rider with other elected Riders  may result in the limitation or elimination of Rider benefits (see "Interaction with Other Riders" below).

If you do not meet one of the Premium testing methods described in the "How this Rider Operates" subsection of this Rider, you will not receive any coverage or benefits afforded by this Rider.  In addition, if at any time after the 10th policy year you fail the 10-Year Paid-Up testing method, that method of testing will no longer be used to determine whether Rider coverage applies.

If you purchase this Rider, you must make two irrevocable elections at the time of application:

(1) the portion of the Base Policy Specified Amount you want covered by this Rider (the "Guarantee Amount").  The Guarantee Amount must be between 50% and 100% of your Base Policy Specified Amount; and

(2) the duration of the Rider coverage expressed in full policy years (the "Guarantee Duration").  The Guarantee Duration is subject to the following limits:

(a) the minimum Guarantee Duration that may be elected is 20 years; and

(b) the maximum Guarantee Duration that may be elected is equal to 120 years minus the Insured's Attained Age on the Policy Date.

Allocation Restrictions.  Only certain investment options are available when you elect this Rider.  We selected the available Sub-Accounts on the basis of risk factors associated with their investment objective and Sub-Accounts were excluded from availability with this Rider on the basis of similar risk considerations.

The following allocations are permitted under this Rider:

(1)      the Fixed Account; and/or

(2)      any combination of the Sub-Accounts listed below:

Ivy Funds Variable Insurance Portfolios

·   Pathfinder Conservative

·   Pathfinder Moderate

·   Pathfinder Moderately Aggressive

·   Pathfinder Moderately Conservative

Allocations or transfers to investment options other than those listed above are not permitted while this Rider is In Force.  We

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reserve the right to modify the list of Rider investment options upon written notice.  If we substitute or delete a Sub-Account from the list of available investment options, the substitution or deletion will not affect existing policies where this Rider is already in effect.

You may instruct us to move your allocations back and forth between the available Rider investment options at any time while this Rider is In Force, which will be considered a transfer event.  While this Rider is In Force, your investment allocation (current and future) must be entirely (100%) to the Rider investment options listed above.  While this Rider is In Force, if you instruct us to allocate amounts to an investment option not available under this Rider, we will not process your request.  We will then notify you that you have submitted allocation instructions that violate the terms of this Rider.  Your allocation will remain unchanged until we receive instructions that comply with the allocation requirements of this Rider.  You may still choose to terminate this Rider and then instruct us to make allocations under any of the investment options available under the policy.  Termination of the Rider will end all charges and coverage under the Rider including payment of the Guarantee Amount.

How this Rider Operates.  During the Guarantee Duration, we conduct tests to determine whether the Net Accumulated Premium actually paid is equal to or greater than the required Net Accumulated Premium under either the 10-Year Paid-Up Method or the Monthly Premium Method.

The Net Accumulated Premium actually paid equals the cumulative sum of all Premiums paid from the Policy Date to the date of the most recent monthly anniversary of the Policy Date, reduced by any partial surrenders, Indebtedness, and Returned Premium.

The required Net Accumulated Premium is what must be paid for the Rider coverage to apply.  Under either test, the required Net Accumulated Premium represents the amount of Premium needed to offset Nationwide's risk that the Insured may die during a period when the policy would otherwise Lapse.  In addition to your elections under this Rider, the required Net Accumulated Premium for each test will vary, based on the Insured's sex, issue age, underwriting class, any Substandard Ratings, the Base Policy Specified Amount, Death Benefit option, and any other optional benefits elected.

You may decide to pay the required Net Accumulated Premium under either method.  Generally, the two methods of calculation are attributable to the different ways policy owners pay Premium.  The 10-Year Paid-Up Method is generally used by policy owners who pay a larger Premium during the first 10 policy years.  In contrast, the Monthly Premium Method is generally used by policy owners who pay a lower Premium over a longer period of time.

Described below is how and when we determine under each method whether you have paid the required Net Accumulated Premium for the Guarantee Amount to apply.

(1) 10-Year Paid-Up Method – This method determines a required Net Accumulated Premium that must be paid within a 10-year period beginning on the Policy Date, regardless of the Guarantee Duration you elect.  The required Net Accumulated Premium under this test is stated in the Policy Data Pages.  The test is satisfied if theNet Accumulated Premium paid is equal to or greater than the required Net Accumulated Premium stated in the Policy Data Pages.

During the first 10 policy years, this test is performed on any monthly anniversary of the Policy Date on which the policy's Cash Surrender Value is insufficient to pay the monthly policy charges, including monthly charges for any elected Riders.

This test is also performed on the first monthly anniversary of the Policy Date after the end of the 10th policy year.  If the test for the 10-Year Paid-Up Method is not satisfied at that time, Lapse protection under this method is no longer available and the test will no longer be performed.  If the test for the 10-Year Paid-Up Method is satisfied with the first test after the end of the 10th policy year, we will retest at the following times while the Rider remains in effect and the conditions under this method are met:

(a) on any monthly anniversary of the Policy Date on which the policy's Cash Surrender Value is insufficient to pay the monthly policy charges, including monthly charges for any elected Riders;

(b) on any date of a partial surrender or policy loan; and

(c) on any date there is Returned Premium.

Lapse protection is no longer available and retesting will no longer be done under the 10-Year Paid-Up Method after any of the following circumstances occur:

·   failing to satisfy the 10-Year Paid-Up Method test at any time it is performed after the end of the 10th policy year;

·   the Guarantee Duration ends or this Rider is otherwise terminated;

·   increasing the Base Policy Specified Amount;

·   changing the Death Benefit option; or

·   adding or increasing any Rider coverage on or after the first anniversary of the Policy Date.

If any of the circumstances above occur, the 10-Year Paid-Up Method is no longer available; however, you may still maintain the Guarantee Amount if you satisfy the test under the Monthly Premium Method.

Note: Depending on how your policy is issued (Guideline Premium/Cash Value Corridor Test or Cash Value Accumulation Test), paying Premium equal to the Net Accumulated Premium under the 10-Year Paid-Up Method may disqualify your policy as a contract for life insurance under Section 7702 of the Code.  If this is the case, you can still pay Premium equal to (or in excess of) the required Net Accumulated Premium under the

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Monthly Premium Method.  Request and carefully review illustrations of your planned Rider elections, Premium payments, surrender, and/or policy loan activity before purchasing this Rider.

 (2) Monthly Premium Method – This method determines a monthly Premium amount that is stated in the Policy Data Pages.  The required Net Accumulated Premium under this test is the sum of the monthly Premium amount in effect for each respective month from the Policy Date to the most recent monthly anniversary of the Policy Date.  This test is satisfied if the Net Accumulated Premium paid is equal to or greater than the required Net Accumulated Premium under this method.

This test is performed on any monthly anniversary of the Policy Date during the Guarantee Duration on which the policy's Cash Surrender Value is insufficient to pay the monthly policy charges, including monthly charges for any elected Riders.

Unless this Rider is otherwise terminated, the Monthly Premium Method test will continue to be conducted for the entire Guarantee Duration.  This test cannot be lost due to policy changes or failure to meet the test on any given occasion.  However, the following policy changes may result in a change to the monthly Premium amount, and therefore the required Net Accumulated Premium, under this method and are subject to our approval:

·   increasing or decreasing the Base Policy Specified Amount;

·   adding or increasing any Rider coverage;

·   changing the Death Benefit option; or

·   changing the underwriting classification of the Insured.

Situations Where the Guarantee Amount may be Modified.  Any changes to the policy resulting in a decrease of the Base Policy Specified Amount, including partial surrenders, will also result in a proportional reduction of the Guarantee Amount.

How the Grace Period under the Base Policy Operates with this Rider. If the policy enters a Grace Period (i.e., Lapse protection is not available under the "Guaranteed Policy Continuation Provision" section and neither of the tests under this Rider are met), we will send you notification that includes the following Premium amounts that, if paid, will prevent the policy from Lapsing:

(1) the amount of Premium required to prevent the policy from Lapsing under the "Grace Period" and "Guaranteed Policy Continuation Provision" sub-sections of the "Lapse" section of this prospectus; and

(2) the amount of Premium required to increase the Net Accumulated Premium paid so that the the Monthly Premium Method test is satisfied.

Note: Generally the amount required to prevent the policy from Lapsing under the 10-Year Paid-Up Method test, if applicable, will be greater.  If you would like to know how much additional Premium must be paid to satisfy the 10-YearPaid-Up Method, please contact our Service Center.  Also note that if the 10-Year Paid-Up Method test is not satisfied at any time after the 10th policy year, that test will no longer apply.

This Rider and the policy to which it is attached will terminate unless sufficient Premium is paid within the 61-day Grace Period.  This Rider cannot be reinstated after a Lapse (see "Lapse").

Interaction with Other Riders

Premium Waiver Rider

If you elected the Premium Waiver Rider, the benefits provided by that Rider in the form of Premium payments will be counted as part of the Net Accumulated Premium paid for the purposes of satisfying the Monthly Premium Method and 10-Year Paid-Up Method tests subject to the following:

·   when qualifying for benefit under the Premium Waiver Rider, the Premium requirements of this Rider will not be reduced;

·   the benefit provided by the Premium Waiver Rider in the form of Premium payments may not be sufficient on its own to meet the Premium requirements associated with this Rider; and

·   if the benefit provided by the Premium Waiver Rider in the form of Premium payments is not sufficient to satisfy the Monthly Premium Method or 10-Year Paid-Up Method tests, you may have to pay additional Premium to meet the required Net Accumulated Premium under the tests.

Waiver of Monthly Deductions Rider

If the Waiver of Monthly Deductions Rider is elected, then upon qualifying for benefits under that Rider, the required Net Accumulated Premium for this Rider will not be waived or reduced.  The benefits provided by the Waiver of Monthly Deductions Rider, in contrast to the Premium Waiver Rider, will not count towards the Net Accumulated Premium for purposes of satisfying any of the required Net Accumulated Premium tests under the Rider.  Failure to make Premium payments sufficient to meet either test of required Net Accumulated Premium while you are receiving benefits under the Waiver of Monthly Deductions Rider may result in a loss of benefits under the Rider.

Long-Term Care Rider

If the Long-Term Care Rider is elected, then upon qualifying for benefits under that Rider, the Premium requirements for the Rider will not be waived or reduced and charges for the Rider will continue to be deducted from the policy's Cash Value.  Benefits under the Long-Term Care Rider do not reduce Net Accumulated Premiums.

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If the Long-Term Care Rider Specified Amount is greater than the Guarantee Amount, then upon commencement of benefits under the Rider and after termination of the Additional Term Insurance Rider, if applicable, the Long-Term Care Rider Specified Amount will be reduced so that it equals the Base Policy Specified Amount after invocation of the Rider.

Overloan Lapse Protection Rider

While the policy is being kept from entering a Grace Period by this Rider, the Overloan Lapse Protection Rider cannot be invoked without your first requesting termination of this Rider.

Invoking the Overloan Lapse Protection Rider at any other time will result in termination of this Rider and its charge.

Riders Terminating when Benefits under this Rider Commence. Once you begin to receive benefits under this Rider and before the end of the Guarantee Duration, no changes to the base policy will be permitted, i.e., changes to Specified Amount and addition of other optional riders.  In addition, if you elected any of the following Riders, they will terminate:

·   Spouse Life Insurance Rider

·   Change of Insured Rider

·   Children's Term Insurance Rider

·   Accidental Death Benefit Rider

·   Additional Term Insurance Rider

·   Premium Waiver Rider

If another Rider is terminated by operation of this Rider, charges under terminated Riders will end and you may not reapply for the terminated Rider until the expiration of the Guarantee Duration.

Termination of the Extended Death Benefit Guarantee Rider.  This Rider will terminate and no coverage will apply if any of the following occurs:

(1)you elect to terminate this Rider in writing.  Termination by written request will be effective the next business day following receipt at our Service Center.  If you elect to terminate this Rider, we may require you to return the Rider and the policy for endorsement;

(2)the Guarantee Duration ends; or

(3)the policy Lapses, is surrendered, or otherwise terminates.  

Note: This Rider cannot be reinstated if the policy Lapses.

Extended Death Benefit Guarantee Rider Charge.  We assess a charge for the coverage provided by this Rider.  The charge for each Base Policy Specified Amount segment is determined, and will vary, based on the Insured's sex, issue age, underwriting class, Guarantee Amount, and Guarantee Duration.   The maximum charge for this Rider is $0.16 per $1,000 of Base Policy Specified Amount and the minimum charge is $0.01 per $1,000 of Base Policy Specified Amount.

This Rider charge will be deducted proportionally from your Sub-Account and Fixed Account allocations.  Because we deduct the Rider charge from the Cash Value, purchase of this Rider may reduce the amount of Proceeds payable when the Death Benefit depends on Cash Value.

Policy Owner Services

Dollar Cost Averaging

You 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 our 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 you request or, if that date has passed or no date is specified, then at the end of the Valuation Period during which we receive your request.  There is no charge for dollar cost averaging and dollar cost averaging transfers do not count as transfer events.  We will continue to process dollar cost averaging transfers until there is no more value left in originating investment option(s) or until you instruct us to terminate your participation in the service.

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.  Policy owners may direct us to automatically transfer specific amounts from the Fixed Account and the:

Ivy Funds Variable Insurance Portfolios

·   Money Market

to any other Sub-Account.  These funds may or may not be available depending on when you purchased this policy.  (see "Appendix A: Sub-Account Information").  Transfers from the Fixed Account must be no more than 1/30th of the Fixed Account value at the time you elect to participate in the program.

We do not assure the success of these strategies and we cannot guarantee that dollar cost averaging will result in a profit or protect against a loss.  You should carefully consider your 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.  We may modify, suspend, or discontinue these programs at any time.  We will notify you in writing 30 days before we do so.

Enhanced Dollar Cost Averaging. Periodically, we may offer enhanced dollar cost averaging programs. When offered, these programs will be available only at the time of application.  All or a portion of the initial Premium may be applied to a program.  Subsequent Premium is not eligible for inclusion in the program.  Under an enhanced dollar cost averaging program, the interest rate credited to the initial Premium allocated to the Fixed Account will be greater than the interest rate credited to standard Fixed Account allocations.  Enhanced dollar cost averaging programs will last

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for one year and Cash Value attributable to the enhanced dollar cost averaging program will be transferred from the Fixed Account to the selected Sub-Account(s) based on the following schedule:

Beginning of Month	Fraction of Cash Value Transferred
2	1/11
3	1/10
4	1/9
5	1/8
6	1/7
7	1/6
8	1/5
9	1/4
10	1/3
11	1/2
12	Remaining Amount

Asset Rebalancing

You may elect to participate in an asset rebalancing program.  Asset rebalancing involves the automatic rebalancing of the Cash Value in your chosen Sub-Accounts (up to 20) on a periodic basis.  Cash Value in the Long-Term Fixed Account is not eligible for asset rebalancing and assets may not be rebalanced into the Long-Term Fixed Account.You can schedule asset rebalancing to occur every three, six, or twelve months on days when we price Accumulation Units.  There is no charge for asset rebalancing and it does not count as a transfer event.

You may elect to participate in an asset rebalancing program at the time of application or at a later date by submitting an election form to our Service Center.  Unless you elect otherwise, asset rebalancing will not affect the allocation of Premiums you pay after beginning the program.  Manual transfers will not automatically terminate the program.  Termination of asset rebalancing will only occur as a result of your specific instruction to do so.  We reserve the right to modify, suspend, or discontinue asset rebalancing at any time.

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 their 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 your policy will Lapse.  Before requesting the Automated Income Monitor program, please consult with your financial and tax advisors.

You can obtain an Automated Income Monitor election form by contacting your registered representative or our Service Center.  At the time of application for a program, we will provide you with an illustration of the proposed income stream and impacts to the Cash Value, Cash Surrender Value, and Death Benefit.  You must submit this illustration along with your application.  Programs will commence at the beginning of the next monthly anniversary after we receive your election form and illustration. On each policy anniversary thereafter we will provide an updated In Force illustration to assist you in determining whether to continue, modify, or discontinue an elected program based on your goals.  You may request modification or termination of a program at any time by written request to our Service Center.

Your program will be based on your 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 you elect payments of a fixed amount, the amount you receive 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 your policy's Investment Experience; or

b. Fixed Duration:  If you elect payments for a fixed duration, the amount you receive 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 below and policy Investment Experience to maintain the elected duration.

2.      Illustration assumptions:

a.   an assumed variable rate of return you specify from the available options stated in the election form;

b. minimum Cash Surrender Value you target to have remaining on your policy's Maturity Date, or other date you specify.  This dollar amount is used to calculate available income.  It is not guaranteed to be the Cash Surrender Value on the specified date;

c. you may also request a change of Death Benefit option from Death Benefit Option 2 to Death Benefit Option 1, or a decrease in 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 your policy will Lapse.

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You are responsible for monitoring your policy to prevent Lapse.  We will provide annual In Force illustrations based on your then current Cash Surrender Value and your elected illustration assumptions to assist you in planning and preventing Lapse.  You may request modification or termination of a program at any time by written request to our Service Center.

Automated Income Monitor programs are subject to the following additional conditions:

1.   To prevent adverse tax consequences, you authorize us to make scheduled payments via policy loan when:

a.   your 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 your 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 Surrenders" 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.   our receipt at our Service Center of your written request to terminate participation;

b.   at the time your 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.   one of the following Riders is invoked or begins providing benefits: the Overloan Lapse Protection Rider; Extended Death Benefit Guarantee Rider; or the Long-Term Care Rider;

f.   for income based on a fixed duration, the end of the period you specify at the time of election;

g.   on any policy anniversary when your then current Cash Surrender Value is less than or equal to the target Cash Surrender Value assumption you specify;

h.   at any time the scheduled partial surrender or policy loan would cause your policy to fail to qualify as life insurance under Section 7702 of the Code, as amended; or

i.   your policy's Maturity Date.

We will notify you upon termination of your Automated Income Monitor program due to one of the above events.  In addition, we may modify, suspend, or discontinue Automated Income Monitor programs at any time.  We will notify you in writing 30 days before we do so.

Policy Loans

After the expiration of the free look period and while the policy is In Force, you may take a loan against the policy's Cash Value.  Loan requests must be submitted in writing to our Service Center.  You may increase your risk of Lapse if you take a policy loan.  There also may be adverse tax consequences.  You should obtain competent tax advice before you decide to take a policy loan.

Loan Amount and Interest Charged

Subject to conditions, you may take a policy loan of no more than 90% of the Cash Value allocated to the Sub-Accounts plus 100% of the Cash Value allocated to the fixed investment options less any Surrender Charge.  The minimum loan amount is $200.

We charge interest on the amount of  Indebtedness at the maximum guaranteed rate of 4.5% per annum.  The interest will accrue daily and is payable at the end of each policy year, or at the time of a new loan, a loan repayment, the Insured's death, a policy Lapse, or a full surrender.  If the interest is not paid when due, we will add it to the outstanding loan amount by transferring a corresponding amount of Cash Value from each Sub-Account to the loan account in the same proportion as your Sub-Account allocations.

Collateral and Interest Earned

As collateral for the policy loan, we will transfer Cash Value equal to the policy loan amount to the policy loan account.  Amounts transferred from the Sub-Accounts will be in the same proportion as your Sub-Account allocations, unless you instruct otherwise.  We will only transfer amounts from the Fixed Account if the loan amount exceeds 90% of the Cash Value allocated to the Sub-Accounts.  Finally, we will only transfer amounts from the Long-Term Fixed Account if your allocations to the Sub-Accounts and the Fixed Account are depleted.

Amounts in the policy loan account will accrue and be credited interest daily at a guaranteed minimum rate of 3.0% per annum in all policy years.

Net Effect of Policy Loans

We will charge interest on the outstanding loan amount and credit interest to the policy loan account at the same time.  In effect, the loan interest charged rate is netted against the interest crediting rate, and this is the amount that you are "charged" for taking the policy loan.  The maximum and current charges shown in the Periodic Charges Other Than Mutual Fund Operating Expenses table do not reflect the interest that is credited to amounts in the loan account.  When the interest charged is netted against the interest credited, the net cost of a policy loan is lower than that which is stated in the table.

The amount transferred to the loan account is part of our general   account and will not be affected by the Investment Experience of the Sub-Accounts. The loan account is credited interest at a different rate than either of the fixed investment

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options. Even if it is repaid, a policy loan will affect the policy, the Cash Surrender Value, and the Death Benefit.  If your total Indebtedness ever exceeds the policy's Cash Value, your policy may Lapse.

Repayment

You may repay all or part of a policy loan at any time while the policy is In Force during the Insured’s lifetime.  The minimum repayment amount is $50.  If any portion of an outstanding loan balance has been transferred from the Long-Term Fixed Account, loan repayments will first be allocated to the Long-Term Fixed Account.  Once any outstanding loan balance attributable to the Long-Term Fixed Account has been repaid, loan repayment allocations to the Long-Term Fixed Account will not be permitted:

1.   to exceed $500,000 in any 12- month period (determined on a rolling basis considering any loan repayment allocations during the  12-months prior to the Valuation Period during which we receive a loan repayment); and/or

2.   if, at the time the loan repayment is received, it would cause the policy's Cash Value allocated to the Long-Term Fixed Account to exceed $1,000,000.

We may also require that any portion of an outstanding loan transferred from the Fixed Account must be allocated to the Fixed Account.  We will then apply all loan repayments according to the allocation in effect at the time the payment is received, unless you indicate otherwise, and subject to the Long-Term Fixed Account restrictions above.  While your policy loan is outstanding, we will treat any payments that you make as Premium payments, unless you indicate otherwise.  Repaying a policy loan 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 monthly policy charges.  You can avoid Lapsing the policy by paying the amount required by the Guaranteed Policy Continuation Provision, purchasing and meeting the requirements of the Extended Death Benefit Guarantee Rider, or, if elected, you can invoke the Overloan Lapse Protection Rider to prevent the policy from Lapsing due to Indebtedness.  Before any Lapse, there is a Grace Period during which you can take action to prevent the Lapse.  Subject to certain conditions, you may reinstate a policy that has Lapsed.

Guaranteed Policy Continuation Provision

The policy provides for a guaranteed policy continuation period referred to as the "Initial Death Benefit Guarantee Period" and is shown on the Policy Data Pages.  During the Initial Death Benefit Guarantee Period, the policy will not Lapse if at the time a Lapse would otherwise occur, you havepaid an amount of Premium, reduced for any Indebtedness, partial surrenders, and/or Returned Premium, equal to or greater than the sum of the Monthly Initial Death Benefit Guarantee Premium in effect for each respective month since your policy was issued.

The Monthly Initial Death Benefit Guarantee Premium required will vary by the Insured's issue age, sex, underwriting class, any Substandard Ratings, the Insured's involvement in certain risky activities, the Specified Amount (including increases), and any Riders elected.

If you make any changes to your policy after it is issued, including any policy loans or partial surrenders, increases or decreases to the Specified Amount, adding or terminating a Rider, and/or changing your Death Benefit option, your Monthly Initial Death Benefit Guarantee Premium may change. A change will result in reissued Policy Data Pages. Your current Monthly Initial Death Benefit Guarantee Premium will be shown on the most recent version of the Policy Data Pages issued. Upon request and for no charge, we will determine whether your Premium payments, minus any Indebtedness, partial surrenders, and/or Returned Premiums, are sufficient to keep the Guaranteed Policy Continuation Provision in effect.  For free assistance in determining if your policy meets the requirements of this provision, contact our Service Center.

When the Initial Death Benefit Guarantee Period ends, if the Cash Surrender Value remains insufficient to cover the monthly policy charges, the policy is at risk of Lapsing and a Grace Period will begin.  There is no separate additional charge for the Guaranteed Policy Continuation Provision.

Duration of the Initial Death Benefit Guarantee Period.  The Initial Death Benefit Guarantee Period begins when we issue the policy.  How long the guaranteed policy continuation period lasts depends on the Insured's age at the time of policy issuance, as reflected in the following table:

Insured's Attained Age at Policy Issuance:	0-69	70 or older
Duration of Guaranteed Policy Continuation Period:	the lesser of 10 policy years or to attained age 75	five policy years

Grace Period

At the beginning of a Grace Period, we will send you a notice that will indicate the amount of Premium you must pay to avoid Lapsing the policy.  This amount is equal to the lesser of three times the current monthly deductions, or the amount of Premium that will bring the Guaranteed Policy Continuation Provision back into effect, if applicable.  If you do not pay the indicated amount 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.

Reinstatement

You may reinstate a Lapsed policy by:

·   submitting, at any time within three years after the end of the Grace Period (or longer if required by state law) and before the Maturity Date, a written request to our Service Center to reinstate the policy;

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·   providing any evidence of insurability that we may require;

·   paying sufficient Premium to keep the policy In Force for three months (or less if required by state law) from the date of reinstatement, or, if the policy is in the guaranteed policy continuation period, paying the lesser of (a) and (b) where:

(a)   is the amount of Premium sufficient to keep the policy In Force for three months from the date of reinstatement; and

(b)   is the amount of Premium sufficient to bring the guaranteed policy continuation provision into effect;

·   paying sufficient Premium to cover all policy charges that were due and unpaid during the Grace Period; and

·   repaying or reinstating any Indebtedness that existed at the end of the Grace Period.

Subject to satisfactory evidence of insurability, you may also reinstate any Riders.

The effective date of a reinstated policy (including any Riders) will be the monthly anniversary date on or next following the date we approve the application for reinstatement.  If elected, the Extended Death Benefit Guarantee Rider cannot be reinstated after a Lapse.

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 corresponding to the policy year in which the policy is reinstated.

We will then add to the Cash Value any Premiums or loan repayments that you made to reinstate the policy.

The Sub-Account allocations that were in effect at the start of the Grace Period will be reinstated, unless you indicate otherwise.

Surrenders

Full Surrender

You may surrender the policy for the Cash Surrender Value at any time while the policy is In Force.  The Cash Surrender Value equals the policy's Cash Value minus any Indebtedness and the Surrender Charge.  A surrender will be effective as of the date we receive the policy and your written surrender request at our Service Center.  We reserve the right to postpone payment of that portion of the Cash Surrender Value attributable to the fixed investment options for up to six months.

Policy Restoration after a Full Surrender.  Prior to the Insured's death, we will permit restoration of a surrendered policy pursuant to the 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).

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 Section1035 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 our Service Center within thirty 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.

No proof of insurability or additional underwriting will be required for requests to restore a surrendered policy that meet the above requirements .   Policy restoration is not a contractual 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.

Partial Surrender

You may request a partial surrender of the policy's Cash Surrender Value at any time after the policy has been In Force for one year.  Currently, we do not assess a Partial Surrender Fee (see "Partial Surrender Fee").

We reserve the right to limit the number of partial surrenders to one per policy year.  The minimum amount of any partial surrender request is $200.  In policy years 2-10, the maximum amount of a partial surrender in any given policy year is equal to 10% of the Cash Surrender Value as of the beginning of the policy year.  In policy years 11+, the maximum amount of a partial Surrender is equal to the Cash Surrender Value less the greater of $500 or three times the most recent monthly deductions.  Monthly deductions are calculated for each month, beginning on the Policy Date, as follows:

1. Mortality and Expense Risk Charge; plus

2. Administrative Charges; plus

3. the monthly cost of any additional benefits provided by any Riders; plus

4. the Base Policy Specified Amount Cost of Insurance.

A partial surrender cannot cause the Total Specified Amount to be reduced below the Minimum Specified Amount indicated on the Policy Data Page, and after any partial

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surrender, the policy must continue to qualify as life insurance under Section 7702 of the Code.  Partial surrenders may be subject to income tax penalties.  They could also cause your policy to become a "modified endowment contract" under the Code, which could change the income tax treatment of any distribution from the policy.

If you take a partial surrender, we will surrender Accumulation Units from the Sub-Accounts proportionally based on the current variable account Cash Value to equal the amount of the partial surrender.  If there are insufficient Accumulation Units available, we will surrender amounts from the Fixed Account.  Only if there is insufficient value in the Sub-Accounts and the Fixed Account will we surrender amounts allocated to the Long-Term Fixed Account.  In addition, the total of all partial surrenders and transfers from the Long-Term Fixed Account within any 12 month period is limited to the greater of:

(1)      $5,000; or

(2) 10% of the Cash Value in the Long-Term Fixed Account determined as of the monthly policy anniversary, coinciding with or last preceding the date twelve months prior to the beginning of the Valuation Period during which we receive your request.  (If your request is received within one month after the first policy anniversary, the Cash Value of the Long-Term Fixed Account on the Policy Date will be used.)

Reduction of the Specified Amount due to a Partial Surrender.  When you take a partial surrender, we will reduce the Specified Amount to keep the Net Amount At Risk the same as before the partial surrender, if necessary.  The policy's charges going forward will be based on the new Specified Amount causing the charges to be lower than they were prior to the partial surrender.

Any reduction of the Specified Amount will be made in the following order: against the most recent increase in the Specified Amount, then against the next most recent increases in the Specified Amount in succession, and finally, against the initial Specified Amount.

The Death Benefit

Calculation of the Death Benefit

We will calculate the Death Benefit and pay it to the beneficiary when we receive (at our Service Center) all information required to process the Death Benefit, including, but not limited to, proof that the Insured has died.  The Death Benefit may be subject to an adjustment if you make an error or misstatement upon application, or if the Insured dies by suicide.

While the policy is In Force, the Death Benefit will never be less than the Specified Amount.  The Death Benefit will depend on which Death Benefit option you have chosen and the tax test you have elected, as discussed in greater detail below.  Also, 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.

Death Benefit Options

There are three Death Benefit options under the policy.  You may choose one.  If you do not choose one of the following Death Benefit options, we will assume that you intended to choose Death Benefit Option 1.  Not all Death Benefit options are available in all states.

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.

Death Benefit Option 1.  The Death Benefit will be the Specified Amount on the date of the Insured’s death.

Death Benefit Option 2.  The Death Benefit will be the Specified Amount plus the Cash Value as of the date of the Insured’s death.

Death Benefit Option 3.  The Death Benefit will be the Specified Amount plusthe accumulated premium account   (which consists of all Premium payments, plus interest, minus all partial surrenders as of the date of the Insured’s death).The interest rate attributable to the accumulated premium account is referred to as the Death Benefit Option 3 Interest Rate and is stated on the Policy Data Page. The amount of the accumulated premium account will be no less than zero and no greater than twice the initial Specified Amount.

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 we issue the policy, you irrevocably elect 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 you do not elect a test, we will assume that you intended to elect the guideline premium/cash value corridor test.  If the cash value accumulation test is elected, the Overloan Lapse Protection Rider is not available.

The cash value accumulation test determines the Minimum Required Death Benefit by multiplying the Cash Value by a percentage described in the federal tax regulations.  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.

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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 your policy, you should consider the following:

·   The cash value accumulation test generally allows flexibility to pay more premium, subject to our 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.

Consult a qualified tax advisor on all tax matters involving your policy.

Regardless of which test you elect, we will monitor compliance to ensure that the policy meets the statutory definition of life insurance for federal tax purposes.  As a result, the Proceeds payable under a policy should be excludable from gross income of the beneficiary for federal income tax purposes.  We may refuse additional Premium payments or return Premium payments to you so that the policy continues to meet the Code's definition of life insurance.

Changes in the Death Benefit Option

After the first policy year, you 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.  You may not change to Death Benefit Option 3.  However, you may change from Death Benefit Option 3 to Death Benefit Option 1 or Death Benefit Option 2.  We will permit only one change of Death Benefit Option per policy year.  The effective date of a change will be the monthly policy anniversary following the date we approve 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, we will adjust the Specified Amount so that the Net Amount At Risk remains the same.  The policy's charges going forward will be based on the adjusted Specified Amount causing the charges to be higher or lower than they were prior to the change.

We will refuse a Death Benefit option change that would reduce the Specified Amount to a level where the Premium you have already paid would exceed any premium limit under the tax tests for life insurance.

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 the maximum premium limitations under Section 7702 of the Code.

Incontestability

We will not contest payment of the Death Benefit based on the initial 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 Specified Amount requiring evidence of insurability, we 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.

Suicide

If the Insured dies by suicide, while sane or insane, within two years from the Policy Date, and, in some states, within two years of a reinstatement date, we 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, while sane or insane, within two years from the date we accept an application for an increase in the Specified Amount, and, in some states, within two years from a subsequent reinstatement date, we will pay no more than the Death Benefit 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 Specified Amount that has been In Force for a shorter period.

The suicide period in some states may be less than two years.

Policy Maturity

The Maturity Date of the policy will automatically be extended until the Insured's date of death if the policy is In Force on the Maturity Date, unless you elect otherwise (see "Extending the Maturity Date")

If you elect not to extend the Maturity Date, we will pay the Proceeds to you, generally, within seven days after we receive your written request at our Service Center.  The payment will be postponed, however, when: the New York Stock Exchange is closed; the SEC restricts trading or declares an emergency; the SEC permits us to defer it for the protection of our policy owners; or the Proceeds are to be paid from the fixed investment options.  The Proceeds will equal the policy's Cash Value minus any Indebtedness.  After we pay the Proceeds, the policy is terminated.

The primary purpose of Maturity Date 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 "Taxes").

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Assuming you have no outstanding loans on the Maturity Date and that no partial surrenders or loans are taken after the Maturity Date, the Proceeds after the Maturity Date 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.

Extending the Maturity Date

During this Maturity Date extension, you will still be able to request partial surrenders, and, if elected, the Long-Term Care Rider will remain in effect (though you will not be charged for it).  Payment of the Proceeds and the termination of policy benefits will coincide with the policy's extended Maturity Date unless you decide otherwise.  If the policy's Maturity Date is extended, we will endorse the policy so that:

(1)   no changes to the Specified Amount will be allowed;

(2)   no changes to the Death Benefit option will be allowed;

(3)   no additional Premium payments will be allowed;

(4)   no additional periodic charges will be deducted;

(5)   100% of the policy's Cash Value will be transferred to the Fixed Account; and

(6)   the Specified Amount will be adjusted to what it was when the Insured reached Attained Age 85, but excluding any coverage provided by the Additional Term Insurance Rider, and subject to any partial surrenders (which will affect the Specified Amount of a policy with Death Benefit Option 1) based on the Insured's Attained Age at the time the partial surrender is requested.  While the Insured is between the Attained Ages of 86 and 90, a partial surrender will decrease the Specified Amount proportionately.  If the Insured is Attained Age 91 or older, a partial surrender will reduce the Proceeds by an amount proportionate to the ratio of the partial surrender to the Cash Value.

Notwithstanding the above, if you have invoked the Overloan Lapse Protection Rider the Proceeds may be reduced (see "Overloan Protection Rider").

The Maturity Date will not be extended when the policy would fail the definition of life insurance under the Code.

Payment of Policy Proceeds

You may elect to receive Proceeds (Death Benefit, maturity Proceeds, or Cash Surrender Value) in a lump sum, or in another form that you may elect at application.  At any time before the Proceeds become payable, you may request to change the payout option by writing to our Service Center.

You may elect one or a combination of options.  To elect more than one payout option, you must apportion at least $2,000 to each option and each payment (made at the specified interval) must be at least $20.  The settlement options below are based on predetermined fixed payments.

If you do not make an election as to the form of the Proceeds, upon the Insured's death, the beneficiary may make the election.  Changing the beneficiary of the policy will revoke the payout option(s) in effect at that time.  Proceeds are neither assignable nor subject to claims of creditors or legal process.  If the beneficiary does not make an election, we will pay the Proceeds in a lump sum.

Normally, we will make a lump sum payment of the Proceeds within seven days after we receive your written request at our Service Center.  However, we will postpone payment of the Proceeds on the days that we are unable to price Accumulation Units (see "Valuation of Accumulation Units"). Proceeds are paid from our general account.  For payout options other than lump sum, we will issue a settlement contract in exchange for the policy.

Please note that for the remainder of "Payment of Policy Proceeds" provision, "you" means the person entitled to the Proceeds.

Life Income with Payments Guaranteed Option

If you elect the Life Income with Payments Guaranteed Option, we retain the Proceeds and make payments to you at specified intervals for a guaranteed period (10, 15, or 20 years) and, if you are still living at the end of the guaranteed period, we will continue making payments to you for the rest of your life.  During the guaranteed period, we will pay interest on the remaining Proceeds at a rate of at least 2.5% per annum, compounded annually.  We will determine annually if we will pay any interest in excess of 2.5%.  The Proceeds can be paid at the beginning of 12-, 6-, 3-, or 1-month intervals.

Since the payments are based on your lifetime, you cannot withdraw any amount you designate to this option once payments begin.  If you die before the guaranteed period has elapsed, we will make the remaining payments to your estate.  If you die after the guaranteed period has elapsed, we will make no further payments.

Joint and Survivor Life Option

If you elect the Joint and Survivor Life Option, we retain the Proceeds and make equal payments to you at specified intervals for the life of the last surviving payee.  The Proceeds can be paid at the beginning of 12-, 6-, 3-, or 1-month intervals.

Since the payments are based on the lifetimes of the payees, you cannot withdraw any amount you designate to this option once payments begin.  Payments will cease upon the death of the last surviving payee.  We will make no payments to the last surviving payee's estate.  It is possible that only one payment will be made under this option if both payees die prior to the first payment.

Life Income Option

If you elect the Life Income Option, we will use the Proceeds to purchase an annuity with the payee as annuitant.  The

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amount payable will be based on our current individual immediate annuity purchase rate on the date of the Insured's death, the Maturity Date, or the date the policy is surrendered, as applicable.  The Proceeds can be paid at the end of 12-, 6-, 3-, or 1-month intervals.

Since the payments are based on your lifetime, you cannot withdraw any amount you designate to this option once payments begin.  Payments will cease upon your death.  We will make no payments to your estate.  It is possible that only one payment will be made under this option if the payee dies prior to the first payment.

Some or all of the payout options listed may not be available in all states.  Forms of payout other than the three listed above may be requested, but are subject to our approval.  Requests for other forms of payout must be based on fixed payments, no variable payment options are permitted.  The amount of payments and duration of any other payout options will be determined by us.

Taxes

The tax treatment of life insurance policies under the Internal Revenue Code ("Code") is complex and the tax treatment of your policy will depend on your particular circumstances.   Seek competent tax advice regarding the tax treatment of the policy given your situation.  The following discussion provides a general overview of the Code's provisions relating to certain common life insurance policy transactions.  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 wealth 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 the first 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.  Unlike the estate tax, the gift tax is not scheduled to be repealed.

In general, in 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.  After 2012, the size of estates that will not incur an estate tax is set to revert to $1 million.  However, it is possible that new tax legislation will be introduced and passed that may make further changes to the estate tax for 2013 and beyond.  Those changes could include changing the threshold at which an estate would pay a federal estate tax and changing the tax rates applicable to such estates.

Under prior law, which is expected to continue if an estate tax is reimposed after 2012, 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 exemption.  As with the estate tax, the GSTT tax has been repealed for 2010; however, unless Congress acts to make that repeal permanent, the GSTT tax is scheduled to be reinstated on January 1, 2013 at a rate of 45%.

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 your case, state by state differences of these taxes preclude a useful description of them in this prospectus.

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 you (whether or not you are the Insured) transfer 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 your taxable income for federal income tax purposes unless it is distributed to you 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.  We 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

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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.

We 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, we 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 we accept but then return 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 the policy, such as payment of additional premiums.  If the policy is not issued as a modified endowment contract, we will monitor it and advise you if the payment of a premium, or other transaction, may cause the policy to become a modified endowment contract.  It is only with your written authorization that we will permit your policy to become a modified endowment contract.  Otherwise, we will reject the requested action or refund any Premium paid in excess of the modified endowment limits.

Depending on your 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.  You should seek competent tax advice regarding the tax treatment of the addition of any rider to your policy, based on your individual facts and circumstances.

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, we 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.

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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.  You should carefully consider this potential tax ramification and seek further information before requesting any changes in the terms of the policy.

In addition, 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.

Surrendering the Policy; 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 you received (or 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 you at surrender.

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 we believe 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.  You should consult with your qualified tax advisor regarding the possible adverse tax consequences that could result from an extension of the scheduled maturity date.

Additional Medicare Tax

The 2010 Health Care Act added Section 1411 to the Code, which imposes an additional tax of  3.8% on certain unearned income of individuals, trusts and estates, for tax years commencing after December 31, 2012.  The additional tax will apply to the lesser of (a) the taxpayer’s net investment income and (b) the excess of the taxpayer’s modified adjusted gross income over a threshold amount (the threshold amount is $250,000 in the case of a joint return or surviving spouse; $125,000 in the case of a married individual filing a separate return; and $200,000 in any other case). "Net investment income" is equal to the sum of (i) gross income from interest, dividends, annuities, royalties, and rents (other than income derived from any trade or business to which the tax does not apply), (ii) other gross income derived from any business to which the tax applies, and (iii) net gain (to the extent taken into account in computing taxable income) attributable to the disposition of property other than property held in a trade or business to which the tax does not apply, less (iv) deductions properly allocable to such income.  Although no official guidance has been provided, it appears that any amounts that are treatable as taxable distributions when they are paid from a life insurance policy would be included in the computation of net investment 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 policy 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 contract 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 amount of gain resulting from the sale of a life insurance policy is equal to the excess of the amount received over the policy owner’s basis in the policy (the investment in the contract reduced by the cost of insurance previously paid out of the policy 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.

Taxation of Death Benefits

Federal Income Tax.  The death benefit is generally excludable from the beneficiary's gross income under Section 101 of the Internal Revenue Code.  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.

The payout option selected by your 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.  Your beneficiaries

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should consult with their tax advisors to determine the tax consequences of electing a payout option, based on their individual circumstances.

Federal Estate Tax.  The death benefit is generally includible in the estate of the insured if either (a) it is paid to, or for the benefit of, the insured’s estate, or (b) at any time during the 3 year period ending with the insured’s death, the insured had an "incident of ownership" in the policy.  The regulations define an incident of ownership as anyright of the insured or the estate of the insured to the economic benefits of the policy. Examples include the power to change the beneficiary, to surrender or cancel the policy, to assign the policy, to revoke an assignment, to pledge the policy for a loan, or to obtain from the insurer a loan against the surrender value of the policy.

Special federal income tax considerations for life insurance policies owned by employers.Sections 101(j) and 6039I to 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.

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 fail to obtain the necessary consent, the death benefit will be taxable to you   when received.  If the employer-owner fails to file a properly completed return under Section 6039I, a penalty may apply.

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 3 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, we 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.

Terminal Illness

Certain distributions made under a policy on the life of a "terminally ill individual" or a "chronically ill individual," as those terms are defined in the Code, are treated as death proceeds (see "Taxation of Death Benefits").

Special Considerations for Corporations

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.

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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 your facts and circumstances, you 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.

See, also, "Taxation of Death Benefits", "Special federal income tax considerations for life insurance policies owned by employers", above; and "Business Uses of the Policy", below.

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 you are contemplating using the policy in any arrangement the value of which depends in part on its tax consequences, you 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 you are a non-resident alien, or a resident alien, or if any of your beneficiaries (including your spouse) are not citizens of the United States, you should confer with a competent tax advisor with respect to the tax treatment of this policy.

If you, 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.

Withholding and Tax Reporting

Distributions of taxable income from a life insurance policy, including a life insurance policy that is a modified endowment contract, are subject to federal income tax withholding.  Generally, the recipient may elect not to have the withholding taken from the distribution.  We will withhold income tax unless you advise us, in writing, of your request not to withhold.  If you request that taxes not be withheld, or if the taxes withheld are insufficient, you may be liable for payment of an estimated tax.

A distribution of income from a life insurance policy may be subject to mandatory back-up withholding.  Mandatory backup withholding means that we are required to withhold taxes on a distribution, at the rate established by Section 3406 of the Code, and the recipient cannot elect to receive the entire distribution at once.  Mandatory backup withholding may arise if we have not been provided a taxpayer identification number, or if the IRS notifies us 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 we deemed 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 Your 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

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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, we do 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 your Accumulation Units for federal income taxes.  If, however, we determine that taxes may be incurred, we reserve the right to assess a charge for these taxes.

We may also incur state and local taxes (in addition to those described in the "Premium Taxes" section) 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 your Accumulation Units.

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.  You should consult your 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.  We make no representation as to the likelihood of

the continuation of these current laws, interpretations, and policies.

Nationwide Life and Annuity Insurance Company

Nationwide, the depositor, is a stock life insurance company organized under Ohio law in March 1981, with its home office at One Nationwide Plaza, Columbus, Ohio 43215.  Nationwide is a provider of life insurance, annuities, and retirement products.

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 VL Separate Account–G

Organization, Registration, and Operation

Nationwide VL Separate Account-G is a separate account established under Ohio law.  We own the assets in this account and we are obligated to pay all benefits under the policies. We may use the separate account to support other variable life insurance policies that we issue.  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 the 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.  We buy and sell 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 our other assets.  The separate account's assets are held separately from our other assets and are not part of our general account.  We may not use the separate account's assets to pay any of our liabilities other than those arising from

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the policies.  We 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.

We do not guarantee any money you place in this separate account.  The value of each Sub-Account will increase or decrease, depending on the Investment Experience of the corresponding mutual fund.  You could lose some or all of your money.

Addition, Deletion, or Substitution of Mutual Funds

Where permitted by applicable law, we reserve the right to:

·   remove, 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 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.

We reserve the right to make other structural and operational changes affecting this separate account.

We will notify you if we make any of the changes above.  Also, to the extent required by law, we will obtain the required orders, approvals, and/or regulatory clearance from the appropriate government agencies (such as the various insurance regulators or the SEC).

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.  We may close Sub-Accounts to allocations of Premiums or policy value, or both, at any time in our 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 VL Separate Account-G 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 VL Separate Account-G.

Voting Rights

Although the separate account owns the mutual fund shares, you 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, we will vote the separate account's shares only as you instruct.

When a shareholder vote occurs, you will have the right to instruct us how to vote.  The weight of your vote is based on the number of mutual fund shares that corresponds to the amount of Cash Value you have allocated to that mutual fund's Sub-Account (as of a date set by the mutual fund).  We will vote shares for which no instructions are received in the same proportion as those that are received.  What this means to you 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.

Legal Proceedings

Nationwide Life and Annuity 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

48

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 ("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 Nationwide Mutual Insurance Company (NMIC) insofar as any inquiry, examination or investigation encompasses NMIC's operations.

In October 2012, NLIC and NLAIC entered into a Regulatory Settlement Agreement with the Florida Office of Insurance Regulation and 21 other state Departments of Insurance to resolve a multi-state market conduct exam regarding claim settlement practices.  The Regulatory Settlement Agreement applies prospectively and requires NLIC and NLAIC to adopt and implement additional procedures relating to the use of to the Social Security Death Master File and identifying and locating beneficiaries once deaths are identified.  In October 2012, NLIC and NLAIC also entered into a Global Resolution Agreement to resolve the related unclaimed property audit.

Other jurisdictions may pursue similar investigations, examinations or inquires. The results of these investigations, examinations or inquiries could result in the payment or escheatment of unclaimed death benefits, and/or changes in the Company’s practices and procedures to its claims handling and escheat processes, all of which could impact claim payments and reserves and/or result in payment of investigation costs, fines or penalties.

On November 20, 2007, Nationwide Retirement Solutions, Inc. ("NRS") and NLIC were named in a lawsuit filed in the Circuit Court of Jefferson County, Alabama entitled Ruth A. Gwin and Sandra H. Turner, and a class of similarly situated individuals v Nationwide Life Insurance Company, Nationwide Retirement Solutions, Inc., Alabama State Employees Association, PEBCO, Inc. and Fictitious Defendants A to Z . On March 12, 2010, NRS and NLIC were named in a Second Amended Class Action Complaint filed in the Circuit Court of Jefferson County, Alabama entitled Steven E. Coker, Sandra H. Turner, David N. Lichtenstein and a class of similarly situated individuals v. Nationwide Life Insurance Company, Nationwide Retirement Solutions, Inc, Alabama State Employees Association, Inc., PEBCO, Inc. and Fictitious Defendants A to Z claiming to represent a class of all participants in the Alabama State Employees Association, Inc. ("ASEA") Plan, excluding members of the Deferred Compensation Committee, ASEA's directors, officers and board members, and PEBCO's directors, officers and board members. On October 22, 2010, the parties to this action executed a court approved stipulation of settlement that agreed to certify a class for settlement purposes only, that provided for payments to the settlement class, and that provided for releases, certain bar orders, and dismissal of the case. The settlement fund has been paid out. On December 6, 2011 the Court entered an Order that NRS owes indemnification to ASEA and PEBCO for only the Coker (Gwin) class action, and dismissed NLIC. The Company has resolved the indemnification claims of ASEA.  On June 19 and 20, 2012, the Court held an evidentiary hearing on the amount of indemnification owed to PEBCO.  The Court has taken the matter under advisement. NRS continues to defend this case vigorously.

On August 15, 2001, NFS and NLIC were named in a lawsuit filed in the U.S. 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 . In the plaintiffs' sixth amended complaint, filed November 18, 2009, they amended the list of named plaintiffs and claim to represent a class of qualified retirement plan trustees under 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 disgorgement of 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 plaintiff's motion for class certification and certified a class of "All trustees of all employee pension benefit plans covered by ERISA which had variable annuity contracts with NFS and NLIC or whose participants had individual variable annuity contracts with NFS and NLIC at any time from January 1, 1996, or the first date NFS and NLIC began receiving payments from mutual funds based on a percentage of assets invested in the funds by NFS and NLIC, whichever came first, to the date of November 6, 2009". On October 21, 2010, the District Court dismissed NFS from the lawsuit. On February 6, 2012, the Second Circuit Court of Appeals vacated the

49

November 6, 2009 order granting class certification and remanded the case back to the District Court for further consideration. The plaintiffs have renewed their motion for class certification. The case is fully briefed. NLIC continues to defend this lawsuit vigorously.

On June 8, 2011, NMIC and NLIC were named in a lawsuit filed in Court of Common Pleas, Cuyahoga County, Ohio entitled Stanley Andrews and Donald Clark, on their behalf and on behalf of the class defined herein v.   Nationwide Mutual Insurance Company and Nationwide Life Insurance Company .  The complaint alleges that NMIC and NLIC have an obligation to review the Social Security Administration Death Master File database for all life insurance policyholders who have at least a 70% probability of being deceased according to actuarial tables.  The complaint further alleges that NMIC and NLIC are not conducting such a review.  The complaint seeks injunctive relief and declaratory judgment requiring NMIC and NLIC to conduct such a review, and alleges NMIC and NLIC have violated the covenant of good faith and fair dealing and have been unjustly enriched by not having conducted such reviews.  The complaint seeks certification as a class action.  Including Andrews, there are four similar class actions in Ohio: two against Western & Southern; one against Cincinnati Life. NMIC and NLIC filed a motion to dismiss.  By order dated January 18, 2012, the State Court issued an order dismissing the lawsuit.  The court issued its opinion on January 23, 2012.  On January 30, 2012, plaintiffs filed their appeal. Plaintiffs filed their appellate brief on April 12, 2012. The Association of Ohio Life Insurance Companies filed an amicus brief in support of NMIC and NLIC's position on May 24, 2012. NMIC and NLIC's filed its brief in opposition on May 25, 2012. Plaintiffs filed their reply brief on June 7, 2012.  Oral argument on plaintiff’s appeal was held on October 1, 2012.  NMIC and NLIC continue to defend their lawsuit vigorously.

Waddell & Reed, Inc.

Waddell & Reed, Inc. is a party to legal proceedings incident to its normal business operations.  While there can be no assurances, none of the currently pending legal proceedings are anticipated to have a materially adverse effect on the ability of Waddell & Reed, Inc. to perform the services as distributor of the contracts.

Financial Statements

The Statement of Additional Information ("SAI") contains the financial statements of Nationwide VL Separate Account-G and the consolidated financial statements of Nationwide Life and Annuity Insurance Company.  You may obtain a copy of the SAIfree of chargeby contacting our Service Center.  You should consider the consolidated financial statements of the company only as bearing on our ability to meet the obligations under the policy.  You 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" earlier in the prospectus).

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.  Please refer to the prospectus for this underlying mutual fund for more information.

Ivy Funds Variable Insurance Portfolios - Asset Strategy

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks high total return over the long term.

Ivy Funds Variable Insurance Portfolios - Balanced

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks current income with a secondary goal of long-term capital appreciation.

Ivy Funds Variable Insurance Portfolios - Bond

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks reasonable return with emphasis on preservation of capital.

