485BPOS 1 d469773d485bpos.htm NATIONWIDE DESTINATION B 2.0 Nationwide Destination B 2.0
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933File No. 333-177439
Pre-Effective Amendment No.□
Post-Effective Amendment No. 4☑
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940File No. 811-03330
Amendment No. 455☑
(Check appropriate box or boxes.)
Nationwide Variable Account-II
(Exact Name of Registrant)
Nationwide Life Insurance Company
(Name of Depositor)
One Nationwide Plaza, Columbus, Ohio 43215
(Address of Depositor's Principal Executive Offices) (Zip Code)
(614) 249-7111
Depositor's Telephone Number, including Area Code
Robert W. Horner III, Vice President Corporate Governance and Secretary,
One Nationwide Plaza, Columbus, Ohio 43215
(Name and Address of Agent for Service)
May 1, 2013
Approximate Date of Proposed Public Offering
It is proposed that this filing will become effective (check appropriate box)
□ immediately upon filing pursuant to paragraph (b)
☑ on May 1, 2013 pursuant to paragraph (b)
□ 60 days after filing pursuant to paragraph (a)(1)
□ on (date) pursuant to paragraph (a)(1)
If appropriate, check the following box:
□ this post-effective amendment designates a new effective date for a previously filed post-effective amendment.

Table of Contents
Nationwide DestinationSM [B] 2.0
Individual Flexible Premium Deferred Variable Annuity Contracts
Issued by
Nationwide Life Insurance Company
through its
Nationwide Variable Account-II
The date of this prospectus is May 1, 2013.
The contracts described in this prospectus are not available in the state of New York.
This prospectus contains basic information about the contracts that should be understood before investing. Read this prospectus carefully and keep it for future reference.
Variable annuities are complex investment products with unique benefits and advantages that may be particularly useful in meeting long-term savings and retirement needs. There are costs and charges associated with these benefits and advantages - costs and charges that are different, or do not exist at all, within other investment products. With help from financial consultants and advisors, investors are encouraged to compare and contrast the costs and benefits of the variable annuity described in this prospectus against those of other investment products, especially other variable annuity and variable life insurance products offered by Nationwide and its affiliates. Nationwide offers a wide array of such products, many with different charges, benefit features, and underlying investment options. This process of comparison and analysis should aid in determining whether the purchase of the contract described in this prospectus is consistent with the purchaser's investment objectives, risk tolerance, investment time