Ivy Funds Variable Insurance Portfolios - Core Equity

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks capital growth.

Ivy Funds Variable Insurance Portfolios - Dividend Opportunities

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks to provide total return.

Ivy Funds Variable Insurance Portfolios - Energy

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks to provide long-term capital appreciation.

Ivy Funds Variable Insurance Portfolios - Global Bond

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks a high level of current income and capital growth (when consistent with a
	high level of current income).

Ivy Funds Variable Insurance Portfolios - Global Natural Resources

Investment Advisor:	Waddell & Reed Investment Management Company
Sub-advisor:	Mackenzie Financial Corporation
Investment Objective:	Seeks long-term growth.

Ivy Funds Variable Insurance Portfolios - Growth

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks capital growth with a secondary objective of current income.

Ivy Funds Variable Insurance Portfolios - High Income

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks a high level of current income and capital when consistent with its primary
	objective as a secondary objective.

Ivy Funds Variable Insurance Portfolios - International Core Equity

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks long-term capital growth.

Ivy Funds Variable Insurance Portfolios - International Growth

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks long-term capital appreciation and a secondary goal of current income.

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Ivy Funds Variable Insurance Portfolios - Limited-Term Bond

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks to provide a high level of current income consistent with preservation of
	capital.

Ivy Funds Variable Insurance Portfolios - Micro Cap Growth

Investment Advisor:	Waddell & Reed Investment Management Company
Sub-advisor:	Wall Street Associates LLC
Investment Objective:	Seeks long-term capital appreciation.

Ivy Funds Variable Insurance Portfolios - Mid Cap Growth

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks to provide growth of investment.

Ivy Funds Variable Insurance Portfolios - Money Market

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks maximum current income consistent with stability of principal.

Ivy Funds Variable Insurance Portfolios - Pathfinder Aggressive

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks maximum growth of capital consistent with a more aggressive level of risk.

Designation: FF

Ivy Funds Variable Insurance Portfolios - Pathfinder Conservative

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Seeks a high level of total return consistent with a conservative level of risk.

Designation: FF

Ivy Funds Variable Insurance Portfolios - Pathfinder Moderate

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	The fund seeks a high level of total return consistent with a moderate level of risk.

Designation: FF

Ivy Funds Variable Insurance Portfolios - Pathfinder Moderately Aggressive

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	The fund seeks growth of capital, but also seeks income consistent with a
	moderately aggressive level of risk.

Designation: FF

Ivy Funds Variable Insurance Portfolios - Pathfinder Moderately Conservative

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	The fund seeks a high level of total return consistent with a moderately
	conservative level of risk.

Designation: FF

Ivy Funds Variable Insurance Portfolios - Real Estate Securities

Investment Advisor:	Waddell & Reed Investment Management Company
Sub-advisor:	Advantus Capital Management, Inc.
Investment Objective:	Total return through a combination of capital appreciation and current income.

Ivy Funds Variable Insurance Portfolios - Science and Technology

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Long-term capital growth.

Ivy Funds Variable Insurance Portfolios - Small Cap Growth

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Capital growth.

Ivy Funds Variable Insurance Portfolios - Small Cap Value

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Long-term accumulation of capital.

Ivy Funds Variable Insurance Portfolios - Value

Investment Advisor:	Waddell & Reed Investment Management Company
Investment Objective:	Long-term capital appreciation.

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Appendix B: Definitions

Accelerated Death Benefit Payment – The actual benefit amount you will receive under the Accelerated Death Benefit Rider if the Eligibility and Conditions for Payment section is satisfied.  The benefit amount you receive is reduced for risk deductions and adjustments for premature payment of the Base Policy Specified Amount.

Accumulation Unit – The measure of your investment in, or share of, a Sub-Account. Initially, we set the Accumulation Unit value at $10 for each Sub-Account.

Attained Age – A person's age based on their birthday nearest the Policy Date plus the number of full years since the Policy Date.  If the last birthday was more than 182 days prior to the Policy Date, their nearest birthday will be their next birthday. The Insured's issue age is shown in the Policy Data Pages.

Base Policy Specified Amount – The amount of Death Benefit coverage under the policy on the Policy Date, excluding any Rider Specified Amount.  Subsequent to the Policy Date, the Death Benefit coverage will equal or exceed this amount unless you request a decrease in the Base Policy Specified Amount or take a partial surrender.

Cash Surrender Value –The Cash Value minus Indebtedness and any surrender charge.

Cash Value –The total of the Sub-Accounts you have chosen, which will vary with Investment Experience, and the policy loan account and the fixed investment options, to which interest will be credited daily.  We will deduct partial surrenders and the policy's periodic charges from the Cash Value.

Code –The Internal Revenue Code of 1986, as amended.

Commissionable Target Premium ("CTP") – An amount used in the calculation of the Premium Load and total compensation we pay.  CTP is actuarially derived based on the Base Policy Specified Amount, the Insured's characteristics and the Death Benefit option of the policy.  It is generally higher for Insureds who are older or in poor health and lower for Insureds who are younger or in good health. A policy with Death Benefit Option 1 or 3 may have lower factors than a policy with Death Benefit Option 2.

Death Benefit –The amount we pay upon the Insured's death, before the deduction of any Indebtedness or 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 you do not make a sufficient payment.

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 we insure under the policy, and whose death triggers payment of the Death Benefit.

Investment Experience – The market performance of a Sub-Account.

Lapse – The policy terminates without value.

Long Term Care Specified Amount –The maximum accumulation of benefits available under the Long Term Care Rider. This amount must be at least 10% of the Base Policy Specified Amount, plus Additional Term Insurance Rider coverage, and no more than 100% of the Base Policy Specified Amount, plus Additional Term Insurance Rider coverage. You elect this amount at the time the rider is issued.

Long-Term Fixed Account - An investment option that is funded by Nationwide's general account.

Maturity Date –The policy anniversary on which the Insured reaches Attained Age 120.

Minimum Required Death Benefit – The lowest Death Benefit that will qualify the policy as life insurance under the Code.

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Net Accumulated Premium –Cumulative Premiums less any partial Surrenders, Indebtedness, and any return of Premium due to Internal Revenue Code Section 7702 guidelines.

Net Amount At Risk –The policy's base Death Benefit minus the policy's Cash Value.

Net Asset Value (NAV) – The price each share of a mutual fund in which a Sub-Account invests.  It is calculated by subtracting the mutual fund's liabilities from its total assets, and dividing that figure by the number of shares outstanding.  We use NAV to calculate the value of Accumulation Units.  NAV does not reflect deductions we make for charges we take from Sub-Accounts.

Net Premium – Premium after transaction charges, but before any allocation to an investment option.

Policy Data Page(s) – The Policy Data Page contains more detailed information about the policy, some of which is unique and particular to the 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 Proceeds or Proceeds –Policy Proceeds may constitute the Death Benefit, or the amount payable if the policy matures or you choose to surrender the policy adjusted to account for any unpaid charges or policy loans and Rider benefits.

Premium – The amount of money you pay to begin and continue the policy.

Premium Waiver Benefit – The benefit received under the Premium Waiver Rider. The benefit takes the form of a monthly credit to the policy upon the Insured's total disability for six consecutive months not caused by a risk not assumed. The amount credited to the policy is the lesser of the Premium you specified or the average actual monthly Premiums you paid over the last 36 months prior to the disability (or such shorter period of time that the policy has been In Force).

Premium Load – The aggregate of the sales load and premium tax charges.

Returned Premium –Any return of Premium due to Code Section 7702 or 7702A.

Rider – An optional benefit you may purchase under the policy.  Rider availability and Rider terms may vary depending on the state in which the policy is issued.

Rider Specified Amount – The portion of the Total Specified Amount attributable to the Rider.

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 our mail and document processing facility.  For service and transaction requests communicated by telephone, the Service Center is our operations processing facility.  Information on how to contact the Service Center is in the "Contacting the Service Center" provision.

Specified Amount – The dollar or face amount of insurance coverage the owner selects.

Sub-Accounts –The mechanism we use to account for your 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 cost of coverage.

Total Specified Amount – The sum of the Base Policy Specified Amount and the Rider Specified Amount.

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Us, we, our, Nationwide– Nationwide Life and Annuity Insurance Company.

Unadjusted Accelerated Death Benefit Payment – An amount equal to the percentage of the Base Policy Specified Amount you elect multiplied by the Base Policy Specified Amount, when you request payment under the Accelerated Death Benefit Rider.  You do not receive the unadjusted amount because it does not include risk charges and adjustments we make due to the premature payment of the Base Policy Specified Amount being made.

Valuation Period –The period during which we determine the change in the value of the Sub-Accounts.  One Valuation Period ends and another begins with the close of trading on the New York Stock Exchange.

You, your or the policy owner or Owner – The person or entity named as the owner in the application, or the person or entity assigned ownership rights.

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Appendix C: Surrender Charge Examples

The information in the tables on this page is used to calculate the surrender charge for your policy based on the Specified Amount of your policy and your individual characteristics. The tables below are samples of the full tables provided in the Statement of Additional Information to this prospectus which is available on request.  The formula we use to calculate surrender charges is:

The maximum surrender charge ("SC") equals the lesser of (a) or (b), multiplied by (p); plus (c) multiplied by (d).  To calculate the actual surrender charge based on surrender in a particular policy year, multiply by (e); and, if applicable, multiply by (f); 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;

(p)   = the surrender charge percentage in the range 24% - 65% which varies by age, sex, and risk classification from the

"Surrender Charge Percentage" chart below;

(c) = the Specified Amount divided by 1,000;

(d) = the applicable rate from the "Administrative Target Factor" chart below;

(e) = the applicable percentage from the "Reduction of Surrender Charges" table in the "Surrender Charges" section of

this prospectus; and

(f) = a Surrender Charge reduction factor applicable only to Specified Amount increases, 0.60 in all cases.

Surrender Target Factor used in (a) of the formula above

	Male	Male	Male	Female
Age	Preferred Non-tobacco	Standard Non-tobacco	Standard Tobacco	Standard Non-tobacco
0	n/a	1.673	n/a	1.316
35	7.380	7.825	8.892	6.584
36	7.756	8.224	9.345	6.914
72	57.393	60.850	69.148	46.433

Surrender Charge Percentage (p) in the formula above1

Age	Male	Female
0	65.0%	65.0%
35	65.0%	65.0%
36	65.0%	65.0%
72	64.0%	65.0%

Administrative Target Factor (d) in the formula above1

Issue Age	Band 2	Band 3	Band 4	Band 5
0	6.00	4.00	4.00	4.00
35	7.50	4.50	4.50	4.50
36	7.50	4.55	4.55	4.55
72	8.20	6.05	6.05	6.05

1"Bands" in the tables correspond to particular ranges of Specified Amount.  If there are increases, the total Specified Amount is used:

Band 2 = Specified Amounts equal to or greater than $100,000 and less than $250,000.

Band 3 = Specified Amounts equal to or greater than $250,000 and less than $500,000.

Band 4 = Specified Amounts equal to or greater than $500,000 and less than $1,000,000.

Band 5 = Specified Amounts equal to or greater than $1,000,000.

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The examples that follow are based on characteristics of the Insured used to calculate the maximum, minimum, and representative surrender charges shown in the "Transaction Fees" portion of the "In Summary:  Fee Tables" section of the prospectus.  They are based on the formula and example tables above.

The maximum Surrender Charge calculation assumes: the Insured is a male; issue age 72; standard tobacco rate class; the Specified Amount is $100,000 (Band 2); premiums paid in the first year are $10,000; a full surrender is taken during the first policy year.

SC= [[[the lesser of (a, b)] x (p) + (c) x (d)] x (e)] x (f)

(f) Not applicable, applies to increases only.

(a) = ($100,000 / 1,000) x 69.148 = $6,914.80	(d) = 8.20
(b) = $10,000	(e) = 100%
(p) = 0.64	(f) Not applicable, applies to increases only.
(c) = $100,000 / 1,000 = $100

(a) is less than (b), so:

SC = [$6,914.80 x (0.64) + $100 x 8.20] x 100%

= [$4,425.47 + $820] x 100%

= $5,245.47 which corresponds to $52.45 per $1,000 of Specified Amount ($5,245.47 / $100).

Assume the policy is surrendered in the fifth year instead of the first, then (e), issue age 50+, = 77.5%

SC = $5,245.47 x 77.5%  = $4,065.24 which corresponds to $40.65 per $1,000 of Specified Amount ($4,065.24 / $100).

The minimum Surrender Charge calculation assumes: the Insured is a female; issue age 0; standard non-tobacco rate class; the Specified Amount is $500,000 (Band 4); premiums paid in the first year are $2,000; a full surrender is taken during the first policy year.

SC= [[[the lesser of (a, b)] x (p) + (c) x (d)] x (e)] x (f)

(a) = ($500,000 / 1,000) x 1.316 = $658.00	(d) = 4.00
(b) = $2,000	(e) = 100%
(p) = 0.65	(f) Not applicable, applies to increases only.
(c) = $500,000 / 1,000 = $500

(a) is less than (b), so:

SC = [$658.00x (0.65) + $500 x 4.00] x 100%

= [$427.70 + $2,000] x 100%

= $2,427.70 which corresponds to $4.86 per $1,000 of Specified Amount ($2,427.70 / $500).

Assume the policy is surrendered in the fifth year instead of the first, then (e), issue age 0-49, = 87.5%

SC = $2,427.70 x 87.5% = $2,124.24 which corresponds to $4.25 per $1,000 of Specified Amount ($2,124.24 / $500).

The representative surrender charge calculation assumes:  the Insured is a male; issue age 35; preferred non-tobacco rate class; the Specified Amount is $500,000 (Band 4); premiums paid in the first year are $7,000; and a complete surrender of the policy in the first policy year.

SC= [[[the lesser of (a, b)] x (p) + (c) x (d)] x (e)] x (f)

(a) = ($500,000 / 1,000) x 7.38 = $3,690	(d) = 4.50
(b) = $7,000	(e) = 100%
(p) = 0.65	(f) Not applicable, applies to increases only.
(c) = $500,000 / 1,000 = $500

(a) is less than (b), so:

SC = [$3,690 x (0.65) + $500 x 4.50] x 100%

= [$2,398.50 + $2,250] x 100%

= $4,648.50 which corresponds to $9.30 per $1,000 of Specified Amount ($4,648.50 / $500).

Assume the policy is surrendered in the fifth year instead of the first, then (e), issue age 0-49, = 87.5%

SC = $4,648.50 x 87.5% = $4,067.44 which corresponds to $8.13 per $1,000 of Specified Amount ($4,067.44 / $500).

57

The following example shows the impact of a Specified Amount increase prior to a complete surrender of the policy.  The Surrender Charge is calculated separately for the initial Specified Amount and each increase.  For this example, assume: the Insured is a male; issue age 35; standard non-tobacco rate class; the Specified Amount is $500,000 (Band 4); premiums paid in the first year are $6,000; the Policy Date is January 1, 2005; and the policy is completely surrendered in the first year.

SC= [[[the lesser of (a, b)] x (p) + (c) x (d)] x (e)] x (f)

(a) = ($500,000 / 1,000) x 7.825 = $3,912.50	(d) = 4.50
(b) = $6,000	(e) = 100%
(p) = 0.65	(f) Not applicable, applies to increases only.
(c) = $500,000 / 1,000 = $500

(a) is less than (b), so:

SC = [$3,912.50 x (0.65) + $500 x 4.50] x 100%

= [$2,543.13+ $2,250] x 100%

= $4,793.13 which corresponds to $9.59 per $1,000 of Specified Amount ($4,793.13 / $500).

Now assume the policy was not actually surrendered, and a Specified Amount increase of $100,000 (Band 4) is requested and becomes effective in the second policy year, on July 1, 2006.  Note: the Attained Age of the person at the time the increase is issued is age 36 for purposes of finding the correct factors in the tables.  Band 4 is applicable because the Total Specified Amount $600,000 is used to determine Band.  The first year premium paid applicable to the increase is $1,000. To calculate the maximum Surrender Charge attributable to the increase, assume it is surrendered in the first year.

SC= [[[the lesser of (a, b)] x (p) + (c) x (d)] x (e)] x (f)

(a) = ($100,000 / 1,000) x 8.224 = $822.40	(d) = 4.55
(b) = $1,000	(e) = 100%
(p) = 0.65	(f) = 0.60
(c) = $100,000 / 1,000 = $100

(a) is less than (b), so:

SC = [$822.40 x (0.65) + $100 x 4.55] x 100%] x 0.60

= [$534.56 + $455.00] x 100%] x 0.60

= $989.56 x 0.60

= $593.74 which corresponds to $5.94 per $1,000 of Specified Amount ($593.74 / $100).

Now assume the policy is completely surrendered in the sixth policy year on March 1, 2010.

For the $500,000 initial Specified Amount, (e), issue age 0-49, = 80.0%, the applicable surrender charge is:

SC = $4,793.13 x 80.0% = $3,834.50 which corresponds to $7.67 per $1,000 of Specified Amount ($3,834.50 / $500).

For the $100,000 Specified Amount increase, (e), issue age 0-49, = 95.0%, (Note that even though the policy is being surrendered in the sixth year, more than three and less than four full years have passed since the date of the increase, so the fourth year surrender charge reduction percentage applies to that portion of Specified Amount.) the applicable surrender charge is:

SC = $593.74 x 95.0% = $564.05 which corresponds to $5.64 per $1,000 of Specified Amount ($564.05 / $100).

The combined surrender charge for a complete surrender of the policy in the sixth year is equal to:

SC = $3,834.50 + $564.05 = $4,398.55 which corresponds to $7.33 per $1,000 of Specified Amount ($4,398.55 / $600).

58

Appendix D: Maximum Surrender Charge Calculation

The maximum surrender charge under the policy is based on the following calculation.  Examples of how to calculate the surrender charge for your policy are provided in "Appendix C: Surrender Charge Examples."

Surrender Target Factor

Male Insureds

Issue	Standard	Preferred	Preferred Plus	Preferred	Standard	Issue	Standard	Preferred	Preferred Plus	Preferred	Standard
Age	Non-tobacco	Non-tobacco	Non-tobacco	Tobacco	Tobacco	Age	Non-tobacco	Non-tobacco	Non-tobacco	Tobacco	Tobacco
0	1.673	n/a	n/a	n/a	n/a	43	11.745	11.078	10.678	12.680	13.347
1	1.717	n/a	n/a	n/a	n/a	44	12.371	11.668	11.246	13.355	14.058
2	1.780	n/a	n/a	n/a	n/a	45	13.029	12.289	11.845	14.066	14.806
3	1.854	n/a	n/a	n/a	n/a	46	13.724	12.944	12.476	14.815	15.595
4	1.939	n/a	n/a	n/a	n/a	47	14.458	13.637	13.144	15.609	16.430
5	2.029	n/a	n/a	n/a	n/a	48	15.235	14.370	13.850	16.447	17.313
6	2.126	n/a	n/a	n/a	n/a	49	16.066	15.153	14.606	17.344	18.257
7	2.227	n/a	n/a	n/a	n/a	50	16.954	15.991	15.413	18.303	19.266
8	2.334	n/a	n/a	n/a	n/a	51	17.903	16.886	16.275	19.327	20.344
9	2.446	n/a	n/a	n/a	n/a	52	18.916	17.841	17.196	20.420	21.495
10	2.564	n/a	n/a	n/a	n/a	53	19.993	18.857	18.175	21.583	22.719
11	2.689	n/a	n/a	n/a	n/a	54	21.137	19.936	19.215	22.818	24.019
12	2.820	n/a	n/a	n/a	n/a	55	22.350	21.080	20.318	24.128	25.398
13	2.953	n/a	n/a	n/a	n/a	56	23.633	22.290	21.485	25.513	26.856
14	3.092	n/a	n/a	n/a	n/a	57	24.993	23.573	22.721	26.981	28.401
15	3.236	n/a	n/a	n/a	n/a	58	26.435	24.933	24.032	28.538	30.040
16	3.380	n/a	n/a	n/a	n/a	59	27.980	26.391	25.437	30.206	31.796
17	3.526	n/a	n/a	n/a	n/a	60	29.637	27.953	26.942	31.994	33.678
18	3.674	3.465	3.340	3.966	4.175	61	31.407	29.623	28.552	33.906	35.690
19	3.827	3.610	3.479	4.132	4.349	62	33.292	31.401	30.266	35.940	37.832
20	3.987	3.761	3.625	4.304	4.531	63	35.291	33.285	32.082	38.098	40.103
21	4.156	3.920	3.778	4.487	4.723	64	37.407	35.282	34.006	40.383	42.508
22	4.334	4.088	3.940	4.679	4.925	65	39.654	37.401	36.049	42.808	45.061
23	4.522	4.265	4.111	4.882	5.139	66	42.044	39.655	38.222	45.388	47.777
24	4.720	4.452	4.291	5.096	5.364	67	44.601	42.067	40.546	48.149	50.683
25	4.930	4.650	4.482	5.322	5.602	68	47.355	44.664	43.050	51.121	53.812
26	5.151	4.858	4.682	5.560	5.853	69	50.326	47.467	45.751	54.330	57.189
27	5.382	5.076	4.893	5.810	6.116	70	53.553	50.510	48.685	57.813	60.856
28	5.626	5.306	5.114	6.073	6.393	71	57.052	53.811	51.866	61.590	64.832
29	5.884	5.549	5.349	6.352	6.686	72	60.850	57.393	55.318	65.691	69.148
30	6.159	5.809	5.599	6.649	6.999	73	64.922	61.233	59.020	70.086	73.775
31	6.452	6.086	5.866	6.965	7.332	74	69.310	65.372	63.009	74.823	78.761
32	6.765	6.380	6.150	7.303	7.687	75	74.065	69.857	67.332	79.957	84.165
33	7.097	6.694	6.452	7.662	8.065	76	79.229	n/a	n/a	n/a	90.033
34	7.450	7.027	6.773	8.043	8.466	77	84.854	n/a	n/a	n/a	96.425
35	7.825	7.380	7.114	8.447	8.892	78	90.966	n/a	n/a	n/a	103.37
36	8.224	7.756	7.476	8.878	9.345	79	97.574	n/a	n/a	n/a	110.879
37	8.644	8.153	7.858	9.332	9.823	80	104.679	n/a	n/a	n/a	118.953
38	9.091	8.575	8.265	9.814	10.331	81	112.323	n/a	n/a	n/a	127.640
39	9.564	9.020	8.694	10.325	10.868	82	120.494	n/a	n/a	n/a	136.925
40	10.064	9.492	9.149	10.864	11.436	83	129.291	n/a	n/a	n/a	146.922
41	10.593	9.992	9.630	11.436	12.038	84	138.796	n/a	n/a	n/a	157.723
42	11.154	10.520	10.140	12.041	12.675	85	149.046	n/a	n/a	n/a	169.370

59

Female Insureds

Issue	Preferred Plus	Preferred	Standard	Preferred	Standard	Issue	Preferred Plus	Preferred	Standard	Preferred	Standard
Age	Non-tobacco	Non-tobacco	Non-tobacco	Tobacco	Tobacco	Age	Non-tobacco	Non-tobacco	Non-tobacco	Tobacco	Tobacco
0	n/a	n/a	1.316	n/a	n/a	43	8.912	9.246	9.803	10.583	11.140
1	n/a	n/a	1.375	n/a	n/a	44	9.380	9.732	10.318	11.139	11.725
2	n/a	n/a	1.429	n/a	n/a	45	9.874	10.245	10.862	11.726	12.343
3	n/a	n/a	1.491	n/a	n/a	46	10.398	10.788	11.437	12.347	12.997
4	n/a	n/a	1.558	n/a	n/a	47	10.950	11.361	12.045	13.004	13.688
5	n/a	n/a	1.631	n/a	n/a	48	11.533	11.965	12.686	13.695	14.416
6	n/a	n/a	1.706	n/a	n/a	49	12.148	12.604	13.363	14.426	15.185
7	n/a	n/a	1.787	n/a	n/a	50	12.796	13.276	14.076	15.195	15.995
8	n/a	n/a	1.870	n/a	n/a	51	13.480	13.986	14.828	16.008	16.850
9	n/a	n/a	1.958	n/a	n/a	52	14.200	14.733	15.620	16.863	17.750
10	n/a	n/a	2.050	n/a	n/a	53	14.958	15.519	16.454	17.763	18.698
11	n/a	n/a	2.147	n/a	n/a	54	15.757	16.348	17.332	18.711	19.696
12	n/a	n/a	2.249	n/a	n/a	55	16.599	17.222	18.259	19.712	20.749
13	n/a	n/a	2.355	n/a	n/a	56	17.487	18.143	19.236	20.766	21.859
14	n/a	n/a	2.464	n/a	n/a	57	18.422	19.113	20.265	21.877	23.028
15	n/a	n/a	2.579	n/a	n/a	58	19.409	20.137	21.350	23.048	24.261
16	n/a	n/a	2.699	n/a	n/a	59	20.450	21.216	22.495	24.284	25.562
17	n/a	n/a	2.823	n/a	n/a	60	21.552	22.360	23.707	25.593	26.940
18	2.686	2.786	2.954	3.189	3.357	61	22.722	23.574	24.994	26.982	28.402
19	2.810	2.916	3.091	3.337	3.513	62	23.965	24.863	26.361	28.458	29.956
20	2.941	3.051	3.235	3.492	3.676	63	25.287	26.235	27.816	30.029	31.609
21	3.078	3.193	3.385	3.655	3.847	64	26.698	27.699	29.367	31.703	33.372
22	3.222	3.343	3.545	3.827	4.028	65	28.203	29.261	31.024	33.491	35.254
23	3.374	3.501	3.712	4.007	4.218	66	29.812	30.930	32.793	35.402	37.265
24	3.536	3.669	3.890	4.199	4.420	67	31.534	32.716	34.687	37.446	39.417
25	3.705	3.844	4.075	4.399	4.631	68	33.378	34.630	36.716	39.637	41.723
26	3.884	4.030	4.272	4.612	4.855	69	35.357	36.683	38.892	41.986	44.196
27	4.072	4.225	4.479	4.836	5.090	70	37.481	38.886	41.229	44.508	46.851
28	4.270	4.430	4.697	5.070	5.337	71	39.762	41.253	43.739	47.218	49.703
29	4.478	4.646	4.925	5.317	5.597	72	42.212	43.795	46.433	50.127	52.765
30	4.697	4.873	5.166	5.577	5.871	73	44.843	46.525	49.328	53.251	56.054
31	4.929	5.114	5.422	5.853	6.161	74	47.674	49.462	52.442	56.613	59.593
32	5.173	5.367	5.690	6.143	6.466	75	50.726	52.628	55.798	60.237	63.407
33	5.430	5.633	5.973	6.448	6.787	76	n/a	n/a	59.424	n/a	67.527
34	5.701	5.915	6.271	6.770	7.126	77	n/a	n/a	63.348	n/a	71.986
35	5.986	6.210	6.584	7.108	7.482	78	n/a	n/a	67.606	n/a	76.825
36	6.286	6.521	6.914	7.464	7.857	79	n/a	n/a	72.238	n/a	82.089
37	6.601	6.848	7.261	7.838	8.251	80	n/a	n/a	77.295	n/a	87.835
38	6.934	7.194	7.627	8.234	8.667	81	n/a	n/a	82.836	n/a	94.132
39	7.286	7.559	8.014	8.652	9.107	82	n/a	n/a	88.784	n/a	100.891
40	7.658	7.946	8.424	9.094	9.573	83	n/a	n/a	95.157	n/a	108.133
41	8.053	8.355	8.858	9.563	10.066	84	n/a	n/a	102.064	n/a	115.982
42	8.470	8.788	9.317	10.059	10.588	85	n/a	n/a	109.558	n/a	124.498

60

"Bands" as used in the Administrative Target Factor and Surrender Charge Percentage tables below correspond to particular ranges of Specified Amount:  Band 2 = Specified Amounts equal to or greater than $100,000 and less than $250,000; Band 3 = Specified Amounts equal to or greater than $250,000 and less than $500,000; Band 4 = Specified Amounts equal to or greater than $500,000 and less than $1,000,000; and Band 5 = Specified Amounts equal to or greater than $1,000,000.

Administrative Target Factor

Age	Band 2	Band 3	Band 4	Band 5	Age	Band 2	Band 3	Band 4	Band 5
0	6.00	4.00	4.00	4.00	43	7.50	4.90	4.90	4.90
1	6.00	4.00	4.00	4.00	44	7.50	4.95	4.95	4.95
2	6.00	4.00	4.00	4.00	45	7.50	5.00	5.00	5.00
3	6.00	4.00	4.00	4.00	46	7.50	5.00	5.00	5.00
4	6.00	4.00	4.00	4.00	47	7.50	5.00	5.00	5.00
5	6.00	4.00	4.00	4.00	48	7.50	5.00	5.00	5.00
6	6.00	4.00	4.00	4.00	49	7.50	5.00	5.00	5.00
7	6.00	4.00	4.00	4.00	50	7.50	5.00	5.00	5.00
8	6.00	4.00	4.00	4.00	51	7.50	5.00	5.00	5.00
9	6.00	4.00	4.00	4.00	52	7.50	5.00	5.00	5.00
10	6.00	4.00	4.00	4.00	53	7.50	5.00	5.00	5.00
11	6.00	4.00	4.00	4.00	54	7.50	5.00	5.00	5.00
12	6.00	4.00	4.00	4.00	55	7.50	5.00	5.00	5.00
13	6.00	4.00	4.00	4.00	56	7.50	5.00	5.00	5.00
14	6.00	4.00	4.00	4.00	57	7.50	5.00	5.00	5.00
15	6.00	4.00	4.00	4.00	58	7.50	5.00	5.00	5.00
16	6.00	4.00	4.00	4.00	59	7.50	5.00	5.00	5.00
17	6.00	4.00	4.00	4.00	60	7.50	5.00	5.00	5.00
18	6.00	4.00	4.00	4.00	61	7.50	5.00	5.00	5.00
19	6.00	4.00	4.00	4.00	62	7.50	5.00	5.00	5.00
20	6.00	4.00	4.00	4.00	63	7.50	5.00	5.00	5.00
21	6.00	4.00	4.00	4.00	64	7.50	5.00	5.00	5.00
22	6.00	4.00	4.00	4.00	65	7.50	5.00	5.00	5.00
23	6.00	4.00	4.00	4.00	66	7.60	5.15	5.15	5.15
24	6.00	4.00	4.00	4.00	67	7.70	5.30	5.30	5.30
25	6.00	4.00	4.00	4.00	68	7.80	5.45	5.45	5.45
26	6.15	4.05	4.05	4.05	69	7.90	5.60	5.60	5.60
27	6.30	4.10	4.10	4.10	70	8.00	5.75	5.75	5.75
28	6.45	4.15	4.15	4.15	71	8.10	5.90	5.90	5.90
29	6.60	4.20	4.20	4.20	72	8.20	6.05	6.05	6.05
30	6.75	4.25	4.25	4.25	73	8.30	6.20	6.20	6.20
31	6.90	4.30	4.30	4.30	74	8.40	6.35	6.35	6.35
32	7.05	4.35	4.35	4.35	75	8.50	6.50	6.50	6.50
33	7.20	4.40	4.40	4.40	76	8.55	6.65	6.65	6.65
34	7.35	4.45	4.45	4.45	77	8.60	6.80	6.80	6.80
35	7.50	4.50	4.50	4.50	78	8.65	6.95	6.95	6.95
36	7.50	4.55	4.55	4.55	79	8.70	7.10	7.10	7.10
37	7.50	4.60	4.60	4.60	80	8.75	7.25	7.25	7.25
38	7.50	4.65	4.65	4.65	81	8.80	7.40	7.40	7.40
39	7.50	4.70	4.70	4.70	82	8.85	7.55	7.55	7.55
40	7.50	4.75	4.75	4.75	83	8.90	7.70	7.70	7.70
41	7.50	4.80	4.80	4.80	84	8.95	7.85	7.85	7.85
42	7.50	4.85	4.85	4.85	85	9.00	8.00	8.00	8.00

61

Surrender Charge Percentage

Issue			Issue
Age	Male	Female	Age	Male	Female
0	65.0%	65.0%	43	65.0%	65.0%
1	65.0%	65.0%	44	65.0%	65.0%
2	65.0%	65.0%	45	65.0%	65.0%
3	65.0%	65.0%	46	65.0%	65.0%
4	65.0%	65.0%	47	65.0%	65.0%
5	65.0%	65.0%	48	65.0%	65.0%
6	65.0%	65.0%	49	65.0%	65.0%
7	65.0%	65.0%	50	65.0%	65.0%
8	65.0%	65.0%	51	65.0%	65.0%
9	65.0%	65.0%	52	65.0%	65.0%
10	65.0%	65.0%	53	65.0%	65.0%
11	65.0%	65.0%	54	65.0%	65.0%
12	65.0%	65.0%	55	65.0%	65.0%
13	65.0%	65.0%	56	65.0%	65.0%
14	65.0%	65.0%	57	65.0%	65.0%
15	65.0%	65.0%	58	65.0%	65.0%
16	65.0%	65.0%	59	65.0%	65.0%
17	65.0%	65.0%	60	65.0%	65.0%
18	65.0%	65.0%	61	65.0%	65.0%
19	65.0%	65.0%	62	65.0%	65.0%
20	65.0%	65.0%	63	65.0%	65.0%
21	65.0%	65.0%	64	65.0%	65.0%
22	65.0%	65.0%	65	65.0%	65.0%
23	65.0%	65.0%	66	65.0%	65.0%
24	65.0%	65.0%	67	65.0%	65.0%
25	65.0%	65.0%	68	65.0%	65.0%
26	65.0%	65.0%	69	65.0%	65.0%
27	65.0%	65.0%	70	65.0%	65.0%
28	65.0%	65.0%	71	65.0%	65.0%
29	65.0%	65.0%	72	64.0%	65.0%
30	65.0%	65.0%	73	59.0%	65.0%
31	65.0%	65.0%	74	55.0%	65.0%
32	65.0%	65.0%	75	51.0%	65.0%
33	65.0%	65.0%	76	48.0%	65.0%
34	65.0%	65.0%	77	44.0%	60.0%
35	65.0%	65.0%	78	41.0%	56.0%
36	65.0%	65.0%	79	38.0%	52.0%
37	65.0%	65.0%	80	35.0%	49.0%
38	65.0%	65.0%	81	33.0%	45.0%
39	65.0%	65.0%	82	30.0%	42.0%
40	65.0%	65.0%	83	28.0%	39.0%
41	65.0%	65.0%	84	26.0%	36.0%
42	65.0%	65.0%	85	24.0%	33.0%

62

Outside back cover page

To learn more about this policy, you should read the Statement of Additional Information ("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, cash values, and to request other information about this policy please call our Service Center at 1-800-848-6331 (TDD: 1-800-238-3035) or write to us at our Service Center at Nationwide Life and Annuity 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 us and the policy.  Information about us and the policy (including the SAI) may also be reviewed and copied at the SEC's Public Reference Room in Washington, D.C., or may be obtained, upon payment of a duplicating fee, by writing the Public Reference Section of the SEC, 100 F Street NE, Washington, D.C. 20549. Additional information on the operation of the Public Reference Room may be obtained by calling the SEC at 1-202-551-8090.

Securities Act of 1933 Registration File No. 333-182896 .

Investment Company Act of 1940 Registration File No. 811-21697

Nationwide VL Separate Account-G

(Registrant)

Nationwide Life and Annuity Insurance Company

(Depositor)

Service Center

P.O. Box 182835

Columbus, Ohio 43218-2835

1-866-221-1100

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 the individual flexible premium variable universal life insurance policy offered by Nationwide Life and Annuity Insurance Company ("Nationwide").  This SAI is not a prospectus and should be read together with the policy prospectus dated XXXX, 2012 and the prospectuses for the mutual funds.  The prospectus is incorporated by reference in this SAI.  You may obtain a copy of these prospectuses FREE OF CHARGE by writing or calling us at our Service Center.  Capitalized terms in this Statement of Additional Information correspond to terms as defined in the prospectus.

The date of this Statement of Additional Information is XXXX, 2012.

Table of Contents
	Page
Nationwide Life and Annuity Insurance Company	1
Nationwide VL Separate Account-G	1
Waddell & Reed, Inc.	1
Services	2
Independent Registered Public Accounting Firm	2
Underwriting Procedure	2
Policy Restoration Procedure	3
Illustrations	3
Advertising	3
Tax Definition of Life Insurance	4
Financial Statements	6

Nationwide Life and Annuity Insurance Company

We are a stock life insurance company organized under the laws of the State of Ohio in March 1981 with our Home Office at One Nationwide Plaza, Columbus, Ohio 43215.  We provide life insurance, annuities and retirement products.  We are admitted to do business in all states, except New York.  We are a member of the Nationwide group of companies and all of our common stock is owned by Nationwide Life Insurance Company which in turn 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 $154.7 billion as of December 31, 2011.

Nationwide VL Separate Account-G

Nationwide VL Separate Account-G is a separate account that invests in mutual funds offered and sold to insurance companies and certain retirement plans.  We established the separate account on August 3, 2004 pursuant to Ohio law.  Although the separate account is registered with the SEC as a unit investment trust pursuant to the Investment Company Act of 1940 the SEC does not supervise our management or the management of the variable account. We serve as the custodian of the assets of the separate account.

Waddell & Reed, Inc.

The policies are distributed by Waddell & Reed, Inc., located at 6300 Lamar Ave., Overland Park, KS 66202.  Waddell & Reed, Inc. was organized as a Delaware corporation in 1981.

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").

1

Gross first year commissions plus any expense allowance payments paid by Nationwide on the sale of these policies provided by Waddell & Reed, Inc. will not exceed 145 % of the target premium plus 5 % of any excess premium payments.  We pay gross renewal commissions in years 2 through 10 on the sale of the policies provided by Waddell & Reed, Inc. that will not exceed 5 % of actual premium payment, and that will not exceed 5 % in policy years 11 and thereafter.  We have paid no underwriting commissions to Waddell & Reed, Inc. for each of this separate account's last three fiscal years.

In order to provide the unit value credit that may be applied to the net investment factor,  we may lower the target premium on the sale of these policies.  Lowering the target premium will have the likely effect of lowering our commission expense.

Services

We have responsibility for administration of the policies and the separate account.  We also maintain 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.

We are the custodian of the assets of the separate account.  We will maintain a record of all purchases and redemption of shares of the mutual funds.  We or our affiliates may have entered into agreements with either the investment adviser or distributor for the mutual funds.  The agreements relate to administrative services we or our affiliate furnish.   Some of the services provided include distribution of underlying fund prospectuses, semi-annual and annual fund reports, proxy materials and fund communications, as well as maintaining the websites and voice response systems necessary for policy owners to execute trades in the mutual funds.  We also act as a limited agent for the mutual fund for purposes of accepting the trades.  For these services the mutual funds may agree to pay us an annual fee based on the average aggregate net assets of the separate account (and other separate accounts of Nationwide or life insurance company subsidiaries of Nationwide) invested in the particular mutual fund (see “Information on Underlying Mutual Fund Payments”).

Independent Registered Public Accounting Firm

The financial statements of Nationwide VL Separate Account-G and the consolidated financial statements and schedules of Nationwide Life and Annuity Insurance Company and subsidiary 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., Columbus, Ohio 43215.

Underwriting Procedure

We underwrite the policies issued through Nationwide VL Separate Account-G.  The policy's cost of insurance depends upon the Insured's sex, issue age, underwriting class, any substandard rating, and the duration 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 are based on the 2001 Commissioners’ Standard Ordinary Mortality Table, Age Nearest Birthday (2001 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.

Mortality tables are unisex for policies issued in the State of Montana and group or sponsored arrangements (including our employees and their family members).

The rate class of an insured may affect the cost of insurance rate.  We currently place 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.

2

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 Section1035 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 our Service Center within thirty 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.

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 your allocations in affect 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.

  Illustrations

Before you purchase the policy and upon request thereafter, we will provide illustrations of future benefits under the policy based upon the proposed Insured's age and premium class, the Death Benefit Option elected, Specified Amount, planned periodic Premiums, and Riders requested.  We reserve the right to charge a reasonable fee of no more than $25 for this service to persons who request more than one policy illustration during a policy year.

Advertising

Rating Agencies.  Independent financial rating services, including Moody's, Standard & Poor's and A.M. Best Company rank and rate us.  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 separate account.  We may advertise these ratings from time to time.  In addition, we may include in certain advertisements, endorsements in the form of a list of organizations, individuals or other parties which recommend us or the policies.  Furthermore, we 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.We 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.  We will advertise historical performance of the Sub-Accounts in accordance with SEC prescribed calculations.  Please note that performance information is annualized.  However, if a Sub-Account has been available in the separate 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.  We may provide information on various topics to you and prospective policy owners in advertising, sales literature or other materials.

3

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 Cash Value Accumulation Test and the Guideline Premium/Cash Value Corridor 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 the Insured	Applicable Percentage		Attained Age of the Insured	Applicable Percentage
0-40	250%		70	115%
41	243%		71	113%
42	236%		72	111%
43	229%		73	109%
44	222%		74	107%
45	215%		75	105%
46	209%		76	105%
47	203%		77	105%
48	197%		78	105%
49	191%		79	105%
50	185%		80	105%
51	178%		81	105%
52	171%		82	105%
53	164%		83	105%
54	157%		84	105%
55	150%		85	105%
56	146%		86	105%
57	142%		87	105%
58	138%		88	105%
59	134%		89	105%
60	130%		90	105%
61	128%		91	104%
62		126%	92	103%
63	124%		93	102%
64	122%		94	101%
65	120%		95	100%
66	119%		96	100%
67	118%		97	100%
68	117%		98	100%
69	116%		99-120	100%

4

Cash Value Accumulation Test

The Cash Value Accumulation Test 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 2001 CSO mortality as prescribed in 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 preferred non-tobacco issue age 55.

Policy Year	Percentage of Cash Value	Policy Year	Percentage of Cash Value	Policy Year	Percentage of Cash Value
1	244%	16	162%	31	122%
2	237%	17	158%	32	120%
3	230%	18	155%	33	119%
4	223%	19	151%	34	117%
5	216%	20	148%	35	116%
6	210%	21	145%	36	115%
7	204%	22	142%	37	114%
8	199%	23	139%	38	113%
9	193%	24	137%	39	112%
10	188%	25	134%	40	111%
11	183%	26	132%	41	110%
12	179%	27	129%	42	109%
13	174%	28	127%	43	107%
14	170%	29	125%	44	106%
15	166%	30	124%	45	103%
				46+	100%

5

Report of Independent Registered Public Accounting Firm

The Board of Directors of Nationwide Life and Annuity Insurance Company and Subsidiary and

Contract Owners of Nationwide VL Separate Account -G:

We have audited the accompanying statement of assets, liabilities and contract owners’ equity of Nationwide VL Separate Account -G (comprised of the sub-accounts listed in note 1(b), (collectively, “the Accounts”)) as of December 31, 2011, 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 audits 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, 2011, by correspondence with the transfer agents of the underlying mutual funds. 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, 2011, 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 13, 2012

Report of Independent Registered Public Accounting Firm

The Board of Directors of Nationwide Life and Annuity Insurance Company and Subsidiary and

Contract Owners of Nationwide VL Separate Account -G:

We have audited the accompanying statement of assets, liabilities and contract owners’ equity of Nationwide VL Separate Account -G (comprised of the sub-accounts listed in note 1(b), (collectively, “the Accounts”)) as of December 31, 2011, 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 audits 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, 2011, by correspondence with the transfer agents of the underlying mutual funds. 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, 2011, 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 13, 2012

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2011

Assets:
Investments at fair value:
Variable Series Funds, Inc. - Global Allocation V.I. Fund - Class II (MLVGA2)
	282,528 shares (cost $4,410,606)	$	4,195,539
Stock Index Fund, Inc. - Initial Shares (DSIF)
	116,823 shares (cost $3,226,020)		3,443,955
Janus Aspen Series - Forty Portfolio - Service Shares (JACAS)
	53,165 shares (cost $1,752,101)		1,739,013
Janus Aspen Series - Global Technology Portfolio - Service II Shares (JAGTS2)
	43,406 shares (cost $255,001)		229,185
Janus Aspen Series - Overseas Portfolio - Service II Shares (JAIGS2)
	89,364 shares (cost $4,044,473)		3,363,669
Investors Growth Stock Series - Initial Class (MIGIC)
	422 shares (cost $4,434)		4,647
Value Series - Initial Class (MVFIC)
	252,087 shares (cost $2,922,467)		3,196,467
Variable Insurance Trust II - International Value Portfolio - Service Class (MVIVSC)
	7,930 shares (cost $124,798)		118,870
M Business Opportunity Value Fund (MFBOV)
	27,475 shares (cost $263,405)		270,356
M Capital Appreciation Fund (MFFCA)
	11,949 shares (cost $263,629)		254,866
M International Equity Fund (MFBIE)
	31,294 shares (cost $348,924)		306,054
M Large Cap Growth Fund (MFTCG)
	17,148 shares (cost $251,206)		276,085
Core Plus Fixed Income Portfolio - Class I (MSVFI)
	10,156 shares (cost $100,422)		103,490
American Century NVIT Multi Cap Value Fund - Class I (NVAMV1)
	85,937 shares (cost $1,212,005)		1,203,123
American Funds NVIT Asset Allocation Fund - Class II (GVAAA2)
	236,321 shares (cost $3,848,093)		4,074,176
American Funds NVIT Bond Fund - Class II (GVABD2)
	52,737 shares (cost $572,665)		602,781
American Funds NVIT Global Growth Fund - Class II (GVAGG2)
	50,184 shares (cost $990,530)		984,607
American Funds NVIT Growth Fund - Class II (GVAGR2)
	36,370 shares (cost $1,772,355)		1,877,073
American Funds NVIT Growth-Income Fund - Class II (GVAGI2)
	30,773 shares (cost $1,071,619)		1,098,588
Federated NVIT High Income Bond Fund - Class III (HIBF3)
	298,479 shares (cost $2,009,039)		1,949,070
NVIT Emerging Markets Fund - Class III (GEM3)
	204,972 shares (cost $2,352,779)		2,078,421
NVIT International Equity Fund - Class III (GIG3)
	13,205 shares (cost $107,952)		105,769
Gartmore NVIT International Equity Fund - Class VI (NVIE6)
	33,213 shares (cost $263,366)		265,038
Neuberger Berman NVIT Multi Cap Opportunities Fund - Class I (NVNMO1)
	40,740 shares (cost $354,573)		317,363
Neuberger Berman NVIT Socially Responsible Fund - Class II (NVNSR2)
	115,208 shares (cost $1,094,283)		1,145,171
NVIT Cardinal Aggressive Fund - Class I (NVCRA1)
	306,786 shares (cost $2,615,139)		2,481,899
NVIT Cardinal Balanced Fund - Class I (NVCRB1)
	268,019 shares (cost $2,657,165)		2,674,827

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2011

NVIT Cardinal Capital Appreciation Fund - Class I (NVCCA1)
	399,864 shares (cost $3,952,478)	3,802,704
NVIT Cardinal Conservative Fund - Class I (NVCCN1)
	99,594 shares (cost $1,023,866)	1,022,833
NVIT Cardinal Moderate Fund - Class I (NVCMD1)
	557,242 shares (cost $5,463,030)	5,438,683
NVIT Cardinal Moderately Aggressive Fund - Class I (NVCMA1)
	799,755 shares (cost $7,426,321)	7,341,748
NVIT Cardinal Moderately Conservative Fund - Class I (NVCMC1)
	90,816 shares (cost $913,411)	921,785
NVIT Core Bond Fund - Class I (NVCBD1)
	109,874 shares (cost $1,179,350)	1,196,532
NVIT Core Plus Bond Fund - Class I (NVLCP1)
	30,548 shares (cost $343,261)	351,001
NVIT Fund - Class I (TRF)
	64,982 shares (cost $476,631)	588,084
NVIT Government Bond Fund - Class I (GBF)
	123,403 shares (cost $1,457,646)	1,472,196
American Century NVIT Growth Fund - Class I (CAF)
	1,239 shares (cost $16,870)	17,047
NVIT International Index Fund - Class VI (GVIX6)
	122,316 shares (cost $951,289)	885,569
NVIT Investor Destinations Aggressive Fund - Class II (GVIDA)
	343,845 shares (cost $2,769,527)	3,008,647
NVIT Investor Destinations Balanced Fund - Class II (NVDBL2)
	76,050 shares (cost $974,561)	974,962
NVIT Investor Destinations Capital Appreciation Fund - Class II (NVDCA2)
	116,705 shares (cost $1,587,872)	1,612,867
NVIT Investor Destinations Conservative Fund - Class II (GVIDC)
	158,089 shares (cost $1,596,009)	1,612,505
NVIT Investor Destinations Moderate Fund - Class II (GVIDM)
	910,884 shares (cost $9,059,636)	9,409,431
NVIT Investor Destinations Moderately Aggressive Fund - Class II (GVDMA)
	1,236,072 shares (cost $11,702,848)	12,323,634
NVIT Investor Destinations Moderately Conservative Fund - Class II (GVDMC)
	82,057 shares (cost $843,486)	852,574
NVIT Mid Cap Index Fund - Class I (MCIF)
	43,239 shares (cost $702,585)	758,852
NVIT Money Market Fund - Class I (SAM)
	11,123,079 shares (cost $11,123,079)	11,123,079
NVIT Multi-Manager International Growth Fund - Class III (NVMIG3)
	71,273 shares (cost $593,730)	622,929
NVIT Multi-Manager International Value Fund - Class III (GVDIV3)
	82,294 shares (cost $751,374)	686,336
NVIT Multi-Manager Large Cap Growth Fund - Class I (NVMLG1)
	120,880 shares (cost $1,117,193)	1,127,807
NVIT Multi-Manager Large Cap Value Fund - Class I (NVMLV1)
	35,834 shares (cost $307,554)	288,824
NVIT Multi-Manager Mid Cap Growth Fund - Class I (NVMMG1)
	132,421 shares (cost $1,054,540)	1,349,374
NVIT Multi-Manager Mid Cap Value Fund - Class II (NVMMV2)
	37,939 shares (cost $360,755)	376,738
NVIT Multi-Manager Small Cap Growth Fund - Class I (SCGF)
	25,607 shares (cost $372,759)	392,561
NVIT Multi-Manager Small Cap Value Fund - Class I (SCVF)
	40,014 shares (cost $357,419)	395,337
NVIT Multi-Manager Small Company Fund - Class I (SCF)
	37,649 shares (cost $593,825)	638,902

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2011

NVIT Multi-Sector Bond Fund - Class I (MSBF)
	99,328 shares (cost $849,503)	861,173
NVIT Short Term Bond Fund - Class II (NVSTB2)
	11,911 shares (cost $123,205)	122,804
NVIT Large Cap Growth Fund - Class I (NVOLG1)
	209,930 shares (cost $3,173,728)	3,083,867
Templeton NVIT International Value Fund - Class III (NVTIV3)
	58,492 shares (cost $732,940)	621,775
Van Kampen NVIT Comstock Value Fund - Class I (EIF)
	75,209 shares (cost $682,534)	734,038
NVIT Real Estate Fund - Class I (NVRE1)
	329,648 shares (cost $2,583,571)	2,986,608
VPS Small/Mid Cap Value Portfolio - Class A (ALVSVA)
	60,759 shares (cost $951,325)	939,341
VP Inflation Protection Fund - Class II (ACVIP2)
	82,520 shares (cost $938,617)	969,606
VP Mid Cap Value Fund - Class I (ACVMV1)
	113,528 shares (cost $1,432,525)	1,532,625
Small Cap Stock Index Portfolio - Service Shares (DVSCS)
	117,893 shares (cost $1,221,181)	1,434,763
Appreciation Portfolio - Initial Shares (DCAP)
	12,703 shares (cost $451,624)	482,696
Quality Bond Fund II - Primary Shares (FQB)
	5,509 shares (cost $62,463)	61,755
VIP Fund - Energy Portfolio - Service Class 2 (FNRS2)
	144,493 shares (cost $2,707,207)	2,704,903
VIP Fund - Equity-Income Portfolio - Service Class (FEIS)
	84,887 shares (cost $1,458,670)	1,581,451
VIP Fund - Freedom Fund 2010 Portfolio - Service Class (FF10S)
	39,190 shares (cost $415,982)	403,659
VIP Fund - Freedom Fund 2020 Portfolio - Service Class (FF20S)
	104,483 shares (cost $1,074,087)	1,065,730
VIP Fund - Freedom Fund 2030 Portfolio - Service Class (FF30S)
	315,635 shares (cost $2,990,516)	3,058,507
VIP Fund - Growth Portfolio - Service Class (FGS)
	55,818 shares (cost $1,956,245)	2,054,664
VIP Fund - Investment Grade Bond Portfolio - Service Class (FIGBS)
	205,761 shares (cost $2,626,984)	2,646,083
VIP Fund - Mid Cap Portfolio - Service Class (FMCS)
	131,996 shares (cost $3,592,699)	3,818,647
VIP Fund - Overseas Portfolio - Service Class R (FOSR)
	86,745 shares (cost $1,444,914)	1,175,393
VIP Fund - Value Strategies Portfolio - Service Class (FVSS)
	1,941 shares (cost $13,914)	17,004
Franklin Income Securities Fund - Class 2 (FTVIS2)
	68,281 shares (cost $970,550)	977,786
Franklin Rising Dividends Securities Fund - Class 1 (FTVRDI)
	2,402 shares (cost $43,058)	48,054
Franklin Small Cap Value Securities Fund - Class 1 (FTVSVI)
	124,229 shares (cost $1,650,614)	1,965,301
Templeton Developing Markets Securities Fund - Class 3 (FTVDM3)
	59,524 shares (cost $503,867)	557,146
Templeton Foreign Securities Fund - Class 3 (TIF3)
	31,442 shares (cost $347,135)	393,340
Templeton Global Bond Securities Fund - Class 3 (FTVGI3)
	114,195 shares (cost $2,169,589)	2,072,639
VIP Founding Funds Allocation Fund - Class 2 (FTVFA2)
	168,286 shares (cost $1,248,651)	1,277,290

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2011

Advisers Management Trust - Short Duration Bond Portfolio - I Class Shares (AMTB)
	55,816 shares (cost $624,160)	602,255
Small-Cap Growth Portfolio - S Class Shares (AMFAS)
	1,692 shares (cost $21,502)	20,527
Socially Responsive Portfolio - I Class Shares (AMSRS)
	9,762 shares (cost $119,067)	140,091
Global Securities Fund/VA - Class 3 (OVGS3)
	32,610 shares (cost $859,865)	901,659
High Income Fund/VA - Class 3 (OVHI3)
	41,555 shares (cost $79,917)	79,785
High Income Fund/VA - Non-Service Shares (OVHI)
	669 shares (cost $1,159)	1,272
Main Street Fund(R)/VA - Non-Service Shares (OVGI)
	37,805 shares (cost $638,594)	782,936
Main Street Small- & Mid-Cap Fund(R)/VA - Non-Service Shares (OVSC)
	43,567 shares (cost $714,062)	748,053
Foreign Bond Portfolio (Unhedged) - Administrative Class (PMVFBA)
	67,243 shares (cost $770,077)	812,964
Low Duration Portfolio - Administrative Class (PMVLDA)
	155,868 shares (cost $1,635,789)	1,617,914
Total Return Portfolio - Administrative Class (PMVTRA)
	31,370 shares (cost $347,312)	345,702
V.I. Capital Appreciation Fund - Series I (AVCA)
	1,036 shares (cost $19,849)	22,200
V.I. Capital Development Fund - Series I (AVCDI)
	6,640 shares (cost $83,606)	82,671
Health Sciences Portfolio - II (TRHS2)
	16,447 shares (cost $267,728)	263,970
VIP Trust - Global Hard Assets Fund: Class R1 (VWHAR)
	22,468 shares (cost $806,035)	691,565
Ivy Fund Variable Insurance Portfolios, Inc. - Asset Strategy (WRASP)
	456,788 shares (cost $4,358,196)	4,160,291
Ivy Fund Variable Insurance Portfolios, Inc. - Balanced (WRBP)
	13,165 shares (cost $117,827)	118,683
Ivy Fund Variable Insurance Portfolios, Inc. - Bond (WRBDP)
	95,025 shares (cost $531,732)	551,528
Ivy Fund Variable Insurance Portfolios, Inc. - Core Equity (WRCEP)
	25,588 shares (cost $282,010)	299,416
Ivy Fund Variable Insurance Portfolios, Inc. - Dividend Opportunities (WRDIV)
	46,260 shares (cost $286,565)	299,486
Ivy Fund Variable Insurance Portfolios, Inc. - Energy (WRENG)
	24,641 shares (cost $143,307)	143,263
Ivy Funds Variable Insurance Portfolios, Inc. - Global Bond (WRGBP)
	424 shares (cost $2,098)	2,079
Ivy Fund Variable Insurance Portfolios, Inc. - Global Natural Resources (WRGNR)
	67,707 shares (cost $387,380)	357,878
Ivy Fund Variable Insurance Portfolios, Inc. - Growth (WRGP)
	23,061 shares (cost $217,561)	235,008
Ivy Fund Variable Insurance Portfolios, Inc. - High Income (WRHIP)
	140,096 shares (cost $478,181)	478,961
Ivy Fund Variable Insurance Portfolios, Inc. - International Growth (WRIP)
	30,686 shares (cost $237,016)	241,070
Ivy Fund Variable Insurance Portfolios, Inc. - International Core Equity (WRI2P)
	12,908 shares (cost $201,870)	189,383
Ivy Funds Variable Insurance Portfolios, Inc. - Limited-Term Bond (WRLTBP)
	568 shares (cost $2,885)	2,858
Ivy Fund Variable Insurance Portfolios, Inc. - Micro Cap Growth (WRMIC)
	6,184 shares (cost $122,717)	127,162

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2011

Ivy Fund Variable Insurance Portfolios, Inc. - Mid Cap Growth (WRMCG)
	28,173 shares (cost $223,977)		235,744
Ivy Fund Variable Insurance Portfolios, Inc. - Money Market (WRMMP)
	250,540 shares (cost $250,540)		250,540
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Aggressive (WRPAP)
	73,430 shares (cost $347,748)		350,100
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Conservative (WRPCP)
	46,814 shares (cost $240,130)		242,647
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderate (WRPMP)
	290,807 shares (cost $1,419,929)		1,471,918
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderately Aggressive (WRPMAP)
	312,439 shares (cost $1,564,378)		1,591,812
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderately Conservative (WRPMCP)
	32,346 shares (cost $169,241)		167,938
Ivy Fund Variable Insurance Portfolios, Inc. - Real Estate Securities (WRRESP)
	17,560 shares (cost $108,642)		118,618
Ivy Fund Variable Insurance Portfolios, Inc. - Science and Technology (WRSTP)
	27,225 shares (cost $430,153)		415,089
Ivy Fund Variable Insurance Portfolios, Inc. - Small Cap Growth (WRSCP)
	18,931 shares (cost $175,021)		176,841
Ivy Fund Variable Insurance Portfolios, Inc. - Small Cap Value (WRSCV)
	8,732 shares (cost $129,184)		127,233
Ivy Fund Variable Insurance Portfolios, Inc. - Value (WRVP)
	14,570 shares (cost $77,329)		81,170
Advantage VT Small Cap Growth Fund - Class 2 (WFVSCG)
	49,580 shares (cost $378,971)		380,773
Total Investments		$	168,533,344
Other Accounts Receivable			140,296
Accounts Payable-Blue Chip Growth Portfolio - II (TRBCG2)			(186	)
		$	168,673,454
Contract Owners’ Equity:
Accumulation units			168,673,454
Total Contract Owners’ Equity (note 8)		$	168,673,454

See accompanying notes to financial statements.

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF OPERATIONS

Year Ended December 31, 2011

Investment Activity:	Total			MLVGA2			DSIF			JACAS			JAGTS2			JAIGS2			MIGIC			MVFIC
Reinvested dividends	$	2,484,110			92,116			58,600			4,362			-			14,936			35			47,137
Net investment income (loss)		2,484,110			92,116			58,600			4,362			-			14,936			35			47,137
Realized gain (loss) on investments		2,679,995			16,616			(81,358	)		160,623			(2,764	)		(38,244	)		1,018			103,506
Change in unrealized gain (loss) on investments		(11,743,102	)		(356,890	)		55,442			(274,065	)		(27,755	)		(1,521,061	)		(1,062	)		(167,909	)
Net gain (loss) on investments		(9,063,107	)		(340,274	)		(25,916	)		(113,442	)		(30,519	)		(1,559,305	)		(44	)		(64,403	)
Reinvested capital gains		690,612			92,062			19,478			-			-			39,799			-			12,749
Net increase (decrease) in contract owners’ equity resulting from operations	$	(5,888,385	)		(156,096	)		52,162			(109,080	)		(30,519	)		(1,504,570	)		(9	)		(4,517	)
Investment Activity:	MVIVSC			MFBOV			MFFCA			MFBIE			MFTCG			MSVFI			NVAMV1			GVAAA2
Reinvested dividends	$	1,064			927			-			10,644			-			3,793			21,488			44,334
Net investment income (loss)		1,064			927			-			10,644			-			3,793			21,488			44,334
Realized gain (loss) on investments		257			9,887			10,519			4,314			14,450			209			(8,201	)		50,890
Change in unrealized gain (loss) on investments		(6,698	)		(21,352	)		(60,000	)		(48,406	)		(18,207	)		1,375			(32,036	)		(78,510	)
Net gain (loss) on investments		(6,441	)		(11,465	)		(49,481	)		(44,092	)		(3,757	)		1,584			(40,237	)		(27,620	)
Reinvested capital gains		-			-			29,355			-			-			-			3,125			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	(5,377	)		(10,538	)		(20,126	)		(33,448	)		(3,757	)		5,377			(15,624	)		16,714

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF OPERATIONS

Year Ended December 31, 2011

Investment Activity:	GVABD2			GVAGG2			GVAGR2			GVAGI2			HIBF3			GEM3			GIG3			NVIE6
Reinvested dividends	$	11,874			8,560			5,141			9,397			110,317			16,976			1,116			3,144
Net investment income (loss)		11,874			8,560			5,141			9,397			110,317			16,976			1,116			3,144
Realized gain (loss) on investments		3,167			84,765			135,708			33,531			36,214			95,395			(3,190	)		11,655
Change in unrealized gain (loss) on investments		15,876			(188,193	)		(232,225	)		(68,571	)		(102,442	)		(670,557	)		(2,183	)		(46,948	)
Net gain (loss) on investments		19,043			(103,428	)		(96,517	)		(35,040	)		(66,228	)		(575,162	)		(5,373	)		(35,293	)
Reinvested capital gains		-			-			-			-			-			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	30,917			(94,868	)		(91,376	)		(25,643	)		44,089			(558,186	)		(4,257	)		(32,149	)
Investment Activity:	NVNMO1			NVNSR2			NVCRA1			NVCRB1			NVCCA1			NVCCN1			NVCMD1			NVCMA1
Reinvested dividends	$	2,042			5,906			41,679			55,166			67,986			18,264			135,818			159,241
Net investment income (loss)		2,042			5,906			41,679			55,166			67,986			18,264			135,818			159,241
Realized gain (loss) on investments		17,961			78,696			31,366			33,648			136,769			1,894			126,643			114,564
Change in unrealized gain (loss) on investments		(64,346	)		(135,516	)		(238,195	)		(125,659	)		(407,985	)		(12,066	)		(449,276	)		(714,139	)
Net gain (loss) on investments		(46,385	)		(56,820	)		(206,829	)		(92,011	)		(271,216	)		(10,172	)		(322,633	)		(599,575	)
Reinvested capital gains		2,715			-			30,340			14,468			20,601			3,310			37,965			65,224
Net increase (decrease) in contract owners’ equity resulting from operations	$	(41,628	)		(50,914	)		(134,810	)		(22,377	)		(182,629	)		11,402			(148,850	)		(375,110	)

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF OPERATIONS

Year Ended December 31, 2011

Investment Activity:	NVCMC1			NVCBD1			NVLCP1			TRF			GBF			CAF			GVIX6			GVIDA
Reinvested dividends	$	16,648			32,272			7,492			7,329			42,490			74			21,275			53,067
Net investment income (loss)		16,648			32,272			7,492			7,329			42,490			74			21,275			53,067
Realized gain (loss) on investments		21,595			12,176			559			31,105			(13,594	)		(1,065	)		(11,123	)		(65,272	)
Change in unrealized gain (loss) on investments		(39,011	)		17,905			9,491			(29,161	)		72,373			177			(112,178	)		(98,372	)
Net gain (loss) on investments		(17,416	)		30,081			10,050			1,944			58,779			(888	)		(123,301	)		(163,644	)
Reinvested capital gains		3,306			-			319			-			4,367			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	2,538			62,353			17,861			9,273			105,636			(814	)		(102,026	)		(110,577	)
Investment Activity:	NVDBL2			NVDCA2			GVIDC			GVIDM			GVDMA			GVDMC			MCIF			SAM
Reinvested dividends	$	13,493			27,771			30,200			176,593			227,714			17,618			5,768			5
Net investment income (loss)		13,493			27,771			30,200			176,593			227,714			17,618			5,768			5
Realized gain (loss) on investments		6,048			2,956			29,540			52,162			(139,131	)		10,346			38,774			-
Change in unrealized gain (loss) on investments		(16,942	)		(57,609	)		(26,911	)		(252,454	)		(339,500	)		(12,659	)		(76,345	)		-
Net gain (loss) on investments		(10,894	)		(54,653	)		2,629			(200,292	)		(478,631	)		(2,313	)		(37,571	)		-
Reinvested capital gains		938			1,296			4,456			-			-			-			11,562			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	3,537			(25,586	)		37,285			(23,699	)		(250,917	)		15,305			(20,241	)		5

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF OPERATIONS

Year Ended December 31, 2011

Investment Activity:	NVMIG3			GVDIV3			NVMLG1			NVMLV1			NVMMG1			NVMMV2			SCGF			SCVF
Reinvested dividends	$	9,242			14,868			85			3,269			-			3,400			-			1,344
Net investment income (loss)		9,242			14,868			85			3,269			-			3,400			-			1,344
Realized gain (loss) on investments		75,937			(14,762	)		55,147			5,429			105,060			46,929			24,817			12,615
Change in unrealized gain (loss) on investments		(140,133	)		(122,309	)		(90,243	)		(37,725	)		(158,523	)		(60,134	)		(34,421	)		(34,712	)
Net gain (loss) on investments		(64,196	)		(137,071	)		(35,096	)		(32,296	)		(53,463	)		(13,205	)		(9,604	)		(22,097	)
Reinvested capital gains		-			-			-			10,330			-			1,724			-			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	(54,954	)		(122,203	)		(35,011	)		(18,697	)		(53,463	)		(8,081	)		(9,604	)		(20,753	)
Investment Activity:	SCF			MSBF			NVSTB2			NVOLG1			NVTIV3			EIF			NVRE1			ALVSVA
Reinvested dividends	$	3,305			35,253			2,078			22,100			19,670			9,935			24,707			4,026
Net investment income (loss)		3,305			35,253			2,078			22,100			19,670			9,935			24,707			4,026
Realized gain (loss) on investments		25,225			5,562			192			(2,105	)		25,487			27,670			83,551			19,976
Change in unrealized gain (loss) on investments		(68,521	)		1,139			(634	)		(103,700	)		(125,414	)		(56,537	)		42,149			(104,143	)
Net gain (loss) on investments		(43,296	)		6,701			(442	)		(105,805	)		(99,927	)		(28,867	)		125,700			(84,167	)
Reinvested capital gains		-			-			-			11,688			758			-			11,471			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	(39,991	)		41,954			1,636			(72,017	)		(79,499	)		(18,932	)		161,878			(80,141	)

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF OPERATIONS

Year Ended December 31, 2011

Investment Activity:	ACVIP2			ACVMV1			DVSCS			DCAP			FQB			FNRS2			FEIS			FF10S
Reinvested dividends	$	24,682			19,640			6,723			4,221			4,621			24,701			38,827			8,215
Net investment income (loss)		24,682			19,640			6,723			4,221			4,621			24,701			38,827			8,215
Realized gain (loss) on investments		17,977			51,839			20,831			15,362			2,616			129,591			46,175			2,949
Change in unrealized gain (loss) on investments		19,886			(118,986	)		(13,117	)		10,338			(5,175	)		(363,715	)		(68,536	)		(19,080	)
Net gain (loss) on investments		37,863			(67,147	)		7,714			25,700			(2,559	)		(234,124	)		(22,361	)		(16,131	)
Reinvested capital gains		5,752			37,193			2,689			-			-			-			-			2,037
Net increase (decrease) in contract owners’ equity resulting from operations	$	68,297			(10,314	)		17,126			29,921			2,062			(209,423	)		16,466			(5,879	)
Investment Activity:	FF20S			FF30S			FGS			FIGBS			FMCS			FOSR			FVSS			FTVIS2
Reinvested dividends	$	22,517			63,118			5,642			82,951			6,288			17,893			168			41,388
Net investment income (loss)		22,517			63,118			5,642			82,951			6,288			17,893			168			41,388
Realized gain (loss) on investments		53,634			48,395			10,449			53,837			45,898			(80,410	)		2,873			32,365
Change in unrealized gain (loss) on investments		(105,760	)		(209,434	)		(33,346	)		(26,856	)		(504,608	)		(184,235	)		(4,491	)		(55,286	)
Net gain (loss) on investments		(52,126	)		(161,039	)		(22,897	)		26,981			(458,710	)		(264,645	)		(1,618	)		(22,921	)
Reinvested capital gains		4,076			9,237			6,720			65,740			7,205			2,400			-			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	(25,533	)		(88,684	)		(10,535	)		175,672			(445,217	)		(244,352	)		(1,450	)		18,467

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF OPERATIONS

Year Ended December 31, 2011

Investment Activity:	FTVRDI			FTVSVI			FTVDM3			TIF3			FTVGI3			FTVFA2			AMTB			AMFAS
Reinvested dividends	$	845			17,576			5,856			7,273			86,141			157			20,846			-
Net investment income (loss)		845			17,576			5,856			7,273			86,141			157			20,846			-
Realized gain (loss) on investments		(589	)		192,330			(20,805	)		13,015			21,976			25,454			(9,228	)		1,756
Change in unrealized gain (loss) on investments		2,460			(254,377	)		(79,738	)		(65,083	)		(160,315	)		(43,791	)		(8,122	)		(3,067	)
Net gain (loss) on investments		1,871			(62,047	)		(100,543	)		(52,068	)		(138,339	)		(18,337	)		(17,350	)		(1,311	)
Reinvested capital gains		-			-			-			-			10,037			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	2,716			(44,471	)		(94,687	)		(44,795	)		(42,161	)		(18,180	)		3,496			(1,311	)
Investment Activity:	AMSRS			OVGS3			OVHI3			OVHI			OVGI			OVSC			PMVFBA			PMVLDA
Reinvested dividends	$	501			10,883			6,579			134			7,238			2,857			12,461			23,428
Net investment income (loss)		501			10,883			6,579			134			7,238			2,857			12,461			23,428
Realized gain (loss) on investments		7,689			(17,119	)		4,004			35			1,564			36,603			10,202			2,726
Change in unrealized gain (loss) on investments		(13,448	)		(80,060	)		(12,004	)		(196	)		(6,530	)		(73,268	)		22,947			(12,966	)
Net gain (loss) on investments		(5,759	)		(97,179	)		(8,000	)		(161	)		(4,966	)		(36,665	)		33,149			(10,240	)
Reinvested capital gains		-			-			-			-			-			-			2,573			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	(5,258	)		(86,296	)		(1,421	)		(27	)		2,272			(33,808	)		48,183			13,188

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF OPERATIONS

Year Ended December 31, 2011

Investment Activity:	PMVTRA			AVCA			AVCDI			TRBCG2			TRHS2			VWHAR			WRASP			WRBP
Reinvested dividends	$	2,374			31			-			-			-			2,203			36,030			1,598
Net investment income (loss)		2,374			31			-			-			-			2,203			36,030			1,598
Realized gain (loss) on investments		(1,645	)		534			5,043			50			(1,509	)		2,011			146,304			1,167
Change in unrealized gain (loss) on investments		(1,610	)		(2,195	)		(15,228	)		(18	)		(4,270	)		(128,833	)		(470,160	)		(8,320	)
Net gain (loss) on investments		(3,255	)		(1,661	)		(10,185	)		32			(5,779	)		(126,822	)		(323,856	)		(7,153	)
Reinvested capital gains		4,884			-			-			-			-			2,370			-			8,421
Net increase (decrease) in contract owners’ equity resulting from operations	$	4,003			(1,630	)		(10,185	)		32			(5,779	)		(122,249	)		(287,826	)		2,866
Investment Activity:	WRBDP			WRCEP			WRDIV			WRENG			WRGBP			WRGNR			WRGP			WRHIP
Reinvested dividends	$	12,085			953			2,699			-			33			-			776			32,203
Net investment income (loss)		12,085			953			2,699			-			33			-			776			32,203
Realized gain (loss) on investments		732			10,972			6,542			4,488			-			8,246			2,091			10,312
Change in unrealized gain (loss) on investments		17,853			(16,718	)		(24,467	)		(19,281	)		(19	)		(95,421	)		(6,034	)		(22,350	)
Net gain (loss) on investments		18,585			(5,746	)		(17,925	)		(14,793	)		(19	)		(87,175	)		(3,943	)		(12,038	)
Reinvested capital gains		2,984			8,530			-			-			-			-			7,079			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	33,654			3,737			(15,226	)		(14,793	)		14			(87,175	)		3,912			20,165

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF OPERATIONS

Year Ended December 31, 2011

Investment Activity:	WRIP			WRI2P			WRLTBP			WRMIC			WRMCG			WRMMP			WRPAP			WRPCP
Reinvested dividends	$	869			2,645			35			-			11			29			3,303			977
Net investment income (loss)		869			2,645			35			-			11			29			3,303			977
Realized gain (loss) on investments		6,640			4,667			(1	)		3,620			5,532			-			4,359			3,920
Change in unrealized gain (loss) on investments		(25,664	)		(34,230	)		(27	)		(13,633	)		(14,300	)		-			(26,096	)		(708	)
Net gain (loss) on investments		(19,024	)		(29,563	)		(28	)		(10,013	)		(8,768	)		-			(21,737	)		3,212
Reinvested capital gains		-			-			-			-			6,602			-			6,580			1,583
Net increase (decrease) in contract owners’ equity resulting from operations	$	(18,155	)		(26,918	)		7			(10,013	)		(2,155	)		29			(11,854	)		5,772
Investment Activity:	WRPMP			WRPMAP			WRPMCP			WRRESP			WRSTP			WRSCP			WRSCV			WRVP
Reinvested dividends	$	10,638			9,567			1,293			630			-			-			674			546
Net investment income (loss)		10,638			9,567			1,293			630			-			-			674			546
Realized gain (loss) on investments		19,191			27,149			954			3,774			6,270			6,363			10,383			1,619
Change in unrealized gain (loss) on investments		(61,509	)		(93,380	)		(5,107	)		373			(52,744	)		(25,027	)		(31,679	)		(8,127	)
Net gain (loss) on investments		(42,318	)		(66,231	)		(4,153	)		4,147			(46,474	)		(18,664	)		(21,296	)		(6,508	)
Reinvested capital gains		15,105			17,137			1,957			-			13,968			1,236			-			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	(16,575	)		(39,527	)		(903	)		4,777			(32,506	)		(17,428	)		(20,622	)		(5,962	)

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENT OF OPERATIONS

Year Ended December 31, 2011

Investment Activity:	WFVSCG			NVAGF3			GEF3
Reinvested dividends	$	-			2,280			104
Net investment income (loss)		-			2,280			104
Realized gain (loss) on investments		9,446			(5,903	)		366
Change in unrealized gain (loss) on investments		(30,678	)		1,973			(893	)
Net gain (loss) on investments		(21,232	)		(3,930	)		(527	)
Reinvested capital gains		-			3,111			-
Net increase (decrease) in contract owners’ equity resulting from operations	$	(21,232	)		1,461			(423	)

See accompanying notes to financial statements.

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	Total						MLVGA2						DSIF						JACAS
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	2,484,110			1,345,207			92,116			21,252			58,600			41,837			4,362			4,078
Realized gain (loss) on investments		2,679,995			(1,941,770	)		16,616			6,754			(81,358	)		(75,816	)		160,623			(74,505	)
Change in unrealized gain (loss) on investments		(11,743,102	)		14,124,785			(356,890	)		137,950			55,442			362,889			(274,065	)		216,500
Reinvested capital gains		690,612			690,661			92,062			10,626			19,478			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		(5,888,385	)		14,218,883			(156,096	)		176,582			52,162			328,910			(109,080	)		146,073
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		69,416,717			57,294,324			1,054,749			634,060			784,468			622,799			379,456			565,783
Transfers between funds		-			-			1,601,129			992,184			357,444			256,135			(242,449	)		390,415
Surrenders (note 6)		(4,530,807	)		(2,455,460	)		(38,740	)		(1,319	)		(78,067	)		(29,036	)		(36,175	)		(28,277	)
Death Benefits (note 4)		(85,723	)		(687,684	)		(1,020	)		-			-			-			(993	)		-
Net policy repayments (loans) (note 5)		(1,532,587	)		(871,656	)		(20,615	)		(6,968	)		(63,278	)		(89,626	)		(20,472	)		(12,904	)
Deductions for surrender charges (note 2d)		(1,484,097	)		(989,964	)		(5,527	)		(1,200	)		(32,497	)		(13,540	)		(14,478	)		(10,564	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(17,338,392	)		(13,275,967	)		(301,515	)		(118,617	)		(286,648	)		(225,566	)		(152,773	)		(164,699	)
Asset charges (note 3)		(525,076	)		(373,464	)		(6,568	)		(1,987	)		(10,006	)		(7,813	)		(5,481	)		(6,006	)
Adjustments to maintain reserves		87,446			(3,833	)		96			(1,484	)		34			(121	)		2			97
Net equity transactions		44,007,481			38,636,296			2,281,989			1,494,669			671,450			513,232			(93,363	)		733,845
Net change in contract owners’ equity		38,119,096			52,855,179			2,125,893			1,671,251			723,612			842,142			(202,443	)		879,918
Contract owners’ equity beginning of period		130,554,358			77,699,179			2,069,695			398,444			2,720,347			1,878,205			1,941,476			1,061,558
Contract owners’ equity end of period	$	168,673,454			130,554,358			4,195,588			2,069,695			3,443,959			2,720,347			1,739,033			1,941,476
CHANGES IN UNITS:
Beginning units		10,808,563			7,247,772			154,611			32,706			231,422			183,488			155,217			90,368
Units purchased		8,029,832			8,152,965			205,658			136,300			104,013			89,168			46,255			108,016
Units redeemed		(4,346,226	)		(4,592,174	)		(35,050	)		(14,395	)		(47,854	)		(41,234	)		(52,069	)		(43,167	)
Ending units		14,492,169			10,808,563			325,219			154,611			287,581			231,422			149,403			155,217

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	JAGTS2						JAIGS2						MIGIC						MVFIC
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	-			-			14,936			15,877			35			21			47,137			34,033
Realized gain (loss) on investments		(2,764	)		198			(38,244	)		(127,836	)		1,018			(77	)		103,506			(53,841	)
Change in unrealized gain (loss) on investments		(27,755	)		1,940			(1,521,061	)		773,754			(1,062	)		708			(167,909	)		298,691
Reinvested capital gains		-			-			39,799			-			-			-			12,749			-
Net increase (decrease) in contract owners’ equity resulting from operations		(30,519	)		2,138			(1,504,570	)		661,795			(9	)		652			(4,517	)		278,883
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		84,516			7,271			1,040,431			916,188			2,502			2,385			559,283			717,477
Transfers between funds		176,828			12,746			644,669			210,984			(971	)		(728	)		230,208			506,331
Surrenders (note 6)		(453	)		(588	)		(57,272	)		(49,702	)		(1,590	)		(1	)		(60,421	)		(68,077	)
Death Benefits (note 4)		-			-			(987	)		-			-			-			(5,246	)		-
Net policy repayments (loans) (note 5)		(264	)		-			(19,117	)		(15,560	)		-			-			(13,647	)		(4,211	)
Deductions for surrender charges (note 2d)		(37	)		(200	)		(25,884	)		(20,338	)		(400	)		(189	)		(15,587	)		(22,780	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(18,618	)		(792	)		(310,716	)		(268,197	)		(577	)		(808	)		(210,955	)		(205,308	)
Asset charges (note 3)		(404	)		(17	)		(13,349	)		(9,518	)		(33	)		(29	)		(9,304	)		(8,082	)
Adjustments to maintain reserves		79			2			6,848			(633	)		(1	)		1			(7	)		(46	)
Net equity transactions		241,647			18,422			1,264,623			763,224			(1,070	)		631			474,324			915,304
Net change in contract owners’ equity		211,128			20,560			(239,947	)		1,425,019			(1,079	)		1,283			469,807			1,194,187
Contract owners’ equity beginning of period		20,560			-			3,605,986			2,180,967			5,728			4,445			2,726,910			1,532,723
Contract owners’ equity end of period	$	231,688			20,560			3,366,039			3,605,986			4,649			5,728			3,196,717			2,726,910
CHANGES IN UNITS:
Beginning units		1,811			-			226,274			171,108			456			398			211,083			132,328
Units purchased		22,338			1,960			126,680			93,720			197			212			64,583			107,046
Units redeemed		(1,770	)		(149	)		(40,806	)		(38,554	)		(285	)		(154	)		(27,466	)		(28,291	)
Ending units		22,379			1,811			312,148			226,274			368			456			248,200			211,083

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	MVIVSC						MFBOV						MFFCA						MFBIE
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	1,064			-			927			1,194			-			281			10,644			6,758
Realized gain (loss) on investments		257			10			9,887			(11,533	)		10,519			(5,010	)		4,314			(503	)
Change in unrealized gain (loss) on investments		(6,698	)		770			(21,352	)		29,607			(60,000	)		45,438			(48,406	)		2,516
Reinvested capital gains		-			-			-			-			29,355			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		(5,377	)		780			(10,538	)		19,268			(20,126	)		40,709			(33,448	)		8,771
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		44,311			1,199			56,655			60,124			35,775			41,830			69,186			50,182
Transfers between funds		75,967			7,162			22,739			54,696			41,587			37,889			75,385			68,781
Surrenders (note 6)		(66	)		-			(1,575	)		(1,565	)		(946	)		(857	)		(731	)		(760	)
Death Benefits (note 4)		-			-			-			-			-			-			-			-
Net policy repayments (loans) (note 5)		4,067			-			1,713			(21,684	)		1,769			(8,076	)		1,901			(8,424	)
Deductions for surrender charges (note 2d)		(83	)		-			-			-			-			-			-			-
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(8,688	)		(189	)		(19,999	)		(16,518	)		(15,767	)		(11,063	)		(18,720	)		(16,813	)
Asset charges (note 3)		(204	)		(7	)		(651	)		(552	)		(820	)		(444	)		(674	)		(478	)
Adjustments to maintain reserves		20			1			(6	)		7			(5	)		2			-			2
Net equity transactions		115,324			8,166			58,876			74,508			61,593			59,281			126,347			92,490
Net change in contract owners’ equity		109,947			8,946			48,338			93,776			41,467			99,990			92,899			101,261
Contract owners’ equity beginning of period		8,946			-			222,016			128,240			213,395			113,405			213,153			111,892
Contract owners’ equity end of period	$	118,893			8,946			270,354			222,016			254,862			213,395			306,052			213,153
CHANGES IN UNITS:
Beginning units		825			-			25,620			16,171			19,701			13,297			26,038			14,298
Units purchased		13,056			843			13,304			16,759			7,858			11,326			22,549			17,962
Units redeemed		(2,718	)		(18	)		(6,388	)		(7,310	)		(2,198	)		(4,922	)		(5,336	)		(6,222	)
Ending units		11,163			825			32,536			25,620			25,361			19,701			43,251			26,038

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	MFTCG						MSVFI						MSVRE					NVAMV1
	2011			2010			2011			2010			2011		2010			2011			2010
Investment activity:
Net investment income (loss)	$	-			565			3,793			5,001			-		-			21,488			2,235
Realized gain (loss) on investments		14,450			(4,066	)		209			(2,979	)		-		-			(8,201	)		5,756
Change in unrealized gain (loss) on investments		(18,207	)		38,404			1,375			4,740			-		-			(32,036	)		20,263
Reinvested capital gains		-			-			-			-			-		-			3,125			3,199
Net increase (decrease) in contract owners’ equity resulting from operations		(3,757	)		34,903			5,377			6,762			-		-			(15,624	)		31,453
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		32,103			24,421			32,321			32,725			-		(16	)		223,340			45,468
Transfers between funds		58,039			55,365			(4,357	)		(72,358	)		-		(12	)		(194,729	)		1,262,330
Surrenders (note 6)		(901	)		(852	)		(777	)		(1	)		-		-			(7,448	)		(5,282	)
Death Benefits (note 4)		-			-			-			-			-		-			(2,564	)		-
Net policy repayments (loans) (note 5)		8,317			2,361			-			-			-		-			(13,002	)		140
Deductions for surrender charges (note 2d)		-			-			(485	)		(168	)		-		-			(12,965	)		(1,374	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(17,788	)		(15,244	)		(14,641	)		(15,570	)		-		28			(109,115	)		(12,749	)
Asset charges (note 3)		(621	)		(412	)		(367	)		(329	)		-		(1	)		(5,068	)		(408	)
Adjustments to maintain reserves		1			(6	)		8			2			-		1			(35	)		(5	)
Net equity transactions		79,150			65,633			11,702			(55,699	)		-		-			(121,586	)		1,288,120
Net change in contract owners’ equity		75,393			100,536			17,079			(48,937	)		-		-			(137,210	)		1,319,573
Contract owners’ equity beginning of period		200,690			100,154			86,590			135,527			-		-			1,340,342			20,769
Contract owners’ equity end of period	$	276,083			200,690			103,669			86,590			-		-			1,203,132			1,340,342
CHANGES IN UNITS:
Beginning units		21,687			13,319			7,213			12,096			-		-			94,019			1,653
Units purchased		11,023			12,857			2,636			2,846			-		156			23,279			95,294
Units redeemed		(2,635	)		(4,489	)		(1,675	)		(7,729	)		-		(156	)		(33,446	)		(2,928	)
Ending units		30,075			21,687			8,174			7,213			-		-			83,852			94,019

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	GVAAA2						GVABD2						GVAGG2						GVAGR2
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	44,334			21,730			11,874			8,949			8,560			6,235			5,141			2,446
Realized gain (loss) on investments		50,890			73,347			3,167			20,640			84,765			(7,938	)		135,708			(116,066	)
Change in unrealized gain (loss) on investments		(78,510	)		221,380			15,876			1,840			(188,193	)		95,323			(232,225	)		397,263
Reinvested capital gains		-			-			-			-			-			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		16,714			316,457			30,917			31,429			(94,868	)		93,620			(91,376	)		283,643
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		1,066,744			2,027,330			113,692			260,276			320,238			284,444			515,425			457,099
Transfers between funds		362,434			(174,850	)		7,655			(3,681	)		(113,017	)		132,156			(97,841	)		368,619
Surrenders (note 6)		(99,028	)		(73,452	)		(199	)		(42,064	)		(6,790	)		(52,409	)		(60,973	)		(19,350	)
Death Benefits (note 4)		-			-			-			-			-			(200	)		(1,281	)		(197	)
Net policy repayments (loans) (note 5)		(21,645	)		(4,877	)		(2,882	)		(8,130	)		(9,355	)		(2,312	)		(8,389	)		(2,437	)
Deductions for surrender charges (note 2d)		(11,514	)		(13,080	)		(1,497	)		(8,251	)		(5,320	)		(22,906	)		(16,331	)		(5,763	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(402,634	)		(293,056	)		(61,034	)		(58,774	)		(131,370	)		(119,135	)		(171,480	)		(158,334	)
Asset charges (note 3)		(13,479	)		(8,548	)		(1,961	)		(1,834	)		(3,771	)		(3,005	)		(6,348	)		(5,293	)
Adjustments to maintain reserves		63,954			(143	)		7			1			(29	)		16			360			(45	)
Net equity transactions		944,832			1,459,324			53,781			137,543			50,586			216,649			153,142			634,299
Net change in contract owners’ equity		961,546			1,775,781			84,698			168,972			(44,282	)		310,269			61,766			917,942
Contract owners’ equity beginning of period		3,173,782			1,398,001			518,084			349,112			1,028,890			718,621			1,815,426			897,484
Contract owners’ equity end of period	$	4,135,328			3,173,782			602,782			518,084			984,608			1,028,890			1,877,192			1,815,426
CHANGES IN UNITS:
Beginning units		291,751			143,955			44,558			31,824			85,800			66,698			171,060			99,951
Units purchased		133,387			232,834			12,456			26,307			33,923			39,429			73,715			109,403
Units redeemed		(48,495	)		(85,038	)		(7,978	)		(13,573	)		(29,188	)		(20,327	)		(59,195	)		(38,294	)
Ending units		376,643			291,751			49,036			44,558			90,535			85,800			185,580			171,060

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	GVAGI2						HIBF3						GEM3						GIG3
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	9,397			5,807			110,317			63,038			16,976			1,396			1,116			-
Realized gain (loss) on investments		33,531			13,608			36,214			(3,567	)		95,395			(262,357	)		(3,190	)		-
Change in unrealized gain (loss) on investments		(68,571	)		53,865			(102,442	)		22,111			(670,557	)		556,660			(2,183	)		-
Reinvested capital gains		-			-			-			-			-			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		(25,643	)		73,280			44,089			81,582			(558,186	)		295,699			(4,257	)		-
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		301,988			364,441			428,359			217,549			664,206			633,871			38,550			-
Transfers between funds		43,707			271,573			672,768			178,407			75,641			(43,724	)		76,146			-
Surrenders (note 6)		(26,857	)		(41,662	)		(11,274	)		(2,921	)		(22,815	)		(49,896	)		(19	)		-
Death Benefits (note 4)		-			-			(622	)		(199	)		(987	)		-			-			-
Net policy repayments (loans) (note 5)		(3,197	)		524			(17,741	)		(5,141	)		(20,364	)		(13,422	)		72			-
Deductions for surrender charges (note 2d)		(6,996	)		(8,652	)		(3,453	)		(1,541	)		(18,320	)		(21,872	)		(20	)		-
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(103,472	)		(85,981	)		(119,463	)		(66,170	)		(226,141	)		(180,047	)		(4,556	)		-
Asset charges (note 3)		(3,199	)		(2,173	)		(4,218	)		(1,870	)		(6,850	)		(5,348	)		(149	)		-
Adjustments to maintain reserves		(13	)		(47	)		474			13			43			180			1			-
Net equity transactions		201,961			498,023			944,830			318,127			444,413			319,742			110,025			-
Net change in contract owners’ equity		176,318			571,303			988,919			399,709			(113,773	)		615,441			105,768			-
Contract owners’ equity beginning of period		922,273			350,970			960,243			560,534			2,192,210			1,576,769			-			-
Contract owners’ equity end of period	$	1,098,591			922,273			1,949,162			960,243			2,078,437			2,192,210			105,768			-
CHANGES IN UNITS:
Beginning units		103,788			43,831			67,173			44,372			103,153			86,223			-			-
Units purchased		43,543			80,581			78,674			37,365			44,283			58,469			13,117			-
Units redeemed		(20,874	)		(20,624	)		(14,495	)		(14,564	)		(21,419	)		(41,539	)		(614	)		-
Ending units		126,457			103,788			131,352			67,173			126,017			103,153			12,503			-

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	NVIE6						NVNMO1						NVNSR2						NVCRA1
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	3,144			2,288			2,042			617			5,906			4,499			41,679			4,332
Realized gain (loss) on investments		11,655			15,713			17,961			5,177			78,696			(27,267	)		31,366			29,264
Change in unrealized gain (loss) on investments		(46,948	)		8,667			(64,346	)		6,862			(135,516	)		170,874			(238,195	)		26,505
Reinvested capital gains		-			-			2,715			25,016			-			-			30,340			109,859
Net increase (decrease) in contract owners’ equity resulting from operations		(32,149	)		26,668			(41,628	)		37,672			(50,914	)		148,106			(134,810	)		169,960
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		69,461			93,286			40,726			38,988			174,971			193,136			1,189,143			626,316
Transfers between funds		(38,379	)		(163,089	)		20,887			108,092			433,405			(202,686	)		274,700			441,157
Surrenders (note 6)		(476	)		(2,304	)		(712	)		169			(22,763	)		(48,367	)		(8,588	)		(79	)
Death Benefits (note 4)		-			-			-			-			(3,538	)		-			(1,075	)		-
Net policy repayments (loans) (note 5)		(3,577	)		234			13			(1,019	)		(2,736	)		(2,769	)		(33,564	)		(437	)
Deductions for surrender charges (note 2d)		(490	)		(1,375	)		(394	)		-			(19,037	)		(13,754	)		(9,928	)		(3,784	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(26,979	)		(27,272	)		(22,525	)		(17,182	)		(84,990	)		(93,866	)		(341,813	)		(230,029	)
Asset charges (note 3)		(1,226	)		(908	)		(904	)		(622	)		(3,950	)		(3,215	)		(6,661	)		(3,557	)
Adjustments to maintain reserves		2			(17	)		(2	)		115			3,523			(2	)		139			(396	)
Net equity transactions		(1,664	)		(101,445	)		37,089			128,541			474,885			(171,523	)		1,062,353			829,191
Net change in contract owners’ equity		(33,813	)		(74,777	)		(4,539	)		166,213			423,971			(23,417	)		927,543			999,151
Contract owners’ equity beginning of period		298,851			373,628			321,900			155,687			721,364			744,781			1,555,220			556,069
Contract owners’ equity end of period	$	265,038			298,851			317,361			321,900			1,145,335			721,364			2,482,763			1,555,220
CHANGES IN UNITS:
Beginning units		37,091			52,401			35,126			19,640			72,005			91,858			163,017			67,030
Units purchased		9,116			15,097			11,473			18,285			60,125			26,440			160,789			126,849
Units redeemed		(9,658	)		(30,407	)		(7,416	)		(2,799	)		(13,946	)		(46,293	)		(46,405	)		(30,862	)
Ending units		36,549			37,091			39,183			35,126			118,184			72,005			277,401			163,017

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	NVCRB1						NVCCA1						NVCCN1						NVCMD1
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	55,166			14,388			67,986			10,939			18,264			4,427			135,818			25,324
Realized gain (loss) on investments		33,648			62,363			136,769			43,265			1,894			8,059			126,643			66,982
Change in unrealized gain (loss) on investments		(125,659	)		75,006			(407,985	)		138,985			(12,066	)		3,893			(449,276	)		298,900
Reinvested capital gains		14,468			-			20,601			72			3,310			7,295			37,965			-
Net increase (decrease) in contract owners’ equity resulting from operations		(22,377	)		151,757			(182,629	)		193,261			11,402			23,674			(148,850	)		391,206
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		1,023,163			491,394			1,094,303			907,353			310,548			372,108			1,652,338			2,040,808
Transfers between funds		179,021			636,881			1,793,220			272,123			228,893			92,900			341,737			1,726,877
Surrenders (note 6)		(100	)		(51,394	)		(279,341	)		(103,805	)		(415	)		(4,592	)		(896,533	)		(96,456	)
Death Benefits (note 4)		-			-			-			(13,763	)		-			-			-			(38,227	)
Net policy repayments (loans) (note 5)		(1,426	)		(3,144	)		(93,211	)		(3	)		(2	)		(2	)		(91,257	)		(37,288	)
Deductions for surrender charges (note 2d)		(1,973	)		(3,748	)		(78,192	)		(2,562	)		(6,417	)		(38	)		(61,444	)		(20,753	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(264,343	)		(170,037	)		(414,832	)		(254,898	)		(79,858	)		(52,701	)		(549,691	)		(342,212	)
Asset charges (note 3)		(9,217	)		(5,755	)		(9,667	)		(5,633	)		(2,883	)		(1,272	)		(16,488	)		(8,355	)
Adjustments to maintain reserves		11			(50	)		(711	)		(258	)		(1	)		4			(75	)		1,069
Net equity transactions		925,136			894,147			2,011,569			798,554			449,865			406,407			378,587			3,225,463
Net change in contract owners’ equity		902,759			1,045,904			1,828,940			991,815			461,267			430,081			229,737			3,616,669
Contract owners’ equity beginning of period		1,772,073			726,169			2,023,626			1,031,811			561,567			131,486			5,208,944			1,592,275
Contract owners’ equity end of period	$	2,674,832			1,772,073			3,852,566			2,023,626			1,022,834			561,567			5,438,681			5,208,944
CHANGES IN UNITS:
Beginning units		167,231			75,697			199,390			114,328			50,764			12,702			502,389			171,116
Units purchased		120,634			115,333			269,230			118,272			48,330			46,077			194,770			391,004
Units redeemed		(32,214	)		(23,799	)		(75,802	)		(33,210	)		(7,997	)		(8,015	)		(160,556	)		(59,731	)
Ending units		255,651			167,231			392,818			199,390			91,097			50,764			536,603			502,389

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	NVCMA1						NVCMC1						NVCBD1						NVLCP1
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	159,241			26,096			16,648			5,701			32,272			20,071			7,492			3,038
Realized gain (loss) on investments		114,564			160,043			21,595			19,899			12,176			9,802			559			1,309
Change in unrealized gain (loss) on investments		(714,139	)		365,900			(39,011	)		20,308			17,905			3,221			9,491			(1,875	)
Reinvested capital gains		65,224			-			3,306			895			-			8,003			319			3,754
Net increase (decrease) in contract owners’ equity resulting from operations		(375,110	)		552,039			2,538			46,803			62,353			41,097			17,861			6,226
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		3,065,740			2,016,586			375,544			123,596			120,059			176,132			73,199			92,416
Transfers between funds		563,933			1,390,346			84,994			132,985			377,194			183,659			112,540			49,566
Surrenders (note 6)		(209,351	)		(2,049	)		(2,521	)		(20	)		(13,061	)		(4,564	)		(287	)		(556	)
Death Benefits (note 4)		(6,018	)		(582,212	)		-			-			-			-			-			-
Net policy repayments (loans) (note 5)		(19,664	)		(45,488	)		-			-			(23,239	)		(967	)		-			-
Deductions for surrender charges (note 2d)		(47,115	)		(16,713	)		(1,039	)		(441	)		(66,876	)		(7,282	)		(1,219	)		(189	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(977,572	)		(641,973	)		(86,001	)		(59,983	)		(67,627	)		(84,729	)		(27,119	)		(11,675	)
Asset charges (note 3)		(20,786	)		(14,595	)		(3,063	)		(2,137	)		(2,184	)		(1,525	)		(1,088	)		(301	)
Adjustments to maintain reserves		879			1,978			(11	)		6			5			3			(1	)		-
Net equity transactions		2,350,046			2,105,880			367,903			194,006			324,271			260,727			156,025			129,261
Net change in contract owners’ equity		1,974,936			2,657,919			370,441			240,809			386,624			301,824			173,886			135,487
Contract owners’ equity beginning of period		5,366,799			2,708,880			551,338			310,529			809,905			508,081			177,110			41,623
Contract owners’ equity end of period	$	7,341,735			5,366,799			921,779			551,338			1,196,529			809,905			350,996			177,110
CHANGES IN UNITS:
Beginning units		541,174			310,026			51,188			31,516			69,927			46,963			14,090			3,588
Units purchased		414,174			384,397			47,874			25,663			41,393			37,972			14,580			12,232
Units redeemed		(179,537	)		(153,249	)		(13,239	)		(5,991	)		(14,403	)		(15,008	)		(2,419	)		(1,730	)
Ending units		775,811			541,174			85,823			51,188			96,917			69,927			26,251			14,090

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	TRF						GBF						CAF					GVIX6
	2011			2010			2011			2010			2011			2010		2011			2010
Investment activity:
Net investment income (loss)	$	7,329			8,021			42,490			53,952			74			-		21,275			11,824
Realized gain (loss) on investments		31,105			(132,510	)		(13,594	)		28,714			(1,065	)		-		(11,123	)		(11,990	)
Change in unrealized gain (loss) on investments		(29,161	)		219,168			72,373			(48,815	)		177			-		(112,178	)		57,579
Reinvested capital gains		-			-			4,367			60,471			-			-		-			-
Net increase (decrease) in contract owners’ equity resulting from operations		9,273			94,679			105,636			94,322			(814	)		-		(102,026	)		57,413
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		109,964			218,322			305,534			727,387			6,682			-		349,109			242,733
Transfers between funds		(161,006	)		(154,662	)		(162,019	)		(668,219	)		12,294			-		64,980			131,761
Surrenders (note 6)		(22,880	)		(47,788	)		(150,182	)		(75,747	)		-			-		(946	)		(4,605	)
Death Benefits (note 4)		(4,379	)		-			(602	)		-			-			-		-			-
Net policy repayments (loans) (note 5)		(6,637	)		(2,734	)		(4,920	)		(4,929	)		-			-		(13,761	)		-
Deductions for surrender charges (note 2d)		(12,968	)		(16,319	)		(67,413	)		(21,211	)		-			-		(569	)		-
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(88,262	)		(111,970	)		(147,830	)		(201,245	)		(1,109	)		-		(97,582	)		(39,970	)
Asset charges (note 3)		(3,300	)		(3,877	)		(5,228	)		(6,513	)		(6	)		-		(1,299	)		(893	)
Adjustments to maintain reserves		(14	)		(10	)		25			82			(2	)		-		-			(3	)
Net equity transactions		(189,482	)		(119,038	)		(232,635	)		(250,395	)		17,859			-		299,932			329,023
Net change in contract owners’ equity		(180,209	)		(24,359	)		(126,999	)		(156,073	)		17,045			-		197,906			386,436
Contract owners’ equity beginning of period		768,603			792,962			1,599,599			1,755,672			-			-		687,664			301,228
Contract owners’ equity end of period	$	588,394			768,603			1,472,600			1,599,599			17,045			-		885,570			687,664
CHANGES IN UNITS:
Beginning units		68,854			80,590			121,105			139,277			-			-		72,715			34,255
Units purchased		10,050			23,396			29,447			50,084			4,731			-		50,075			46,124
Units redeemed		(26,471	)		(35,132	)		(46,603	)		(68,256	)		(2,873	)		-		(15,506	)		(7,664	)
Ending units		52,433			68,854			103,949			121,105			1,858			-		107,284			72,715

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	GVIDA						NVDBL2						NVDCA2						GVIDC
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	53,067			36,731			13,493			1,469			27,771			7,378			30,200			15,452
Realized gain (loss) on investments		(65,272	)		(72,557	)		6,048			702			2,956			3,575			29,540			11,240
Change in unrealized gain (loss) on investments		(98,372	)		374,887			(16,942	)		17,072			(57,609	)		81,045			(26,911	)		17,304
Reinvested capital gains		-			-			938			496			1,296			1,569			4,456			1,987
Net increase (decrease) in contract owners’ equity resulting from operations		(110,577	)		339,061			3,537			19,739			(25,586	)		93,567			37,285			45,983
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		861,218			801,103			434,923			208,515			490,389			466,815			423,868			310,439
Transfers between funds		21,917			370,424			389,885			127,407			244,285			453,424			305,714			212,389
Surrenders (note 6)		(93,600	)		(40,610	)		(360	)		(60	)		(492	)		(1,484	)		(93,221	)		(3,156	)
Death Benefits (note 4)		-			(4,002	)		-			-			-			-			-			-
Net policy repayments (loans) (note 5)		(9,884	)		(11,580	)		(4,780	)		-			-			-			-			-
Deductions for surrender charges (note 2d)		(48,277	)		(37,382	)		(1,698	)		(66	)		(1,849	)		(4,107	)		(9,385	)		(2,244	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(385,283	)		(325,133	)		(162,655	)		(51,974	)		(125,125	)		(65,420	)		(145,599	)		(96,617	)
Asset charges (note 3)		(11,816	)		(9,597	)		(3,718	)		(765	)		(6,916	)		(3,524	)		(6,821	)		(4,990	)
Adjustments to maintain reserves		(11	)		(54	)		(8	)		(5	)		(22	)		(3	)		(60	)		(26	)
Net equity transactions		334,264			743,169			651,589			283,052			600,270			845,701			474,496			415,795
Net change in contract owners’ equity		223,687			1,082,230			655,126			302,791			574,684			939,268			511,781			461,778
Contract owners’ equity beginning of period		2,784,959			1,702,729			319,285			16,494			1,037,099			97,831			1,100,725			638,947
Contract owners’ equity end of period	$	3,008,646			2,784,959			974,411			319,285			1,611,783			1,037,099			1,612,506			1,100,725
CHANGES IN UNITS:
Beginning units		221,749			155,410			24,978			1,417			75,852			8,016			87,481			53,773
Units purchased		84,468			108,425			64,580			28,394			53,262			73,952			61,702			52,549
Units redeemed		(56,855	)		(42,086	)		(13,997	)		(4,833	)		(10,117	)		(6,116	)		(24,676	)		(18,841	)
Ending units		249,362			221,749			75,561			24,978			118,997			75,852			124,507			87,481

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	GVIDM						GVDMA						GVDMC						MCIF
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	176,593			74,099			227,714			128,710			17,618			7,488			5,768			6,762
Realized gain (loss) on investments		52,162			(97,119	)		(139,131	)		(221,773	)		10,346			11,559			38,774			(55,793	)
Change in unrealized gain (loss) on investments		(252,454	)		576,220			(339,500	)		1,104,162			(12,659	)		11,268			(76,345	)		166,462
Reinvested capital gains		-			-			-			-			-			-			11,562			619
Net increase (decrease) in contract owners’ equity resulting from operations		(23,699	)		553,200			(250,917	)		1,011,099			15,305			30,315			(20,241	)		118,050
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		3,145,325			1,501,008			4,522,268			3,585,719			293,012			175,593			166,854			133,184
Transfers between funds		767,159			2,144,359			597,767			1,870,005			218,510			42,194			87,131			(78,268	)
Surrenders (note 6)		(25,802	)		(17,835	)		(432,964	)		(193,093	)		(2,386	)		(39	)		(5,050	)		(29,316	)
Death Benefits (note 4)		-			(14,961	)		-			-			-			-			-			(11,600	)
Net policy repayments (loans) (note 5)		(26,435	)		1,492			(66,018	)		1,273			(10,493	)		(44,590	)		(8,443	)		(82,977	)
Deductions for surrender charges (note 2d)		(44,571	)		(14,365	)		(104,964	)		(102,429	)		(5,577	)		(142	)		(5,241	)		(3,281	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(948,737	)		(614,989	)		(1,614,307	)		(1,237,917	)		(87,355	)		(65,474	)		(66,411	)		(57,637	)
Asset charges (note 3)		(36,300	)		(18,472	)		(38,225	)		(28,176	)		(2,870	)		(1,643	)		(2,667	)		(2,341	)
Adjustments to maintain reserves		233			(3,048	)		(3,008	)		(2,271	)		3			(755	)		(102	)		293
Net equity transactions		2,830,872			2,963,189			2,860,549			3,893,111			402,844			105,144			166,071			(131,943	)
Net change in contract owners’ equity		2,807,173			3,516,389			2,609,632			4,904,210			418,149			135,459			145,830			(13,893	)
Contract owners’ equity beginning of period		6,601,716			3,085,327			9,710,940			4,806,730			434,425			298,966			613,069			626,962
Contract owners’ equity end of period	$	9,408,889			6,601,716			12,320,572			9,710,940			852,574			434,425			758,899			613,069
CHANGES IN UNITS:
Beginning units		518,780			268,912			761,845			425,494			34,079			25,450			41,128			53,080
Units purchased		351,786			311,899			431,675			492,265			43,816			18,663			19,939			20,962
Units redeemed		(130,891	)		(62,031	)		(205,943	)		(155,914	)		(12,365	)		(10,034	)		(8,827	)		(32,914	)
Ending units		739,675			518,780			987,577			761,845			65,530			34,079			52,240			41,128

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	SAM						NVMIG3						GVDIV3						NVMLG1
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	5			8			9,242			5,906			14,868			15,570			85			495
Realized gain (loss) on investments		-			-			75,937			(34,341	)		(14,762	)		(58,980	)		55,147			80,362
Change in unrealized gain (loss) on investments		-			-			(140,133	)		149,225			(122,309	)		93,970			(90,243	)		(17,678	)
Reinvested capital gains		-			-			-			-			-			-			-			42,453
Net increase (decrease) in contract owners’ equity resulting from operations		5			8			(54,954	)		120,790			(122,203	)		50,560			(35,011	)		105,632
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		20,724,738			16,854,392			153,525			212,674			81,759			152,353			299,650			279,240
Transfers between funds		(13,243,913	)		(15,107,354	)		(143,651	)		(93,873	)		35,437			(36,622	)		(28,667	)		308,561
Surrenders (note 6)		(614,966	)		(214,193	)		(30,039	)		(52,287	)		(917	)		(4,863	)		(15,263	)		(34,537	)
Death Benefits (note 4)		(1,527	)		-			(6,524	)		-			-			-			(4,364	)		(10,789	)
Net policy repayments (loans) (note 5)		(398,191	)		(85,451	)		(12,045	)		(5,369	)		(25	)		(88	)		(9,113	)		(83,628	)
Deductions for surrender charges (note 2d)		(93,333	)		(50,000	)		(16,106	)		(15,860	)		(2,984	)		(6,287	)		(15,117	)		(16,848	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(1,388,504	)		(1,265,050	)		(92,964	)		(108,106	)		(38,156	)		(39,275	)		(135,308	)		(124,954	)
Asset charges (note 3)		(33,126	)		(28,202	)		(3,288	)		(3,544	)		(1,913	)		(1,698	)		(4,088	)		(3,364	)
Adjustments to maintain reserves		1,820			345			(51	)		(9	)		(23	)		(47	)		468			456
Net equity transactions		4,952,998			104,487			(151,143	)		(66,374	)		73,178			63,473			88,198			314,137
Net change in contract owners’ equity		4,953,003			104,495			(206,097	)		54,416			(49,025	)		114,033			53,187			419,769
Contract owners’ equity beginning of period		6,170,232			6,065,737			829,332			774,916			735,427			621,394			1,074,619			654,850
Contract owners’ equity end of period	$	11,123,235			6,170,232			623,235			829,332			686,402			735,427			1,127,806			1,074,619
CHANGES IN UNITS:
Beginning units		537,380			528,280			86,794			92,482			68,742			61,633			112,634			79,282
Units purchased		1,837,038			1,484,746			22,265			29,690			12,839			16,998			47,210			71,797
Units redeemed		(1,405,670	)		(1,475,646	)		(37,094	)		(35,378	)		(5,098	)		(9,889	)		(38,097	)		(38,445	)
Ending units		968,748			537,380			71,965			86,794			76,483			68,742			121,747			112,634

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	NVMLV1						NVMMG1						NVMMV2						SCGF
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	3,269			1,294			-			-			3,400			6,710			-			-
Realized gain (loss) on investments		5,429			7,152			105,060			48,616			46,929			35,136			24,817			1,586
Change in unrealized gain (loss) on investments		(37,725	)		8,104			(158,523	)		272,504			(60,134	)		20,476			(34,421	)		47,272
Reinvested capital gains		10,330			8,756			-			-			1,724			22,721			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		(18,697	)		25,306			(53,463	)		321,120			(8,081	)		85,043			(9,604	)		48,858
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		69,645			57,251			208,256			226,629			93,960			145,445			84,769			53,901
Transfers between funds		49,924			65,331			(53,101	)		(57,906	)		(110,978	)		(315,500	)		103,802			76,172
Surrenders (note 6)		(239	)		(179	)		(34,777	)		(43,766	)		(23,006	)		(41,718	)		(2,909	)		(1,472	)
Death Benefits (note 4)		-			-			(2,427	)		-			(3,693	)		-			-			-
Net policy repayments (loans) (note 5)		(2,598	)		39			(13,484	)		(5,773	)		(7,554	)		(1,996	)		(1,349	)		(542	)
Deductions for surrender charges (note 2d)		(470	)		(2,746	)		(30,608	)		(12,738	)		(16,336	)		(10,301	)		(3,822	)		(2,104	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(32,510	)		(25,733	)		(140,254	)		(143,649	)		(55,692	)		(71,738	)		(48,994	)		(27,828	)
Asset charges (note 3)		(1,061	)		(647	)		(5,544	)		(5,320	)		(1,900	)		(2,382	)		(1,104	)		(669	)
Adjustments to maintain reserves		81			18			(48	)		(99	)		(15	)		(4	)		(117	)		384
Net equity transactions		82,772			93,334			(71,987	)		(42,622	)		(125,214	)		(298,194	)		130,276			97,842
Net change in contract owners’ equity		64,075			118,640			(125,450	)		278,498			(133,295	)		(213,151	)		120,672			146,700
Contract owners’ equity beginning of period		224,750			106,110			1,474,969			1,196,471			510,213			723,364			271,889			125,189
Contract owners’ equity end of period	$	288,825			224,750			1,349,519			1,474,969			376,918			510,213			392,561			271,889
CHANGES IN UNITS:
Beginning units		24,511			13,082			145,695			149,880			48,371			82,042			24,951			14,412
Units purchased		13,216			18,936			29,925			33,865			11,979			17,960			17,968			14,313
Units redeemed		(4,278	)		(7,507	)		(36,430	)		(38,050	)		(23,767	)		(51,631	)		(6,659	)		(3,774	)
Ending units		33,449			24,511			139,190			145,695			36,583			48,371			36,260			24,951

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	SCVF						SCF						MSBF						NVSTB2
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	1,344			1,511			3,305			1,246			35,253			36,931			2,078			1,251
Realized gain (loss) on investments		12,615			(25,517	)		25,225			(10,714	)		5,562			(10,559	)		192			63
Change in unrealized gain (loss) on investments		(34,712	)		89,942			(68,521	)		123,404			1,139			24,705			(634	)		620
Reinvested capital gains		-			-			-			-			-			-			-			189
Net increase (decrease) in contract owners’ equity resulting from operations		(20,753	)		65,936			(39,991	)		113,936			41,954			51,077			1,636			2,123
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		99,446			63,578			144,343			117,539			109,714			245,044			25,657			12,978
Transfers between funds		49,024			26,936			40,810			(195,012	)		100,382			102,571			14,442			15,600
Surrenders (note 6)		(9,808	)		(10,077	)		(4,961	)		(1,152	)		(9,800	)		(16,745	)		(2,986	)		(736	)
Death Benefits (note 4)		(467	)		-			(2,072	)		-			-			-			-			-
Net policy repayments (loans) (note 5)		(7,754	)		(1,445	)		(6,936	)		(369	)		(19,237	)		(6	)		(343	)		-
Deductions for surrender charges (note 2d)		(2,909	)		(6,823	)		(8,972	)		(3,343	)		(3,810	)		(4,871	)		(5,301	)		(76	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(33,932	)		(29,501	)		(68,561	)		(57,377	)		(43,756	)		(34,045	)		(11,363	)		(9,313	)
Asset charges (note 3)		(1,422	)		(1,121	)		(2,505	)		(1,460	)		(1,680	)		(1,499	)		(289	)		(274	)
Adjustments to maintain reserves		(42	)		3			(2	)		5			5			25			6			(5	)
Net equity transactions		92,136			41,550			91,144			(141,169	)		131,818			290,474			19,823			18,174
Net change in contract owners’ equity		71,383			107,486			51,153			(27,233	)		173,772			341,551			21,459			20,297
Contract owners’ equity beginning of period		323,952			216,466			587,756			614,989			687,406			345,855			101,345			81,048
Contract owners’ equity end of period	$	395,335			323,952			638,909			587,756			861,178			687,406			122,804			101,345
CHANGES IN UNITS:
Beginning units		25,346			21,442			42,779			56,094			53,859			29,967			9,291			7,610
Units purchased		15,203			10,233			17,078			20,534			17,382			29,581			7,310			2,741
Units redeemed		(7,966	)		(6,329	)		(10,618	)		(33,849	)		(7,313	)		(5,689	)		(5,487	)		(1,060	)
Ending units		32,583			25,346			49,239			42,779			63,928			53,859			11,114			9,291

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	NVOLG1						NVTIV3						EIF						NVRE1
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	22,100			191			19,670			17,060			9,935			8,861			24,707			34,887
Realized gain (loss) on investments		(2,105	)		3,737			25,487			59,826			27,670			(29,440	)		83,551			35,467
Change in unrealized gain (loss) on investments		(103,700	)		13,026			(125,414	)		(136,098	)		(56,537	)		104,827			42,149			228,757
Reinvested capital gains		11,688			1,183			758			112,563			-			-			11,471			166,880
Net increase (decrease) in contract owners’ equity resulting from operations		(72,017	)		18,137			(79,499	)		53,351			(18,932	)		84,248			161,878			465,991
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		441,178			71,201			178,104			276,332			152,406			156,959			696,476			590,398
Transfers between funds		(47,862	)		3,143,423			(152,644	)		(160,985	)		7,056			120,278			137,565			418,189
Surrenders (note 6)		(56,580	)		(15,005	)		(22,126	)		(63,860	)		(15,485	)		(29,412	)		(21,496	)		(25,841	)
Death Benefits (note 4)		(3,592	)		-			(5,833	)		-			(2,365	)		-			(987	)		-
Net policy repayments (loans) (note 5)		(29,148	)		(1,652	)		(13,323	)		(3,963	)		(7,259	)		(2,667	)		(31,671	)		(9,773	)
Deductions for surrender charges (note 2d)		(56,388	)		(4,195	)		(13,047	)		(17,304	)		(5,598	)		(11,700	)		(10,363	)		(12,122	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(273,543	)		(24,178	)		(99,321	)		(121,404	)		(66,093	)		(68,038	)		(194,906	)		(140,954	)
Asset charges (note 3)		(12,658	)		(817	)		(3,234	)		(3,817	)		(3,090	)		(2,452	)		(7,776	)		(5,795	)
Adjustments to maintain reserves		68			3			1			(74	)		1,432			(1	)		(55	)		(324	)
Net equity transactions		(38,525	)		3,168,780			(131,423	)		(95,075	)		61,004			162,967			566,787			813,778
Net change in contract owners’ equity		(110,542	)		3,186,917			(210,922	)		(41,724	)		42,072			247,215			728,665			1,279,769
Contract owners’ equity beginning of period		3,194,400			7,483			832,699			874,423			692,051			444,836			2,261,602			981,833
Contract owners’ equity end of period	$	3,083,858			3,194,400			621,777			832,699			734,123			692,051			2,990,267			2,261,602
CHANGES IN UNITS:
Beginning units		224,814			573			60,073			67,086			61,272			45,596			235,145			132,893
Units purchased		38,328			227,514			15,554			26,648			18,673			26,372			90,315			130,343
Units redeemed		(41,149	)		(3,273	)		(24,406	)		(33,661	)		(13,401	)		(10,696	)		(33,530	)		(28,091	)
Ending units		221,993			224,814			51,221			60,073			66,544			61,272			291,930			235,145

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	ALVSVA						ACVIP2						ACVMV1						ACVV
	2011			2010			2011			2010			2011			2010			2011		2010
Investment activity:
Net investment income (loss)	$	4,026			1,533			24,682			5,755			19,640			25,481			-		10,890
Realized gain (loss) on investments		19,976			30,136			17,977			8,113			51,839			2,345			-		(148,481	)
Change in unrealized gain (loss) on investments		(104,143	)		74,540			19,886			3,387			(118,986	)		177,078			-		212,246
Reinvested capital gains		-			-			5,752			-			37,193			-			-		-
Net increase (decrease) in contract owners’ equity resulting from operations		(80,141	)		106,209			68,297			17,255			(10,314	)		204,904			-		74,655
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		255,690			381,273			271,358			131,369			270,925			231,714			-		116,085
Transfers between funds		151,112			205,509			285,997			138,415			67,710			505,065			-		(1,193,588	)
Surrenders (note 6)		(36,282	)		(23,290	)		(6,171	)		(6,162	)		(19,312	)		(21,723	)		-		(5,458	)
Death Benefits (note 4)		-			-			-			-			-			-			-		-
Net policy repayments (loans) (note 5)		(5,687	)		-			(11,714	)		(1,177	)		(5,265	)		385			-		(282	)
Deductions for surrender charges (note 2d)		(6,111	)		(7,382	)		(6,021	)		(4,816	)		(10,486	)		(13,511	)		-		(3,345	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(69,237	)		(35,009	)		(77,546	)		(51,324	)		(112,585	)		(92,215	)		-		(61,118	)
Asset charges (note 3)		(3,027	)		(1,358	)		(1,796	)		(1,203	)		(4,992	)		(3,741	)		-		(2,455	)
Adjustments to maintain reserves		29			(342	)		170			45			4			(36	)		-		98
Net equity transactions		286,487			519,401			454,277			205,147			185,999			605,938			-		(1,150,063	)
Net change in contract owners’ equity		206,346			625,610			522,574			222,402			175,685			810,842			-		(1,075,408	)
Contract owners’ equity beginning of period		732,996			107,386			454,564			232,162			1,356,944			546,102			-		1,075,408
Contract owners’ equity end of period	$	939,342			732,996			977,138			454,564			1,532,629			1,356,944			-		-
CHANGES IN UNITS:
Beginning units		64,559			12,003			35,291			18,947			86,985			41,747			-		102,102
Units purchased		40,461			64,886			45,562			23,515			29,967			59,595			-		11,708
Units redeemed		(14,710	)		(12,330	)		(12,964	)		(7,171	)		(18,019	)		(14,357	)		-		(113,810	)
Ending units		90,310			64,559			67,889			35,291			98,933			86,985			-		-

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	DVSCS						DCAP						FQB						FCS
	2011			2010			2011			2010			2011			2010			2011		2010
Investment activity:
Net investment income (loss)	$	6,723			3,819			4,221			951			4,621			5,773			-		1,153
Realized gain (loss) on investments		20,831			(65,725	)		15,362			(1,784	)		2,616			1,985			-		(548,686	)
Change in unrealized gain (loss) on investments		(13,117	)		273,621			10,338			19,070			(5,175	)		1,881			-		846,160
Reinvested capital gains		2,689			-			-			-			-			-			-		-
Net increase (decrease) in contract owners’ equity resulting from operations		17,126			211,715			29,921			18,237			2,062			9,639			-		298,627
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		330,087			232,416			115,032			111,792			6,936			17,336			-		392,959
Transfers between funds		172,006			214,373			179,335			25,874			(39	)		56,190			-		(3,084,371	)
Surrenders (note 6)		(8,403	)		(9,919	)		(102	)		(1,165	)		(55,386	)		(15,801	)		-		(15,883	)
Death Benefits (note 4)		(2,678	)		(198	)		-			-			-			-			-		-
Net policy repayments (loans) (note 5)		(24,806	)		(983	)		(1,001	)		-			(5,986	)		(4	)		-		(6,783	)
Deductions for surrender charges (note 2d)		(10,822	)		(7,459	)		-			(1,103	)		(12,203	)		(7,842	)		-		(23,898	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(129,421	)		(91,767	)		(23,086	)		(11,545	)		(8,758	)		(12,855	)		-		(198,190	)
Asset charges (note 3)		(3,818	)		(2,474	)		(788	)		(305	)		(372	)		(616	)		-		(8,290	)
Adjustments to maintain reserves		(3	)		9			107			-			(10	)		49			-		(79	)
Net equity transactions		322,142			333,998			269,497			123,548			(75,818	)		36,457			-		(2,944,535	)
Net change in contract owners’ equity		339,268			545,713			299,418			141,785			(73,756	)		46,096			-		(2,645,908	)
Contract owners’ equity beginning of period		1,095,495			549,782			183,379			41,594			135,504			89,408			-		2,645,908
Contract owners’ equity end of period	$	1,434,763			1,095,495			482,797			183,379			61,748			135,504			-		-
CHANGES IN UNITS:
Beginning units		80,099			50,580			14,077			3,682			10,068			7,208			-		219,138
Units purchased		44,807			42,501			26,646			11,784			507			5,707			-		32,242
Units redeemed		(20,588	)		(12,982	)		(6,725	)		(1,389	)		(6,089	)		(2,847	)		-		(251,380	)
Ending units		104,318			80,099			33,998			14,077			4,486			10,068			-		-

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	FNRS2						FEIS						FF10S						FF20S
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	24,701			5,628			38,827			19,745			8,215			4,659			22,517			16,110
Realized gain (loss) on investments		129,591			(65,796	)		46,175			(78,465	)		2,949			(331	)		53,634			(21,911	)
Change in unrealized gain (loss) on investments		(363,715	)		378,140			(68,536	)		206,914			(19,080	)		8,233			(105,760	)		96,316
Reinvested capital gains		-			-			-			-			2,037			3,102			4,076			5,238
Net increase (decrease) in contract owners’ equity resulting from operations		(209,423	)		317,972			16,466			148,194			(5,879	)		15,663			(25,533	)		95,753
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		1,224,825			688,346			379,194			282,625			198,675			187,558			251,563			289,142
Transfers between funds		250,439			(417,790	)		207,130			170,384			7,696			15,171			168,574			126,614
Surrenders (note 6)		(15,901	)		(15,201	)		(14,723	)		(14,798	)		(1,259	)		(3,612	)		(17,121	)		(3,697	)
Death Benefits (note 4)		(1,057	)		-			(440	)		-			-			-			-			(11,336	)
Net policy repayments (loans) (note 5)		(19,133	)		(13,255	)		(17,411	)		(30,425	)		-			-			(12,326	)		-
Deductions for surrender charges (note 2d)		(18,252	)		(13,607	)		(61,268	)		(10,490	)		(101	)		(897	)		(5,436	)		(9,008	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(272,945	)		(165,208	)		(165,841	)		(134,039	)		(31,085	)		(14,987	)		(135,870	)		(97,744	)
Asset charges (note 3)		(9,122	)		(4,393	)		(5,460	)		(3,946	)		(2,669	)		(823	)		(5,731	)		(3,374	)
Adjustments to maintain reserves		(84	)		(2,276	)		58			17			3			(8	)		(6	)		(39	)
Net equity transactions		1,138,770			56,616			321,239			259,328			171,260			182,402			243,647			290,558
Net change in contract owners’ equity		929,347			374,588			337,705			407,522			165,381			198,065			218,114			386,311
Contract owners’ equity beginning of period		1,781,543			1,406,955			1,243,740			836,218			238,277			40,212			846,521			460,210
Contract owners’ equity end of period	$	2,710,890			1,781,543			1,581,445			1,243,740			403,658			238,277			1,064,635			846,521
CHANGES IN UNITS:
Beginning units		96,805			91,096			111,065			85,940			17,629			3,354			62,287			38,779
Units purchased		84,546			59,319			62,575			53,139			17,272			16,096			40,438			33,640
Units redeemed		(25,969	)		(53,610	)		(33,621	)		(28,014	)		(4,951	)		(1,821	)		(23,498	)		(10,132	)
Ending units		155,382			96,805			140,019			111,065			29,950			17,629			79,227			62,287

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	FF30S						FGS						FIGBS						FMCS
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	63,118			46,236			5,642			2,742			82,951			83,868			6,288			7,894
Realized gain (loss) on investments		48,395			(32,244	)		10,449			(11,344	)		53,837			28,857			45,898			(107,525	)
Change in unrealized gain (loss) on investments		(209,434	)		233,483			(33,346	)		325,479			(26,856	)		27,410			(504,608	)		794,279
Reinvested capital gains		9,237			14,923			6,720			5,019			65,740			26,317			7,205			8,613
Net increase (decrease) in contract owners’ equity resulting from operations		(88,684	)		262,398			(10,535	)		321,896			175,672			166,452			(445,217	)		703,261
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		822,220			725,261			350,406			286,273			484,576			636,520			1,147,685			1,024,471
Transfers between funds		239,296			1,158,661			212,613			162,351			(91,754	)		214,565			148,905			155,397
Surrenders (note 6)		(83,425	)		(14,647	)		(43,272	)		(20,504	)		(65,908	)		(58,944	)		(83,133	)		(81,890	)
Death Benefits (note 4)		-			-			-			-			(2,418	)		-			(4,151	)		-
Net policy repayments (loans) (note 5)		(31,478	)		(6,034	)		(10,153	)		(12,015	)		(14,778	)		(21,831	)		(17,797	)		(15,236	)
Deductions for surrender charges (note 2d)		(36,890	)		(17,254	)		(19,936	)		(17,632	)		(25,498	)		(19,874	)		(43,160	)		(29,763	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(338,739	)		(238,474	)		(174,582	)		(129,317	)		(224,535	)		(212,697	)		(346,842	)		(281,015	)
Asset charges (note 3)		(15,903	)		(9,406	)		(6,960	)		(5,258	)		(8,405	)		(8,474	)		(14,510	)		(10,189	)
Adjustments to maintain reserves		1,079			(22	)		13			(72	)		61			2			2,216			(876	)
Net equity transactions		556,160			1,598,085			308,129			263,826			51,341			529,267			789,213			760,899
Net change in contract owners’ equity		467,476			1,860,483			297,594			585,722			227,013			695,719			343,996			1,464,160
Contract owners’ equity beginning of period		2,594,511			734,028			1,757,069			1,171,347			2,419,427			1,723,708			3,475,527			2,011,367
Contract owners’ equity end of period	$	3,061,987			2,594,511			2,054,663			1,757,069			2,646,440			2,419,427			3,819,523			3,475,527
CHANGES IN UNITS:
Beginning units		192,800			63,273			143,625			118,780			181,403			139,164			203,373			151,478
Units purchased		79,414			154,353			44,579			46,160			47,544			75,153			93,767			97,004
Units redeemed		(38,371	)		(24,826	)		(20,490	)		(21,315	)		(43,864	)		(32,914	)		(46,812	)		(45,109	)
Ending units		233,843			192,800			167,714			143,625			185,083			181,403			250,328			203,373

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	FOSR						FVSS						FTVIS2						FTVRDI
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	17,893			16,018			168			83			41,388			29,810			845			775
Realized gain (loss) on investments		(80,410	)		(275,925	)		2,873			(8,403	)		32,365			5,397			(589	)		(305	)
Change in unrealized gain (loss) on investments		(184,235	)		384,854			(4,491	)		12,782			(55,286	)		23,881			2,460			7,921
Reinvested capital gains		2,400			2,356			-			-			-			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		(244,352	)		127,303			(1,450	)		4,462			18,467			59,088			2,716			8,391
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		235,094			252,172			2,835			4,286			329,444			175,938			3,971			4,761
Transfers between funds		22,249			(363,309	)		(3,093	)		594			130,152			166,744			(3,642	)		(221	)
Surrenders (note 6)		(23,846	)		(24,523	)		-			(20,522	)		(29,429	)		(1,453	)		-			4
Death Benefits (note 4)		-			-			-			-			-			-			-			-
Net policy repayments (loans) (note 5)		(3,366	)		(6,003	)		-			-			(9,088	)		(17,075	)		(9	)		(7	)
Deductions for surrender charges (note 2d)		(18,396	)		(14,970	)		-			(10,331	)		(5,347	)		(2,687	)		-			(323	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(126,277	)		(128,709	)		(2,058	)		(4,259	)		(89,020	)		(52,671	)		(3,252	)		(3,270	)
Asset charges (note 3)		(5,257	)		(4,899	)		(86	)		(169	)		(2,148	)		(1,434	)		(229	)		(211	)
Adjustments to maintain reserves		13			(79	)		6			(7	)		29			(105	)		(4	)		(12	)
Net equity transactions		80,214			(290,320	)		(2,396	)		(30,408	)		324,593			267,257			(3,165	)		721
Net change in contract owners’ equity		(164,138	)		(163,017	)		(3,846	)		(25,946	)		343,060			326,345			(449	)		9,112
Contract owners’ equity beginning of period		1,339,535			1,502,552			20,851			46,797			634,768			308,423			48,500			39,388
Contract owners’ equity end of period	$	1,175,397			1,339,535			17,005			20,851			977,828			634,768			48,051			48,500
CHANGES IN UNITS:
Beginning units		96,609			122,463			1,624			4,609			50,753			27,785			3,873			3,804
Units purchased		22,891			25,351			226			446			41,367			30,896			312			434
Units redeemed		(16,994	)		(51,205	)		(397	)		(3,431	)		(15,758	)		(7,928	)		(575	)		(365	)
Ending units		102,506			96,609			1,453			1,624			76,362			50,753			3,610			3,873

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	FTVSVI						FTVDM3						TIF3						FTVGI3
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	17,576			15,818			5,856			11,278			7,273			6,532			86,141			6,766
Realized gain (loss) on investments		192,330			(146,312	)		(20,805	)		(87,786	)		13,015			(2,548	)		21,976			12,207
Change in unrealized gain (loss) on investments		(254,377	)		577,648			(79,738	)		176,344			(65,083	)		27,971			(160,315	)		52,025
Reinvested capital gains		-			-			-			-			-			-			10,037			1,232
Net increase (decrease) in contract owners’ equity resulting from operations		(44,471	)		447,154			(94,687	)		99,836			(44,795	)		31,955			(42,161	)		72,230
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		387,908			511,259			90,947			106,175			57,208			56,749			862,747			260,983
Transfers between funds		(320,669	)		14,479			(67,918	)		(113,768	)		4,912			(10,197	)		544,150			288,882
Surrenders (note 6)		(25,578	)		(82,728	)		(2,591	)		(14,686	)		(12,136	)		(7,163	)		(36,797	)		(15,031	)
Death Benefits (note 4)		(2,217	)		-			-			-			(213	)		-			(1,425	)		-
Net policy repayments (loans) (note 5)		(10,467	)		(1,650	)		(944	)		(5,177	)		(6,050	)		(1,358	)		(1,470	)		(2,606	)
Deductions for surrender charges (note 2d)		(10,745	)		(23,747	)		(2,860	)		(4,925	)		(4,053	)		(5,215	)		(9,276	)		(7,432	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(169,789	)		(150,600	)		(51,241	)		(59,234	)		(36,326	)		(43,362	)		(157,623	)		(62,894	)
Asset charges (note 3)		(6,795	)		(6,420	)		(2,512	)		(2,664	)		(1,719	)		(1,730	)		(7,085	)		(2,638	)
Adjustments to maintain reserves		(23	)		(496	)		5			(5	)		(39	)		10			14			89
Net equity transactions		(158,375	)		260,097			(37,114	)		(94,284	)		1,584			(12,266	)		1,193,235			459,353
Net change in contract owners’ equity		(202,846	)		707,251			(131,801	)		5,552			(43,211	)		19,689			1,151,074			531,583
Contract owners’ equity beginning of period		2,168,193			1,460,942			688,956			683,404			436,714			417,025			917,947			386,364
Contract owners’ equity end of period	$	1,965,347			2,168,193			557,155			688,956			393,503			436,714			2,069,021			917,947
CHANGES IN UNITS:
Beginning units		151,664			131,306			33,975			39,603			31,120			32,215			51,427			24,758
Units purchased		43,523			57,420			7,258			5,906			5,323			6,155			86,368			36,567
Units redeemed		(52,686	)		(37,062	)		(8,579	)		(11,534	)		(5,050	)		(7,250	)		(20,910	)		(9,898	)
Ending units		142,501			151,664			32,654			33,975			31,393			31,120			116,885			51,427

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	FTVFA2						AMTB						AMINS					AMFAS
	2011			2010			2011			2010			2011		2010			2011			2010
Investment activity:
Net investment income (loss)	$	157			18,926			20,846			28,965			-		-			-			-
Realized gain (loss) on investments		25,454			10,319			(9,228	)		(8,093	)		-		105			1,756			(5,072	)
Change in unrealized gain (loss) on investments		(43,791	)		28,414			(8,122	)		5,260			-		-			(3,067	)		7,129
Reinvested capital gains		-			71			-			-			-		-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		(18,180	)		57,730			3,496			26,132			-		105			(1,311	)		2,057
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		411,679			410,039			703,750			647,003			-		(127	)		4,405			4,776
Transfers between funds		56,861			273,762			(547,653	)		(397,713	)		-		(49	)		893			(3,919	)
Surrenders (note 6)		-			1			(17,174	)		(7,188	)		-		-			-			(7	)
Death Benefits (note 4)		-			-			-			-			-		-			-			-
Net policy repayments (loans) (note 5)		-			-			1,064			(225	)		-		-			(9	)		(2	)
Deductions for surrender charges (note 2d)		(1,335	)		(81	)		(4,736	)		(6,633	)		-		-			-			(326	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(89,976	)		(59,680	)		(63,793	)		(57,427	)		-		73			(2,226	)		(1,917	)
Asset charges (note 3)		(1,647	)		(1,264	)		(1,795	)		(1,688	)		-		(2	)		(95	)		(88	)
Adjustments to maintain reserves		(142	)		18			(42	)		10			-		-			(1	)		(4	)
Net equity transactions		375,440			622,795			69,621			176,139			-		(105	)		2,967			(1,487	)
Net change in contract owners’ equity		357,260			680,525			73,117			202,271			-		-			1,656			570
Contract owners’ equity beginning of period		920,025			239,500			529,531			327,260			-		-			18,868			18,298
Contract owners’ equity end of period	$	1,277,285			920,025			602,648			529,531			-		-			20,524			18,868
CHANGES IN UNITS:
Beginning units		96,251			27,625			46,253			30,096			-		-			1,901			2,205
Units purchased		49,381			78,723			62,786			71,770			-		299			420			749
Units redeemed		(9,913	)		(10,097	)		(56,551	)		(55,613	)		-		(299	)		(231	)		(1,053	)
Ending units		135,719			96,251			52,488			46,253			-		-			2,090			1,901

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	AMSRS						OVGR					OVGS3						OVHI3
	2011			2010			2011		2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	501			53			-		435			10,883			9,167			6,579			7,740
Realized gain (loss) on investments		7,689			(134,810	)		-		20,628			(17,119	)		(39,488	)		4,004			22,166
Change in unrealized gain (loss) on investments		(13,448	)		163,225			-		241			(80,060	)		144,300			(12,004	)		(11,101	)
Reinvested capital gains		-			-			-		-			-			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		(5,258	)		28,468			-		21,304			(86,296	)		113,979			(1,421	)		18,805
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		16,766			45,058			-		60,258			227,802			205,067			21,034			26,212
Transfers between funds		(14,689	)		(557,996	)		-		(300,097	)		45,253			51,347			(169	)		(77,001	)
Surrenders (note 6)		(86	)		(89	)		-		(8,673	)		(4,281	)		(20,197	)		(2,344	)		(118	)
Death Benefits (note 4)		-			-			-		-			(1,054	)		-			-			-
Net policy repayments (loans) (note 5)		-			-			-		(6,266	)		(5,630	)		(8,517	)		86			(405	)
Deductions for surrender charges (note 2d)		(777	)		(1,833	)		-		(9,133	)		(8,452	)		(20,352	)		(1,875	)		(525	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(14,372	)		(17,746	)		-		(35,651	)		(101,380	)		(91,707	)		(10,364	)		(12,369	)
Asset charges (note 3)		(675	)		(848	)		-		(1,214	)		(3,373	)		(2,747	)		(341	)		(269	)
Adjustments to maintain reserves		(5	)		(1	)		-		(3,676	)		91			(975	)		(10	)		(3	)
Net equity transactions		(13,838	)		(533,455	)		-		(304,452	)		148,976			111,919			6,017			(64,478	)
Net change in contract owners’ equity		(19,096	)		(504,987	)		-		(283,148	)		62,680			225,898			4,596			(45,673	)
Contract owners’ equity beginning of period		159,183			664,170			-		283,148			839,039			613,141			75,187			120,860
Contract owners’ equity end of period	$	140,087			159,183			-		-			901,719			839,039			79,783			75,187
CHANGES IN UNITS:
Beginning units		12,033			61,680			-		27,288			57,376			48,626			25,362			46,755
Units purchased		1,261			4,444			-		5,573			21,570			21,486			7,830			11,848
Units redeemed		(2,368	)		(54,091	)		-		(32,861	)		(11,726	)		(12,736	)		(5,764	)		(33,241	)
Ending units		10,926			12,033			-		-			67,220			57,376			27,428			25,362

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	OVHI						OVGI						OVSC						PMVFBA
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	134			101			7,238			10,458			2,857			2,018			12,461			3,826
Realized gain (loss) on investments		35			128			1,564			(111,176	)		36,603			102,402			10,202			(3	)
Change in unrealized gain (loss) on investments		(196	)		(10	)		(6,530	)		237,763			(73,268	)		(27,370	)		22,947			22,721
Reinvested capital gains		-			-			-			-			-			-			2,573			3,201
Net increase (decrease) in contract owners’ equity resulting from operations		(27	)		219			2,272			137,045			(33,808	)		77,050			48,183			29,745
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		-			-			167,608			248,171			115,199			112,755			213,169			170,036
Transfers between funds		-			-			(155,458	)		(141,360	)		283,014			(182,568	)		198,429			193,533
Surrenders (note 6)		(2	)		1			(24,307	)		(61,088	)		(14,104	)		(11,989	)		(18	)		(573	)
Death Benefits (note 4)		-			-			(4,813	)		-			(1,101	)		-			-			-
Net policy repayments (loans) (note 5)		(10	)		(483	)		(6,081	)		(12,442	)		(2,517	)		(13,415	)		(20,591	)		-
Deductions for surrender charges (note 2d)		(6	)		(55	)		(14,658	)		(24,342	)		(8,150	)		(7,323	)		(738	)		(191	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(189	)		(262	)		(106,082	)		(129,042	)		(56,369	)		(46,714	)		(58,284	)		(28,531	)
Asset charges (note 3)		(8	)		(9	)		(3,723	)		(4,288	)		(2,807	)		(2,074	)		(1,043	)		(522	)
Adjustments to maintain reserves		1			1			-			(20	)		(90	)		(5	)		(53	)		(105	)
Net equity transactions		(214	)		(807	)		(147,514	)		(124,411	)		313,075			(151,333	)		330,871			333,647
Net change in contract owners’ equity		(241	)		(588	)		(145,242	)		12,634			279,267			(74,283	)		379,054			363,392
Contract owners’ equity beginning of period		1,514			2,102			928,361			915,727			469,006			543,289			433,834			70,442
Contract owners’ equity end of period	$	1,273			1,514			783,119			928,361			748,273			469,006			812,888			433,834
CHANGES IN UNITS:
Beginning units		439			700			78,508			89,913			34,302			49,035			36,138			6,424
Units purchased		-			-			16,046			26,911			30,875			11,384			36,275			32,795
Units redeemed		(61	)		(261	)		(28,319	)		(38,316	)		(9,212	)		(26,117	)		(10,018	)		(3,081	)
Ending units		378			439			66,235			78,508			55,965			34,302			62,395			36,138

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	PMVLDA						PMVTRA					AVCA						AVCDI
	2011			2010			2011			2010		2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	23,428			15,353			2,374			-		31			156			-			-
Realized gain (loss) on investments		2,726			17,900			(1,645	)		-		534			(1,611	)		5,043			30,973
Change in unrealized gain (loss) on investments		(12,966	)		(485	)		(1,610	)		-		(2,195	)		4,546			(15,228	)		(10,852	)
Reinvested capital gains		-			5,054			4,884			-		-			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		13,188			37,822			4,003			-		(1,630	)		3,091			(10,185	)		20,121
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		712,975			360,105			95,636			-		3,487			3,775			27,772			87,070
Transfers between funds		(221,452	)		761,491			255,842			-		2,583			(22	)		(14,975	)		(111,065	)
Surrenders (note 6)		(27,494	)		(27,747	)		-			-		(268	)		(1,462	)		(269	)		(4,154	)
Death Benefits (note 4)		(286	)		-			-			-		-			-			-			-
Net policy repayments (loans) (note 5)		(24,234	)		(30,768	)		(212	)		-		(1,646	)		(10	)		(54	)		(210	)
Deductions for surrender charges (note 2d)		(5,308	)		(5,357	)		-			-		(300	)		(1,315	)		(514	)		(2,742	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(138,888	)		(67,546	)		(9,517	)		-		(2,978	)		(3,131	)		(12,384	)		(29,540	)
Asset charges (note 3)		(3,992	)		(2,617	)		(48	)		-		(110	)		(105	)		(301	)		(953	)
Adjustments to maintain reserves		(29	)		(91	)		(51	)		-		5			3			(6	)		(63	)
Net equity transactions		291,292			987,470			341,650			-		773			(2,267	)		(731	)		(61,657	)
Net change in contract owners’ equity		304,480			1,025,292			345,653			-		(857	)		824			(10,916	)		(41,536	)
Contract owners’ equity beginning of period		1,313,281			287,989			-			-		23,062			22,238			93,582			135,118
Contract owners’ equity end of period	$	1,617,761			1,313,281			345,653			-		22,205			23,062			82,666			93,582
CHANGES IN UNITS:
Beginning units		112,919			26,072			-			-		2,174			2,421			7,294			12,509
Units purchased		122,759			167,514			35,092			-		679			419			2,998			14,820
Units redeemed		(98,104	)		(80,667	)		(897	)		-		(580	)		(666	)		(3,352	)		(20,035	)
Ending units		137,574			112,919			34,195			-		2,273			2,174			6,940			7,294

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	TRBCG2						TREI2					TRHS2						VWHAR
	2011			2010			2011		2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	-			-			-		5,643			-			-			2,203			-
Realized gain (loss) on investments		50			139,038			-		72,979			(1,509	)		2,962			2,011			6,083
Change in unrealized gain (loss) on investments		(18	)		(80,536	)		-		(21,688	)		(4,270	)		511			(128,833	)		14,363
Reinvested capital gains		-			-			-		-			-			-			2,370			-
Net increase (decrease) in contract owners’ equity resulting from operations		32			58,502			-		56,934			(5,779	)		3,473			(122,249	)		20,446
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		6			66,730			-		51,504			97,915			1,365			262,304			5,941
Transfers between funds		-			(432,083	)		-		(409,767	)		178,683			9,001			406,131			166,047
Surrenders (note 6)		-			(22,842	)		-		(25,789	)		(418	)		-			(6,519	)		(2	)
Death Benefits (note 4)		-			-			-		-			-			-			-			-
Net policy repayments (loans) (note 5)		-			313			-		(4,036	)		(692	)		-			(210	)		(470	)
Deductions for surrender charges (note 2d)		-			(9,584	)		-		(12,562	)		(137	)		-			-			-
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		-			(44,970	)		-		(37,369	)		(14,674	)		(496	)		(35,565	)		(1,763	)
Asset charges (note 3)		-			(1,628	)		-		(1,958	)		(515	)		(18	)		(1,078	)		(69	)
Adjustments to maintain reserves		(36	)		(17	)		-		30			(390	)		2			1,794			(2	)
Net equity transactions		(30	)		(444,081	)		-		(439,947	)		259,772			9,854			626,857			169,682
Net change in contract owners’ equity		2			(385,579	)		-		(383,013	)		253,993			13,327			504,608			190,128
Contract owners’ equity beginning of period		184			385,763			-		383,013			13,327			-			190,128			-
Contract owners’ equity end of period	$	186			184			-		-			267,320			13,327			694,736			190,128
CHANGES IN UNITS:
Beginning units		14			34,091			-		36,899			1,253			-			15,955			-
Units purchased		-			5,899			-		13,780			23,201			3,608			57,607			23,426
Units redeemed		-			(39,976	)		-		(50,679	)		(1,686	)		(2,355	)		(3,828	)		(7,471	)
Ending units		14			14			-		-			22,768			1,253			69,734			15,955

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	WRASP						WRBP						WRBDP						WRCEP
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	36,030			21,335			1,598			1,001			12,085			7,113			953			1,174
Realized gain (loss) on investments		146,304			4,301			1,167			1,066			732			6,935			10,972			1,008
Change in unrealized gain (loss) on investments		(470,160	)		227,502			(8,320	)		7,623			17,853			(424	)		(16,718	)		26,913
Reinvested capital gains		-			-			8,421			730			2,984			-			8,530			-
Net increase (decrease) in contract owners’ equity resulting from operations		(287,826	)		253,138			2,866			10,420			33,654			13,624			3,737			29,095
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		1,894,072			1,141,901			57,589			20,332			164,932			247,974			119,739			115,462
Transfers between funds		(143,716	)		1,396,066			1,468			32,375			109,433			(48,290	)		14,883			33,580
Surrenders (note 6)		(133,857	)		(22,635	)		(405	)		(1	)		(267	)		(2	)		(5,468	)		-
Death Benefits (note 4)		-			-			-			-			-			-			-			-
Net policy repayments (loans) (note 5)		(18,337	)		(2,170	)		-			-			(843	)		-			(1,635	)		(5	)
Deductions for surrender charges (note 2d)		(22,201	)		(13,289	)		-			(20	)		(587	)		(179	)		(7,842	)		(269	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(460,178	)		(303,738	)		(18,716	)		(11,550	)		(49,643	)		(34,343	)		(41,892	)		(29,306	)
Asset charges (note 3)		(9,486	)		(5,438	)		(132	)		(51	)		(320	)		(83	)		(180	)		(45	)
Adjustments to maintain reserves		2,396			(288	)		8			15			252			41			1			(8	)
Net equity transactions		1,108,693			2,190,409			39,812			41,100			222,957			165,118			77,606			119,409
Net change in contract owners’ equity		820,867			2,443,547			42,678			51,520			256,611			178,742			81,343			148,504
Contract owners’ equity beginning of period		3,340,666			897,119			76,003			24,483			294,914			116,172			218,075			69,571
Contract owners’ equity end of period	$	4,161,533			3,340,666			118,681			76,003			551,525			294,914			299,418			218,075
CHANGES IN UNITS:
Beginning units		322,433			94,099			6,810			2,569			25,441			10,627			19,900			7,675
Units purchased		246,162			267,760			5,324			5,408			24,199			20,013			12,948			15,320
Units redeemed		(135,745	)		(39,426	)		(1,841	)		(1,167	)		(5,302	)		(5,199	)		(5,972	)		(3,095	)
Ending units		432,850			322,433			10,293			6,810			44,338			25,441			26,876			19,900

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	WRDIV						WRENG						WRGBP					WRGNR
	2011			2010			2011			2010			2011			2010		2011			2010
Investment activity:
Net investment income (loss)	$	2,699			1,442			-			151			33			-		-			-
Realized gain (loss) on investments		6,542			2,656			4,488			948			-			-		8,246			6,381
Change in unrealized gain (loss) on investments		(24,467	)		25,812			(19,281	)		14,979			(19	)		-		(95,421	)		39,616
Reinvested capital gains		-			-			-			-			-			-		-			-
Net increase (decrease) in contract owners’ equity resulting from operations		(15,226	)		29,910			(14,793	)		16,078			14			-		(87,175	)		45,997
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		110,838			83,732			63,572			50,282			579			-		152,824			130,279
Transfers between funds		29,720			27,203			24,596			7,507			1,612			-		33,241			30,311
Surrenders (note 6)		(915	)		(1,099	)		-			(30	)		-			-		(3,038	)		(979	)
Death Benefits (note 4)		-			-			-			-			-			-		-			-
Net policy repayments (loans) (note 5)		(1,451	)		(1,051	)		(1,554	)		(210	)		-			-		(1,857	)		(558	)
Deductions for surrender charges (note 2d)		(954	)		(2,008	)		(1,542	)		(27	)		-			-		(2,174	)		(1,945	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(36,444	)		(28,474	)		(22,785	)		(14,695	)		(126	)		-		(52,793	)		(37,062	)
Asset charges (note 3)		(194	)		(59	)		(23	)		(4	)		-			-		(300	)		(106	)
Adjustments to maintain reserves		(1	)		(2	)		4			(3	)		(1	)		-		460			3,073
Net equity transactions		100,599			78,242			62,268			42,820			2,064			-		126,363			123,013
Net change in contract owners’ equity		85,373			108,152			47,475			58,898			2,078			-		39,188			169,010
Contract owners’ equity beginning of period		214,112			105,960			95,789			36,891			-			-		318,772			149,762
Contract owners’ equity end of period	$	299,485			214,112			143,264			95,789			2,078			-		357,960			318,772
CHANGES IN UNITS:
Beginning units		21,311			12,273			10,177			4,780			-			-		37,409			20,574
Units purchased		15,115			12,725			9,747			7,456			225			-		24,032			23,878
Units redeemed		(5,151	)		(3,687	)		(3,183	)		(2,059	)		(16	)		-		(7,965	)		(7,043	)
Ending units		31,275			21,311			16,741			10,177			209			-		53,476			37,409

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	WRGP						WRHIP						WRIP						WRI2P
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	776			553			32,203			12,207			869			1,150			2,645			986
Realized gain (loss) on investments		2,091			483			10,312			1,865			6,640			1,409			4,667			1,816
Change in unrealized gain (loss) on investments		(6,034	)		16,403			(22,350	)		12,343			(25,664	)		21,602			(34,230	)		13,628
Reinvested capital gains		7,079			-			-			-			-			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		3,912			17,439			20,165			26,415			(18,155	)		24,161			(26,918	)		16,430
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		88,422			58,476			163,895			127,211			109,968			88,672			86,594			47,112
Transfers between funds		22,184			32,015			29,821			99,658			7,761			17,733			28,868			22,523
Surrenders (note 6)		(506	)		-			(3,272	)		5			(2,069	)		(3	)		(625	)		1
Death Benefits (note 4)		-			-			-			-			-			-			-			-
Net policy repayments (loans) (note 5)		-			-			(2,239	)		(1,112	)		(1,392	)		(1,043	)		6			-
Deductions for surrender charges (note 2d)		(307	)		(220	)		(1,399	)		(110	)		(481	)		(205	)		(2,847	)		(28	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(30,893	)		(21,875	)		(48,775	)		(32,446	)		(36,362	)		(27,520	)		(23,834	)		(17,035	)
Asset charges (note 3)		(172	)		(27	)		(237	)		(61	)		(279	)		(106	)		(129	)		(44	)
Adjustments to maintain reserves		(7	)		16			5			9			5			9			(4	)		10
Net equity transactions		78,721			68,385			137,799			193,154			77,151			77,537			88,029			52,539
Net change in contract owners’ equity		82,633			85,824			157,964			219,569			58,996			101,698			61,111			68,969
Contract owners’ equity beginning of period		152,371			66,547			321,002			101,433			182,075			80,377			128,270			59,301
Contract owners’ equity end of period	$	235,004			152,371			478,966			321,002			241,071			182,075			189,381			128,270
CHANGES IN UNITS:
Beginning units		15,030			7,390			23,825			8,647			18,448			9,348			11,781			6,214
Units purchased		10,884			10,121			18,867			17,993			14,125			13,188			11,328			7,481
Units redeemed		(3,215	)		(2,481	)		(8,919	)		(2,815	)		(6,218	)		(4,088	)		(2,911	)		(1,914	)
Ending units		22,699			15,030			33,773			23,825			26,355			18,448			20,198			11,781

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	WRLTBP					WRMIC						WRMCG						WRMMP
	2011			2010		2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	35			-		-			-			11			21			29			130
Realized gain (loss) on investments		(1	)		-		3,620			5,438			5,532			2,189			-			-
Change in unrealized gain (loss) on investments		(27	)		-		(13,633	)		14,064			(14,300	)		21,439			-			-
Reinvested capital gains		-			-		-			-			6,602			-			-			-
Net increase (decrease) in contract owners’ equity resulting from operations		7			-		(10,013	)		19,502			(2,155	)		23,649			29			130
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		290			-		64,593			25,082			100,569			55,299			1,135,695			1,102,282
Transfers between funds		2,716			-		25,048			3,815			49,438			13,961			(965,844	)		(1,085,305	)
Surrenders (note 6)		-			-		-			2			(490	)		(70	)		-			-
Death Benefits (note 4)		-			-		-			-			-			-			-			-
Net policy repayments (loans) (note 5)		-			-		(599	)		(231	)		(1,199	)		(723	)		-			-
Deductions for surrender charges (note 2d)		-			-		(3,251	)		-			(638	)		(37	)		(948	)		-
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(147	)		-		(18,048	)		(9,816	)		(27,406	)		(16,623	)		(68,080	)		(69,354	)
Asset charges (note 3)		(8	)		-		(94	)		(24	)		(224	)		(30	)		(761	)		(352	)
Adjustments to maintain reserves		2			-		(6	)		4			5			21			1			65
Net equity transactions		2,853			-		67,643			18,832			120,055			51,798			100,063			(52,664	)
Net change in contract owners’ equity		2,860			-		57,630			38,334			117,900			75,447			100,092			(52,534	)
Contract owners’ equity beginning of period		-			-		69,534			31,200			117,843			42,396			150,448			202,982
Contract owners’ equity end of period	$	2,860			-		127,164			69,534			235,743			117,843			250,540			150,448
CHANGES IN UNITS:
Beginning units		-			-		5,677			3,588			8,350			3,952			14,780			19,956
Units purchased		299			-		7,412			3,680			11,105			6,071			112,281			108,356
Units redeemed		(19	)		-		(1,924	)		(1,591	)		(2,657	)		(1,673	)		(102,453	)		(113,532	)
Ending units		280			-		11,165			5,677			16,798			8,350			24,608			14,780

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	WRPAP						WRPCP						WRPMP						WRPMAP
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	3,303			1,623			977			122			10,638			4,123			9,567			4,808
Realized gain (loss) on investments		4,359			3,629			3,920			647			19,191			23,730			27,149			17,593
Change in unrealized gain (loss) on investments		(26,096	)		15,605			(708	)		2,744			(61,509	)		61,772			(93,380	)		75,867
Reinvested capital gains		6,580			3,234			1,583			233			15,105			6,793			17,137			8,563
Net increase (decrease) in contract owners’ equity resulting from operations		(11,854	)		24,091			5,772			3,746			(16,575	)		96,418			(39,527	)		106,831
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		143,719			126,524			62,603			53,077			733,142			299,957			725,947			383,651
Transfers between funds		31,397			35,052			125,517			41,226			67,066			178,090			264,899			114,747
Surrenders (note 6)		-			(2	)		(20,909	)		-			(14,918	)		-			(7,548	)		(3,513	)
Death Benefits (note 4)		-			-			-			-			-			-			-			-
Net policy repayments (loans) (note 5)		-			-			-			-			-			-			(25,165	)		-
Deductions for surrender charges (note 2d)		(89	)		(1,365	)		-			-			(13,371	)		-			(9,123	)		(5,042	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(57,553	)		(41,501	)		(24,749	)		(9,621	)		(166,262	)		(100,804	)		(259,576	)		(147,907	)
Asset charges (note 3)		(146	)		(31	)		(186	)		(72	)		(1,681	)		(358	)		(1,722	)		(284	)
Adjustments to maintain reserves		30			81			(3	)		(1	)		106			203			(1	)		(633	)
Net equity transactions		117,358			118,758			142,273			84,609			604,082			377,088			687,711			341,019
Net change in contract owners’ equity		105,504			142,849			148,045			88,355			587,507			473,506			648,184			447,850
Contract owners’ equity beginning of period		244,601			101,752			94,598			6,243			884,414			410,908			943,631			495,781
Contract owners’ equity end of period	$	350,105			244,601			242,643			94,598			1,471,921			884,414			1,591,815			943,631
CHANGES IN UNITS:
Beginning units		21,892			10,521			8,520			615			79,043			41,362			83,892			50,451
Units purchased		16,161			15,951			19,224			8,822			72,642			51,215			89,753			48,921
Units redeemed		(5,361	)		(4,580	)		(6,053	)		(917	)		(18,186	)		(13,534	)		(27,725	)		(15,480	)
Ending units		32,692			21,892			21,691			8,520			133,499			79,043			145,920			83,892

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	WRPMCP						WRRESP						WRSTP						WRSCP
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	1,293			304			630			498			-			-			-			-
Realized gain (loss) on investments		954			479			3,774			1,081			6,270			5,075			6,363			4,974
Change in unrealized gain (loss) on investments		(5,107	)		3,079			373			6,123			(52,744	)		21,310			(25,027	)		20,877
Reinvested capital gains		1,957			521			-			-			13,968			5,585			1,236			-
Net increase (decrease) in contract owners’ equity resulting from operations		(903	)		4,383			4,777			7,702			(32,506	)		31,970			(17,428	)		25,851
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		83,895			49,160			48,733			22,980			172,029			140,739			72,038			62,999
Transfers between funds		67,696			5,101			29,456			1,510			17,983			65,996			12,406			10,966
Surrenders (note 6)		(11,409	)		-			(230	)		2			(2,949	)		(1,523	)		(469	)		(732	)
Death Benefits (note 4)		-			-			-			-			-			-			-			-
Net policy repayments (loans) (note 5)		-			-			(17	)		-			(1,431	)		(6	)		(1,127	)		(736	)
Deductions for surrender charges (note 2d)		(18	)		-			(111	)		(17	)		(4,080	)		(17	)		(4,602	)		(164	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(26,492	)		(13,242	)		(11,350	)		(6,900	)		(62,421	)		(41,484	)		(25,196	)		(18,427	)
Asset charges (note 3)		(212	)		(32	)		(63	)		(6	)		(380	)		(125	)		(210	)		(81	)
Adjustments to maintain reserves		45			122			8			5			812			1,498			1,229			2,135
Net equity transactions		113,505			41,109			66,426			17,574			119,563			165,078			54,069			55,960
Net change in contract owners’ equity		112,602			45,492			71,203			25,276			87,057			197,048			36,641			81,811
Contract owners’ equity beginning of period		55,340			9,848			47,420			22,144			328,047			130,999			140,200			58,389
Contract owners’ equity end of period	$	167,942			55,340			118,623			47,420			415,104			328,047			176,841			140,200
CHANGES IN UNITS:
Beginning units		4,973			982			4,581			2,749			27,320			12,301			11,308			6,068
Units purchased		13,552			5,291			7,723			2,648			17,850			19,945			7,724			7,562
Units redeemed		(3,433	)		(1,300	)		(1,391	)		(816	)		(8,484	)		(4,926	)		(3,077	)		(2,322	)
Ending units		15,092			4,973			10,913			4,581			36,686			27,320			15,955			11,308

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	WRSCV						WRVP						WFVSCG						NVAGF3
	2011			2010			2011			2010			2011			2010			2011			2010
Investment activity:
Net investment income (loss)	$	674			51			546			317			-			-			2,280			3,104
Realized gain (loss) on investments		10,383			2,682			1,619			461			9,446			2,848			(5,903	)		367
Change in unrealized gain (loss) on investments		(31,679	)		21,252			(8,127	)		6,946			(30,678	)		31,014			1,973			(967	)
Reinvested capital gains		-			-			-			-			-			-			3,111			1,270
Net increase (decrease) in contract owners’ equity resulting from operations		(20,622	)		23,985			(5,962	)		7,724			(21,232	)		33,862			1,461			3,774
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		43,773			40,857			32,298			22,574			103,915			58,261			7,177			28,644
Transfers between funds		(25,234	)		40,488			2,523			7,093			43,658			202,753			(61,606	)		3,269
Surrenders (note 6)		(2,115	)		(1	)		(700	)		-			(83	)		(25	)		-			(3	)
Death Benefits (note 4)		-			-			-			-			(707	)		-			-			-
Net policy repayments (loans) (note 5)		(1,384	)		-			(381	)		-			(6,124	)		(6,503	)		-			-
Deductions for surrender charges (note 2d)		(220	)		(134	)		-			-			(271	)		-			-			(638	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(17,155	)		(11,988	)		(8,016	)		(4,535	)		(32,871	)		(14,190	)		(1,852	)		(7,432	)
Asset charges (note 3)		(123	)		(22	)		(6	)		(2	)		(1,342	)		(568	)		(44	)		(154	)
Adjustments to maintain reserves		-			(4	)		(4	)		7			1,604			42			(323	)		1
Net equity transactions		(2,458	)		69,196			25,714			25,137			107,779			239,770			(56,648	)		23,687
Net change in contract owners’ equity		(23,080	)		93,181			19,752			32,861			86,547			273,632			(55,187	)		27,461
Contract owners’ equity beginning of period		150,313			57,132			61,420			28,559			294,068			20,436			55,187			27,726
Contract owners’ equity end of period	$	127,233			150,313			81,172			61,420			380,615			294,068			-			55,187
CHANGES IN UNITS:
Beginning units		11,553			5,551			5,245			2,895			17,571			1,548			4,465			2,428
Units purchased		4,847			7,271			3,045			2,798			11,872			17,553			4			2,731
Units redeemed		(5,187	)		(1,269	)		(811	)		(448	)		(5,605	)		(1,530	)		(4,469	)		(694	)
Ending units		11,213			11,553			7,479			5,245			23,838			17,571			-			4,465

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	GEF3						WRMSP					GVGHS					GGTC3
	2011			2010			2011		2010			2011		2010			2011		2010
Investment activity:
Net investment income (loss)	$	104			68			-		206			-		398			-		-
Realized gain (loss) on investments		366			198			-		(143	)		-		7,337			-		13,137
Change in unrealized gain (loss) on investments		(893	)		806			-		(15	)		-		(6,991	)		-		(6,517	)
Reinvested capital gains		-			-			-		-			-		-			-		-
Net increase (decrease) in contract owners’ equity resulting from operations		(423	)		1,072			-		48			-		744			-		6,620
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		2,179			7,550			-		1,523			-		25,761			-		27,802
Transfers between funds		(10,814	)		1,225			-		(5,353	)		-		(116,140	)		-		(224,441	)
Surrenders (note 6)		-			-			-		-			-		(1,221	)		-		(1,255	)
Death Benefits (note 4)		-			-			-		-			-		-			-		-
Net policy repayments (loans) (note 5)		-			-			-		-			-		(1	)		-		(497	)
Deductions for surrender charges (note 2d)		-			-			-		-			-		(1,425	)		-		(1,039	)
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		(946	)		(956	)		-		(372	)		-		(7,452	)		-		(10,860	)
Asset charges (note 3)		(1	)		(1	)		-		-			-		(130	)		-		(270	)
Adjustments to maintain reserves		(2	)		4			-		(231	)		-		3,823			-		65
Net equity transactions		(9,584	)		7,822			-		(4,433	)		-		(96,785	)		-		(210,495	)
Net change in contract owners’ equity		(10,007	)		8,894			-		(4,385	)		-		(96,041	)		-		(203,875	)
Contract owners’ equity beginning of period		10,007			1,113			-		4,385			-		96,041			-		203,875
Contract owners’ equity end of period	$	-			10,007			-		-			-		-			-		-
CHANGES IN UNITS:
Beginning units		670			83			-		433			-		8,633			-		15,818
Units purchased		420			658			-		135			-		4,700			-		4,774
Units redeemed		(1,090	)		(71	)		-		(568	)		-		(13,333	)		-		(20,592	)
Ending units		-			670			-		-			-		-			-		-

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2011 and 2010

	GVUG1					FVMOS
	2011		2010			2011		2010
Investment activity:
Net investment income (loss)	$	-		-			-		1,904
Realized gain (loss) on investments		-		(4,824	)		-		(3,705	)
Change in unrealized gain (loss) on investments		-		10,765			-		2,255
Reinvested capital gains		-		-			-		-
Net increase (decrease) in contract owners’ equity resulting from operations		-		5,941			-		454
Equity transactions:
Purchase payments received from contract owners (notes 2a and 6)		-		8,807			-		404
Transfers between funds		-		(116,043	)		-		(46,110	)
Surrenders (note 6)		-		-			-		-
Death Benefits (note 4)		-		-			-		-
Net policy repayments (loans) (note 5)		-		-			-		-
Deductions for surrender charges (note 2d)		-		-			-		-
Redemptions to pay cost of insurance charges and administration charges (notes 2b and 2c)		-		(5,677	)		-		(843	)
Asset charges (note 3)		-		(154	)		-		(32	)
Adjustments to maintain reserves		-		1			-		(3	)
Net equity transactions		-		(113,066	)		-		(46,584	)
Net change in contract owners’ equity		-		(107,125	)		-		(46,130	)
Contract owners’ equity beginning of period		-		107,125			-		46,130
Contract owners’ equity end of period	$	-		-			-		-
CHANGES IN UNITS:
Beginning units		-		10,026			-		4,486
Units purchased		-		1,618			-		39
Units redeemed		-		(11,644	)		-		(4,525	)
Ending units		-		-			-		-

See accompanying notes to financial statements.

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

(1) Background and Summary of Significant Accounting Policies

(a) Organization and Nature of Operations

The Nationwide VL Separate Account-G (the Account) was established pursuant to a resolution of the Board of Directors of Nationwide Life and Annuity Insurance Company (the Company) on December 10, 2003. The Account is registered as a unit investment trust under the Investment Company Act of 1940. The Company currently offers five individual flexible premium variable life insurance policies through the Account: Nationwide® Options Select, Nationwide MarathonSM VUL, Nationwide YourLife® Protection VUL, Nationwide YourLife® Accumulation VUL and Nationwide MarathonSM Performance VUL. The Company offers a last survivor flexible premium adjustable variable life insurance policy- Nationwide YourLife® Survivorship VUL. The primary distribution for contracts is through wholesalers and brokers.

(b) The Contracts

Only 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:

BLACKROCK FUNDS

Variable Series Funds, Inc. - Global Allocation V.I. Fund - Class II (MLVGA2)

DREYFUS CORPORATION FUNDS

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

JANUS FUNDS

Janus Aspen Series - Forty Portfolio - Service Shares (JACAS)

Janus Aspen Series - Global Technology Portfolio - Service II Shares (JAGTS2)

Janus Aspen Series - Overseas Portfolio - Service II Shares (JAIGS2)

MASSACHUSETTS FINANCIAL SERVICES CO.

Investors Growth Stock Series - Initial Class (MIGIC)

Value Series - Initial Class (MVFIC)

Variable Insurance Trust II - International Value Portfolio - Service Class (MVIVSC)

M FUNDS

M Business Opportunity Value Fund (MFBOV)

M Capital Appreciation Fund (MFFCA)

M International Equity Fund (MFBIE)

M Large Cap Growth Fund (MFTCG)

MORGAN STANLEY

Core Plus Fixed Income Portfolio - Class I (MSVFI)

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

NATIONWIDE FUNDS GROUP

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)*

Federated NVIT High Income Bond Fund - Class III (HIBF3)

NVIT Emerging Markets Fund - Class III (GEM3)

NVIT International Equity Fund - Class III (GIG3)

Gartmore NVIT International Equity Fund - Class VI (NVIE6)

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

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 Fund - Class I (TRF)

NVIT Fund - Class II (TRF2)*

NVIT Government Bond Fund - Class I (GBF)

American Century NVIT Growth Fund - Class I (CAF)

NVIT International Index Fund - Class VI (GVIX6)

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)

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

NVIT Money Market Fund - Class I (SAM)

NVIT Multi-Manager International Growth Fund - Class III (NVMIG3)

NVIT Multi-Manager International Value Fund - Class III (GVDIV3)

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)

Van Kampen NVIT Comstock Value Fund - Class I (EIF)

NVIT Real Estate Fund - Class I (NVRE1)

PORTFOLIOS OF THE ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC.

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

PORTFOLIOS OF THE AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

VP Inflation Protection Fund - Class II (ACVIP2)

VP International Fund - Class III (ACVI3)*

VP Mid Cap Value Fund - Class I (ACVMV1)

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

VP Value Fund - Class I (ACVV)*

VP Vista(SM) Fund - Class I (ACVVS1)*

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)

PORTFOLIOS OF THE FEDERATED INSURANCE SERIES

Quality Bond Fund II - Primary Shares (FQB)

PORTFOLIOS OF THE FIDELITY(R) VARIABLE INSURANCE PRODUCTS

VIP Fund - Energy Portfolio - Service Class 2 (FNRS2)

VIP Fund - Equity-Income Portfolio - Service Class (FEIS)

VIP Fund - Freedom Fund 2010 Portfolio - Service Class (FF10S)

VIP Fund - Freedom Fund 2020 Portfolio - Service Class (FF20S)

VIP Fund - Freedom Fund 2030 Portfolio - Service Class (FF30S)

VIP Fund - Growth Portfolio - Service Class (FGS)

VIP Fund - Investment Grade Bond Portfolio - Service Class (FIGBS)

VIP Fund - Mid Cap Portfolio - Service Class (FMCS)

VIP Fund - Overseas Portfolio - Service Class R (FOSR)

VIP Fund - Value Strategies Portfolio - Service Class (FVSS)

PORTFOLIOS OF THE FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Franklin Income Securities Fund - Class 2 (FTVIS2)

Franklin Rising Dividends Securities Fund - Class 1 (FTVRDI)

Franklin Small Cap Value Securities Fund - Class 1 (FTVSVI)

Templeton Developing Markets Securities Fund - Class 3 (FTVDM3)

Templeton Foreign Securities Fund - Class 3 (TIF3)

Templeton Global Bond Securities Fund - Class 3 (FTVGI3)

VIP Founding Funds Allocation Fund - Class 2 (FTVFA2)

PORTFOLIOS OF THE NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST

Advisers Management Trust - Short Duration Bond Portfolio - I Class Shares (AMTB)

International Portfolio - S Class Shares (AMINS)*

Regency Portfolio - S Class Shares (AMRS)*

Small-Cap Growth Portfolio - S Class Shares (AMFAS)

Socially Responsive Portfolio - I Class Shares (AMSRS)

PORTFOLIOS OF THE OPPENHEIMER VARIABLE ACCOUNT FUNDS

Capital Appreciation Fund/VA - Non-Service Shares (OVGR)*

Global Securities Fund/VA - Class 3 (OVGS3)

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

High Income Fund/VA - Class 3 (OVHI3)

High Income Fund/VA - Non-Service Shares (OVHI)

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

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

PORTFOLIOS OF THE PIMCO VARIABLE INSURANCE TRUST

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

Putnam VT Growth and Income Fund - IB Shares (PVGIB)*

Putnam VT Voyager Fund - IB Shares (PVTVB)*

PORTFOLIOS OF THE VAN KAMPEN LIFE INVESTMENT TRUST

V.I. Basic Value Fund - Series I (AVBVI)*

V.I. Capital Appreciation Fund - Series I (AVCA)

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

V.I. Capital Development Fund - Series I (AVCDI)

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 - Global Hard Assets Fund: Class R1 (VWHAR)

WADDELL & REED, INC.

Ivy Fund Variable Insurance Portfolios, Inc. - Asset Strategy (WRASP)

Ivy Fund Variable Insurance Portfolios, Inc. - Balanced (WRBP)

Ivy Fund Variable Insurance Portfolios, Inc. - Bond (WRBDP)

Ivy Fund Variable Insurance Portfolios, Inc. - Core Equity (WRCEP)

Ivy Fund Variable Insurance Portfolios, Inc. - Dividend Opportunities (WRDIV)

Ivy Fund Variable Insurance Portfolios, Inc. - Energy (WRENG)

Ivy Funds Variable Insurance Portfolios, Inc. - Global Bond (WRGBP)

Ivy Fund Variable Insurance Portfolios, Inc. - Global Natural Resources (WRGNR)

Ivy Fund Variable Insurance Portfolios, Inc. - Growth (WRGP)

Ivy Fund Variable Insurance Portfolios, Inc. - High Income (WRHIP)

Ivy Fund Variable Insurance Portfolios, Inc. - International Growth (WRIP)

Ivy Fund Variable Insurance Portfolios, Inc. - International Core Equity (WRI2P)

Ivy Funds Variable Insurance Portfolios, Inc. - Limited-Term Bond (WRLTBP)

Ivy Fund Variable Insurance Portfolios, Inc. - Micro Cap Growth (WRMIC)

Ivy Fund Variable Insurance Portfolios, Inc. - Mid Cap Growth (WRMCG)

Ivy Fund Variable Insurance Portfolios, Inc. - Money Market (WRMMP)

Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Aggressive (WRPAP)

Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Conservative (WRPCP)

Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderate (WRPMP)

Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderately Aggressive (WRPMAP)

Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderately Conservative (WRPMCP)

Ivy Fund Variable Insurance Portfolios, Inc. - Real Estate Securities (WRRESP)

Ivy Fund Variable Insurance Portfolios, Inc. - Science and Technology (WRSTP)

Ivy Fund Variable Insurance Portfolios, Inc. - Small Cap Growth (WRSCP)

Ivy Fund Variable Insurance Portfolios, Inc. - Small Cap Value (WRSCV)

Ivy Fund Variable Insurance Portfolios, Inc. - Value (WRVP)

WELLS FARGO FUNDS

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

*At December 31, 2011, 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 asset 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, 2011 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.

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

(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

FASB ASC 820 was effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years, with early adoption permitted. The Account adopted FASB ASC 820 effective January 1, 2008. The adoption of FASB ASC 820 did not have a material impact on the Account’s financial position or results of operations.

In September 2009 the FASB issued ASU 2009-12, which amends FASB ASC 820, Fair Value Measurements and Disclosures. This guidance applies to reporting entities that hold an investment that is required or permitted to be measured or disclosed at fair value on a recurring or nonrecurring basis if the investment does not have a readily determinable fair value and the investee has attributes of an investment company. For these investments, this update allows, as a practical expedient, the use of net asset value (NAV) as the basis to estimate fair value as long as it is not probable, as of the measurement date that the investment will be sold and NAV is not the value that will be used in the sale. The NAVs must be calculated consistent with the American Institute of Certified Public Accountants Audit and Accounting Guide, Investment Companies, which generally requires these investments to be measured at fair value. Additionally, the guidance provided updated disclosures for investments within its scope and noted that if the investor can redeem the investment with the investee on the measurement date at NAV, the investment should likely be classified as Level 2 in the fair value hierarchy. Investments that cannot be redeemed with the investee at NAV would generally be classified as Level 3 in the fair value hierarchy. If the investment is not redeemable with the investee on the measurement date, but will be at a future date, the length of time until the investment is redeemable should be considered in determining classification as Level 2 or 3. This guidance is effective for interim and annual periods ending after December 15, 2009 with early adoption permitted. The Account adopted this guidance effective the period ending December 31, 2009. The adoption of this guidance did not have a material impact on the financial statements of the Account.

In January 2010, the FASB issued ASU 2010-06, which amends FASB ASC 820, Fair Value Measurement and Disclosures. This guidance requires new disclosures and provides amendments to clarify existing disclosures. The new requirements include disclosing transfers in and out of Levels 1 and 2 fair value measurements, the reasons for the transfers, and further disaggregating activity in level 3 fair value measurements. The clarification of existing disclosure guidance includes further disaggregation of fair value measurement disclosures for each class of assets and liabilities and providing disclosures about the valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements. This guidance is effective for interim and annual reporting periods beginning after December 15, 2009, except for the new disclosures regarding the activity in Level 3 measurements, which shall be effective for fiscal years beginning after December 15, 2010, and for interim periods with January 1, 2010, except for the new disclosure regarding the activity in Level 3 measurements, which the Account adopted for the fiscal period beginning January 1, 2011.

In May 2011, the FASB issued ASU 2011-04, which amends existing guidance in Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures. The guidance in this ASU clarifies existing fair value measurement guidance and expands disclosures primarily related to Level 3 fair value measurements. The ASU will require reporting entities to disclose quantitative information about the unobservable inputs used in the fair value measurements categorized within Level 3 of the fair value hierarchy. In addition, ASU 2011-04 will require reporting entities to make disclosures about amounts and reasons for all transfers in and out of Level 1 and Level 2 fair value measurements. The new and revised disclosures are effective for interim and annual reporting periods beginning after December 15, 2011. The Account will adopt this guidance prospectively for the annual period beginning January 1, 2012. The adoption of this guidance will result in increased disclosures and will have an immaterial impact on the Account’s financial statements.

(g) Subsequent Events

The Company evaluated subsequent events through the date the financial statements were issued with the SEC.

(2) Policy Charges

(a) Deductions from Premium

For Nationwide® Options Select and Nationwide MarathonSM VUL contracts, the Company currently deducts 0.50% from each premium payment (up to 2.50% maximum) to cover sales expenses. The Company also deducts 3.50% from each premium payment to cover premium taxes.

For Nationwide YourLife® Accumulation VUL contracts, the Company currently deducts 2.50% from each premium payment (maximum is 2.50%) to cover sales expenses. The Company also deducts 3.50% from each premium payment to cover premium taxes.

For Nationwide MarathonSM Performance VUL contracts, the Company currently deducts 5.50% from each premium (the maximum is 6.50%) to cover sales expenses if the Accumulation Rider is not elected. If the Accumulation Rider is elected, the Company currently deducts 2.50% from each premium payment (the maximum is 2.50%) to cover sales expenses. The Company also deducts 3.50% from each premium to cover premium taxes, regardless of whether the Accumulation Rider has been elected.

For Nationwide YourLife® Protection VUL contracts, the Company currently deducts 6.50% from each premium (the maximum is 6.50%) to cover sales expenses. The Company also deducts 3.50% from each premium to cover premium taxes.

For Nationwide YourLife® Survivorship VUL contracts, the Company currently deducts 4.50% from each premium (the maximum is 6.50%) to cover sales expenses. The Company also deducts 3.50% from each premium to cover premium taxes.

The Company may, at its sole discretion, reduce the sales loading.

For the periods ended December 31, 2011 and 2010, total front-end sales charge deductions were $4,350,812 and $3,412,537, respectively and were recognized as a reduction of purchase payments on the Statement of Changes in Contract Owners’ Equity.

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

(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).

(c) Administrative Charges

For all contracts, the Company currently deducts a short-term trading fee of 1.00% of an amount allocated to a sub account and transferred from that sub account within 60 days of that allocation.

For Nationwide® Options Select and Nationwide MarathonSM VUL contracts, the Company currently deducts a $10 administrative charge per policy per month (maximum of $20 per policy per month) taken proportionally from the sub accounts and any companion fixed funds of the contract.

For Nationwide YourLife® Protection VUL contracts and Nationwide MarathonSM Performance VUL, if the Accumulation Rider is not elected, the Company currently deducts a $20 administrative charge per month (which is also the maximum charge) in the first policy year and $5 per month thereafter.

For Nationwide YourLife® Accumulation VUL contracts and Nationwide MarathonSM Performance VUL, if the Accumulation Rider is elected, the Company currently deducts a $25 administrative charge per month (which is also the maximum charge) in the first policy year and $10 per month thereafter.

For Nationwide YourLife® Survivorship VUL contracts, the Company currently deducts a $15 administrative charge per month (maximum of $20 per policy per month).

For Nationwide® Options Select VUL contracts, the Company currently deducts a monthly underwriting and distribution charge on the first $250,000 of Specified Amount. The current underwriting and distribution charge is $0.15 per $1,000 of Specified Amount for Insureds younger than 50 as of the Policy Date, and $0.17 per $1,000 of Specified Amount for Insureds 50 or older as of the Policy Date. The maximum guaranteed charge is $0.20 per $1,000 of Specified Amount.

For MarathonSM Performance VUL contracts, if the Accumulation Rider is not elected, the guaranteed maximum underwriting and distribution charge for all ages is $0.20 per $1,000 of the first $250,000 of Base Policy Specified Amount and $0.10 per $1,000 of Base Policy Specified Amount in excess of $250,000. Currently, the Company charges rates lower than the guaranteed maximum. Any change in current rates will be applied uniformly for Insureds with the same issue age, Base Policy Specified Amount, and Death Benefit option in effect at the time of determination.

For MarathonSM Performance VUL contracts, if the Accumulation Rider is elected, the guaranteed maximum underwriting and distribution charge is of $1.18 per $1,000 of the first $250,000 of Base Policy Specified Amount and $1.01 per $1,000 of Base Policy Specified Amount in excess of $250,000. Currently, the Company may charge rates lower than the guaranteed maximums. Any change in current rates will be applied uniformly for Insureds with the same issue age, Base Policy Specified Amount, and Death Benefit option in effect at the time of determination.

For Nationwide MarathonSM contracts, the Company currently deducts a monthly underwriting and distribution charge of $0.10 per $1,000 of the first $250,000 of Specified Amount. The maximum guaranteed charge is $0.20 per $1,000 of the first $250,000 of Specified Amount.

For Nationwide YourLife® Protection VUL contracts, the Company currently deducts a monthly underwriting and distribution charge of $0.20 per $1,000 of Specified Amount. The maximum guaranteed charge is $0.20 per $1,000 of Specified Amount.

For Nationwide YourLife® Accumulation VUL contracts, the Company currently deducts a monthly underwriting and distribution charge of $1.18 per $1,000 of Specified Amount. The maximum guaranteed charge is $1.18 per $1,000 of Specified Amount.

For Nationwide YourLife® Survivorship VUL contracts, the monthly underwriting and distribution charge varies by the insureds’ attained ages, sexes and Base Policy Specified Amount. The maximum guaranteed underwriting and distribution charge is $0.74 per $1,000 of Specified Amount.

The charges above are assessed against each contract by liquidating units.

(d) Surrender Charges

Policy surrenders result in a redemption of the contract value from the Account and payment of the surrender proceeds to the contract owner or designee. The surrender proceeds consist of the contract value, less any outstanding policy loans, and less a surrender charge, if applicable. The amount of the charge is based upon a specified percentage of the initial surrender charge which varies by issue age, sex and rate class.

For Nationwide YourLife® Protection VUL contracts, the charge is 100% of the initial surrender charge from the first through second or third year, depending on the insured’s age at the time of policy issuance. Thereafter, the charge will begin to decline over time to 0% of the initial surrender charge in the thirteenth year or fifteenth year, depending on the insured’s age at the time of policy issuance.

For both the Nationwide® Options Select and Nationwide MarathonSM VUL contracts, the charge is 100% of the initial surrender charge from the first through second or third year, depending on the insured’s age at the time of policy issuance. Thereafter, the charge will begin to decline over time to 0% of the initial surrender charge in the eleventh year or thirteenth year, depending on the insured’s age at the time of policy issuance.

For Nationwide YourLife® Accumulation VUL contracts, the charge is 100% of the initial surrender charge from the first, through second or fourth year, depending on the insured’s age at the time of policy issuance. Thereafter, the charge will begin to and decline over time to 0% of the initial surrender charge in the eleventh year.

For MarathonSM Performance VUL contracts, the charge is 100% of the initial surrender charge in the first year, and declines over time to 0% of the initial surrender charge in the thirteenth year through fifteenth year, depending on the insured’s age at the time of policy issuance. 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.

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

For Nationwide YourLife® Survivorship VUL contracts, the surrender charge is assessed during the first fifteen policy years upon surrender, policy lapse, or certain Base Policy Specified Amount decreases. The maximum Surrender Charge that may be assessed for any segment of coverage is $50 per $1,000 of Base Policy Specified Amount. The minimum Surrender Charge that may be assessed for any segment of coverage is $0.52 per $1,000 of Base Policy Specified Amount.

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 Nationwide YourLife® Accumulation VUL contracts, the current charge is 0% of variable contract value on an annualized basis, with a guaranteed maximum charge of 0.30 % of the variable contract value on an annualized basis.

The amount of the charge for other contracts may vary based on the policy year and the amount of the contract value. The tables below show by product the amount of the charge on an annualized basis, current charges, and charge variation based on policy year and contract value.

Nationwide® Options Select VUL contracts

Policy Years	Charge for First $25,000 in Variable Contract Value (Annualized)	Charge for Next $225,000 in Variable Contract Value (Annualized)	Charge for Variable Contract Value in Excess Of $250,000 (Annualized)
1 through 10	0.60%	0.30%	0.10%
11 through 20	0.30%	0.20%	0.05%
21 and later	0.00%	0.00%	0.00%

Note: the guaranteed maximum for all contracts is 0.60% on an annualized basis.

Nationwide MarathonSM VUL contracts

Policy Years	Charge for First $25,000 in Variable Contract Value (Annualized)	Charge for Next $225,000 in Variable Contract Value (Annualized)	Charge for Variable Contract Value in Excess Of $250,000 (Annualized)
1 through 10	0.60%	0.30%	0.10%
11 through 20	0.30%	0.10%	0.00%
21 and later	0.00%	0.00%	0.00%

Note: the guaranteed maximum for all contracts is 0.60% on an annualized basis.

Nationwide®YourLife SM Protection VUL contracts

Policy Years	Charge for First $250,000 in Variable Contract Value (Annualized)	Charge for Variable Contract Value in Excess Of $250,000 (Annualized)
1 through 15	0.80%	0.30%
16 or later	0.30%	0.20%

Note: the guaranteed maximum for all contracts is 0.80% on an annualized basis. Nationwide MarathonSM Performance VUL contracts For contracts that do not elect the accumulation rider, the charge will be deducted in accordance with the table below.

Policy Years	Charge for First $250,000 in Variable Contract Value (Annualized)	Charge for Variable Contract Value in Excess Of $250,000 (Annualized)
1 through 15	0.80%	0.30%
16 or later	0.30%	0.20%

Note: the guaranteed maximum for all contracts not electing that accumulation rider is 0.80% on an annualized basis. If you do elect the accumulations rider, the maximum guaranteed charge is equal to an annualized rate of 0.30% of variable contract value for all policy years and the current charge is 0.00%.

Nationwide YourLife® Survivorship VUL contracts

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

Policy Years	Charge for First $250,000 in Variable Contract Value (Annualized)	Charge for Variable Contract Value in Excess Of $250,000 (Annualized)
1 through 15	0.80%	0.50%
16 through 20	0.50%	0.50%
21 or later	0.00%	0.00%

Note: the guaranteed maximum for all contracts is 0.80% on an annualized basis of all variable account cash value for policy years 1-15, 0.50% on an annualized basis for all variable cash value for policy years 16-20 and 0.30% for policy year 21 and later.

The charges above are assessed against each contract by liquidating units.

(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. 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 90% of a policy’s variable cash surrender value plus 100% of a policy’s fixed cash surrender value less applicable value of surrender charge. Interest is charged on the outstanding loan and is due and payable in advance on the policy anniversary. For Nationwide® Options Select, Nationwide MarathonSM VUL, Nationwide YourLife® Accumulation VUL contracts and Nationwide YourLife® Survivorship VUL the maximum guaranteed loan interest charged is 3.90% on the outstanding loan. For the Nationwide YourLife® Protection and Nationwide MarathonSM Performance VUL contracts the maximum guaranteed loan interest charged is 4.50%, except for contract owners electing the accumulation rider on the Nationwide MarathonSM Performance in which case the maximum guaranteed loan interest charged is 3.90%. Current loan interest charged may vary. 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. Interest credited is paid by the Company’s general account to the Account. 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 Changes 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, 2011 and 2010, total transfers into the Account from the fixed account were $6,120,487 and $5,676,468, respectively, and total transfers from the Account to the fixed account were $3,447,374 and $1,990,052, respectively.

(7) Fair Value Measurement

FASB ASC 820 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.

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

The Account recognizes significant transfers between fair value hierarchy levels at the reporting period end. There were no significant transfers between Level 1 and 2 as of December 31, 2011.

The following table summarizes assets measured at fair value on a recurring basis as of December 31, 2011:

	Level 1	Level 2	Level 3	Total
Separate Account Investments	$168,533,344	$0	$0	$168,533,344

The Account did not have any assets or liabilities reported at fair value on a nonrecurring basis required to be disclosed under FASB ASC 820.

The cost of purchases and proceeds from sales of Investments for the year ended December 31,2011 are as follows:

	Purchases of Investments		Sales of Investments
Variable Series Funds, Inc. - Global Allocation V.I. Fund - Class II ( MLVGA2 )	$	2,734,086	$	267,970
Stock Index Fund, Inc. - Initial Shares ( DSIF )		1,038,357		288,834
Janus Aspen Series - Forty Portfolio - Service Shares ( JACAS )		511,236		600,401
Janus Aspen Series - Global Technology Portfolio - Service II Shares ( JAGTS2 )		288,462		49,313
Janus Aspen Series - Overseas Portfolio - Service II Shares ( JAIGS2 )		1,745,736		428,826
Investors Growth Stock Series - Initial Class ( MIGIC )		2,415		3,449
Value Series - Initial Class ( MVFIC )		938,243		404,313
Variable Insurance Trust II - International Value Portfolio - Service Class ( MVIVSC )		170,222		53,855
M Business Opportunity Value Fund ( MFBOV )		96,385		36,575
M Capital Appreciation Fund ( MFFCA )		121,252		30,298
M International Equity Fund ( MFBIE )		178,778		41,787
M Large Cap Growth Fund ( MFTCG )		117,727		38,579
Core Plus Fixed Income Portfolio - Class I ( MSVFI )		29,822		14,509
U.S. Real Estate Portfolio - Class I ( MSVRE )		-		-
American Century NVIT Multi Cap Value Fund - Class I ( NVAMV1 )		328,888		426,000
American Funds NVIT Asset Allocation Fund - Class II ( GVAAA2 )		1,260,885		332,982
American Funds NVIT Bond Fund - Class II ( GVABD2 )		126,653		60,995
American Funds NVIT Global Growth Fund - Class II ( GVAGG2 )		319,128		260,001
American Funds NVIT Growth Fund - Class II ( GVAGR2 )		660,354		502,252
American Funds NVIT Growth-Income Fund - Class II ( GVAGI2 )		335,423		124,214
Federated NVIT High Income Bond Fund - Class III ( HIBF3 )		1,452,474		397,413
NVIT Emerging Markets Fund - Class III ( GEM3 )		734,332		272,936
NVIT International Equity Fund - Class III ( GIG3 )		134,735		23,593
Gartmore NVIT International Equity Fund - Class VI ( NVIE6 )		69,875		68,396
Neuberger Berman NVIT Multi Cap Opportunities Fund - Class I ( NVNMO1 )		102,638		60,788
Neuberger Berman NVIT Socially Responsible Fund - Class II ( NVNSR2 )		760,921		280,291
NVIT Cardinal Aggressive Fund - Class I ( NVCRA1 )		1,295,658		162,117
NVIT Cardinal Balanced Fund - Class I ( NVCRB1 )		1,235,080		240,306
NVIT Cardinal Capital Appreciation Fund - Class I ( NVCCA1 )		2,903,075		852,769
NVIT Cardinal Conservative Fund - Class I ( NVCCN1 )		518,849		47,404
NVIT Cardinal Moderate Fund - Class I ( NVCMD1 )		1,695,762		1,143,402
NVIT Cardinal Moderately Aggressive Fund - Class I ( NVCMA1 )		3,344,822		767,988
NVIT Cardinal Moderately Conservative Fund - Class I ( NVCMC1 )		515,343		127,478
NVIT Core Bond Fund - Class I ( NVCBD1 )		649,200		292,650
NVIT Core Plus Bond Fund - Class I ( NVLCP1 )		179,988		16,152
NVIT Fund - Class I ( TRF )		52,102		234,568
NVIT Government Bond Fund - Class I ( GBF )		614,832		801,010
American Century NVIT Growth Fund - Class I ( CAF )		46,820		28,885
NVIT International Index Fund - Class VI ( GVIX6 )		400,483		79,275
NVIT Investor Destinations Aggressive Fund - Class II ( GVIDA )		740,493		353,351
NVIT Investor Destinations Balanced Fund - Class II ( NVDBL2 )		747,433		80,871
NVIT Investor Destinations Capital Appreciation Fund - Class II ( NVDCA2 )		668,488		38,085
NVIT Investor Destinations Conservative Fund - Class II ( GVIDC )		836,812		327,666
NVIT Investor Destinations Moderate Fund - Class II ( GVIDM )		3,858,822		845,545
NVIT Investor Destinations Moderately Aggressive Fund - Class II ( GVDMA )		4,126,638		1,035,597
NVIT Investor Destinations Moderately Conservative Fund - Class II ( GVDMC )		554,634		134,174
NVIT Mid Cap Index Fund - Class I ( MCIF )		270,186		86,828
NVIT Money Market Fund - Class I ( SAM )		16,137,139		11,184,096
NVIT Multi-Manager International Growth Fund - Class III ( NVMIG3 )		127,140		269,342
NVIT Multi-Manager International Value Fund - Class III ( GVDIV3 )		114,895		26,916
NVIT Multi-Manager Large Cap Growth Fund - Class I ( NVMLG1 )		344,600		255,461
NVIT Multi-Manager Large Cap Value Fund - Class I ( NVMLV1 )		130,096		33,708
NVIT Multi-Manager Mid Cap Growth Fund - Class I ( NVMMG1 )		208,336		280,331
NVIT Multi-Manager Mid Cap Value Fund - Class II ( NVMMV2 )		93,840		214,105
NVIT Multi-Manager Small Cap Growth Fund - Class I ( SCGF )		205,892		75,603
NVIT Multi-Manager Small Cap Value Fund - Class I ( SCVF )		173,554		80,068
NVIT Multi-Manager Small Company Fund - Class I ( SCF )		207,669		113,222
NVIT Multi-Sector Bond Fund - Class I ( MSBF )		234,095		67,030
NVIT Short Term Bond Fund - Class II ( NVSTB2 )		58,410		36,515

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

NVIT Large Cap Growth Fund - Class I ( NVOLG1 )	368,587	373,313
Templeton NVIT International Value Fund - Class III ( NVTIV3 )	162,607	273,656
Van Kampen NVIT Comstock Value Fund - Class I ( EIF )	239,240	168,381
NVIT Real Estate Fund - Class I ( NVRE1 )	877,468	278,123
VPS Small/Mid Cap Value Portfolio - Class A ( ALVSVA )	421,510	130,897
VP Inflation Protection Fund - Class II ( ACVIP2 )	704,884	227,835
VP Mid Cap Value Fund - Class I ( ACVMV1 )	483,556	240,733
VP Value Fund - Class I ( ACVV )	6	539
Small Cap Stock Index Portfolio - Service Shares ( DVSCS )	514,962	183,396
Appreciation Portfolio - Initial Shares ( DCAP )	355,554	81,943
Quality Bond Fund II - Primary Shares ( FQB )	8,676	79,861
VIP Fund - Contrafund Portfolio - Service Class ( FCS )	-	-
VIP Fund - Energy Portfolio - Service Class 2 ( FNRS2 )	1,549,149	391,601
VIP Fund - Equity-Income Portfolio - Service Class ( FEIS )	583,288	223,191
VIP Fund - Freedom Fund 2010 Portfolio - Service Class ( FF10S )	230,721	49,214
VIP Fund - Freedom Fund 2020 Portfolio - Service Class ( FF20S )	558,185	286,846
VIP Fund - Freedom Fund 2030 Portfolio - Service Class ( FF30S )	831,922	206,883
VIP Fund - Growth Portfolio - Service Class ( FGS )	484,267	163,824
VIP Fund - Investment Grade Bond Portfolio - Service Class ( FIGBS )	803,401	603,722
VIP Fund - Mid Cap Portfolio - Service Class ( FMCS )	1,373,585	571,684
VIP Fund - Overseas Portfolio - Service Class R ( FOSR )	242,039	141,530
VIP Fund - Value Strategies Portfolio - Service Class ( FVSS )	2,696	4,930
Franklin Income Securities Fund - Class 2 ( FTVIS2 )	510,734	144,791
Franklin Rising Dividends Securities Fund - Class 1 ( FTVRDI )	3,051	5,368
Franklin Small Cap Value Securities Fund - Class 1 ( FTVSVI )	465,594	606,500
Templeton Developing Markets Securities Fund - Class 3 ( FTVDM3 )	146,196	177,458
Templeton Foreign Securities Fund - Class 3 ( TIF3 )	73,694	64,992
Templeton Global Bond Securities Fund - Class 3 ( FTVGI3 )	1,487,300	194,214
VIP Founding Funds Allocation Fund - Class 2 ( FTVFA2 )	449,903	74,293
Advisers Management Trust - Short Duration Bond Portfolio - I Class Shares ( AMTB )	726,149	636,067
International Portfolio - S Class Shares ( AMINS )	-	-
Small-Cap Growth Portfolio - S Class Shares ( AMFAS )	14,865	11,899
Socially Responsive Portfolio - I Class Shares ( AMSRS )	12,129	25,461
Global Securities Fund/VA - Class 3 ( OVGS3 )	259,222	99,424
High Income Fund/VA - Class 3 ( OVHI3 )	25,174	12,576
High Income Fund/VA - Non-Service Shares ( OVHI )	134	213
Main Street Fund(R)/VA - Non-Service Shares ( OVGI )	123,918	264,399
Main Street Small- & Mid-Cap Fund(R)/VA - Non-Service Shares ( OVSC )	418,577	102,867
Foreign Bond Portfolio (Unhedged) - Administrative Class ( PMVFBA )	453,103	107,161
Low Duration Portfolio - Administrative Class ( PMVLDA )	1,432,881	1,118,136
Total Return Portfolio - Administrative Class ( PMVTRA )	412,136	63,179
V.I. Capital Appreciation Fund - Series I ( AVCA )	6,099	5,298
V.I. Capital Development Fund - Series I ( AVCDI )	40,200	40,924
Blue Chip Growth Portfolio - II ( TRBCG2 )	-	541
Equity Income Portfolio - II ( TREI2 )	2	322
Health Sciences Portfolio - II ( TRHS2 )	315,140	58,717
VIP Trust - Global Hard Assets Fund: Class R1 ( VWHAR )	748,593	120,335
Ivy Fund Variable Insurance Portfolios, Inc. - Asset Strategy ( WRASP )	2,252,972	1,109,475
Ivy Fund Variable Insurance Portfolios, Inc. - Balanced ( WRBP )	60,177	10,203
Ivy Fund Variable Insurance Portfolios, Inc. - Bond ( WRBDP )	276,626	37,016
Ivy Fund Variable Insurance Portfolios, Inc. - Core Equity ( WRCEP )	121,903	34,818
Ivy Fund Variable Insurance Portfolios, Inc. - Dividend Opportunities ( WRDIV )	125,582	22,258
Ivy Fund Variable Insurance Portfolios, Inc. - Energy ( WRENG )	76,222	13,958
Ivy Funds Variable Insurance Portfolios, Inc. - Global Bond ( WRGBP )	2,168	71
Ivy Fund Variable Insurance Portfolios, Inc. - Global Natural Resources ( WRGNR )	161,572	22,621
Ivy Fund Variable Insurance Portfolios, Inc. - Growth ( WRGP )	93,465	6,867
Ivy Fund Variable Insurance Portfolios, Inc. - High Income ( WRHIP )	248,153	78,060
Ivy Fund Variable Insurance Portfolios, Inc. - International Growth ( WRIP )	102,297	24,267
Ivy Fund Variable Insurance Portfolios, Inc. - International Core Equity ( WRI2P )	106,291	15,595
Ivy Funds Variable Insurance Portfolios, Inc. - Limited-Term Bond ( WRLTBP )	2,969	84
Ivy Fund Variable Insurance Portfolios, Inc. - Micro Cap Growth ( WRMIC )	79,113	11,466
Ivy Fund Variable Insurance Portfolios, Inc. - Mid Cap Growth ( WRMCG )	141,843	15,102
Ivy Fund Variable Insurance Portfolios, Inc. - Money Market ( WRMMP )	818,228	716,261
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Aggressive ( WRPAP )	148,248	20,451
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Conservative ( WRPCP )	207,211	62,375
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderate ( WRPMP )	707,427	76,746
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderately Aggressive ( WRPMAP )	821,628	107,214
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderately Conservative (WRPMCP)	131,192	13,272
Ivy Fund Variable Insurance Portfolios, Inc. - Real Estate Securities ( WRRESP )	75,988	8,906
Ivy Fund Variable Insurance Portfolios, Inc. - Science and Technology ( WRSTP )	192,069	47,266
Ivy Fund Variable Insurance Portfolios, Inc. - Small Cap Growth ( WRSCP )	87,886	21,326
Ivy Fund Variable Insurance Portfolios, Inc. - Small Cap Value ( WRSCV )	46,600	48,386
Ivy Fund Variable Insurance Portfolios, Inc. - Value ( WRVP )	31,004	4,740
Advantage VT Small Cap Growth Fund - Class 2 ( WFVSCG )	218,466	110,537

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

AllianceBernstein NVIT Global Fixed Income Fund - Class III(obsolete) ( NVAGF3 )			12,110		63,369
Gartmore NVIT Worldwide Leaders Fund—Class III ( GEF3 )			6,112		15,589
	Total	$	83,826,832	$	36,736,624

(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, 2011, and the investment income ratio and total return for each of the periods in the five year period ended December 31, 2011. 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 VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*	Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
Variable Series Funds, Inc. - Global Allocation V.I. Fund - Class II (MLVGA2)
2011	0.00%		325,219	$	12.900807	$	4,195,588		2.92%		-3.63%
2010	0.00%		154,611		13.386468		2,069,695		1.90%		9.88%
2009	0.00%		32,706		12.182592		398,444		3.46%		21.83%		5/1/2009
Stock Index Fund, Inc. - Initial Shares (DSIF)
2011	0.00%		287,581		11.975613		3,443,959		1.89%		1.88%
2010	0.00%		231,422		11.754920		2,720,347		1.93%		14.84%
2009	0.00%		183,488		10.236118		1,878,205		2.13%		26.33%
2008	0.00%		136,077		8.102406		1,102,552		2.29%		-37.14%
2007	0.00%		80,552		12.889762		1,038,296		1.83%		5.26%
Janus Aspen Series - Forty Portfolio - Service Shares (JACAS)
2011	0.00%		149,403		11.639880		1,739,033		0.24%		-6.94%
2010	0.00%		155,217		12.508137		1,941,476		0.26%		6.48%
2009	0.00%		90,368		11.747058		1,061,558		0.01%		46.01%
2008	0.00%		52,700		8.045115		423,976		0.01%		-44.31%
2007	0.00%		4,350		14.445945		62,840		0.33%		36.63%
Janus Aspen Series - Global Technology Portfolio - Service II Shares (JAGTS2)
2011	0.00%		22,379		10.352942		231,688		0.00%		-8.81%
2010	0.00%		1,811		11.352948		20,560		0.00%		13.53%		5/3/2010
Janus Aspen Series - Overseas Portfolio - Service II Shares (JAIGS2)
2011	0.00%		312,148		10.783470		3,366,039		0.39%		-32.33%
2010	0.00%		226,274		15.936367		3,605,986		0.56%		25.03%
2009	0.00%		171,108		12.746144		2,180,967		0.42%		79.07%
2008	0.00%		113,377		7.117893		807,004		2.70%		-52.21%
2007	0.00%		48,306		14.893765		719,458		0.53%		28.07%
Investors Growth Stock Series - Initial Class (MIGIC)
2011	0.00%		368		12.633894		4,649		0.58%		0.58%
2010	0.00%		456		12.561314		5,728		0.43%		12.47%
2009	0.00%		398		11.168160		4,445		0.69%		39.55%
2008	0.00%		335		8.002768		2,681		0.53%		-36.87%
2007	0.00%		250		12.677102		3,169		0.29%		11.36%
Value Series - Initial Class (MVFIC)
2011	0.00%		248,200		12.879603		3,196,717		1.59%		-0.30%
2010	0.00%		211,083		12.918661		2,726,910		1.48%		11.53%
2009	0.00%		132,328		11.582760		1,532,723		1.20%		22.71%
2008	0.00%		47,608		9.438767		449,361		0.95%		-32.58%
2007	0.00%		26,056		14.000352		364,793		0.50%		7.91%
Variable Insurance Trust II - International Value Portfolio - Service Class (MVIVSC)
2011	0.00%		11,163		10.650622		118,893		1.42%		-1.78%
2010	0.00%		825		10.843288		8,946		0.00%		8.43%		5/3/2010
M Business Opportunity Value Fund (MFBOV)
2011	0.00%		32,536		8.309381		270,354		0.37%		-4.11%
2010	0.00%		25,620		8.665720		222,016		0.71%		9.27%
2009	0.00%		16,171		7.930242		128,240		0.68%		24.58%
2008	0.00%		7,871		6.365512		50,103		0.05%		-34.48%
2007	0.00%		6,272		9.715909		60,938		0.00%		-2.84%		9/18/2007
M Capital Appreciation Fund (MFFCA)
2011	0.00%		25,361		10.049361		254,862		0.00%		-7.22%
2010	0.00%		19,701		10.831673		213,395		0.19%		27.00%
2009	0.00%		13,297		8.528591		113,405		0.06%		48.61%
2008	0.00%		8,429		5.739062		48,374		0.00%		-42.03%
2007	0.00%		5,678		9.900064		56,213		0.00%		-1.00%		9/18/2007
M International Equity Fund (MFBIE)
2011	0.00%		43,251		7.076176		306,052		4.27%		-13.56%
2010	0.00%		26,038		8.186209		213,153		4.31%		4.61%
2009	0.00%		14,298		7.825688		111,892		3.79%		25.28%
2008	0.00%		6,018		6.246550		37,592		4.59%		-39.84%
2007	0.00%		3,324		10.383840		34,516		1.47%		3.84%		9/18/2007

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*	Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
M Large Cap Growth Fund (MFTCG)
2011	0.00%		30,075	$	9.179807	$	276,083		0.00%		-0.80%
2010	0.00%		21,687		9.253931		200,690		0.38%		23.06%
2009	0.00%		13,319		7.519606		100,154		0.55%		37.40%
2008	0.00%		6,432		5.472607		35,199		0.02%		-48.97%
2007	0.00%		3,248		10.724819		34,834		0.00%		7.25%		9/18/2007
Core Plus Fixed Income Portfolio - Class I (MSVFI)
2011	0.00%		8,174		12.682719		103,669		3.80%		5.65%
2010	0.00%		7,213		12.004773		86,590		5.42%		7.14%
2009	0.00%		12,096		11.204270		135,527		11.88%		9.64%
2008	0.00%		28,841		10.218734		294,718		4.14%		-10.20%
2007	0.00%		32,734		11.380012		372,513		3.39%		5.45%
U.S. Real Estate Portfolio - Class I (MSVRE)
2008	0.00%		52,025		8.656213		450,338		3.67%		-37.89%
2007	0.00%		41,926		13.937607		584,348		1.00%		-17.07%
American Century NVIT Multi Cap Value Fund - Class I (NVAMV1)
2011	0.00%		83,852		14.348277		1,203,132		1.58%		0.65%
2010	0.00%		94,019		14.256071		1,340,342		1.59%		13.46%
2009	0.00%		1,653		12.564442		20,769		0.88%		25.64%		5/1/2009
American Funds NVIT Asset Allocation Fund - Class II (GVAAA2)
2011	0.00%		376,643		10.979437		4,135,328		1.22%		0.93%
2010	0.00%		291,751		10.878393		3,173,782		1.08%		12.02%
2009	0.00%		143,955		9.711378		1,398,001		0.09%		23.41%
2008	0.00%		86,089		7.868935		677,429		3.74%		-29.78%
2007	0.00%		24,380		11.205324		273,186		7.29%		6.14%
American Funds NVIT Bond Fund - Class II (GVABD2)
2011	0.00%		49,036		12.292646		602,782		2.13%		5.72%
2010	0.00%		44,558		11.627184		518,084		1.60%		5.99%
2009	0.00%		31,824		10.970085		349,112		0.39%		12.15%
2008	0.00%		19,150		9.781713		187,319		8.04%		-9.87%
2007	0.00%		4,806		10.853118		52,160		12.10%		2.98%
American Funds NVIT Global Growth Fund - Class II (GVAGG2)
2011	0.00%		90,535		10.875437		984,608		0.85%		-9.31%
2010	0.00%		85,800		11.991721		1,028,890		0.76%		11.30%
2009	0.00%		66,698		10.774250		718,621		0.00%		41.60%
2008	0.00%		34,853		7.608765		265,187		3.86%		-38.64%
2007	0.00%		9,724		12.399481		120,573		3.48%		14.36%
American Funds NVIT Growth Fund - Class II (GVAGR2)
2011	0.00%		185,580		10.115272		1,877,192		0.27%		-4.69%
2010	0.00%		171,060		10.612804		1,815,426		0.17%		18.19%
2009	0.00%		99,951		8.979238		897,484		0.00%		38.78%
2008	0.00%		63,278		6.470039		409,410		2.57%		-44.21%
2007	0.00%		28,662		11.597638		332,412		1.18%		11.90%
American Funds NVIT Growth-Income Fund - Class II (GVAGI2)
2011	0.00%		126,457		8.687464		1,098,591		0.91%		-2.24%
2010	0.00%		103,788		8.886120		922,273		0.85%		10.97%
2009	0.00%		43,831		8.007342		350,970		0.00%		30.69%
2008	0.00%		23,626		6.126963		144,755		4.55%		-38.06%
2007	0.00%		1,448		9.892316		14,324		0.72%		-1.08%		5/1/2007
Federated NVIT High Income Bond Fund - Class III (HIBF3)
2011	0.00%		131,352		14.839228		1,949,162		8.09%		3.81%
2010	0.00%		67,173		14.295077		960,243		9.58%		13.16%
2009	0.00%		44,372		12.632602		560,534		10.14%		46.08%
2008	0.00%		21,626		8.647843		187,019		10.34%		-28.10%
2007	0.00%		11,190		12.027193		134,584		7.70%		3.17%

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*		Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
NVIT Emerging Markets Fund - Class III (GEM3)
2011		0.00%		126,017	$	16.493303	$	2,078,437		0.76%		-22.39%
2010		0.00%		103,153		21.252025		2,192,210		0.08%		16.21%
2009		0.00%		86,223		18.287102		1,576,769		1.19%		63.48%
2008		0.00%		44,366		11.185864		496,271		1.39%		-57.83%
2007		0.00%		24,604		26.524857		652,618		0.75%		45.55%
NVIT International Equity Fund - Class III (GIG3)
2011		0.00%		12,503		8.459397		105,768		1.98%		-15.41%		5/2/2011
Gartmore NVIT International Equity Fund - Class VI (NVIE6)
2011		0.00%		36,549		7.251572		265,038		1.00%		-10.00%
2010		0.00%		37,091		8.057227		298,851		0.88%		13.00%
2009		0.00%		52,401		7.130177		373,628		0.22%		29.45%
2008		0.00%		4,934		5.508000		27,176		1.15%		-44.92%		5/1/2008
Neuberger Berman NVIT Multi Cap Opportunities Fund - Class I (NVNMO1)
2011		0.00%		39,183		8.099461		317,361		0.61%		-11.62%
2010		0.00%		35,126		9.164158		321,900		0.26%		15.61%
2009		0.00%		19,640		7.927018		155,687		0.19%		52.96%
2008		0.00%		39		5.182412		202		0.00%		-48.18%		5/1/2008
Neuberger Berman NVIT Socially Responsible Fund - Class II (NVNSR2)
2011		0.00%		118,184		9.691118		1,145,335		0.62%		-3.27%
2010		0.00%		72,005		10.018250		721,364		0.62%		23.56%
2009		0.00%		91,858		8.107965		744,781		0.44%		31.27%
2008		0.00%		88,800		6.176544		548,477		0.43%		-38.23%		5/1/2008
NVIT Cardinal Aggressive Fund - Class I (NVCRA1)
2011		0.00%		277,401		8.950086		2,482,763		2.08%		-6.19%
2010		0.00%		163,017		9.540229		1,555,220		0.42%		15.00%
2009		0.00%		67,030		8.295819		556,069		1.16%		29.30%
2008		0.00%		16,061		6.416027		103,048		1.31%		-35.84%		5/1/2008
NVIT Cardinal Balanced Fund - Class I (NVCRB1)
2011		0.00%		255,651		10.462826		2,674,832		2.61%		-1.26%
2010		0.00%		167,231		10.596561		1,772,073		1.07%		10.46%
2009		0.00%		75,697		9.593104		726,169		2.37%		19.88%
2008		0.00%		23,058		8.002099		184,513		1.47%		-19.98%		5/1/2008
NVIT Cardinal Capital Appreciation Fund - Class I (NVCCA1)
2011		0.00%		392,818		9.807509		3,852,566		2.27%		-3.37%
2010		0.00%		199,390		10.149086		2,023,626		0.76%		12.46%
2009		0.00%		114,328		9.025006		1,031,811		2.05%		24.25%
2008		0.00%		29,990		7.263571		217,835		1.75%		-27.36%		5/1/2008
NVIT Cardinal Conservative Fund - Class I (NVCCN1)
2011		0.00%		91,097		11.227964		1,022,834		2.80%		1.50%
2010		0.00%		50,764		11.062310		561,567		1.34%		6.87%
2009		0.00%		12,702		10.351566		131,486		3.11%		13.22%
2008		0.00%		5,694		9.142885		52,061		2.42%		-8.57%		5/1/2008
NVIT Cardinal Moderate Fund - Class I (NVCMD1)
2011		0.00%		536,603		10.135390		5,438,681		2.36%		-2.25%
2010		0.00%		502,389		10.368348		5,208,944		0.88%		11.42%
2009		0.00%		171,116		9.305236		1,592,275		2.68%		22.00%
2008		0.00%		20,669		7.626933		157,640		1.78%		-23.73%		5/1/2008
NVIT Cardinal Moderately Aggressive Fund - Class I (NVCMA1)
2011		0.00%		775,811		9.463303		7,341,735		2.43%		-4.57%
2010		0.00%		541,174		9.916957		5,366,799		0.70%		13.50%
2009		0.00%		310,026		8.737590		2,708,880		2.12%		26.69%
2008		0.00%		55,360		6.896919		381,815		1.72%		-31.03%		5/1/2008
NVIT Cardinal Moderately Conservative Fund - Class I (NVCMC1)
2011		0.00%		85,823		10.740467		921,779		2.81%		-0.28%
2010		0.00%		51,188		10.770841		551,338		1.22%		9.31%
2009		0.00%		31,516		9.853071		310,529		2.53%		17.64%
2008		0.00%		13,698		8.375935		114,734		1.48%		-16.24%		5/1/2008

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*		Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
NVIT Core Bond Fund - Class I (NVCBD1)
2011		0.00%		96,917	$	12.345910	$	1,196,529		3.23%		6.59%
2010		0.00%		69,927		11.582155		809,905		2.95%		7.06%
2009		0.00%		46,963		10.818752		508,081		3.75%		8.78%
2008		0.00%		4,746		9.945181		47,200		1.56%		-0.55%		5/1/2008
NVIT Core Plus Bond Fund - Class I (NVLCP1)
2011		0.00%		26,251		13.370773		350,996		2.65%		6.37%
2010		0.00%		14,090		12.569892		177,110		2.93%		8.35%
2009		0.00%		3,588		11.600708		41,623		5.45%		16.62%
2008		0.00%		230		9.947099		2,288		3.30%		-0.53%		5/1/2008
NVIT Fund - Class I (TRF)
2011		0.00%		52,433		11.221824		588,394		1.09%		0.53%
2010		0.00%		68,854		11.162791		768,603		1.00%		13.45%
2009		0.00%		80,590		9.839457		792,962		1.39%		26.10%
2008		0.00%		84,151		7.803097		656,639		1.40%		-41.55%
2007		0.00%		81,126		13.351018		1,083,115		1.16%		8.18%
NVIT Government Bond Fund - Class I (GBF)
2011		0.00%		103,949		14.166560		1,472,600		2.84%		7.25%
2010		0.00%		121,105		13.208362		1,599,599		2.80%		4.78%
2009		0.00%		139,277		12.605611		1,755,672		3.53%		2.69%
2008		0.00%		117,240		12.275629		1,439,195		4.28%		7.72%
2007		0.00%		40,524		11.395982		461,811		5.07%		7.16%
American Century NVIT Growth Fund - Class I (CAF)
2011		0.00%		1,858		9.174041		17,045		0.62%		-8.26%		5/2/2011
NVIT International Index Fund - Class VI (GVIX6)
2011		0.00%		107,284		8.254444		885,570		2.75%		-12.72%
2010		0.00%		72,715		9.456969		687,664		2.47%		7.54%
2009		0.00%		34,255		8.793694		301,228		3.18%		28.62%
2008		0.00%		17,707		6.837123		121,065		2.01%		-43.11%
2007		0.00%		14,812		12.017667		178,006		1.65%		9.50%
NVIT Investor Destinations Aggressive Fund - Class II (GVIDA)
2011		0.00%		249,362		12.065374		3,008,646		1.83%		-3.93%
2010		0.00%		221,749		12.559061		2,784,959		1.64%		14.63%
2009		0.00%		155,410		10.956366		1,702,729		1.00%		27.21%
2008		0.00%		86,385		8.613097		744,042		2.41%		-36.84%
2007		0.00%		24,672		13.637494		336,464		2.19%		5.96%
NVIT Investor Destinations Balanced Fund - Class II (NVDBL2)
2011		0.00%		75,561		12.895684		974,411		2.16%		0.88%
2010		0.00%		24,978		12.782641		319,285		1.16%		9.81%
2009		0.00%		1,417		11.640280		16,494		1.76%		16.40%		5/1/2009
NVIT Investor Destinations Capital Appreciation Fund - Class II (NVDCA2)
2011		0.00%		118,997		13.544740		1,611,783		2.02%		-0.94%
2010		0.00%		75,852		13.672666		1,037,099		1.22%		12.03%
2009		0.00%		8,016		12.204484		97,831		1.35%		22.04%		5/1/2009
NVIT Investor Destinations Conservative Fund - Class II (GVIDC)
2011		0.00%		124,507		12.951126		1,612,506		2.43%		2.93%
2010		0.00%		87,481		12.582446		1,100,725		2.01%		5.89%
2009		0.00%		53,773		11.882294		638,947		1.70%		9.08%
2008		0.00%		20,458		10.892776		222,845		3.94%		-6.02%
2007		0.00%		1,266		11.590847		14,674		3.73%		5.38%
NVIT Investor Destinations Moderate Fund - Class II (GVIDM)
2011		0.00%		739,675		12.720302		9,408,889		2.16%		-0.04%
2010		0.00%		518,780		12.725464		6,601,716		1.69%		10.91%
2009		0.00%		268,912		11.473370		3,085,327		1.37%		19.14%
2008		0.00%		102,479		9.630534		986,929		2.97%		-23.20%
2007		0.00%		59,144		12.538964		741,604		3.09%		5.66%

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*		Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
NVIT Investor Destinations Moderately Aggressive Fund - Class II (GVDMA)
2011		0.00%		987,577	$	12.475556	$	12,320,572		2.05%		-2.13%
2010		0.00%		761,845		12.746609		9,710,940		1.80%		12.83%
2009		0.00%		425,494		11.296821		4,806,730		1.26%		24.39%
2008		0.00%		255,853		9.081599		2,323,555		2.72%		-31.39%
2007		0.00%		156,190		13.236630		2,067,429		2.50%		6.15%
NVIT Investor Destinations Moderately Conservative Fund - Class II (GVDMC)
2011		0.00%		65,530		13.010443		852,574		2.38%		2.06%
2010		0.00%		34,079		12.747585		434,425		2.04%		8.52%
2009		0.00%		25,450		11.747183		298,966		1.43%		14.56%
2008		0.00%		12,983		10.254072		133,130		3.83%		-15.04%
2007		0.00%		1,116		12.069809		13,470		3.34%		5.86%
NVIT Mid Cap Index Fund - Class I (MCIF)
2011		0.00%		52,240		14.527168		758,899		0.81%		-2.54%
2010		0.00%		41,128		14.906376		613,069		1.21%		26.20%
2009		0.00%		53,080		11.811646		626,962		1.06%		36.76%
2008		0.00%		38,566		8.637043		333,096		1.35%		-36.46%
2007		0.00%		23,042		13.593553		313,223		1.42%		7.56%
NVIT Money Market Fund - Class I (SAM)
2011		0.00%		968,748		11.482073		11,123,235		0.00%		0.00%
2010		0.00%		537,380		11.482065		6,170,232		0.00%		0.00%
2009		0.00%		528,280		11.482050		6,065,737		0.21%		0.04%
2008		0.00%		414,695		11.477234		4,759,554		1.74%		2.05%
2007		0.00%		174,684		11.246272		1,964,544		4.75%		4.79%
NVIT Multi-Manager International Growth Fund - Class III (NVMIG3)
2011		0.00%		71,965		8.660251		623,235		1.25%		-9.37%
2010		0.00%		86,794		9.555175		829,332		0.76%		14.04%
2009		0.00%		92,482		8.379106		774,916		1.28%		36.46%
2008		0.00%		83,365		6.140389		511,893		0.11%		-38.60%		5/1/2008
NVIT Multi-Manager International Value Fund - Class III (GVDIV3)
2011		0.00%		76,483		8.974574		686,402		2.00%		-16.11%
2010		0.00%		68,742		10.698362		735,427		2.55%		6.11%
2009		0.00%		61,633		10.082162		621,394		2.25%		29.84%
2008		0.00%		69,824		7.765128		542,194		1.79%		-46.33%
2007		0.00%		60,332		14.468946		872,940		2.26%		2.93%
NVIT Multi-Manager Large Cap Growth Fund - Class I (NVMLG1)
2011		0.00%		121,747		9.263525		1,127,806		0.01%		-2.91%
2010		0.00%		112,634		9.540808		1,074,619		0.05%		15.51%
2009		0.00%		79,282		8.259762		654,850		0.75%		29.78%
2008		0.00%		2,391		6.364575		15,219		0.52%		-36.35%		5/1/2008
NVIT Multi-Manager Large Cap Value Fund - Class I (NVMLV1)
2011		0.00%		33,449		8.634796		288,825		1.18%		-5.83%
2010		0.00%		24,511		9.169345		224,750		0.86%		13.05%
2009		0.00%		13,082		8.111157		106,110		1.37%		27.59%
2008		0.00%		183		6.357067		1,163		0.75%		-36.43%		5/1/2008
NVIT Multi-Manager Mid Cap Growth Fund - Class I (NVMMG1)
2011		0.00%		139,190		9.695515		1,349,519		0.00%		-4.23%
2010		0.00%		145,695		10.123676		1,474,969		0.00%		26.82%
2009		0.00%		149,880		7.982859		1,196,471		0.00%		27.12%
2008		0.00%		26,311		6.279727		165,226		0.00%		-37.20%		5/1/2008
NVIT Multi-Manager Mid Cap Value Fund - Class II (NVMMV2)
2011		0.00%		36,583		10.303092		376,918		0.75%		-2.32%
2010		0.00%		48,371		10.547920		510,213		1.21%		19.63%
2009		0.00%		82,042		8.817001		723,364		1.06%		30.47%
2008		0.00%		58,272		6.757903		393,798		0.87%		-32.42%		5/1/2008

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	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)
2011		0.00	%		36,260	$	10.826282	$	392,561		0.00	%		-0.65	%
2010		0.00	%		24,951		10.896900		271,889		0.00	%		25.45	%
2009		0.00	%		14,412		8.686440		125,189		0.00	%		27.46	%
2008		0.00	%		8,023		6.814966		54,677		0.00	%		-46.42	%
2007		0.00	%		4,802		12.718919		61,076		0.00	%		9.75	%
NVIT Multi-Manager Small Cap Value Fund - Class I (SCVF)
2011		0.00	%		32,583		12.133163		395,335		0.38	%		-5.07	%
2010		0.00	%		25,346		12.781169		323,952		0.58	%		26.60	%
2009		0.00	%		21,442		10.095402		216,466		0.50	%		26.22	%
2008		0.00	%		15,192		7.998530		121,514		1.19	%		-32.15	%
2007		0.00	%		12,256		11.788779		144,483		1.35	%		-6.89	%
NVIT Multi-Manager Small Company Fund - Class I (SCF)
2011		0.00	%		49,239		12.975667		638,909		0.52	%		-5.56	%
2010		0.00	%		42,779		13.739369		587,756		0.29	%		25.32	%
2009		0.00	%		56,094		10.963538		614,989		0.21	%		34.70	%
2008		0.00	%		29,057		8.139096		236,498		1.11	%		-38.19	%
2007		0.00	%		12,442		13.167514		163,830		0.16	%		2.13	%
NVIT Multi-Sector Bond Fund - Class I (MSBF)
2011		0.00	%		63,928		13.471066		861,178		4.42	%		5.55	%
2010		0.00	%		53,859		12.763067		687,406		6.95	%		10.59	%
2009		0.00	%		29,967		11.541196		345,855		9.60	%		24.38	%
2008		0.00	%		20,192		9.279073		187,363		8.63	%		-17.29	%
2007		0.00	%		12,774		11.218961		143,311		4.29	%		4.62	%
NVIT Short Term Bond Fund - Class II (NVSTB2)
2011		0.00	%		11,114		11.049485		122,804		1.65	%		1.30	%
2010		0.00	%		9,291		10.907906		101,345		1.33	%		2.42	%
2009		0.00	%		7,610		10.650192		81,048		2.54	%		7.11	%
2008		0.00	%		897		9.943310		8,919		0.00	%		-0.57	%	5/1/2008
NVIT Large Cap Growth Fund - Class I (NVOLG1)
2011		0.00	%		221,993		13.891692		3,083,858		0.69	%		-2.23	%
2010		0.00	%		224,814		14.209081		3,194,400		0.07	%		8.80	%
2009		0.00	%		573		13.059893		7,483		0.25	%		30.60	%	5/1/2009
Templeton NVIT International Value Fund - Class III (NVTIV3)
2011		0.00	%		51,221		12.139096		621,777		2.61	%		-12.43	%
2010		0.00	%		60,073		13.861453		832,699		2.01	%		6.35	%
2009		0.00	%		67,086		13.034354		874,423		0.38	%		30.34	%	5/1/2009
Van Kampen NVIT Comstock Value Fund - Class I (EIF)
2011		0.00	%		66,544		11.032149		734,123		1.34	%		-2.32	%
2010		0.00	%		61,272		11.294732		692,051		1.57	%		15.77	%
2009		0.00	%		45,596		9.756035		444,836		1.26	%		28.55	%
2008		0.00	%		48,218		7.589375		365,944		2.03	%		-36.99	%
2007		0.00	%		57,762		12.044718		695,727		1.82	%		-2.22	%
NVIT Real Estate Fund - Class I (NVRE1)
2011		0.00	%		291,930		10.243095		2,990,267		0.92	%		6.50	%
2010		0.00	%		235,145		9.617905		2,261,602		2.04	%		30.18	%
2009		0.00	%		132,893		7.388147		981,833		2.24	%		30.84	%
2008		0.00	%		4,089		5.646840		23,089		5.01	%		-43.53	%	5/1/2008
VPS Small/Mid Cap Value Portfolio - Class A (ALVSVA)
2011		0.00	%		90,310		10.401302		939,342		0.46	%		-8.39	%
2010		0.00	%		64,559		11.353901		732,996		0.37	%		26.91	%
2009		0.00	%		12,003		8.946607		107,386		1.11	%		42.86	%
2008		0.00	%		3,021		6.262626		18,919		0.00	%		-37.37	%	5/1/2008

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*			Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**			Total Return***			Inception Date****
VP Inflation Protection Fund - Class II (ACVIP2)
2011		0.00	%		67,889	$	14.393172	$	977,138		3.78	%		11.74	%
2010		0.00	%		35,291		12.880459		454,564		1.59	%		5.12	%
2009		0.00	%		18,947		12.253214		232,162		1.94	%		10.21	%
2008		0.00	%		10,488		11.117573		116,602		4.01	%		-1.59	%
2007		0.00	%		3,362		11.297046		37,981		4.44	%		9.49	%
VP International Fund - Class III (ACVI3)
2008		0.00	%		1,080		9.507294		10,268		0.57	%		-44.82	%
2007		0.00	%		352		17.230511		6,065		0.00	%		18.06	%
VP Mid Cap Value Fund - Class I (ACVMV1)
2011		0.00	%		98,933		15.491583		1,532,629		1.36	%		-0.69	%
2010		0.00	%		86,985		15.599747		1,356,944		2.48	%		19.25	%
2009		0.00	%		41,747		13.081223		546,102		3.89	%		29.94	%
2008		0.00	%		29,645		10.066767		298,427		0.09	%		-24.35	%
2007		0.00	%		16,400		13.306496		218,227		0.88	%		-2.31	%
VP Ultra(R) Fund - Class I (ACVU1)
2008		0.00	%		4,365		7.124413		31,098		0.00	%		-41.48	%
2007		0.00	%		4,394		12.174342		53,494		0.00	%		21.02	%
VP Value Fund - Class I (ACVV)
2009		0.00	%		102,102		10.532686		1,075,408		5.42	%		19.86	%
2008		0.00	%		85,421		8.787234		750,615		2.28	%		-26.78	%
2007		0.00	%		65,490		12.000449		785,909		1.35	%		-5.14	%
VP Vista(SM) Fund - Class I (ACVVS1)
2008		0.00	%		12,491		8.973691		112,091		0.00	%		-48.62	%
2007		0.00	%		5,864		17.466180		102,422		0.00	%		39.77	%
Small Cap Stock Index Portfolio - Service Shares (DVSCS)
2011		0.00	%		104,318		13.753744		1,434,763		0.54	%		0.56	%
2010		0.00	%		80,099		13.676760		1,095,495		0.49	%		25.83	%
2009		0.00	%		50,580		10.869560		549,782		1.97	%		25.03	%
2008		0.00	%		28,168		8.693766		244,886		0.72	%		-30.91	%
2007		0.00	%		19,302		12.583781		242,892		0.26	%		-0.65	%
Appreciation Portfolio - Initial Shares (DCAP)
2011		0.00	%		33,998		14.200755		482,797		1.31	%		9.01	%
2010		0.00	%		14,077		13.026837		183,379		0.89	%		15.32	%
2009		0.00	%		3,682		11.296583		41,594		0.34	%		22.56	%
2008		0.00	%		3,901		9.217282		35,957		1.89	%		-29.55	%
2007		0.00	%		5,014		13.083574		65,601		1.58	%		7.13	%
Quality Bond Fund II - Primary Shares (FQB)
2011		0.00	%		4,486		13.764662		61,748		5.84	%		2.27	%
2010		0.00	%		10,068		13.458845		135,504		4.50	%		8.50	%
2009		0.00	%		7,208		12.403996		89,408		5.18	%		20.43	%
2008		0.00	%		3,785		10.299392		38,983		4.57	%		-7.29	%
2007		0.00	%		2,514		11.108998		27,928		3.46	%		5.38	%
VIP Fund - Contrafund Portfolio - Service Class (FCS)
2009		0.00	%		219,138		12.074163		2,645,908		1.46	%		35.66	%
2008		0.00	%		209,580		8.899992		1,865,261		0.98	%		-42.61	%
2007		0.00	%		173,746		15.508728		2,694,579		1.01	%		17.51	%
VIP Fund - Energy Portfolio - Service Class 2 (FNRS2)
2011		0.00	%		155,382		17.446617		2,710,890		1.00	%		-5.20	%
2010		0.00	%		96,805		18.403422		1,781,543		0.45	%		19.16	%
2009		0.00	%		91,096		15.444750		1,406,955		0.36	%		47.57	%
2008		0.00	%		41,466		10.465765		433,974		0.00	%		-54.40	%
2007		0.00	%		16,830		22.953063		386,300		0.22	%		45.64	%

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*		Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
VIP Fund - Equity-Income Portfolio - Service Class (FEIS)
2011		0.00%		140,019	$	11.294505	$	1,581,445		2.72%		0.86%
2010		0.00%		111,065		11.198307		1,243,740		2.06%		15.09%
2009		0.00%		85,940		9.730256		836,218		2.60%		30.03%
2008		0.00%		50,518		7.482988		378,026		3.10%		-42.70%
2007		0.00%		31,088		13.060141		406,014		2.40%		1.42%
VIP Fund - Freedom Fund 2010 Portfolio - Service Class (FF10S)
2011		0.00%		29,950		13.477731		403,658		2.38%		-0.28%
2010		0.00%		17,629		13.516167		238,277		4.49%		12.74%
2009		0.00%		3,354		11.989176		40,212		4.71%		24.15%
2008		0.00%		2,564		9.656832		24,761		3.12%		-25.08%
2007		0.00%		2,212		12.888793		28,510		2.89%		8.65%
VIP Fund - Freedom Fund 2020 Portfolio - Service Class (FF20S)
2011		0.00%		79,227		13.437783		1,064,635		2.17%		-1.12%
2010		0.00%		62,287		13.590648		846,521		2.73%		14.52%
2009		0.00%		38,779		11.867504		460,210		4.18%		28.78%
2008		0.00%		25,258		9.215628		232,769		2.97%		-32.71%
2007		0.00%		12,316		13.695591		168,675		2.80%		10.17%
VIP Fund - Freedom Fund 2030 Portfolio - Service Class (FF30S)
2011		0.00%		233,843		13.094199		3,061,987		2.18%		-2.70%
2010		0.00%		192,800		13.457007		2,594,511		2.86%		16.00%
2009		0.00%		63,273		11.600974		734,028		2.94%		31.40%
2008		0.00%		36,079		8.828445		318,522		2.95%		-38.08%
2007		0.00%		21,486		14.256765		306,321		2.61%		11.21%
VIP Fund - Growth Portfolio - Service Class (FGS)
2011		0.00%		167,714		12.250993		2,054,663		0.29%		0.14%
2010		0.00%		143,625		12.233728		1,757,069		0.20%		24.06%
2009		0.00%		118,780		9.861487		1,171,347		0.35%		28.15%
2008		0.00%		114,992		7.695394		884,910		0.80%		-47.23%
2007		0.00%		97,194		14.583722		1,417,450		0.57%		26.87%
VIP Fund - Investment Grade Bond Portfolio - Service Class (FIGBS)
2011		0.00%		185,083		14.298667		2,646,440		3.31%		7.21%
2010		0.00%		181,403		13.337306		2,419,427		3.61%		7.68%
2009		0.00%		139,164		12.386163		1,723,708		9.17%		15.67%
2008		0.00%		99,043		10.707897		1,060,542		3.42%		-3.35%
2007		0.00%		72,418		11.078504		802,283		2.16%		4.21%
VIP Fund - Mid Cap Portfolio - Service Class (FMCS)
2011		0.00%		250,328		15.258073		3,819,523		0.16%		-10.72%
2010		0.00%		203,373		17.089422		3,475,527		0.30%		28.70%
2009		0.00%		151,478		13.278281		2,011,367		0.69%		40.01%
2008		0.00%		101,995		9.483511		967,271		0.40%		-39.51%
2007		0.00%		69,056		15.677232		1,082,607		0.74%		15.49%
VIP Fund - Overseas Portfolio - Service Class R (FOSR)
2011		0.00%		102,506		11.466618		1,175,397		1.34%		-17.30%
2010		0.00%		96,609		13.865532		1,339,535		1.35%		13.01%
2009		0.00%		122,463		12.269434		1,502,552		2.41%		26.49%
2008		0.00%		111,554		9.699843		1,082,056		2.93%		-43.88%
2007		0.00%		89,282		17.283296		1,543,087		3.21%		17.23%
VIP Fund - Value Strategies Portfolio - Service Class (FVSS)
2011		0.00%		1,453		11.703406		17,005		0.91%		-8.85%
2010		0.00%		1,624		12.839377		20,851		0.23%		26.45%
2009		0.00%		4,609		10.153436		46,797		0.56%		57.40%
2008		0.00%		3,737		6.450849		24,107		0.86%		-51.17%
2007		0.00%		2,576		13.212045		34,034		0.87%		5.60%

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*	Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
Franklin Income Securities Fund - Class 2 (FTVIS2)
2011	0.00%		76,362	$	12.805162	$	977,828		5.46%		2.38%
2010	0.00%		50,753		12.507001		634,768		6.68%		12.67%
2009	0.00%		27,785		11.100337		308,423		7.57%		35.59%
2008	0.00%		19,057		8.186428		156,008		5.03%		-29.66%
2007	0.00%		5,526		11.637657		64,310		1.27%		3.76%
Franklin Rising Dividends Securities Fund - Class 1 (FTVRDI)
2011	0.00%		3,610		13.310500		48,051		1.74%		6.29%
2010	0.00%		3,873		12.522488		48,500		1.82%		20.94%
2009	0.00%		3,804		10.354358		39,388		1.76%		17.67%
2008	0.00%		4,380		8.799201		38,541		2.12%		-26.94%
2007	0.00%		4,572		12.044130		55,066		2.39%		-2.41%
Franklin Small Cap Value Securities Fund - Class 1 (FTVSVI)
2011	0.00%		142,501		13.791811		1,965,347		0.86%		-3.53%
2010	0.00%		151,664		14.296027		2,168,193		0.92%		28.49%
2009	0.00%		131,306		11.126242		1,460,942		1.49%		29.54%
2008	0.00%		63,876		8.588732		548,614		1.42%		-32.87%
2007	0.00%		50,330		12.794049		643,924		0.69%		-2.14%
Templeton Developing Markets Securities Fund - Class 3 (FTVDM3)
2011	0.00%		32,654		17.062376		557,155		0.91%		-15.86%
2010	0.00%		33,975		20.278309		688,956		1.73%		17.51%
2009	0.00%		39,603		17.256364		683,404		3.61%		72.63%
2008	0.00%		30,241		9.996007		302,289		2.77%		-52.67%
2007	0.00%		20,640		21.120230		435,922		2.17%		28.70%
Templeton Foreign Securities Fund - Class 3 (TIF3)
2011	0.00%		31,393		12.534749		393,503		1.69%		-10.68%
2010	0.00%		31,120		14.033220		436,714		1.66%		8.41%
2009	0.00%		32,215		12.945045		417,025		5.15%		37.20%
2008	0.00%		73,691		9.435374		695,303		2.53%		-40.39%
2007	0.00%		38,256		15.828965		605,553		1.79%		15.45%
Templeton Global Bond Securities Fund - Class 3 (FTVGI3)
2011	0.00%		116,885		17.701343		2,069,021		5.69%		-0.83%
2010	0.00%		51,427		17.849519		917,947		1.21%		14.38%
2009	0.00%		24,758		15.605635		386,364		16.16%		18.69%
2008	0.00%		18,407		13.148675		242,030		3.23%		6.21%
2007	0.00%		6,758		12.380292		83,666		2.88%		11.03%
VIP Founding Funds Allocation Fund - Class 2 (FTVFA2)
2011	0.00%		135,719		9.411247		1,277,285		0.01%		-1.54%
2010	0.00%		96,251		9.558606		920,025		3.75%		10.25%
2009	0.00%		27,625		8.669683		239,500		3.21%		30.25%
2008	0.00%		10,079		6.656135		67,088		3.14%		-33.44%		5/1/2008
Advisers Management Trust - Short Duration Bond Portfolio - I Class Shares  (AMTB)
2011	0.00%		52,488		11.481642		602,648		3.30%		0.29%
2010	0.00%		46,253		11.448574		529,531		5.59%		5.29%
2009	0.00%		30,096		10.873885		327,260		6.92%		13.33%
2008	0.00%		43,351		9.595209		415,961		4.96%		-13.43%
2007	0.00%		33,310		11.083576		369,194		3.57%		4.77%
International Portfolio - S Class Shares (AMINS)
2008	0.00%		25,895		8.019658		207,668		0.00%		-46.44%
2007	0.00%		47,864		14.972222		716,630		3.38%		3.21%
Regency Portfolio - S Class Shares (AMRS)
2008	0.00%		26,414		7.206627		190,356		1.04%		-45.95%
2007	0.00%		18,746		13.332382		249,929		0.39%		3.05%

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*	Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
Small-Cap Growth Portfolio - S Class Shares (AMFAS)
2011	0.00%		2,090	$	9.820243	$	20,524		0.00%		-1.06%
2010	0.00%		1,901		9.925489		18,868		0.00%		19.61%
2009	0.00%		2,205		8.298232		18,298		0.00%		22.75%
2008	0.00%		2,561		6.760031		17,312		0.00%		-39.47%
2007	0.00%		2,424		11.168606		27,073		0.00%		0.52%
Socially Responsive Portfolio - I Class Shares (AMSRS)
2011	0.00%		10,926		12.821427		140,087		0.32%		-3.08%
2010	0.00%		12,033		13.228911		159,183		0.02%		22.85%
2009	0.00%		61,680		10.767989		664,170		2.26%		31.43%
2008	0.00%		54,272		8.193158		444,659		1.36%		-39.44%
2007	0.00%		85,608		13.529389		1,158,224		0.10%		7.61%
Capital Appreciation Fund/VA - Non-Service Shares (OVGR)
2009	0.00%		27,288		10.376282		283,148		0.27%		44.52%
2008	0.00%		23,978		7.179944		172,160		0.13%		-45.52%
2007	0.00%		18,658		13.178440		245,883		0.20%		14.15%
Global Securities Fund/VA - Class 3 (OVGS3)
2011	0.00%		67,220		13.414448		901,719		1.17%		-8.27%
2010	0.00%		57,376		14.623513		839,039		1.30%		15.97%
2009	0.00%		48,626		12.609317		613,141		2.01%		39.70%
2008	0.00%		33,763		9.026171		304,751		1.35%		-40.19%
2007	0.00%		23,236		15.092302		350,685		0.94%		6.34%
High Income Fund/VA - Class 3 (OVHI3)
2011	0.00%		27,428		2.908819		79,783		8.50%		-1.88%
2010	0.00%		25,362		2.964546		75,187		6.29%		14.68%
2009	0.00%		46,755		2.584961		120,860		0.00%		26.75%
2008	0.00%		6,619		2.039384		13,499		5.41%		-78.89%
2007	0.00%		1,914		9.661022		18,491		0.00%		-3.39%		5/1/2007
High Income Fund/VA - Non-Service Shares (OVHI)
2011	0.00%		378		3.367180		1,273		9.33%		-2.34%
2010	0.00%		439		3.447769		1,514		6.37%		14.81%
2009	0.00%		700		3.002931		2,102		0.00%		25.32%
2008	0.00%		873		2.396292		2,092		7.99%		-78.67%
2007	0.00%		1,106		11.235173		12,426		7.49%		-0.10%
Main Street Fund(R)/VA - Non-Service Shares (OVGI)
2011	0.00%		66,235		11.823344		783,119		0.87%		-0.01%
2010	0.00%		78,508		11.825046		928,361		1.11%		16.11%
2009	0.00%		89,913		10.184591		915,727		1.63%		28.29%
2008	0.00%		82,941		7.938976		658,467		1.29%		-38.47%
2007	0.00%		57,410		12.902441		740,729		0.73%		4.42%
Main Street Small- & Mid-Cap Fund(R)/VA - Non-Service Shares (OVSC)
2011	0.00%		55,965		13.370383		748,273		0.44%		-2.21%
2010	0.00%		34,302		13.672847		469,006		0.48%		23.41%
2009	0.00%		49,035		11.079617		543,289		1.09%		37.20%
2008	0.00%		58,050		8.075736		468,796		0.47%		-37.83%
2007	0.00%		32,394		12.989416		420,779		0.22%		-1.21%
Foreign Bond Portfolio (Unhedged) - Administrative Class (PMVFBA)
2011	0.00%		62,395		13.028098		812,888		2.01%		8.52%
2010	0.00%		36,138		12.004915		433,834		1.40%		9.48%
2009	0.00%		6,424		10.965488		70,442		0.26%		9.65%		4/30/2009
Low Duration Portfolio - Administrative Class (PMVLDA)
2011	0.00%		137,574		11.759209		1,617,761		1.68%		1.11%
2010	0.00%		112,919		11.630295		1,313,281		1.76%		5.29%
2009	0.00%		26,072		11.045905		287,989		1.51%		10.46%		4/30/2009
Total Return Portfolio - Administrative Class (PMVTRA)
2011	0.00%		34,195		10.108298		345,653		1.64%		1.08%		4/29/2011

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*	Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
V.I. Basic Value Fund - Series I (AVBVI)
2008	0.00%		8,367	$	5.937752	$	49,681		0.91%		-51.77%
2007	0.00%		7,730		12.310539		95,160		0.72%		1.54%
V.I. Capital Appreciation Fund - Series I (AVCA)
2011	0.00%		2,273		9.768863		22,205		0.14%		-7.91%
2010	0.00%		2,174		10.607978		23,062		0.75%		15.49%
2009	0.00%		2,421		9.185296		22,238		0.62%		21.08%
2008	0.00%		2,205		7.586238		16,728		0.00%		-42.49%
2007	0.00%		1,938		13.191695		25,566		0.00%		12.01%
V.I. Capital Development Fund - Series I (AVCDI)
2011	0.00%		6,940		11.911516		82,666		0.00%		-7.16%
2010	0.00%		7,294		12.830002		93,582		0.00%		18.78%
2009	0.00%		12,509		10.801700		135,118		0.00%		42.37%
2008	0.00%		7,496		7.587025		56,873		0.00%		-47.03%
2007	0.00%		2,714		14.321990		38,870		0.00%		10.84%
Blue Chip Growth Portfolio - II (TRBCG2)
2011	0.00%		14		13.304880		186		0.00%		1.36%
2010	0.00%		14		13.126208		184		0.00%		16.00%
2009	0.00%		34,091		11.315697		385,763		0.00%		41.79%
2008	0.00%		73,411		7.980543		585,859		0.15%		-42.65%
2007	0.00%		27,656		13.915435		384,845		0.13%		12.49%
Equity Income Portfolio - II (TREI2)
2009	0.00%		36,899		10.380043		383,013		1.82%		25.25%
2008	0.00%		32,472		8.287351		269,107		2.35%		-36.26%
2007	0.00%		14,258		13.002714		185,393		1.63%		3.03%
Health Sciences Portfolio - II (TRHS2)
2011	0.00%		22,768		11.741045		267,320		0.00%		10.39%
2010	0.00%		1,253		10.636434		13,327		0.00%		6.36%		5/3/2010
Limited-Term Bond Portfolio - II (TRLT2)
2008	0.00%		5,231		11.230967		58,749		3.64%		1.31%
2007	0.00%		466		11.086232		5,166		4.04%		5.23%
VIP Trust - Global Hard Assets Fund: Class R1 (VWHAR)
2011	0.00%		69,734		9.962653		694,736		0.49%		-16.40%
2010	0.00%		15,955		11.916501		190,128		0.00%		19.17%		5/3/2010
Ivy Fund Variable Insurance Portfolios, Inc. - Asset Strategy (WRASP)
2011	0.00%		432,850		9.614262		4,161,533		0.94%		-7.21%
2010	0.00%		322,433		10.360806		3,340,666		1.01%		8.67%
2009	0.00%		94,099		9.533783		897,119		0.14%		25.05%
2008	0.00%		6,405		7.624275		48,833		0.96%		-23.76%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Balanced (WRBP)
2011	0.00%		10,293		11.530280		118,681		1.51%		3.31%
2010	0.00%		6,810		11.160539		76,003		1.86%		17.11%
2009	0.00%		2,569		9.530163		24,483		0.90%		13.23%
2008	0.00%		3		8.416983		25		0.00%		-15.83%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Bond (WRBDP)
2011	0.00%		44,338		12.439097		551,525		2.65%		7.31%
2010	0.00%		25,441		11.592060		294,914		2.78%		6.04%
2009	0.00%		10,627		10.931821		116,172		1.83%		7.16%
2008	0.00%		2,000		10.201066		20,402		0.13%		2.01%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Core Equity (WRCEP)
2011	0.00%		26,876		11.140721		299,418		0.36%		1.66%
2010	0.00%		19,900		10.958527		218,075		0.91%		20.89%
2009	0.00%		7,675		9.064570		69,571		0.65%		24.02%
2008	0.00%		1,458		7.308863		10,656		0.24%		-26.91%		7/25/2008

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*	Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
Ivy Fund Variable Insurance Portfolios, Inc. - Dividend Opportunities (WRDIV)
2011	0.00%		31,275	$	9.575854	$	299,485		0.99%		-4.69%
2010	0.00%		21,311		10.047011		214,112		0.98%		16.37%
2009	0.00%		12,273		8.633605		105,960		0.58%		17.88%
2008	0.00%		1,581		7.323854		11,579		0.11%		-26.76%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Energy (WRENG)
2011	0.00%		16,741		8.557685		143,264		0.00%		-9.08%
2010	0.00%		10,177		9.412267		95,789		0.26%		21.96%
2009	0.00%		4,780		7.717746		36,891		0.00%		40.48%
2008	0.00%		77		5.493770		423		0.29%		-45.06%		7/25/2008
Ivy Funds Variable Insurance Portfolios, Inc. - Global Bond (WRGBP)
2011	0.00%		209		9.942236		2,078		2.54%		-0.58%		5/2/2011
Ivy Fund Variable Insurance Portfolios, Inc. - Global Natural Resources (WRGNR)
2011	0.00%		53,476		6.693839		357,960		0.00%		-21.45%
2010	0.00%		37,409		8.521264		318,772		0.00%		17.06%
2009	0.00%		20,574		7.279176		149,762		0.00%		73.64%
2008	0.00%		4,390		4.192055		18,403		5.19%		-58.08%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Growth (WRGP)
2011	0.00%		22,699		10.353045		235,004		0.38%		2.12%
2010	0.00%		15,030		10.137791		152,371		0.54%		12.58%
2009	0.00%		7,390		9.004979		66,547		0.26%		27.07%
2008	0.00%		1,331		7.086429		9,432		0.00%		-29.14%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - High Income (WRHIP)
2011	0.00%		33,773		14.181907		478,966		7.39%		5.26%
2010	0.00%		23,825		13.473317		321,002		6.56%		14.86%
2009	0.00%		8,647		11.730371		101,433		4.75%		46.42%
2008	0.00%		2,010		8.011550		16,103		1.43%		-19.88%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - International Growth (WRIP)
2011	0.00%		26,355		9.147083		241,071		0.40%		-7.32%
2010	0.00%		18,448		9.869648		182,075		0.91%		14.79%
2009	0.00%		9,348		8.598329		80,377		0.80%		26.89%
2008	0.00%		2,086		6.776160		14,135		0.58%		-32.24%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - International Core Equity (WRI2P)
2011	0.00%		20,198		9.376216		189,381		1.51%		-13.88%
2010	0.00%		11,781		10.887910		128,270		1.16%		14.09%
2009	0.00%		6,214		9.543084		59,301		2.44%		36.97%
2008	0.00%		733		6.967466		5,107		0.82%		-30.33%		7/25/2008
Ivy Funds Variable Insurance Portfolios, Inc. - Limited-Term Bond (WRLTBP)
2011	0.00%		280		10.214380		2,860		1.35%		2.14%		5/2/2011
Ivy Fund Variable Insurance Portfolios, Inc. - Micro Cap Growth (WRMIC)
2011	0.00%		11,165		11.389527		127,164		0.00%		-7.01%
2010	0.00%		5,677		12.248345		69,534		0.00%		40.85%
2009	0.00%		3,588		8.695716		31,200		0.00%		41.29%
2008	0.00%		3		6.154606		18		0.00%		-38.45%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Mid Cap Growth (WRMCG)
2011	0.00%		16,798		14.033982		235,743		0.01%		-0.56%
2010	0.00%		8,350		14.112979		117,843		0.03%		31.56%
2009	0.00%		3,952		10.727709		42,396		0.00%		46.66%
2008	0.00%		104		7.314577		761		0.00%		-26.85%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Money Market (WRMMP)
2011	0.00%		24,608		10.181228		250,540		0.02%		0.02%
2010	0.00%		14,780		10.179140		150,448		0.08%		0.08%
2009	0.00%		19,956		10.171477		202,982		0.78%		1.02%
2008	0.00%		9,084		10.068911		91,466		0.15%		0.69%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Aggressive (WRPAP)
2011	0.00%		32,692		10.709183		350,105		1.14%		-4.15%
2010	0.00%		21,892		11.173084		244,601		1.08%		15.53%
2009	0.00%		10,521		9.671369		101,752		0.24%		23.32%

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*	Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Conservative (WRPCP)
2011	0.00%		21,691	$	11.186358	$	242,643		0.65%		0.75%
2010	0.00%		8,520		11.103054		94,598		0.41%		9.38%
2009	0.00%		615		10.151169		6,243		0.03%		12.95%
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderate (WRPMP)
2011	0.00%		133,499		11.025710		1,471,921		0.99%		-1.46%
2010	0.00%		79,043		11.189027		884,414		0.64%		12.63%
2009	0.00%		41,362		9.934421		410,908		0.19%		17.95%
2008	0.00%		4,780		8.422293		40,259		0.00%		-15.78%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderately Aggressive  (WRPMAP)
2011	0.00%		145,920		10.908819		1,591,815		0.77%		-3.02%
2010	0.00%		83,892		11.248161		943,631		0.73%		14.46%
2009	0.00%		50,451		9.826989		495,781		0.18%		20.70%
2008	0.00%		9,522		8.141331		77,522		0.00%		-18.59%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Pathfinder Moderately Conservative  (WRPMCP)
2011	0.00%		15,092		11.127860		167,942		0.98%		0.00%
2010	0.00%		4,973		11.128058		55,340		0.87%		10.97%
2009	0.00%		982		10.028059		9,848		0.00%		15.12%
Ivy Fund Variable Insurance Portfolios, Inc. - Real Estate Securities (WRRESP)
2011	0.00%		10,913		10.869843		118,623		0.71%		5.01%
2010	0.00%		4,581		10.351416		47,420		1.61%		28.51%
2009	0.00%		2,749		8.055120		22,144		2.30%		23.62%
2008	0.00%		412		6.515876		2,685		1.94%		-34.84%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Science and Technology (WRSTP)
2011	0.00%		36,686		11.315053		415,104		0.00%		-5.77%
2010	0.00%		27,320		12.007564		328,047		0.00%		12.75%
2009	0.00%		12,301		10.649440		130,999		0.00%		43.84%
2008	0.00%		231		7.403637		1,710		0.00%		-25.96%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Small Cap Growth (WRSCP)
2011	0.00%		15,955		11.083753		176,841		0.00%		-10.60%
2010	0.00%		11,308		12.398273		140,200		0.00%		28.85%
2009	0.00%		6,068		9.622434		58,389		0.16%		34.72%
2008	0.00%		231		7.142413		1,650		0.00%		-28.58%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Small Cap Value (WRSCV)
2011	0.00%		11,213		11.346891		127,233		0.48%		-12.79%
2010	0.00%		11,553		13.010697		150,313		0.06%		26.41%
2009	0.00%		5,551		10.292224		57,132		0.00%		29.15%
2008	0.00%		144		7.969357		1,148		0.25%		-20.31%		7/25/2008
Ivy Fund Variable Insurance Portfolios, Inc. - Value (WRVP)
2011	0.00%		7,479		10.853362		81,172		0.74%		-7.32%
2010	0.00%		5,245		11.710184		61,420		0.82%		18.71%
2009	0.00%		2,895		9.864810		28,559		1.69%		26.64%
2008	0.00%		261		7.789549		2,033		0.34%		-22.10%		7/25/2008
Advantage VT Small Cap Growth Fund - Class 2 (WFVSCG)
2011	0.00%		23,838		15.966729		380,615		0.00%		-4.60%
2010	0.00%		17,571		16.735960		294,068		0.00%		26.77%
2009	0.00%		1,548		13.201660		20,436		0.00%		32.02%		5/1/2009
AllianceBernstein NVIT Global Fixed Income Fund - Class III(obsolete) (NVAGF3)
2010	0.00%		4,465		12.359941		55,187		6.41%		8.24%
2009	0.00%		2,428		11.419071		27,726		8.59%		14.19%		5/1/2009
Gartmore NVIT Worldwide Leaders Fund - Class III (obsolete) (GEF3)
2010	0.00%		670		14.935320		10,007		1.36%		11.36%
2009	0.00%		83		13.411529		1,113		0.63%		34.12%		5/1/2009
Ivy Fund Variable Insurance Portfolios, Inc. - Mortgage Securities(obsolete) (WRMSP)
2009	0.00%		433		10.127592		4,385		1.22%		8.37%

(Continued)

NATIONWIDE VL SEPARATE ACCOUNT-G

NOTES TO FINANCIAL STATEMENTS December 31, 2011

	Contract Expense Rate*	Units		Unit Fair Value		Contract Owners’ Equity		Investment Income Ratio**		Total Return***		Inception Date****
Janus Aspen Series - INTECH Risk-Managed Core Portfolio -Service Shares(obsolete)  (JARLCS)
2008	0.00%		3,769	$	6.408647	$	24,154		0.69%		-36.24%
2007	0.00%		3,828		10.051308		38,476		1.93%		0.51%		5/1/2007
Market Opportunity Fund II - Service Shares(obsolete) (FVMOS)
2009	0.00%		4,486		10.283025		46,130		1.42%		1.28%
2008	0.00%		4,736		10.152569		48,083		1.09%		-0.86%
2007	0.00%		2,496		10.240958		25,561		0.12%		-1.48%
NVIT Health Sciences Fund - Class III(obsolete) (GVGHS)
2009	0.00%		8,633		11.124833		96,041		0.27%		19.11%
2008	0.00%		7,323		9.339799		68,396		0.32%		-25.23%
2007	0.00%		5,826		12.491648		72,776		0.08%		13.23%
NVIT Mid Cap Growth Fund - Class I (obsolete) (SGRF)
2008	0.00%		71,365		7.252787		517,595		0.00%		-46.11%
2007	0.00%		84,110		13.458816		1,132,021		0.00%		9.01%
NVIT Technology & Communications Fund - Class III(obsolete) (GGTC3)
2009	0.00%		15,818		12.888766		203,875		0.00%		52.44%
2008	0.00%		9,743		8.454726		82,374		0.00%		-48.59%
2007	0.00%		7,472		16.444438		122,873		0.00%		20.19%
NVIT U.S. Growth Leaders Fund - Class I(obsolete) (GVUG1)
2009	0.00%		10,026		10.684702		107,125		0.00%		25.84%
2008	0.00%		6,995		8.490774		59,393		0.00%		-41.29%
2007	0.00%		3,802		14.462452		54,986		0.00%		22.49%
2011	Contract owners equity:							$	168,673,454
2010	Contract owners equity:							$	130,554,358
2009	Contract owners equity:							$	77,699,179
2008	Contract owners equity:							$	38,340,805
2007	Contract owners equity:							$	32,958,038

*	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 owners’ 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 contractholder 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.

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholder

Nationwide Life and Annuity Insurance Company:

We have audited the accompanying consolidated balance sheets of Nationwide Life and Annuity Insurance Company and subsidiary (the Company), a wholly owned subsidiary of Nationwide Life Insurance Company, as of December 31, 2011 and 2010, and the related consolidated statements of operations, changes in equity and cash flows for each of the years in the three-year period ended December 31, 2011. In connection with our audits of the consolidated financial statements, we also have audited the financial statement schedules as listed in the accompanying index. 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 consolidated 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 and Annuity Insurance Company and subsidiary as of December 31, 2011 and 2010, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2011, 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

March 23, 2012

 NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Consolidated Statements of Operations

  (in millions)

		Years ended December 31,
	2011	2010	2009
Revenues
Policy charges	$           169.2	$            158.8	$            125.3
Premiums	80.7	46.9	41.3
Net investment income	103.1	87.1	74.7
Net realized investment gains	14.9	6.9	13.5
Other-than-temporary impairment losses
Total other-than-temporary impairment losses	(7.4)	(34.8)	(125.9)
Non-credit portion of loss recognized in other comprehensive income	2.7	12.5	48.7
Net other-than-temporary impairment losses recognized in earnings	(4.7)	(22.3)	(77.2)
Total revenues	$           363.2	$            277.4	$            177.6
Benefits and expenses
Interest credited to policyholder account values	$             36.7	$              34.9	$              29.6
Benefits and claims	164.0	109.9	88.3
Amortization of deferred policy acquisition costs	4.1	24.8	34.9
Amortization of value of business acquired and other intangible assets	2.0	3.6	11.5
Interest expense	8.7	-	-
Other expenses, net of deferrals	41.3	31.5	25.8
Total benefits and expenses	$           256.8	$            204.7	$            190.1
Income (loss) before federal income tax expense (benefit)	$           106.4	$              72.7	$             (12.5)
Federal income tax expense (benefit)	35.0	24.7	(6.0)
Net income (loss)	$             71.4	$              48.0	$               (6.5)

See accompanying notes to the consolidated financial statements.

 NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Consolidated Balance Sheets

(in millions, except for share and per share amounts)

	December 31,
	2011	2010
Assets
Investments
Fixed maturity securities, available-for-sale	$            4,088.5	$              3,362.5
Equity securities, available-for-sale	2.4	3.0
Mortgage loans, net of allowance	485.2	549.1
Short-term investments	64.8	207.5
Policy loans	26.5	23.4
Total investments	$            4,667.4	$              4,145.5
Cash and cash equivalents	11.6	306.1
Accrued investment income	48.7	43.9
Deferred policy acquisition costs	549.2	506.8
Value of business acquired	19.0	21.0
Other assets	477.2	514.7
Separate account assets	1,158.3	1,322.4
Total assets	$            6,931.4	$              6,860.4
Liabilities and Shareholder's Equity
Liabilities
Future policy benefits and claims	$            4,271.3	$              4,167.1
Long-term debt	285.1	272.0
Other liabilities	281.1	351.4
Separate account liabilities	1,158.3	1,322.4
Total liabilities	$            5,995.8	$              6,112.9
Shareholder’s equity
Common stock ($40 par value; authorized, issued and outstanding - 66,000 shares)	$                    2.6	$                     2.6
Additional paid-in capital	557.9	457.9
Retained earnings	323.4	252.0
Accumulated other comprehensive income	51.7	35.0
Total shareholder’s equity	$               935.6	$                 747.5
Total liabilities and shareholder's equity	$            6,931.4	$              6,860.4

See accompanying notes to the consolidated financial statements.

 NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Consolidated Statements of Changes in Shareholder's Equity

(in millions)

	Common stock	Additional paid-in capital	Retained earnings	Accumulated other comprehensive income (loss)	Total shareholder’s equity
Balance as of December 31, 2008	$            2.6	$        317.9	$        176.3	$                     (82.6)	$            414.2
Cumulative effect of adoption of   accounting principle, net of taxes	-	-	34.2	(34.2)	-
Capital contributions from Nationwide Life   Insurance Company	-	140.0	-	-	140.0
Comprehensive income (loss):
Net loss	-	-	(6.5)	-	(6.5)
Other comprehensive income	-	-	-	104.5	104.5
Total comprehensive (loss) income	-	-	(6.5)	104.5	98.0
Balance as of December 31, 2009	$            2.6	$        457.9	$        204.0	$                     (12.3)	$            652.2
Comprehensive income:
Net income	-	-	48.0	-	48.0
Other comprehensive income	-	-	-	47.3	47.3
Total comprehensive income	-	-	48.0	47.3	95.3
Balance as of December 31, 2010	$            2.6	$        457.9	$        252.0	$                       35.0	$            747.5
Capital contributions from Nationwide Life   Insurance Company	-	100.0	-	-	100.0
Comprehensive income:
Net income	-	-	71.4	-	71.4
Other comprehensive income	-	-	-	16.7	16.7
Total comprehensive income	-	-	71.4	16.7	88.1
Balance as of December 31, 2011	$           2.6	$      557.9	$      323.4	$                      51.7	$          935.6

See accompanying notes to the consolidated financial statements.

 NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Consolidated Statements of Cash Flows

(in millions)

	Years ended December 31,
	2011	2010	2009
Cash flows from operating activities:
Net income (loss)	$            71.4	$             48.0	$              (6.5)
Adjustments to net income (loss)
Net realized investment gains	(14.9)	(6.9)	(13.5)
Net other-than-temporary impairment losses recognized in earnings	4.7	22.3	77.2
Interest credited to policyholder accounts	36.7	34.9	29.6
Capitalization of deferred policy acquisition costs	(137.4)	(161.5)	(119.5)
Amortization of deferred policy acquisition costs	4.1	24.8	34.9
Amortization and depreciation	9.1	9.3	11.3
Deferred tax expense	45.1	65.4	11.6
Changes in:
Policy liabilities	(145.1)	(176.5)	(145.9)
Other, net	(0.8)	(24.8)	48.1
Net cash used in operating activities	$        (127.1)	$          (165.0)	$            (72.7)
Cash flows from investing activities:
Proceeds from maturities of available-for-sale securities	$          346.5	$           388.2	$           593.4
Proceeds from sales of available-for-sale securities	321.6	211.8	531.9
Proceeds from sales/repayments of mortgage loans	153.0	151.6	94.0
Purchases of available-for-sale securities	(1,309.1)	(880.3)	(1,547.9)
Issuance and purchases of mortgage loans	(88.3)	(51.1)	(7.2)
Net decrease (increase) in short-term investments	142.7	(31.2)	1.2
Collateral (paid) received, net	(80.2)	93.8	(28.7)
Other, net	(1.4)	(4.0)	-
Net cash used in investing activities	$        (515.2)	$          (121.2)	$          (363.3)
Cash flows from financing activities:
Proceeds from issuance of long-term debt	$            13.1	$           272.0	$                  -
Investment and universal life insurance product deposits and other additions	404.0	486.9	518.4
Investment and universal life insurance product withdrawals and other deductions	(167.2)	(162.8)	(226.0)
Cash contributed by Nationwide Life Insurance Company	100.0	-	140.0
Other, net	(2.1)	(5.8)	(0.8)
Net cash provided by financing activities	$          347.8	$           590.3	$           431.6
Net (decrease) increase in cash and cash equivalents	$        (294.5)	$           304.1	$              (4.4)
Cash and cash equivalents, beginning of period	306.1	2.0	6.4
Cash and cash equivalents, end of period	$            11.6	$           306.1	$               2.0

See accompanying notes to the consolidated financial statements.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements

December 31, 2011, 2010 and 2009

(1) Nature of Operations

Nationwide Life and Annuity Insurance Company (NLAIC or the Company) is an Ohio domiciled stock life insurance company and a member of the Nationwide group of companies, which is comprised of Nationwide Mutual Insurance Company (NMIC) and all of its subsidiaries and affiliates.

All of the outstanding shares of NLAIC’s common stock are owned by Nationwide Life Insurance Company (NLIC), an Ohio domiciled stock life insurance company. 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 licensed in 49 states and the District of Columbia. The Company offers universal and traditional life insurance, variable universal life insurance, corporate-owned life insurance (COLI) and individual annuity contracts on a non-participating basis. The Company sells fixed and variable rate annuities.  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, wirehouses and regional firms and life insurance specialists.  The Company also distributes products through the agency distribution force of the Company’s ultimate majority parent company, NMIC.

During 2010, NLAIC made capital contributions totaling $70.0 million to form Olentangy Reinsurance, LLC (Olentangy) as a Vermont-domiciled special purpose financial captive insurance company for the purpose of assuming certain universal life and term life insurance policies from NLAIC.  Olentangy is a wholly-owned subsidiary of NLAIC.

On December 31, 2009, NLAIC merged with an affiliate, Nationwide Life and Annuity Company of America (NLACA), with NLAIC as the surviving entity.  The merger was completed to streamline the enterprise's capital structure and create operational efficiencies.  See Note 2 for further information.

As of December 31, 2011 and 2010, the Company did not have a significant concentration of financial instruments in a single investee, industry or geographic region of the United States of America (U.S.).  Also, the Company did not have a concentration of business transactions with a particular customer, lender, distribution source, market or geographic region of the U.S. in which business is conducted that makes it overly vulnerable to a single event which could cause a severe impact to the Company’s financial position.

(2) Summary of Significant Accounting Policies

Use of Estimates

The consolidated financial statements were prepared in accordance with accounting principles generally accepted in the U.S. (GAAP). The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions affecting the amounts reported in the financial statements and accompanying notes.  Significant estimates include the balance and amortization of deferred policy acquisition costs (DAC), investment impairment losses, valuation allowances for mortgage loans, certain investment and derivative valuations, future policy benefits and claims liabilities, provision for income taxes and valuation of deferred tax assets.  Actual results may differ significantly from those estimates.

Basis of Presentation

The consolidated financial statements include the accounts of NLAIC and Olentangy, the company in which NLAIC has a controlling financial interest.  All significant intercompany accounts and transactions have been eliminated.

Certain items in the consolidated financial statements and related notes have been reclassified to conform to the current presentation.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Revenues and Benefits

Investment and Universal Life Insurance Products.  Investment products consist primarily of individual variable and fixed deferred annuities.  Universal life insurance products include universal life insurance, variable universal life insurance, COLI and other interest-sensitive life insurance policies.  Revenues for investment products and universal life insurance products consist of net investment income, asset fees, cost of insurance charges, administrative fees and surrender charges that have been earned and assessed against policy account balances during the period.  The timing of revenue recognition as it relates to fees assessed on investment contracts and universal life contracts is determined based on the nature of such fees.  Asset fees, cost of insurance charges and administrative fees are assessed on a daily or monthly basis and recognized as revenue when assessed and earned.  Certain amounts assessed that represent compensation for services to be provided in future periods are reported as unearned revenue and recognized in income over the periods benefited.  Surrender charges are recognized 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 premiums and benefits, and primarily consist of whole life insurance, term life insurance and certain annuities with life contingencies.  Premiums for traditional life insurance products are recognized as revenue when due.  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

The process of calculating reserve amounts for traditional life insurance products involves the use of a number of assumptions, including those related to persistency (how long a contract stays with a company), mortality (the relative incidence of death in a given time), morbidity (the relative incidence of disability resulting from disease or physical impairment) and interest rates (the rates expected to be paid or received on financial instruments, including insurance or investment contracts).

The Company calculates its liability for future policy benefits and claims for investment products in the accumulation phase and universal life insurance policies as the policy account balance, which represents participants’ net premiums and deposits plus investment performance and interest credited less applicable contract charges.

The liability for future policy benefits and claims for traditional life insurance policies was determined using the net level premium method using interest rates varying from 5.3% to 6.6% and estimates of mortality, morbidity, investment yields and withdrawals that were used or being experienced at the time the policies were issued.

The liability for future policy benefits for payout annuities was calculated using the present value of future benefits and   maintenance costs discounted using interest rates at issue varying generally from 3.0% to 13.0%.

The Company offers certain universal life insurance, variable universal life insurance and variable annuity products with secondary guarantees, guaranteed minimum death benefits (GMDB) and guaranteed minimum income benefits (GMIB).  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 guarantee benefit payments plus interest.  The Company regularly 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 guarantee 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 amortization of DAC, value of business acquired (VOBA) and unearned revenue reserves. Refer to Note 4 for discussion of these guarantees.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Reinsurance ceded

The Company cedes insurance to other companies in order to limit potential losses and to diversify its exposures. Such agreements do not discharge 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 generally 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

Investment and universal life insurance products.  The Company has deferred certain costs that vary with and primarily relate to acquiring business, consisting principally of commissions, premium taxes, certain expenses of the policy issue and underwriting department, certain variable sales expenses that relate to and vary with the production of new and renewal business and other acquisition expenses net of those acquisition costs ceded to reinsurers. In addition, the Company defers sales inducements, such as interest credit bonuses and jumbo deposit bonuses.  The methods and assumptions used to amortize and assess recoverability of DAC depend on the type of insurance product.

Investment products primarily consist of individual variable and fixed deferred annuities.  Universal life insurance products include universal life insurance, variable universal life insurance, COLI and other interest-sensitive life insurance policies.  For these products, the Company amortizes DAC with interest over the lives of the policies in relation to the present value of estimated gross profits from projected interest margins, policy charges, and net realized investment gains and losses less policy benefits and policy maintenance expenses.  DAC for investments 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 Company adjusts the DAC asset related to investment and universal life insurance products to reflect the impact of unrealized gains and losses on fixed maturity securities available-for-sale with the corresponding adjustment recorded in accumulated other comprehensive income (AOCI). The adjustment to DAC represents the change in amortization of DAC that would have been required as a charge or credit to operations had such unrealized amounts been realized and allocated to the product lines.

The assumptions used in the estimation of future gross profits are based on the Company’s current best estimates of future events and are reviewed as part of an annual process during the second quarter.  During the annual process, the Company performs a comprehensive study of assumptions, including mortality and persistency studies, maintenance expense studies, and an evaluation of projected general and separate account investment returns.  The most significant assumptions that are involved in the estimation of future gross profits include future net separate account investment performance, surrender/lapse rates, interest margins and mortality.  Quarterly, consideration is given as to whether adjustments to the assumptions in the annual process for all other product lines are necessary. Currently, the Company’s long-term assumption for net separate account investment performance is approximately 7% growth per year.  The Company reviews this assumption, like others, as part of its annual process.  Variances from the long-term assumption are expected since the majority of the investments in the underlying separate accounts are in equity securities.  The Company bases its reversion to the mean process on actual net separate account investment performance from the anchor date to the valuation date.  The Company then 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 assumed net separate account investment performance used in the DAC models is intended to reflect what is anticipated.  However, based on historical returns of the S&P 500 Index, and as part of its pre-set parameters, the Company’s reversion to the mean process generally limits net separate account investment performance to 0-15% during the three-year reversion period.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

In addition to the comprehensive annual study of assumptions, management evaluates the appropriateness of the individual variable annuity DAC balance quarterly within pre-set parameters.  These parameters are designed to appropriately reflect the Company’s long-term expectations with respect to individual variable annuity contracts while also evaluating the potential impact of short-term experience on the Company’s recorded individual variable annuity DAC balance.  If the recorded balance of individual variable annuity DAC falls outside of these parameters for a prescribed period, or if the recorded balance falls outside of these parameters and management determines it is highly improbable to get back within the parameters during this time period, assumptions are required to be unlocked, and DAC is recalculated using revised best estimate assumptions.  When DAC assumptions are unlocked and revised, the Company continues to use the reversion to the mean process.

Changes in assumptions can have a significant impact on the amount of DAC reported for investment and universal life insurance products and their related amortization patterns.  In the event actual experience differs from assumptions or future assumptions are revised, the Company is required to record an increase or decrease in DAC amortization expense, which could be significant.  In general, increases in the estimated long-term general and separate account returns result in increased expected future profitability and may lower the rate of DAC amortization, while increases in long-term lapse/surrender and mortality assumptions reduce the expected future profitability of the underlying business and may increase the rate of DAC amortization.

Traditional life insurance products. Generally, DAC is amortized with interest over the premium-paying period of the related policies in proportion to the ratio of actual annual premium revenue to the anticipated total premium revenue.  Such anticipated premium revenue is estimated using the same assumptions as those used for computing liabilities for future policy benefits at issuance.  Under existing accounting guidance, the concept of DAC unlocking does not apply to traditional life insurance products, although evaluations of DAC for recoverability at the time of policy issuance and loss recognition testing at each reporting period are required.

See Note 5 for a discussion of assumption changes that impacted DAC amortization and related balances.

Investments

Purchases and sales of securities are recorded on the trade date. Realized gains and losses on sales of fixed maturity and equity securities are recognized in income based on the specific identification method. Interest and dividend income are recognized when earned.

Available-for-sale securities.  Available-for-sale securities are reported at fair value, with unrealized holding gains and losses reported as a separate component of other comprehensive income, net of adjustments for DAC, future policy benefits and claims and deferred federal income taxes.

To determine the fair value of securities for which market quotations are available, independent pricing services are most often utilized. For these securities, the Company obtains the pricing services’ methodologies, inputs and assumptions and classifies the investments accordingly in the fair value hierarchy. As of December 31, 2011 and 2010, 82% and 79%, respectively, of fixed maturity securities were priced using independent pricing services.

Non-binding broker quotes are also utilized to determine the fair value of certain corporate debt, mortgage-backed and other asset-backed securities when quotes are not available from independent pricing services. Broker quotes are considered unobservable inputs, and these securities are classified accordingly 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 such that generally only one quotation is available.As the brokers often do not provide the necessary transparency into their quotes and methodologies, the Company periodically performs reviews and tests to ensure that quotes are a reasonable estimate of the investments’ fair value.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

For certain fixed maturity securities not valued using independent pricing services or broker quotes, a corporate pricing matrix or internally developed pricing model is most often used. The corporate pricing matrix is developed using private spreads for 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.

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 net investment income. These securities are not restored to accrual status until the Company determines that payment of future principal and interest is probable.

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. All other investment income is recorded using the effective-yield method without anticipating the impact of prepayments.

Mortgage loans, net of allowance.  The Company holds commercial mortgage loans that are collateralized by properties throughout the U.S.  Mortgage loans held-for-investment are carried at amortized cost less a valuation allowance.

The Company maintains a valuation allowance comprised of specific reserves for impaired loans and non-specific reserves for losses inherent in the balance of the portfolio.  Specific reserve changes are included in other-than-temporary impairment losses, while changes in non-specific reserves are recorded in net realized investment gains and losses.

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 considered delinquent when contractual payments are 90 days past due.

Policy loans.  Policy loans, which are collateralized by the related insurance policy, are carried 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 of highly liquid mutual funds and government agency discount notes with original maturities of less than twelve months. The Company and various affiliates entered into 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.

Securities lending.  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 on 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 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.  Periodically, the Company may receive non-cash collateral, which would be recorded off-balance sheet.  The Company continues to recognize loaned securities in either available-for-sale or short-term investments, and 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.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Other-than-temporary impairment evaluations.  The Company periodically reviews its available-for-sale securities to determine if any decline in fair value to below cost or 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. Treasury securities and obligations of U.S. Government corporations and agencies and obligations of states and political subdivisions for other-than-temporary impairment by examining similar characteristics referenced above for corporate debt securities.

When evaluating whether residential mortgage-backed securities, commercial mortgage-backed securities, collateralized debt obligations and other asset-backed securities are other-than-temporarily impaired, the Company examines characteristics of the underlying collateral, such as delinquency and default rates, the quality of the underlying borrower, the type of collateral in the pool, the vintage year of the collateral, subordination levels within the structure of the collateral pool, the quality of any credit guarantors, the Company’s intent to sell the security and whether it is more likely than not it will be required to sell the security before the recovery of its amortized cost basis.

For all debt securities evaluated for other-than-temporary impairment (for which the Company does not have the intent to sell and it is not more likely than not that it will be required to sell the security before the recovery of its amortized cost basis), the Company considers the timing and present value of the cash flows.  The Company evaluates its intent to sell on an individual security basis.  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.

Other-than-temporary impairment losses on securities (where 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 portion of the impairment loss being recognized in earnings and the non-credit loss portion of the impairment 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.

Equity securities may experience other-than-temporary impairment in the future based on the prospects for full recovery in value in a reasonable period of time, and the Company’s ability and intent to hold the security to recovery.

It is reasonably 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 in the near term, which could be significant.

Derivative Instruments

The Company uses derivative instruments to manage exposures and mitigate risks associated with interest rates and foreign currency.  These derivative instruments primarily include interest rate swaps and cross-currency swaps.  Certain features embedded in the Company’s market-indexed life insurance and certain variable life insurance contracts require derivative accounting.  All derivative instruments are carried at fair value and are reflected as assets or liabilities in the consolidated balance sheets.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Fair Value of Financial Instruments

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 financial assets and liabilities carried 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.

· 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 Company reviews its fair value hierarchy classifications for financial assets and liabilities quarterly. Changes in 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.

Federal Income Taxes

The Company recognizes deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss 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 of a change in tax rates is recognized in income in the period that includes the enactment date.  Valuation allowances are established when management determines it is more likely than not that all or some portion of the deferred tax assets will not be realized. Interest expense and any associated penalties are shown as income tax expense.

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.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Tax reserves are reviewed regularly and are adjusted as events occur that management believes impact its liability for additional taxes, such as 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 or release of administrative guidance or rendering of a court decision affecting a particular tax issue.

NLAIC is included in the NLIC and subsidiaries consolidated federal income tax return, which is eligible to join the NMIC consolidated tax return group in 2014.

Cash and Cash Equivalents

Cash and cash equivalents, which include highly liquid investments with original maturities of less than three months, are carried at cost, which approximates fair value.

Value of Business Acquired

As a result of the acquisition of Provident Mutual Life Insurance Company (Provident) in 2002 and the application of purchase accounting, the Company reports an intangible asset representing the fair value of the business in force and the portion of the purchase price that was allocated to the value of the right to receive future cash flows from the life insurance and annuity contracts existing as of the closing date of the Provident acquisition.  The value assigned to VOBA was supported by an independent valuation study commissioned by the Company and executed by a team of qualified valuation experts, including actuarial consultants.

VOBA represents the actuarially-determined value of future cash flows for acquired insurance contracts. Expected future cash flows are determined based on projected future policy and contract charges, premiums, mortality and morbidity, separate account performance, surrenders, changes in reserves, operating expenses, investment income and other factors.  Amortization of VOBA occurs with interest over the anticipated lives of the major lines of business to which it relates in relation to estimated gross profits, gross margins or premiums, as appropriate.  VOBA is adjusted for unrealized gains and losses on available-for-sale securities for changes in amortization that would have been required had such unrealized amounts been realized. In the event actual experience differs or assumptions are revised, an increase or decrease in VOBA amortization expense is recorded, which could be significant.

Separate Accounts

Separate account assets and liabilities represent contractholders’ funds that have been legally segregated into accounts with specific investment objectives.  Separate account assets are comprised of public, privately registered and non-registered mutual funds and investments in securities.  Separate account assets are recorded at fair value and the Company primarily uses net asset value (NAV) to estimate the underlying fair value for certain mutual funds that do not have readily determinable fair values.  The Company also uses market quotations to determine the underlying fair value of mutual funds when available.  The value of separate account liabilities is set to equal the fair value for separate account assets.  Investment income and realized investment gains or losses of these accounts accrue directly to the contractholders.

NLACA Merger

On December 31, 2009, NLAIC merged with its affiliate, NLACA, with NLAIC as the surviving entity.  The merger was accounted for at historical cost in a manner similar to a pooling of interests because the involved entities were under common control.  NLACA is reflected in the Company’s prior year consolidated financial statements at the historical cost of the transferred net assets to provide comparative information as though the companies were combined for all periods presented.  This presentation is consistent for both GAAP and statutory reporting.  Since NLACA was a wholly-owned subsidiary, there was no noncontrolling interest impact.

The Company has presented its consolidated financial statements and accompanying notes as applicable for 2009 and prior to reflect the NLACA merger.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

The following table summarizes the impact of the merger with NLACA on the consolidated statement of operations for the year ended December 31:

(in millions)	2009
Total revenues	$                42.9
Total benefits and expenses	$                40.3
Federal income tax benefit	$                (0.2)
Net income	$                  2.8

The impact of the merger on shareholder’s equity was $67.9 million and $57.5 million as of December 31, 2009 and 2008, respectively.

Subsequent Events

The Company evaluated subsequent events through March 23, 2012, the date the consolidated financial statements were issued.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

(3)      Recently Issued Accounting Standards

Adopted Accounting Standards

In April 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2011-02, which amends the factors a creditor should consider to determine whether a restructuring constitutes a troubled debt restructuring in Accounting Standards Codification (ASC) 310, Receivables.  The Company adopted this guidance for interim and annual periods beginning June 15, 2011. The adoption of this guidance had an immaterial impact on the Company’s consolidated statements of operations and consolidated balance sheets.

On December 31, 2010, the Company adopted new disclosure requirements regarding the credit quality of its financing receivables (e.g., commercial mortgage loans) and the related allowance for credit losses within ASU 2010-20, which amends FASB ASC 310, Receivables.  The adoption of this guidance resulted in increased disclosures only and had no impact on the Company's consolidated statements of operations or consolidated balance sheets.

On January 1, 2010, the Company adopted ASU 2010-06, except for the new disclosure providing disaggregated information related to the activity in Level 3 fair value measurements, which the Company adopted effective January 1, 2011.

In April 2009, the FASB issued guidance under FASB ASC 320, Investments – Debt and Equity Securities.  This guidance is designed to create greater clarity and consistency in accounting for and presentation of impairment losses on debt securities.  This guidance is effective for interim and annual periods ending after June 15, 2009 with early adoption permitted.  As of the beginning of the interim period of adoption, this guidance requires a cumulative-effect adjustment to reclassify the non-credit component of previously recognized other-than-temporary impairment losses on debt securities from retained earnings to the beginning balance of AOCI.  The Company adopted this guidance as of January 1, 2009.  The adoption of this guidance resulted in a cumulative-effect adjustment of $34.2 million, net of taxes, as an increase to the opening balance of retained earnings with a corresponding decrease to the opening balance of AOCI.

Pending Accounting Standards

In May 2011, the FASB issued ASU 2011-04, which amends existing guidance in ASC 820, Fair Value Measurements and Disclosures.  The guidance in this ASU clarifies existing fair value measurement guidance and expands disclosures primarily related to Level 3 fair value measurements.  The Company will adopt this guidance prospectively for the annual period beginning January 1, 2012.  The adoption of this guidance will result in increased disclosures and will have an immaterial impact on the Company’s consolidated statements of operations or consolidated balance sheet.

In October 2010, the FASB issued ASU 2010-26, which amends FASB ASC 944, Financial Services – Insurance, by modifying the definition of the types of costs incurred by insurance entities that can be capitalized in the acquisition of new and renewal contracts.  Under the amended guidance, acquisition costs are to include only those costs that are directly related to the acquisition or renewal of insurance contracts.  The methods and assumptions used to amortize and assess recoverability of DAC were not impacted as a result of adopting this guidance.  The Company adopted this guidance retrospectively, effective January 1, 2012, which resulted in a reduction to total equity of $67.0 million, net of taxes, as of December 31, 2009.

In June 2011, the FASB issued ASU 2011-05, which amends existing guidance in ASC 220, Comprehensive Income. The amended guidance requires reporting entities to present net income and other comprehensive income in either a single continuous statement or in two separate, but consecutive, statements of net income and other comprehensive income.  In December 2011, the FASB issued ASU 2011-12, which defers certain changes in ASU 2011-05 related to the presentation of reclassification adjustments out of accumulated other comprehensive income.  The Company will adopt both updates retrospectively, effective December 31, 2012.  The adoption of this guidance will impact the presentation of the Company’s consolidated financial statements.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

In December 2011, the FASB issued ASU 2011-11, which expands the disclosure requirements within ASC 210-10, Balance Sheet – Offsetting.  The new disclosures require improved information about certain financial instruments and derivatives that are either offset in accordance with GAAP or subject to enforceable master offsetting arrangements irrespective of GAAP. The Company will adopt this guidance retrospectively for interim and annual periods beginning January 1, 2013.  The adoption of this guidance will result in increased disclosures only and will have no impact on the Company's consolidated statements of operations or consolidated balance sheets.

 (4)      Certain Long-Duration Contracts

Variable Annuity Contracts

The Company issues variable annuity contracts through its separate accounts, for which investment income and gains and losses on investments accrue directly to, and investment risk is borne by, the contractholder.  The Company also provides various forms of guarantees to benefit the related contractholders.  The Company provides two primary guarantee types of variable annuity contracts:  GMDB and GMIB.

The GMDB, offered on every variable annuity contract, 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 and have the death benefit paid into the contract and a second death benefit paid upon the survivor’s death.

The GMIB, which was offered as a rider to several variable annuity contracts, is a living benefit that provides the contractholder with a guaranteed annuitization value.

The following table summarizes information regarding variable annuity contracts with guarantees invested in general and separate accounts as of December 31 (a contract may contain multiple guarantees):

			2011				2010
				Wtd. avg.				Wtd. avg.
	General	Separate	Net	attained	General	Separate	Net	attained
	account	account	amount	age of	account	account	amount	age of
(in millions)	value	value	at risk1	contractholders	value	value	at risk1	contractholders
Return of net deposits:
In the event of death	$       9.0	$   102.9	$     0.2	69	$      10.5	$    142.2	$         -	68
Minimum return or anniversary contract value :
In the event of death	$     62.1	$   523.8	$   32.5	68	$      65.4	$    660.3	$    26.2	67
At annuitization	$       0.8	$     24.1	$         -	64	$        1.1	$      36.2	$         -	64

__________

1 Net amount at risk is calculated on a seriatim basis and equals the respective guaranteed benefit less the account value (or zero if the account value exceeds the guaranteed benefit).

The Company’s reserve balances and paid claims for variable annuity contracts with guarantees were immaterial for the years ended December 31, 2011 and 2010.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Universal and Variable Universal Life Insurance Contracts

The Company offers certain universal life and variable universal life insurance products with secondary guarantees.  This no-lapse guarantee provides that a policy will not lapse so long as the policyholder makes minimum premium payments.  The reserve balances on these guarantees were $147.1 million and $76.0 million as of December 31, 2011 and 2010, respectively.  Paid claims on contracts maintained in force by these guarantees were immaterial for the years ended December 31, 2011 and 2010, respectively.

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 December 31:

		2011			2010
			Wtd. avg.			Wtd. avg.
		Net	attained		Net	attained
	Account	amount	age of	Account	amount	age of
(in millions)	value	at risk1	contractholders	value	at risk1	contractholders
No-lapse guarantees	$          714.0	$       7,206.1	58	$          601.9	$       5,507.0	58

__________

1 Net amount at risk is calculated on a seriatim basis and equals the respective guaranteed death benefit less the account value (or zero if the account value exceeds the guaranteed benefit).

Related Separate Accounts

The following table summarizes account balances of deferred variable annuity, variable single premium immediate annuity and variable universal life insurance contracts that were invested in separate accounts as of December 31:

(in millions)	2011	2010
Mutual funds:
Bond	$           173.5	$             185.9
Domestic equity	628.2	743.3
International equity	99.5	128.9
Total mutual funds	901.2	1,058.1
Money market funds	48.6	49.3
Total	$           949.8	$          1,107.4

The Company did not transfer any assets from the general account to the separate account to cover guarantees for any of its variable annuity contracts during the years ended December 31, 2011 and 2010.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

(5) Deferred Policy Acquisition Costs and Value of Business Acquired

Deferred Policy Acquisition Costs

The following table presents a reconciliation of DAC for the years ended December 31:

(in millions)	2011	2010	2009
Balance at beginning of year	$          506.8	$            416.5	$            471.2
Capitalization of DAC	137.4	161.5	119.5
Amortization of DAC, excluding unlocks	(28.0)	(39.1)	(28.4)
Amortization of DAC, related to unlocks	23.9	14.3	(6.5)
Adjustments to DAC related to unrealized gains and losses on available-for-sale securities	(90.9)	(46.4)	(139.3)
Balance at end of year	$          549.2	$            506.8	$            416.5

During 2011 and 2010, the Company conducted its annual comprehensive review of model assumptions and the most significant contributor to the favorable unlock of assumptions primarily related to interest spread.

During 2009, the Company’s recorded balance of individual variable annuity DAC fell outside the Company’s preset parameters for the prescribed period, which primarily was driven by favorable equity market performance compared to assumed net separate account returns and resulted in a decrease in DAC amortization of $6.1 million, pre-tax.

Based upon the market performance in the second half of 2011, the DAC balance for variable annuities is currently outside of the preset parameters.  Accordingly, future periods may incur additional amortization of DAC if the Company’s actual returns are less than the assumed net separate account performance.

Value of Business Acquired

The following table presents a reconciliation of VOBA for the years ended December 31:

(in millions)	2011	2010	2009
Balance at beginning of year	$             21.0	$              24.6	$              32.5
Amortization of VOBA, excluding unlocks	(3.7)	(4.1)	(4.6)
Amortization of VOBA, related to unlocks	1.7	0.5	(3.2)
Change in unrealized loss on available-for-sale securities	-	-	(0.1)
Balance at end of year	$             19.0	$              21.0	$              24.6

Interest on the unamortized VOBA balance (at interest rates ranging from 4.5% to 6.5%) is included in amortization and was $1.1 million, $1.4 million, and $1.8 million during the years ended December 31, 2011, 2010 and 2009, respectively.  Additionally, the VOBA gross carrying amount was $69.9 million and accumulated amortization of $50.9 million and $48.9 million for the years ended December 31, 2011 and 2010, respectively.  The initial useful life related to the VOBA balances is 28 years.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Based on current assumptions, which are subject to change, the following table summarizes estimated amortization of VOBA for the next five years ended December 31:

(in millions)
2012	$             2.6
2013	$             2.2
2014	$             1.4
2015	$             1.2
2016	$             1.0

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

(6)      Investments

Available-for-Sale Securities

The following table summarizes amortized cost, gross unrealized gains and losses and fair value of available-for-sale securities as of the dates indicated:

		Gross	Gross
	Amortized	unrealized	unrealized	Fair
(in millions)	cost	gains	losses	value
December 31, 2011:
Fixed maturity securities:
U.S. Treasury securities and obligations of U.S.
Government corporations and agencies	$           26.5	$           5.7	$              -	$          32.2
Obligations of states and political subdivisions	221.8	22.0	-	243.8
Corporate public securities	2,478.6	197.3	17.1	2,658.8
Corporate private securities	455.1	35.1	2.7	487.5
Residential mortgage-backed securities	460.5	17.2	26.7	451.0
Commercial mortgage-backed securities	83.5	3.7	0.3	86.9
Collateralized debt obligations	84.5	0.9	11.6	73.8
Other asset-backed securities	54.2	0.9	0.6	54.5
Total fixed maturity securities	$     3,864.7	$      282.8	$        59.0	$    4,088.5
Equity securities	2.2	0.2	-	2.4
Total available-for-sale securities	$     3,866.9	$      283.0	$        59.0	$    4,090.9
December 31, 2010:
Fixed maturity securities:
U.S. Treasury securities and obligations of U.S.
Government corporations and agencies	$            26.5	$            1.4	$              -	$           27.9
Obligations of states and political subdivisions	198.0	1.9	7.0	192.9
Corporate public securities	1,947.7	118.7	11.3	2,055.1
Corporate private securities	443.4	30.1	2.7	470.8
Residential mortgage-backed securities	468.7	12.0	30.9	449.8
Commercial mortgage-backed securities	98.0	4.4	0.4	102.0
Collateralized debt obligations	20.7	0.8	11.0	10.5
Other asset-backed securities	52.9	1.4	0.8	53.5
Total fixed maturity securities	$       3,255.9	$        170.7	$          64.1	$      3,362.5
Equity securities	2.2	0.8	-	3.0
Total available-for-sale securities	$       3,258.1	$        171.5	$          64.1	$      3,365.5

The fair value of the Company’s investments may fluctuate significantly in response to changes in interest rates, investment quality ratings and credit spreads.  While the Company has the ability and intent to hold equity securities until recovery, and the Company does not have the intent to sell, nor is it more likely than not it will be required to sell fixed maturity securities in unrealized loss positions, investment losses may be realized to the extent liquidity needs require the disposition of securities in unfavorable interest rate, liquidity or credit spread environments.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

The following table summarizes the amortized cost and fair value of fixed maturity securities, by maturity, as of December 31, 2011.  Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without early redemption penalties.

	Amortized	Fair
(in millions)	cost	value
Fixed maturity securities:
Due in one year or less	$               175.0	$               177.8
Due after one year through five years	1,313.1	1,374.9
Due after five years through ten years	960.2	1,030.2
Due after ten years	733.7	839.4
Subtotal	$            3,182.0	$            3,422.3
Residential mortgage-backed securities	460.5	451.0
Commercial mortgage-backed securities	83.5	86.9
Collateralized debt obligations	84.5	73.8
Other asset-backed securities	54.2	54.5
Total fixed maturity securities	$            3,864.7	$            4,088.5

The following table summarizes components of net unrealized gains and losses on available-for-sale securities, as of December 31:

(in millions)	2011	2010
Net unrealized gains, before adjustments and taxes	$          224.0	$          107.4
Adjustment to DAC	(140.6)	(49.7)
Adjustment to future policy benefits and claims	(1.6)	(1.5)
Deferred federal income tax expense	(28.4)	(19.4)
Net unrealized gains on available-for-sale securities	$            53.4	$            36.8

The following table summarizesthe change in net unrealized gains and losses on available-for-sale securities reported in accumulated other comprehensive income, as of December 31:

(in millions)	2011	2010
Balance at beginning of year	$            36.8	$            (9.0)
Unrealized gains and losses arising during the period:
Net unrealized gains before adjustments	118.8	106.9
Non-credit impairments and subsequent changes in fair value of those debt securities	1.3	7.9
Net adjustments to DAC	(90.9)	(46.4)
Net adjustment to future policy benefits and claims	(0.1)	0.4
Related federal income tax expense	(10.2)	(23.9)
Change in unrealized gains on available-for-sale securities	$            18.9	$            44.9
Reclassification adjustments to net investment gains and losses, net of taxes ($1.2
and $(0.5) as of December 31, 2011 and 2010, respectively)	$              2.3	(0.9)
Change in net unrealized gains on available-for-sale securities	$            16.6	$            45.8
Balance at end of year	$            53.4	$            36.8

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

The following table summarizes available-for-sale securities, by asset class, in a gross 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 and number of securities, as of the dates indicated:

	Less than or equal  to one year			More than one year				Total
		Gross	Number		Gross	Number		Gross	Number
	Fair	unrealized	of	Fair	unrealized	of	Fair	unrealized	of
(in millions, except number of securities)	value	losses	securities	value	losses	securities	value	losses	securities
December 31, 2011:
Fixed maturity securities:
Obligations of states and
political subdivisions	$      11.0	$              -	2	$           -	$              -	-	$      11.0	$              -	2
Corporate public securities	296.3	9.5	63	31.4	7.6	13	327.7	17.1	76
Residential mortgage-backed securities	39.3	0.6	14	126.5	26.1	65	165.8	26.7	79
Collateralized debt obligations	39.5	0.5	4	7.7	11.1	5	47.2	11.6	9
Other fixed maturity securities	40.1	1.4	13	23.9	2.2	9	64.0	3.6	22
Total fixed maturity securities	$   426.2	$        12.0	96	$   189.5	$        47.0	92	$   615.7	$        59.0	188
December 31, 2010:
Fixed maturity securities:
Obligations of states and
political subdivisions	$     126.3	$            7.0	18	$            -	$              -	-	$     126.3	$            7.0	18
Corporate public securities	189.9	4.8	31	41.3	6.5	23	231.2	11.3	54
Residential mortgage-backed securities	4.3	-	5	171.0	30.9	80	175.3	30.9	85
Collateralized debt obligations	-	-	-	8.0	11.0	6	8.0	11.0	6
Other fixed maturity securities	54.6	2.7	15	35.9	1.2	7	90.5	3.9	22
Total fixed maturity securities	$     375.1	$          14.5	69	$     256.2	$          49.6	116	$     631.3	$          64.1	185

The following table summarizes gross unrealized losses based on the ratio of estimated fair value to amortized cost, for all available-for-sale securities in an unrealized loss position, as of the dates indicated:

	December 31, 2011			December 31, 2010
	Less	More		Less	More
	than or	than		than or	than
	equal to	one		equal to	one
(in millions)	one year	year	Total	one year	year	Total
99.9% - 80.0%	$     12.0	$     12.1	$ 24.1	$       13.9	$     16.1	$     30.0
Less than 80.0%
Residential mortgage-backed securities	-	17.5	17.5	-	17.6	17.6
Collateralized debt obligations	-	11.1	11.1	-	11.0	11.0
Other	-	6.3	6.3	0.6	4.9	5.5
Total	$     12.0	$     47.0	$ 59.0	$       14.5	$     49.6	$     64.1

These unrealized losses represent temporary fluctuations in economic factors that are not indicative of other-than-temporary impairment.

Residential 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 ratio at origination and prepayment speeds.  Cash flows generated by the collateral are then utilized, along with consideration for the issue’s position in the overall structure, to determine cash flows associated with the security.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Collateralized debt obligations are assessed for impairment using expected cash flows based on various inputs including default estimates based on the underlying corporate securities and 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.

Management believes unrealized losses on available-for-sale securities do not represent other-than-temporary impairments as the Company does not intend to sell the securities, it is not more likely than not that the Company will be required to sell the securities before recovery of their amortized cost basis or the present value of estimated cash flows were equal to or greater than the amortized cost basis of the securities.

Mortgage Loans, Net of Allowance

The Company’s investments in mortgage loans consist primarily of first lien and collateral dependent commercial mortgage loans.  These mortgage loans are further segregated into the following classes based on the unique risk profiles of the underlying property types: office, warehouse, retail, apartment and other.

The collectability of a mortgage loan is based on the ability of the borrower to repay and/or the value of the underlying collateral.  The quality of a loan is generally defined by the specific financial position and condition of a borrower and the underlying collateral. Many of the Company’s 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.

As part of the underwriting process, specific guidelines are followed to ensure the initial quality of a new mortgage loan.  Third-party appraisals are generally obtained to support loaned amounts.

The Company actively monitors the credit quality of its mortgage loans to support the development of the valuation allowance.  This monitoring process includes quantitative analyses which facilitate the identification of deteriorating loans, and qualitative analyses which consider other factors relevant to the borrowers’ ability to repay.  Loans with deteriorating credit fundamentals are identified for special surveillance procedures and are categorized based on the severity of their deterioration and management’s judgment as to the likelihood of loss.

Mortgage loans are considered impaired 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 is impaired, a provision for loss is established equal to the fair value of the collateral.

In addition to the loan-specific reserves, the Company maintains a non-specific reserve for losses developed based on loan surveillance categories and property type classes and reflects management’s best estimate of probable credit losses inherent in the portfolio as of the balance sheet date but not yet attributable to specific loans.  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, composition of the loan portfolio, current economic conditions and other relevant factors.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

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, for the years ended December 31:

(in millions)	2011	2010
Amortized cost:
Loans with non-specific reserves	$            484.2	$               522.9
Loans with specific reserves	5.5	39.4
Total amortized cost	$            489.7	$               562.3
Valuation allowance:
Non-specific reserves	$                3.4	$                   4.9
Specific reserves	1.1	8.3
Total valuation allowance	$                4.5	$                 13.2
Mortgage loans, net of allowance	$            485.2	$               549.1

The following table summarizes activity in the valuation allowance for mortgage loans for the years ended December 31:

(in millions)	2011	2010
Balance at beginning of year	$                  13.2	$                  7.5
Additions	3.6	11.3
Deductions	(12.3)	(5.6)
Balance at end of year	$                    4.5	$                13.2

The following table summarizes impaired mortgage loans by class for the years ended December 31:

(in millions)	Office	Warehouse	Retail	Apartment	Other	Total
2011
Amortized cost	$            -	$                -	$        1.7	$               -	$         3.8	$           5.5
Specific reserves	$            -	$                -	$      (0.6)	$               -	$       (0.5)	$          (1.1)
Impaired mortgage loans, net of allowance	$            -	$                -	$        1.1	$               -	$         3.3	$           4.4
2010
Amortized cost	$            -	$           10.0	$         5.5	$           4.7	$        19.2	$          39.4
Specific reserves	$            -	$           (1.5)	$       (1.5)	$          (0.8)	$        (4.5)	$           (8.3)
Impaired mortgage loans, net of allowance	$            -	$             8.5	$         4.0	$           3.9	$        14.7	$          31.1

As of December 31, 2011, 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 average recorded investment and interest income recognized for impaired mortgage loans by class for the year ended December 31, 2011:

(in millions)	Office	Warehouse	Retail	Apartment	Other	Total
Average recorded investment	$            -	$            6.8	$        5.3	$          0.8	$         8.5	$         21.4
Interest income recognized	$            -	$            0.7	$        0.5	$               -	$         0.8	$           2.0

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Management uses an internal credit quality rating process to reflect an internal view of the credit risk associated with individual loans, as well as the portfolio as a whole.  This process considers a number of relevant loan quality measurements and factors, including loan-to-value ratio (LTV), debt service coverage ratio (DSC), current market rent expectations, economic vacancy, property characteristics, market area, and borrower strength.  LTV 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 yields an individual internal credit quality rating score for substantially all of the Company’s mortgage loans which is then translated to a credit quality rating ranging from 1 to 5, with 1 representing the lowest risk profile and lowest potential for loss and 5 representing the highest risk profile and highest potential for loss.  These internal ratings by property are updated at least annually.

The following table summarizes the amortized cost of mortgage loans by internal credit quality rating and by class as of:

(in millions)	Office	Warehouse	Retail	Apartment	Other	Total
December 31, 2011
Rated 1	$     22.4	$             2.9	$      13.3	$                -	$              -	$        38.6
Rated 2	27.8	29.9	86.3	44.6	5.1	193.7
Rated 3	45.5	40.3	85.5	50.9	6.8	229.0
Rated 4	2.1	5.3	3.6	-	7.2	18.2
Rated 5	-	-	3.2	-	7.0	10.2
Total mortgage loans	$     97.8	$           78.4	$   191.9	$         95.5	$        26.1	$      489.7
December 31, 2010
Rated 1	$            -	$                  -	$             -	$                -	$               -	$               -
Rated 2	32.7	8.3	74.8	9.2	-	125.0
Rated 3	43.1	94.4	132.8	64.3	19.5	354.1
Rated 4	3.2	11.4	13.5	30.9	19.2	78.2
Rated 5	1.7	-	-	-	3.3	5.0
Total mortgage loans	$       80.7	$          114.1	$     221.1	$        104.4	$         42.0	$       562.3

Internal credit quality ratings are not used to establish the valuation allowance; however, there is a strong correlation between the two processes.  For example, mortgage loans in the category receiving the highest loss factors for determination of the valuation allowance are generally rated with an internal credit quality rating of 4 or 5, while mortgage loans in the category receiving the lowest loss factors for determination of the valuation allowance are generally rated 1, 2 or 3.

While the internal credit ratings reflect management’s assessment of relative credit risk in the mortgage loan portfolio for the date indicated based on underwriting criteria and ongoing assessment of the properties’ performance, management believes the amounts, net of valuation allowance, are collectible.

Securities Lending

The fair value of loaned securities was $18.1 million and $96.3 million as of December 31, 2011 and 2010, respectively.  The Company received $18.5 million and $98.7 million of cash collateral on securities lending as of December 31, 2011 and 2010, respectively. The Company did not receive any non-cash collateral on securities lending as of the balance sheet dates.

Assets on Deposit

Fixed maturity securities with an amortized cost of $4.6 million and $4.5 million were on deposit with various regulatory agencies as required by law as of December 31, 2011 and 2010, respectively.  These securities continue to be included in fixed maturity securities on the consolidated balance sheets.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Net Investment Income

The following table summarizes net investment income by investment type for the years ended December 31:

(in millions)	2011	2010	2009
Fixed maturity securities, available-for-sale	$            185.9	$              175.6	$              159.1
Equity securities, available-for-sale	0.2	0.2	0.4
Mortgage loans	32.2	35.8	42.3
Other	6.2	7.0	4.4
Gross investment income	$            224.5	$              218.6	$              206.2
Less:
Investment expenses	4.9	5.9	5.6
Net investment income ceded (See Note 13)	116.5	125.6	125.9
Net investment income	$            103.1	$                87.1	$                74.7

Net Realized Investment Gains and Losses

The following table summarizes net realized investment gains and losses, by source, for the years ended December 31:

(in millions)	2011	2010	2009
Net derivative gains (losses)	$                  5.9	$                 (0.9)	$                 (2.2)
Realized gains on sales	10.2	11.4	29.3
Realized losses on sales	(2.7)	(3.2)	(12.5)
Valuation gains (losses)	1.5	(0.4)	(1.1)
Net realized investment gains	$               14.9	$                   6.9	$                 13.5

Proceeds from the sale of available-for-sale securities were $321.6 million, $211.8 million and $531.9 million during the years ended December 31, 2011, 2010 and 2009, respectively.  Gross gains of $5.7 million, $11.1 million and $29.4 million and gross losses of $1.1 million, $1.0 million and $9.3 million were realized on those sales during the years ended December 31, 2011, 2010 and 2009, respectively.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Other-Than-Temporary Impairment Losses

The following table summarizes other-than-temporary impairments for the years ended December 31:

		Included in other comprehensive income
(in millions)	Total		Net
2011
Fixed maturity securities	$              3.7	$                 (2.7)	$              1.0
Mortgage loans	3.7	-	3.7
Other-than-temporary impairment losses	$              7.4	$                 (2.7)	$              4.7
2010
Fixed maturity securities	$             23.9	$                (12.5)	$             11.4
Mortgage loans	10.9	-	$             10.9
Other-than-temporary impairment losses	$             34.8	$                (12.5)	$             22.3
2009
Fixed maturity securities	$           119.7	$                (48.7)	$             71.0
Equity securities	0.7	-	$               0.7
Mortgage loans	5.5	-	$               5.5
Other-than-temporary impairment losses	$           125.9	$                (48.7)	$             77.2

The following table summarizes the non-credit portion of other-than-temporary impairments, which have credit losses in earnings, and any subsequent changes in the fair value of those debt securities recognized in other comprehensive income, before federal income taxes, for the years ended December 31:

(in millions)	2011	2010	2009
Balance at beginning of year	$           (12.9)	$             (20.8)	$                   -
Net activity in the period1	1.3	7.9	(20.8)
Balance at end of year	$           (11.6)	$             (12.9)	$             (20.8)

_________

1 Includes the $52.6 million cumulative-effect of adoption of accounting principle for guidance impacting FASB ASC 320-10, Investments – Debt and Equity Securities as of January 1, 2009.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

The following table summarizes the cumulative 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 it is not more likely than not the Company will be required to sell the security prior to recovery of the amortized cost basis, for the years ended December 31:

(in millions)	2011	2010	2009
Cumulative credit loss at beginning of year	$             26.4	$              25.8	$              59.5
New credit losses	0.4	2.1	18.7
Incremental credit losses	0.6	9.1	5.5
Losses related to securities included in the beginning balance sold or      paid down during the period	(9.7)	(10.6)	(57.7)
Losses related to securities included in the beginning balance for which      there was a change in intent	-	-	(0.2)
Cumulative credit loss at end of year	$             17.7	$              26.4	$              25.8

(7)   Fair Value of Financial Instruments

The following table summarizes assets and liabilities measured at fair value on a recurring basis as of December 31, 2011:

(in millions)	Level 1	Level 2	Level 3	Total
Assets
Investments:
Fixed maturity securities:
U.S. Treasury securities and obligations of U.S.
Government corporations and agencies	$            32.2	$                 -	$                 -	$            32.2
Obligations of states and political subdivisions	-	243.8	-	243.8
Corporate public securities	1.2	2,657.6	-	2,658.8
Corporate private securities	-	375.0	112.5	487.5
Residential mortgage-backed securities	49.8	401.2	-	451.0
Commercial mortgage-backed securities	-	86.9	-	86.9
Collateralized debt obligations	-	-	73.8	73.8
Other asset-backed securities	-	54.3	0.2	54.5
Total fixed maturity securities at fair value	$            83.2	$      3,818.8	$         186.5	$      4,088.5
Equity securities	0.3	2.1	-	2.4
Short-term investments	0.9	63.9	-	64.8
Total other investments at fair value	$              1.2	$            66.0	$                 -	$            67.2
Investments at fair value	84.4	3,884.8	186.5	4,155.7
Cash and cash equivalents	11.6	-	-	11.6
Derivative assets1	-	0.4	-	0.4
Separate account assets	1,158.3	-	-	1,158.3
Assets at fair value	$      1,254.3	$      3,885.2	$         186.5	$      5,326.0
Liabilities
Derivative liabilities1	$                 -	$              2.7	$                 -	$              2.7
Liabilities at fair value	$                 -	$              2.7	$                 -	$              2.7

__________

1 The notional amounts related to the derivative assets and liabilities outstanding were $3.4 million and $9.4 million as of December 31, 2011, respectively.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

The following table summarizes changes in fair value measurements for which the Company used significant unobservable inputs (Level 3) to determine fair value for the year ended December 31, 2011:

	Balance							Balance
	as of					Transfers	Transfers	as of
	December	Net gains (losses)				into	out of	December
(in millions)	31, 2010	In earnings1	In OCI	Purchases	Sales	Level 3	Level 3	31, 2011
Assets
Investments:
Fixed maturity securities:
Corporate public securities	$         0.4	$               -	$         -	$           -	$         -	$           -	$      (0.4)	$           -
Corporate private securities	110.7	(0.7)	0.3	19.6	(34.7)	18.4	(1.1)	112.5
Collateralized debt obligations	10.5	(0.1)	(0.5)	63.9	-	-	-	73.8
Other asset-backed securities	3.5	-	-	-	(0.2)	-	(3.1)	0.2
Total fixed maturity securities at fair value	$     125.1	$          (0.8)	$    (0.2)	$     83.5	$  (34.9)	$     18.4	$      (4.6)	$   186.5

__________

1 Net gains and losses included in earnings are reported in net realized investment gains and losses and other-than-temporary impairment losses.The Company did not have a change in unrealized gains (losses) in earnings on assets and liabilities still held at the end of the year.

Transfers into and out of Level 3 during the year ended December 31, 2011 represent changes in the sources used to price certain securities.  There were no significant transfers between Levels 1 and 2 during the year ended December 31, 2011, except certain separate accounts previously included in Level 2.

The following table summarizes assets and liabilities measured at fair value on a recurring basis as of December 31, 2010:

(in millions)	Level 1	Level 2	Level 3	Total
Assets
Investments:
Fixed maturity securities:
U.S. Treasury securities and obligations of U.S.
Government corporations and agencies	$             27.9	$                  -	$                  -	$             27.9
Obligations of states and political subdivisions	-	192.9	-	192.9
Corporate public securities	1.5	2,053.2	0.4	2,055.1
Corporate private securities	-	360.1	110.7	470.8
Residential mortgage-backed securities	56.9	392.9	-	449.8
Commercial mortgage-backed securities	-	102.0	-	102.0
Collateralized debt obligations	-	-	10.5	10.5
Other asset-backed securities	-	50.0	3.5	53.5
Total fixed maturity securities at fair value	$             86.3	$        3,151.1	$           125.1	$        3,362.5
Equity securities	0.8	2.2	-	3.0
Short-term investments	-	207.5	-	207.5
Total other investments at fair value	$               0.8	$           209.7	$                  -	$           210.5
Investments at fair value	87.1	3,360.8	125.1	3,573.0
Cash and cash equivalents	306.1	-	-	306.1
Derivative assets1	-	0.5	-	0.5
Separate account assets	-	1,322.4	-	1,322.4
Assets at fair value	$           393.2	$        4,683.7	$           125.1	$        5,202.0
Liabilities
Derivative liabilities1	$                  -	$               2.8	$                  -	$               2.8
Liabilities at fair value	$                  -	$               2.8	$                  -	$               2.8

__________

1 The notional amounts related to the derivative assets and liabilities outstanding were $6.9 million and $14.4 million as of December 31, 2010, respectively.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

The following table summarizes changes in fair value measurements for which the Company used significant unobservable inputs (Level 3) to determine fair value for the year ended December 31, 2010:

	Balance						Balance
	as of				Transfers	Transfers	as of
	December	Net gains (losses)		Activity	into	out of	December
(in millions)	31, 2009	In earnings1	In OCI	in period	Level 3	Level 3	31, 2010
Assets
Investments:
Fixed maturity securities:
Corporate public securities	$         9.0	$             0.2	$         -	$       (3.1)	$         0.6	$       (6.3)	$         0.4
Corporate private securities	137.1	1.1	3.4	(39.8)	19.6	(10.7)	110.7
Residential mortgage-backed securities	222.5	-	-	(2.9)	-	(219.6)	-
Commercial mortgage-backed securities	33.8	-	-	-	-	(33.8)	-
Collateralized debt obligations	10.5	(4.1)	1.7	-	2.4	-	10.5
Other asset-backed securities	21.8	(0.1)	(0.5)	(1.4)	-	(16.3)	3.5
Total fixed maturity securities at fair value	$     434.7	$           (2.9)	$      4.6	$     (47.2)	$       22.6	$   (286.7)	$     125.1

__________

1 Net gains and losses included in earnings are reported in net realized investment gains and losses, other-than-temporary impairment losses and interest credited to policyholder accounts.The Company did not have a change in unrealized gains (losses) in earnings on assets and liabilities still held at the end of the year.

At December 31, 2009, most of the Company’s investments in residential mortgage-backed securities backed by Alt-A and sub-prime collateral were categorized as Level 3 financial assets because there was little market activity in these securities.   During 2010, market activity increased in these securities such that they are no longer considered inactive.  As such, these securities were transferred out of Level 3 and into Level 2.  Additionally, many of the Company’s investments in below investment-grade commercial mortgage-backed securities, which were categorized as Level 3 financial assets as of December 31, 2009 were transferred to Level 2 in 2010. This was primarily due to an increase in the observable valuation inputs of market activity and availability of higher quality independent pricing data.

There were no significant transfers between Levels 1 and 2 during the year ended December 31, 2010.

Fair Value Option

The Company assesses the fair value option election for newly acquired financial assets or liabilities on a prospective basis. There are no material assets or liabilities for which the Company elected the fair value option.

Use of Net Asset Value for Estimating Fair Value

The Company uses net asset value to estimate the underlying fair value for certain mutual funds that do not have readily determinable fair values, which are included in separate accounts.

All of these mutual fund investments are included in Level 2 and had fair values totaling $1.32 billion as of December 31, 2010.  These funds have no unfunded commitments or restrictions and the Company always has the ability to redeem the separate account investment in these funds with the investee at net asset value daily.  These mutual funds are primarily invested in domestic and international equity funds.

Contractholders have the ability to select and change investment categories, which will result in the underlying mutual funds being purchased and sold in the future.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

Fair Value on a Nonrecurring Basis

The Company measured certain mortgage loans at fair value, or fair value of the collateral for collateral dependent loans, on a non-recurring basis subsequent to their initial recognition, due to impairments or foreclosures recorded during the year. In determining the fair value for these mortgage loans, the Company primarily uses the direct capitalization method based on management’s view of current market capitalization rates.  Alternatively, the Company may use a discounted cash flow methodology or an independently provided appraisal of value.  Each of these methodologies is considered to represent a Level 3 fair value measurement.  Refer to Note 6 for further discussion of the carrying value of impaired mortgage loans.

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 December 31.  The valuation techniques used to estimate these fair values are described below.

	2011		2010
	Carrying	Fair	Carrying	Fair
(in millions)	value	value	value	value
Assets
Investments:
Mortgage loans held-for-investment	$        485.2	$        495.6	$          549.1	$          526.4
Policy loans	$           26.5	$           26.5	$            23.4	$            23.4
Liabilities
Investment contracts	$     2,661.7	$     2,836.5	$       2,791.1	$       2,886.7
Long-term debt	$        285.1	$        260.9	$          272.0	$          272.0

Mortgage loans held-for-investment:  The fair values of mortgage loans held-for-investment 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.

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.

Long-term debt:  The fair value for long-term debt is based on estimated market prices using observable inputs from similar debt instruments.

(8) Long-Term Debt

On December 31, 2010, Olentangy issued a variable funding surplus note due on December 31, 2040 to Nationwide Corporation, a majority-owned subsidiary of NMIC.  The note is redeemable in full or partial amount at any time subject to proper notice and approval.  A redemption premium shall be payable if the note is redeemed on or prior to the third anniversary date of the note’s issuance.  The note bears interest at the rate of three-month U.S. London Interbank Offered Rate plus 2.80% payable quarterly.  Olentangy agrees to draw down or reduce principal amounts in accordance with the terms outlined in the purchase agreement.  The maximum amount outstanding under the agreement is $312.7 million in 2016.  The principal amount outstanding was $285.1 million and $272.0 million as of December 31, 2011 and 2010, respectively.  The Company made interest payments on this surplus note of $8.7 million during 2011.  Any payment of interest or principal on the note requires the prior approval of the State of Vermont.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

(9) Federal Income Taxes

The following table summarizes the federal income tax expense (benefit) attributable to income (loss) for the years ended December 31:

(in millions)	2011	2010	2009
Current tax benefit	$                (10.1)	$                 (40.7)	$                 (17.6)
Deferred tax expense	45.1	65.4	11.6
Total tax expense (benefit)	$                  35.0	$                   24.7	$                   (6.0)

Total federal income tax expense (benefit) differs from the amount computed by applying the U.S. federal income tax rate to income (loss) before federal income tax expense (benefit), as follows for the years ended December 31:

	2011			2010			2009
(in millions)	Amount	%		Amount	%		Amount	%
Rate reconciliation:
Computed (expected tax expense (benefit))	$       37.2	35	%	$        25.4	35	%	$        (4.4)	35	%
Dividend received deduction	(1.8)	(2)	%	(1.2)	(2)	%	(1.2)	10	%
Other, net	(0.4)	-	%	0.5	1	%	(0.4)	3	%
Total	$       35.0	33	%	$        24.7	34	%	$        (6.0)	48	%

The Company’s current federal income tax payable, due to NLIC, was $4.1 million and receivable from NLIC of $28.5 million as of December 31, 2011 and 2010, respectively.

Total federal income taxes refunded were $41.8 million, $27.5 million and $22.4 million during the years ended December 31, 2011, 2010 and 2009, respectively.

As of December 31, 2011, the Company no longer has capital loss carryforwards.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

The following table summarizes the tax effects of temporary differences that give rise to significant components of the net deferred tax liability as of December 31:

(in millions)	2011	2010
Deferred tax assets:
Future policy benefits and claims	$                    7.8	$                   16.9
Mortgage loans	5.6	5.6
Capital loss carryforward	-	14.4
Deferred revenue	11.5	5.5
Other	1.4	2.3
Gross deferred tax assets	$                  26.3	$                   44.7
Deferred tax liabilities:
Deferred policy acquisition costs	140.1	$                 129.0
Available-for-sale securities	51.6	30.8
Derivatives	8.2	8.2
Value of business acquired	6.7	7.4
Other	14.6	10.0
Gross deferred tax liabilities	$               221.2	$                 185.4
Net deferred tax liability	$              (194.9)	$               (140.7)

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion of the total gross deferred tax assets will not be realized.  Valuation allowances are established when necessary to reduce the deferred tax assets to amounts expected to be realized.  Based on management’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.

A rollforward of the beginning and ending uncertain tax positions, including permanent and temporary differences, but excluding interest and penalties, is as follows:

(in millions)	2011	2010	2009
Balance at beginning of period	$             14.7	$                7.4	$                1.5
Additions for current year tax positions	0.7	2.1	2.7
Reductions for current year tax positions	(0.8)	-	-
Additions for prior year tax positions	0.3	5.2	3.5
Reductions for prior years tax positions	(5.1)	-	(0.3)
Balance at end of period	$               9.8	$              14.7	$                7.4

The Company believes it is reasonably possible that approximately $9.2 million of unrecognized tax benefits will be recognized during 2012, mostly as a result of an industry issue resolution program with the Internal Revenue Service (IRS).  These tax benefits are primarily bad debt deductions related to certain investment impairments.

The Company files income tax returns in the U.S. federal jurisdiction and various state jurisdictions.  With few exceptions, the Company is no longer subject to U.S. federal, state or local income tax examinations by tax authorities through the 2005 tax year.  The IRS is conducting an examination of the Company’s U.S. income tax returns for the years 2006 through 2008.  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.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

(10)  Statutory Financial Information

Statutory Results

The Company is required to prepare 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 department of insurance.  Statutory accounting practices focus on insurer solvency and materially differ from GAAP.  The principal differences include charging policy acquisition and certain sales inducement costs to expense as incurred, establishing future policy benefits and claims reserves using different actuarial assumptions, excluding certain assets from statutory admitted assets; and valuing investments and establishing deferred taxes on a different basis.  The following tables summarize the statutory net loss and statutory capital and surplus for the Company for the years ended December 31:

(in millions)	2011	2010	2009
Statutory net loss	$              (61.2)	$               (49.5)	$               (61.1)
Statutory capital and surplus	$             302.5	$               287.2	$               213.5

On December 31, 2009, NLAIC merged with its affiliate, NLACA, with NLAIC as the surviving entity.  See Note 2 for details on the accounting treatment of this transaction.

Dividend Restrictions

The payment of dividends by the Company 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 seek prior regulatory approval to pay a dividend or distribution of cash or other property if the fair market value thereof, together with that of other dividends or distributions made in the preceding 12 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 for the prior year.  During the year ended December 31, 2011, 2010 and 2009, the Company did not pay any dividends to NLIC.  As of January 1, 2012, the Company has the ability to pay dividends to NLIC totaling $30.3 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 capital and 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 capital and surplus must be reasonable in relation to the insurer’s outstanding liabilities and adequate for its financial needs.

The Company currently does not expect such regulatory requirements to impair its ability to pay operating expenses and dividends in the future.

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, where the Company is domiciled, imposes minimum RBC requirements that were developed by the NAIC.  The formulas 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, as defined by the NAIC, to authorized control level RBC, as defined by the NAIC.  Companies below specific trigger points or ratios are classified within certain levels, each of which requires specified corrective action.  The Company exceeded the minimum RBC requirements for all periods presented herein.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

(11)  Other Comprehensive Income

The Company’s other comprehensive income and loss includes net income (loss) and certain items that are reported directly within separate components of shareholder’s equity that are not recorded in net income.

The following table summarizes the Company’s other comprehensive income for the years ended December 31:

(in millions)	Unrealized gains on available-for-sale securities	Unrealized gains (losses) on derivatives used in cash flow hedging relationships	Total other comprehensive income
Year ended December 31, 2011
Other comprehensive income before federal income taxes	25.6	0.1	25.7
Federal income tax expense	(9.0)	-	(9.0)
Total other comprehensive income	16.6	0.1	16.7
Year ended December 31, 2010
Other comprehensive income before federal income taxes	70.2	2.3	72.5
Federal income tax expense	(24.4)	(0.8)	(25.2)
Total other comprehensive income	45.8	1.5	47.3
Year ended December 31, 20091
Other comprehensive income (loss) before federal income taxes	160.9	(0.3)	160.6
Federal income tax (expense) benefit	(56.2)	0.1	(56.1)
Total other comprehensive income (loss)	104.7	(0.2)	104.5

_______

1 The adoption of guidance impacting FASB ASC 320-10, Investments – Debt and Equity Securities during 2009 resulted in a cumulative-effect adjustment of $34.2 million, net of taxes, to reclassify the non-credit component of previously recognized other-than-temporary impairment losses from the beginning balance of retained earnings to AOCI, which is excluded from the table above.

(12)       Related Party Transactions

The Company has entered into significant, recurring transactions and agreements with NMIC and other affiliates as a part of its ongoing operations.  These include employee benefit plans, office space leases and agreements related to reinsurance, cost sharing, administrative services, marketing, intercompany repurchases and cash management services.  Measures used to allocate expenses among companies include individual employee estimates of time spent, special cost studies, the number of full-time employees, commission expense and other methods agreed to by the participating companies.

Pursuant to a financial support agreement, NLIC agreed to provide the Company with the minimum capital and surplus required by each state in which the Company does business and to maintain creditworthiness at a level consistent with that of NLIC.  This agreement does not constitute NLIC as guarantor of any obligation or indebtedness of the Company or provide any creditor of NLAIC with recourse to or against any of the assets of NLIC.

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.  For the years ended December 31, 2011, 2010, and  2009, the Company made payments to NMIC and NSC totaling $10.5 million, $10.3 million, and $7.4 million, respectively.

The Company leases office space from NMIC.  For the years ended December 31, 2011, 2010, and 2009, the Company made lease payments to NMIC of $0.6 million, $0.8 million, and $0.8 million, respectively.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

The Company has a reinsurance agreement with NLIC whereby certain individual deferred fixed annuity contracts are ceded on a modified coinsurance basis.  Under a modified coinsurance agreement, the ceding company retains invested assets, and investment earnings are paid to the reinsurer.  Under the terms of the Company’s agreement, the investment risk associated with changes in interest rates is borne by NLIC.  Risk of asset default is retained by the Company, although a fee is paid by NLIC to the Company for the Company’s retention of such risk.  The agreement will remain in force until all contract obligations are settled.  Amounts ceded to NLIC in 2011 include premiums of $136.9 million ($135.1 million and $250.8 million in 2010 and 2009, respectively); net investment income of $116.5 million ($125.6 million and $125.9 million in 2010 and 2009, respectively); policy reserves of $2.36 billion ($2.45 billion and $2.53 billion in 2010 and 2009, respectively); and benefits, claims and other expenses of $233.7 million ($242.0 million and $367.2 million in 2010 and 2009, respectively).

The Company also has a reinsurance agreement with NLIC whereby a certain life insurance contract is ceded on a 100% coinsurance basis.  Policy reserves ceded and amounts receivable from NLIC under this agreement totaled $142.7 million and $138.2 million as of December 31, 2011 and 2010, respectively.

Funds of Nationwide Funds Group (NFG), an affiliate, are offered to the Company’s customers as investment options in certain of the Company’s products.  As of December 31, 2011 and 2010, customer allocations to NFG funds totaled $616.3 million and $285.2 million, respectively.  For the years ended December 31, 2011 and 2010, NFG paid the Company $2.2 million and $1.4 million, respectively, for the distribution and servicing of these funds.

The Company also participates in intercompany repurchase agreements with affiliates whereby the seller transfers securities to the buyer at a stated value.  Upon demand or after a stated period, the seller repurchases the securities at the original sales price plus interest.  As of December 31, 2011 and 2010, the Company had no outstanding borrowings from affiliated entities under such agreements.  During 2011 and 2010, the most the Company had outstanding at any given time was $15.0 million and $5.5 million, respectively, and the amounts the Company incurred for interest expense on intercompany repurchase agreements during 2011 and 2010 were immaterial.

Amounts on deposit with NCMC for the benefit of the Company were $45.4 million and $108.8 million as of December 31, 2011 and 2010, respectively.

As of December 31, 2011 and 2010, net intercompany receivables due from affiliates were $33.0 million and $4.2 million, respectively.

Effective December 1, 2010 all of the traditional life insurance business previously ceded to NF Reinsurance, Ltd., an affiliate, was recaptured by the Company.  As part of the recapture, the Company received $38.7 million from NF Reinsurance, Ltd. under the recapture agreement, consisting of $37.1 million and $1.6 million for reserves and pending claims, respectively.

Refer to Note 8 for discussion of variable funding surplus note between Olentangy and Nationwide Corporation.

During 2011, NLAIC received $100.0 million in cash capital contributions from NLIC.  During 2009, NLAIC received $140.0 million in cash capital contributions from NLIC.

During 2011 and 2010, the Company sold, at fair value, commercial mortgage loans with a carrying value of $8.0 million and $9.3 million, respectively, to NMIC.  The sales resulted in a net realized loss of $1.6 million in 2011 and 2010.

During 2009, the Company sold fixed maturity securities to NLIC with a carrying value of $188.8 million.  The sales were executed at fair value for cash and resulted in net realized losses of $26.4 million.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Notes to Consolidated Financial Statements, Continued

December 31, 2011, 2010 and 2009

(13)       Contingencies

Legal and Regulatory Matters

Nationwide Financial Services, Inc., and its affiliates, including NLAIC (collectively NFS), are a 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.  The Company’s litigation and regulatory matters are subject to many uncertainties, and given their complexity and scope, their outcomes cannot be predicted.  Regulatory proceedings also could affect the outcome of one or more of the Company’s litigations 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 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 in a particular quarter or annual period.

The financial services industry has been the subject of increasing scrutiny on a broad range of issues by regulators and legislators. The Company and/or its affiliates have been contacted by, self reported or received subpoenas from state and federal regulatory agencies, including the Securities and Exchange Commission, and other governmental bodies, state securities law regulators and state attorneys general for information relating to, among other things, sales compensation, the allocation of compensation, unsuitable sales or replacement practices, and claims handling and escheatment practices.  The Company is cooperating with and responding to regulators in connection with these inquiries and will cooperate with NMIC in responding to these inquiries to the extent that any inquiries encompass NMIC’s operations.

(14)       Reinsurance

The following table summarizes the effects of reinsurance on life insurance in force and premiums for the years ended December 31:

(in millions)	2011	2010	2009
Premiums
Direct	$               106.4	$                   92.6	$                   80.8
Assumed	-	-	-
Ceded	(25.7)	$                 (45.7)	$                 (39.5)
Net	$                  80.7	$                   46.9	$                   41.3
Life insurance in force
Direct	$          62,504.3	$            54,960.1	$            47,866.4
Assumed	1.1	1.1	1.2
Ceded	$        (19,427.7)	$          (19,640.0)	$          (28,676.3)
Net	$          43,077.7	$            35,321.2	$            19,191.3

Total amounts recoverable under reinsurance contracts totaled $267.5 million and $287.0 million as of December 31, 2011 and 2010, respectively.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Schedule I                   Consolidated Summary of Investments – Other Than Investments in Related Parties

As of December 31, 2011 (in millions)
Column A	Column B	Column C	Column D
			Amount at
			which shown
			in the
		Fair	consolidated
Type of investment	Cost	value	balance sheet
Fixed maturity securities, available-for-sale:
Bonds:
U.S. Treasury securities and obligations of U.S.
Government corporations and agencies	$            26.5	$            32.2	$             32.2
Obligations of states and political subdivisions	221.8	243.8	243.8
Public utilities	438.0	473.7	473.7
All other corporate	3,178.4	3,338.8	3,338.8
Total fixed maturity securities, available-for-sale	$       3,864.7	$      4,088.5	$       4,088.5
Equity securities, available-for-sale	2.2	2.4	2.4
Mortgage loans, net of allowance	489.7		485.2
Short-term investments	64.8		64.8
Policy loans	26.5		26.5
Total investments	$       4,447.9		$       4,667.4

__________

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), hedges and commitment hedges on mortgage loans.

See accompanying notes to the consolidated financial statements and report of independent registered public accounting firm.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Schedule IV                           Reinsurance

As of December 31, 2011, 2010 and 2009 and for each of the years then ended (in millions)

Column A	Column B	Column C	Column D	Column E	Column F
					Percentage
		Ceded to	Assumed		of amount
	Gross	other	from other	Net	assumed
	amount	companies	companies	amount	to net
2011
Life insurance in force	$    62,504.3	$   (19,427.7)	$               1.1	$    43,077.7	-
Life insurance premiums 1	$          106.4	$           (25.7)	$                  -	$            80.7	-
2010
Life insurance in force	$       54,960.1	$     (19,640.0)	$                1.1	$       35,321.2	-
Life insurance premiums 1	$              92.6	$            (45.7)	$                  -	$              46.9	-
2009
Life insurance in force	$       47,866.4	$     (28,676.3)	$                1.2	$       19,191.3	-
Life insurance premiums 1	$              80.8	$            (39.5)	$                  -	$              41.3	-

__________

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 the consolidated financial statements and report of independent registered public accounting firm.

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY AND SUBSIDIARY

(a wholly-owned subsidiary of Nationwide Life Insurance Company)

Schedule V                           Valuation and Qualifying Accounts

Years ended December 31, 2011, 2010 and 2009 (in millions)

Column A	Column B	Column C		Column D	Column E
	Balance at	Charged to	Charged to		Balance at
	beginning	costs and	other		end of
Description	of period	expenses	accounts	Deductions1	period
2011
Valuation allowances - mortgage loans	$        13.2	$             3.6	$               -	$        (12.3)	$            4.5
2010
Valuation allowances - mortgage loans	$            7.5	$            11.3	$               -	$           (5.6)	$           13.2
2009
Valuation allowances - mortgage loans	$            6.8	$              6.6	$               -	$           (5.9)	$             7.5

____________

1 Amounts generally represent payoffs, sales and recoveries.

See accompanying notes to the consolidated financial statements and report of independent registered public accounting firm.

PART C. OTHER INFORMATION

Item 26.                   Exhibits

(a) Resolution of the Depositor’s Board of Directors authorizing the establishment of the Registrant – Filed previously with registration statement (333-121878) on January 6, 2005, as document "item26a.txt," and hereby incorporated by reference.

(b) Not Applicable.

(c) Underwriting or Distribution contracts between the Depositor and Principal Underwriter – Filed previously with registration statement (333-117998) on August 6, 2004, as document "item26c.txt," and hereby incorporated by reference.

(d) Contract – Attached hereto .

(e) Applications – Attached hereto .

(f) Depositor’s Certificate of Incorporation and By-Laws –

(1)   Amended Articles of Incorporation for Nationwide Life and Annuity Insurance Company.  Filed previously with initial registration statement (333-164123) on January 4, 2010, as document "exhibitf1.htm" and hereby incorporated by reference.

(2)   Amended and Restated Code of Regulations of Nationwide Life and Annuity Insurance Company.  Filed previously with initial registration statement (333-164123) on January 4, 2010, as document "exhibitf1.htm" and hereby incorporated by reference.

(3)   Articles of Merger of Nationwide Life and Annuity Company of America with and into Nationwide Life and Annuity Insurance Company, effective December 31, 2009.   Filed previously with initial registration statement (333-164123) on January 4, 2010, as document "exhibitf1.htm" and hereby incorporated by reference.

(g) Reinsurance Contracts –

(1) Automatic YRT Reinsurance Agreement with SCOR Global Life U.S. Re Insurance Company of Texas, dated April 1, 2008, previously filed on April 13, 2011, with registration statement (333-156020), as Exhibit (g)(3) and hereby incorporated by reference.

(2) Automatic and Facultative YRT Reinsurance Agreement with Munich American Reinsurance Company Atlanta, Georgia, dated January 19, 2005, attached hereto.

(3) Automatic/Facultative YRT Reinsurance Agreement with RGA Reinsurance Company dated October 1, 2006, previously filed on April 12, 2011, with registration statement (333-149295), as Exhibit (g)(1) and hereby incorporated by reference.

(4) Automatic and Facultative Yearly Renewable Term Reinsurance Agreement with General & Cologne Life Re of America dated October 21, 2003, previously filed on April 12, 2011, with registration statement (333-149295), as Exhibit (g)(3) and hereby incorporated by reference.

(h) Form of Participation Agreements –

The following Fund Participation Agreement was previously filed on September 27, 2007 with pre-effective amendment number 3 of registration statement (333-137202) under Exhibit 26(h), and is hereby incorporated by reference.

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".

(i)           Administrative Contracts –

The following Administrative Agreement was previously filed on September 27, 2007 with pre-effective amendment number 3 of registration statement (333-137202) under Exhibit (i), and is hereby incorporated by reference.

Administrative Services Agreement with Waddell & Reed, Inc. dated December 1, 2000, as amended, as document, "waddellreedasa.htm".

(j) Not Applicable.

(k) Opinion of Counsel – Previously filed with registration statement (333-182896) on July 27, 2012. .

(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 hereby incorporated by reference.

(99) Power of Attorney – Attached hereto.

Item 27. Directors and Officers of the Depositor

President and Chief Operating Officer and Director	Kirt A. Walker
Executive Vice President-Chief Legal and Governance Officer	Patricia R. Hatler
Executive Vice President	Terri L. Hill
Executive Vice President-Finance	Lawrence A. Hilsheimer
Executive Vice President-Chief Marketing & Strategy Officer	Matthew Jauchius
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	Steven M. English
Senior Vice President	Harry H. Hallowell
Senior Vice President and Treasurer	David LaPaul
Senior Vice President-Business Transformation Office	Robert P. McIsaac
Senior Vice President-Chief Claims Officer	David A. Bano
Senior Vice President-Chief Compliance Officer	Sandra L. Rich
Senior Vice President-Chief Financial Officer and Director	Timothy G. Frommeyer
Senior Vice President-Chief Financial Officer-Property and Casualty	Michael P. Leach
Senior Vice President-Chief Risk Officer	Michael W. Mahaffey
Senior Vice President-CIO ACS	Daniel G. Greteman
Senior Vice President-CIO Enterprise Applications	Mark A. Gaetano
Senior Vice President-CIO IT Infrastructure	Gregory S. Moran
Senior Vice President-CIO NF Systems	Susan J. Gueli
Senior Vice President-Controller	James D. Benson
Senior Vice President-Corporate Marketing	Gordon E. Hecker
Senior Vice President-Corporate Strategy	Katherine M. Liebel
Senior Vice President-Deputy General Counsel	Thomas W. Dietrich
Senior Vice President-Deputy General Counsel	Sandra L. Neely
Senior Vice President-Distribution and Sales	John L. Carter
Senior Vice President-Enterprise Chief Technology Officer	Guruprasad C. Vasudeva
Senior Vice President-Field Operations EC	Amy T. Shore
Senior Vice President-Field Operations IC	Jeff M. Rommel
Senior Vice President-Head of Taxation	Pamela A. Biesecker
Senior Vice President-Individual Products & Solutions and Director	Eric S. Henderson
Senior Vice President-Internal Audit	Kai V. Monahan
Senior Vice President-Investment Management Group	Michael S. Spangler
Senior Vice President-IT Strategic Initiatives	Robert J. Dickson
Senior Vice President-Nationwide Financial	Steven C. Power
Senior Vice President-Nationwide Financial Network	Peter A. Golato
Senior Vice President-NF Brand Marketing	William J. Burke
Senior Vice President-NI Brand Marketing	Jennifer M. Hanley
Senior Vice President-NW Retirement Plans	Anne L. Arvia
Senior Vice President-PCIO Sales Support	Melissa D. Gutierrez
Senior Vice President-President-Nationwide Bank	J. Lynn Greenstein
Senior Vice President-Property and Casualty Commercial/Farm Product Pricing	W. Kim Austen
Vice President-Corporate Governance and Secretary	Robert W. Horner, III
Director	Stephen S. Rasmussen

The business address of the Directors and Officers of the Depositor is:

One Nationwide Plaza, Columbus, Ohio 43215

Item 28.                      Persons Controlled by or Under Common Control with the Depositor or Registrant.

*	Subsidiaries for which separate financial statements are filed
**	Subsidiaries included in the respective consolidated financial statements
***	Subsidiaries included in the respective group financial statements filed for unconsolidated subsidiaries
****	Other subsidiaries
COMPANY		STATE/COUNTRY OF ORGANIZATION	PRINCIPAL BUSINESS
1492 Capital, LLC		Ohio	The company acts as an investment holding company.
AGMC Reinsurance, Ltd.		Turks & Caicos Islands	The company is in the business of reinsurance of mortgage guaranty risks.
ALLIED General Agency Company		Iowa	The company acts as a managing general agent and surplus lines broker for property and casualty insurance products.
ALLIED Group, Inc.		Iowa	The company is a property and casualty insurance holding company.
ALLIED Insurance Company of America		Ohio	The company is organized to write commercial lines insurance business.
ALLIED Property and Casualty Insurance Company		Iowa	The company underwrites general property and casualty insurance.
ALLIED Texas Agency, Inc.		Texas	The company acts as a managing general agent to place personal and commercial automobile insurance with Colonial County Mutual Insurance Company.
AMCO Insurance Company		Iowa	The company underwrites general property and casualty insurance.
American Marine Underwriters, Inc.		Florida	The company is an underwriting manager for ocean cargo and hull insurance.
Champions of the Community, Inc.		Ohio	The company raises money to enable it to make gifts and grants to charitable organizations.
Colonial County Mutual Insurance Company*		Texas	The company underwrites non-standard automobile and motorcycle insurance and other commercial liability coverages in Texas.
Crestbrook Insurance Company*		Ohio	The company is a multi-line insurance corporation that is authorized to write personal, automobile, homeowners and commercial insurance.
Depositors Insurance Company		Iowa	The company underwrites general property and casualty insurance.
DVM Insurance Agency, Inc.		California	The company places non-California pet insurance business not written by Veterinary Pet Insurance Company.
Farmland Mutual Insurance Company		Iowa	The company provides property and casualty insurance primarily to agricultural businesses.
Freedom Specialty Insurance Company		Ohio	The company operates as a multi-line insurance company.
Gates McDonald of Ohio, LLC		Ohio	The company provided services to employers for managing workers’ and unemployment compensation matters and employee benefit costs.  The company is currently winding down to permit its eventual dissolution.
Gates, McDonald & Company of New York, Inc.		New York	The company provides workers’ compensation and self-insured claims administration services to employers with exposure in New York.

COMPANY	STATE/COUNTRY OF ORGANIZATION	PRINCIPAL BUSINESS
GatesMcDonald Health Plus, LLC	Ohio	The company provided medical management and cost containment services to employers.  The company is currently winding down to permit its eventual dissolution.
Insurance Intermediaries, Inc.	Ohio	The company is an insurance agency and provides commercial property and casualty brokerage services.
Life Reo Holdings, LLC	Ohio	The company is an investment holding company.
Lone Star General Agency, Inc.	Texas	The company acts as general agent to market nonstandard automobile and motorcycle insurance for Colonial County Mutual Insurance Company.
National Casualty Company	Wisconsin	The company underwrites various property and casualty coverage, as well as some individual and group accident and health insurance.
National Casualty Company of America, Ltd.	England	This is a limited liability company organized for the purpose of carrying on the business of insurance, reinsurance, indemnity, and guarantee of various kinds.  The company is currently inactive.
Nationwide Advantage Mortgage Company*	Iowa	The company makes residential mortgage loans.
Nationwide Affinity Insurance Company of America*	Ohio	The company is a property and casualty insurer that writes personal lines business.
Nationwide Agribusiness Insurance Company	Iowa	The company provides property and casualty insurance primarily to agricultural businesses.
Nationwide Arena, LLC*	Ohio	The purpose of the company is to develop Nationwide Arena and to engage in related development activity.
Nationwide Asset Management, LLC	Ohio	The company provides investment advisory services as a registered investment advisor to affiliated and non-affiliated clients.
Nationwide Assurance Company	Wisconsin	The company underwrites non-standard automobile and motorcycle insurance.
Nationwide Bank*	United States	This is a federally chartered savings bank supervised by the Office of the Comptroller of the Currency 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 Better Health (Ohio), LLC	Ohio	The company provided employee population health management.  The company is currently winding down to permit its eventual dissolution.
Nationwide Better Health Holding Company, LLC	Ohio	The company is a holding company.  The company is currently winding down to permit its eventual dissolution.
Nationwide Cash Management Company	Ohio	The company buys and sells investment securities of a short-term nature as the agent for other corporations, foundations and insurance company separate accounts.
Nationwide Community Development Corporation, LLC	Ohio	The company holds investments in low-income housing funds.
Nationwide Corporation	Ohio	The company acts as a holding company.
Nationwide Emerging Managers, LLC	Delaware	The company acts as a holding company.

COMPANY	STATE/COUNTRY OF ORGANIZATION	PRINCIPAL BUSINESS
Nationwide Exclusive Agent Risk Purchasing Group, LLC	Ohio	The company’s purpose is to provide a mechanism for the purchase of group liability insurance for insurance agents operating nationwide.
Nationwide Financial Assignment Company	Ohio	The company is an administrator of structured settlements.
Nationwide Financial General Agency, Inc. (fka 1717 Brokerage Services, 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 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 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.
Nationwide Financial Structured Products, LLC	Ohio	The company captures and reports the results of the structured products business unit.
Nationwide Fund Advisors (fka Gartmore Mutual Fund Capital Trust)	Delaware	The trust acts as a registered investment advisor.
Nationwide Fund Distributors LLC (successor to Gartmore Distribution Services, Inc.)	Delaware	The company is a limited purpose broker-dealer.
Nationwide Fund Management LLC (successor to Gartmore Investors Services, Inc.)	Delaware	The company provides administration, transfer and dividend disbursing agent services to various mutual fund entities.
Nationwide General Insurance Company	Ohio	The company transacts a general insurance business, except life insurance, and primarily provides automobile and fire insurance to select customers.
Nationwide Global Holdings, Inc.	Ohio	The company acts as a holding company.
Nationwide Global Ventures, Inc.	Delaware	The company acts as a holding company.
Nationwide Indemnity Company*	Ohio	The company is involved in the reinsurance business and assumes business from Nationwide Mutual Insurance Company and other insurers within the Nationwide insurance organization.
Nationwide Insurance Company of America	Wisconsin	The company is an independent agency personal lines underwriter of property and casualty insurance.
Nationwide Insurance Company of Florida*	Ohio	The company transacts general insurance business, except life insurance.
Nationwide Insurance Foundation*	Ohio	The company contributes to non-profit activities and projects.
Nationwide Investment Advisors, LLC	Ohio	The company provides investment advisory services.
Nationwide Investment Services Corporation**	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 Life and Annuity Insurance Company**	Ohio	The company engages in underwriting life insurance and granting, purchasing and disposing of annuities.

COMPANY	STATE/COUNTRY OF ORGANIZATION	PRINCIPAL BUSINESS
Nationwide Life Insurance Company*	Ohio	The company provides individual life insurance, group life and health insurance, fixed and variable annuity products and other life insurance products.
Nationwide Lloyds	Texas	The company markets commercial and property insurance in Texas.
Nationwide Mutual Fire Insurance Company	Ohio	The company engages in a general insurance and reinsurance business, except life insurance.
Nationwide Mutual Insurance Company*	Ohio	The company engages in a general insurance and reinsurance business, except life insurance.
Nationwide Private Equity Fund, LLC	Ohio	The company invests in private equity funds.
Nationwide Property and Casualty Insurance Company	Ohio	The company engages in a general insurance business, except life insurance.
Nationwide Property Protection Services, LLC	Ohio	The company provides alarm systems and security guard services.
Nationwide Realty Investors, Ltd.*	Ohio	The company is engaged in the business of developing, owning and operating real estate and real estate investment.
Nationwide Realty Services, Ltd.	Ohio	The company provides relocation services to Nationwide associates.
Nationwide Retirement Solutions, Inc.*	Delaware	The company markets and administers deferred compensation plans for public employees.
Nationwide Retirement Solutions, Inc. of Arizona	Arizona	The company markets and administers deferred compensation plans for public employees.
Nationwide Retirement Solutions, Inc. of Ohio	Ohio	The company provides retirement products, marketing and education and administration to public employees.
Nationwide Retirement Solutions, Inc. of Texas	Texas	The company markets and administers deferred compensation plans for public employees.
Nationwide Retirement Solutions Insurance Agency, Inc.	Massachusetts	The company markets and administers deferred compensation plans for public employees.
Nationwide SA Capital Trust	Delaware	The trust acts as a holding company.
Nationwide Sales Solutions, Inc.	Iowa	The company engages in the direct marketing of property and casualty insurance products.
Nationwide Securities, LLC	Delaware	The company is a registered broker-dealer.
Nationwide Services Company, LLC	Ohio	The company performs shared services functions for the Nationwide organization.
Newhouse Capital Partners, LLC	Delaware	The company is an investment holding company.
Newhouse Capital Partners II, LLC	Delaware	The company is an investment holding company.

COMPANY	STATE/COUNTRY OF ORGANIZATION	PRINCIPAL BUSINESS
NFS Distributors, Inc.	Delaware	The company acts primarily as a holding company for Nationwide Financial Services, Inc. companies.
NWD Asset Management Holdings, Inc.	Delaware	The company acts as a holding company.
NWD Investment Management, Inc.	Delaware	The company acts as a holding company and provides other business services for the NWD Investments Management group of companies.
NWD Management & Research Trust	Delaware	The company acts as a holding company for the NWD Investments Management group.
Olentangy Reinsurance, LLC	Vermont	The company is a captive life reinsurance company.
Pension Associates, Inc.	Wisconsin	The company provides pension plan administration and recordkeeping services, and pension plan and compensation consulting.
Premier Agency, Inc.	Iowa	The company is an insurance agency.
Privilege Underwriters, Inc.	Delaware	The company acts as a holding company for the PURE Group of insurance companies.
Privilege Underwriters, Reciprocal Exchange	Florida	The company acts as a reciprocal insurance company.
Pure Insurance Company	Florida	The company acts as a captive reinsurance company.
Pure Risk Management, LLC	Florida	The company acts as an attorney-in-fact for Privilege Underwriters Reciprocal Exchange.
Registered Investment Advisors Services, Inc.	Texas	The company is a technology company that facilitates third-party money management services for registered investment advisors.
Retention Alternatives, Ltd.*	Bermuda	The company is a captive insurer and writes first dollar insurance policies in workers’ compensation, general liability and automobile liability for its affiliates in the United States.
Riverview International Group, Inc.	Delaware	The company is an inactive shell company.
Scottsdale Indemnity Company	Ohio	The company is engaged in a general insurance business, except life insurance.
Scottsdale Insurance Company	Ohio	The company primarily provides excess and surplus lines of property and casualty insurance.
Scottsdale Surplus Lines Insurance Company	Arizona	The company provides excess and surplus lines coverage on a non-admitted basis.
THI Holdings (Delaware), Inc.*	Delaware	The company acts as a holding company.
Titan Auto Insurance of New Mexico, Inc.	New Mexico	The company is an insurance agency that operates employee agent storefronts.
Titan Indemnity Company	Texas	The company is a multi-line insurance company that operates primarily as a property and casualty insurance company.
Titan Insurance Company	Michigan	The company is a property and casualty insurance company.

COMPANY	STATE/COUNTRY OF ORGANIZATION	PRINCIPAL BUSINESS
Titan Insurance Services, Inc.	Texas	The company is a Texas grandfathered managing general agency.
Veterinary Pet Insurance Company*	California	The company provides pet insurance.
Victoria Automobile Insurance Company	Indiana	The company is a property and casualty insurance company.
Victoria Fire & Casualty Company	Ohio	The company is a property and casualty insurance company.
Victoria National Insurance Company	Ohio	The company is a property and casualty insurance company.
Victoria Select Insurance Company	Ohio	The company is a property and casualty insurance company.
Victoria Specialty Insurance Company	Ohio	The company is a property and casualty insurance company.
VPI Services, Inc.	California	The company operates as a nationwide pet registry service for holders of Veterinary Pet Insurance Company policies, including pet indemnification and a lost pet recovery program.
Western Heritage Insurance Company	Arizona	The company underwrites excess and surplus lines of property and casualty insurance.
Whitehall Holdings, Inc.	Texas	The company acts as a holding company for the Titan group.
W.I. of Florida (d.b.a. Titan Auto Insurance)	Florida	The company is an insurance agency.

COMPANY	STATE/COUNTRY OF ORGANIZATION	PRINCIPAL BUSINESS
MFS Variable Account*	Ohio	Issuer of variable annuity contracts.
Nationwide Multi-Flex Variable Account*	Ohio	Issuer of variable annuity contracts.
Nationwide VA Separate Account-A*	Ohio	Issuer of variable annuity contracts.
Nationwide VA Separate Account-B*	Ohio	Issuer of variable annuity contracts.
Nationwide VA Separate Account-C*	Ohio	Issuer of variable annuity contracts.
Nationwide VA Separate Account-D*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-II*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-3*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-4*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-5*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-6*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-7*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-8*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-9*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-10*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-11*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-12*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-13*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-14*	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-15	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-16	Ohio	Issuer of variable annuity contracts.
Nationwide Variable Account-17	Ohio	Issuer of variable annuity contracts.
Nationwide Provident VA Separate Account 1*	Pennsylvania	Issuer of variable annuity contracts.
Nationwide Provident VA Separate Account A*	Delaware	Issuer of variable annuity contracts.

COMPANY	STATE/COUNTRY OF ORGANIZATION	PRINCIPAL BUSINESS
Nationwide VL Separate Account-A	Ohio	Issuer of variable life insurance policies.
Nationwide VL Separate Account-B	Ohio	Issuer of variable life insurance policies.
Nationwide VL Separate Account-C*	Ohio	Issuer of variable life insurance policies.
Nationwide VL Separate Account-D*	Ohio	Issuer of variable life insurance policies.
Nationwide VL Separate Account-G*	Ohio	Issuer of variable life insurance policies.
Nationwide VLI Separate Account*	Ohio	Issuer of variable life insurance policies.
Nationwide VLI Separate Account-2*	Ohio	Issuer of variable life insurance policies.
Nationwide VLI Separate Account-3*	Ohio	Issuer of variable life insurance policies.
Nationwide VLI Separate Account-4*	Ohio	Issuer of variable life insurance policies.
Nationwide VLI Separate Account-5*	Ohio	Issuer of variable life insurance policies.
Nationwide VLI Separate Account-6*	Ohio	Issuer of variable life insurance policies.
Nationwide VLI Separate Account-7*	Ohio	Issuer of variable life insurance policies.
Nationwide Provident VLI Separate Account 1*	Pennsylvania	Issuer of variable life insurance policies.
Nationwide Provident VLI Separate Account A*	Delaware	Issuer of variable life insurance policies.

The ownership and control of each of the companies/entities listed above (including the percentage of voting securities owned or other basis of control) is shown in the following organizational chart.

Item 29. Indemnification

Ohio's General Corporation Law expressly authorizes and Nationwide’s Amended and Restated Code of Regulations provides for indemnification by Nationwide of any person who, because such person is or was a director, officer or employee of Nationwide was or is a party; or is threatened to be made a party to:

o   any threatened, pending or completed civil action, suit or proceeding;

o   any threatened, pending or completed criminal action, suit or proceeding;

o   any threatened, pending or completed administrative action or proceeding;

o   any threatened, pending or completed investigative action or proceeding.

The indemnification will be for actual and reasonable expenses, including attorney's fees, judgments, fines and amounts paid in settlement by such person in connection with such action, suit or proceeding, to the extent and under the circumstances permitted by the Ohio's General Corporation Law.

Although Nationwide is of the opinion that 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 permitted, Nationwide has been informed that in the opinion of the Securities and Exchange Commission the indemnification of directors, officers or persons controlling Nationwide for liabilities arising under the Securities Act of 1933 ("Act") is against public policy as expressed in the Act and is, therefore, unenforceable.  In the event that a claim for indemnification against such liabilities is asserted by a director, officer or controlling person in connection with the securities being registered, the registrant will submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act. Nationwide and the directors, officers and/or controlling persons will be governed by the final adjudication of such issue.  Nationwide will not be required to seek the court’s determination if, in the opinion of Nationwide’s counsel, the matter has been settled by controlling precedent.

Item 30. Principal Underwriter

Waddell & Reed, Inc. serves as principal underwriter and general distributor for contracts issued through the following separate investment accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company:

Nationwide Variable Account-9

Nationwide Variable Account-12

Nationwide VA Separate Account-D

Nationwide VL Separate Account-G

Nationwide VLI Separate Account-5

Nationwide VLI Separate Account-7

Also, Waddell & Reed, Inc. serves as principal underwriter and general distributor for the following management investment companies:

Waddell & Reed Advisors Funds

Waddell & Reed Advisors Accumulative Fund

Waddell & Reed Advisors Asset Strategy Fund

Waddell & Reed Advisors Bond Fund

Waddell & Reed Advisors Continental Income Fund

Waddell & Reed Advisors Core Investment Fund

Waddell & Reed Advisors Cash Management

Waddell & Reed Advisors Dividend Opportunities Fund

Waddell & Reed Advisors Energy Fund

Waddell & Reed Advisors Global Bond Fund

Waddell & Reed Government Securities Fund

Waddell & Reed Advisors High Income Fund

Waddell & Reed Advisors International Growth Fund

Waddell & Reed Advisors Municipal Bond Fund

Waddell & Reed Advisors Municipal High Income Fund

Waddell & Reed Advisors New Concepts Fund

Waddell & Reed Advisors Science and Technology Fund

Waddell & Reed Advisors Small Cap Fund

Waddell & Reed Advisors Tax-Managed Equity Fund

Waddell & Reed Advisors Value Fund

Waddell & Reed Advisors Vanguard Fund

InvestEd Portfolios

InvestEd Balanced Portfolio

InvestEd Conservative Portfolio

InvestEd Growth Portfolio

Ivy Funds Variable Insurance Portfolios

Ivy Funds VIP Asset Strategy Portfolio

Ivy Funds VIP Balanced Portfolio

Ivy Funds VIP Bond Portfolio

Ivy Funds VIP Core Equity Portfolio

Ivy Funds VIP Dividend Opportunities Portfolio

Ivy Funds VIP Energy Portfolio

Ivy Funds VIP Global Bond Portfolio

Ivy Funds VIP Global Natural Resources Portfolio

Ivy Funds VIP Growth Portfolio

Ivy Funds VIP High Income Portfolio

Ivy Funds VIP International Core Equity Portfolio

Ivy Funds VIP International Growth Portfolio

Ivy Funds VIP Limited-Term Bond Portfolio

Ivy Funds VIP Micro Cap Growth Portfolio

Ivy Funds VIP Mid Cap Growth Portfolio

Ivy Funds VIP Money Market Portfolio

Ivy Funds VIP Pathfinder Aggressive Portfolio

Ivy Funds VIP Pathfinder Conservative Portfolio

Ivy Funds VIP Pathfinder Moderately Aggressive Portfolio

Ivy Funds VIP Pathfinder Moderately Conservative Portfolio

Ivy Funds VIP Pathfinder Moderate Portfolio

Ivy Funds VIP Real Estate Securities Portfolio

Ivy Funds VIP Science and Technology Portfolio

Ivy Funds VIP Small Cap Growth Portfolio

Ivy Funds VIP Small Cap Value Portfolio

Ivy Funds VIP Value Portfolio

(b) Directors and officers of Waddell & Reed, Inc.:

Thomas W. Butch	Chairman of the Board, Director and President
Henry J. Hermann	Director
Steven E. Anderson	Senior Executive Vice President and National Sales Manager
Bradley D. Hofmeister	Executive Vice President
Daniel C. Schulte	Senior Vice President and General Counsel
Michael D. Strohm	Director, Chief Operating Officer and Chief Executive Officer
Terry L. Lister	Senior Vice President, Chief Regulatory Officer and Chief Compliance Officer
Wendy J. Hills	Senior Vice President and Secretary
Brent K. Bloss	Senior Vice President, Treasurer, Principal Accounting Officer, and Principal Financial Officer
Melissa A. Clouse	Vice President and Controller

The principal business address of Waddell & Reed, Inc. is 6300 Lamar Avenue, Overland Park, Kansas 66202.  Waddell & Reed, Inc. was organized as a Delaware corporation in 1981 and has, through predecessor companies, offered financial products and services since 1937.

(c)

Name of Principal Underwriter	Net Underwriting Discounts and Commissions	Compensation on Redemption or Annuitization	Brokerage Commissions	Compensation
Waddell & Reed, Inc.	N/A	N/A	N/A	N/A

Item 31.                 Location of Accounts and Records

Timothy G. Frommeyer

Nationwide Life and Annuity Insurance Company

One Nationwide Plaza

Columbus, OH  43215

Item 32.                 Management Services

Not Applicable.

Item 33. Fee Representation

Nationwide Life and Annuity 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 and Annuity Insurance Company.

SIGNATURES

As required by the Securities Act of 1933, and the Investment Company Act of 1940, the Registrant, NATIONWIDE VL SEPARATE ACCOUNT-G, certifies that it has caused this Registration Statement to be signed on its behalf in the City of Columbus, and State of Ohio, on this 14 th   day of November , 2012.

NATIONWIDE VL SEPARATE ACCOUNT-G

(Registrant)

NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY

(Depositor)

By: /s/ TIMOTHY D. CRAWFORD

Timothy D. Crawford

As required by the Securities Act of 1933, the Registration Statement has been signed by the following persons in the capacities indicated on this 14 h   day of November , 2012.

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
STEPHEN S. RASMUSSEN
Stephen S. Rasmussen, Director
	By /s/ TIMOTHY D. CRAWFORD
	Timothy D. Crawford
	Attorney-in-Fact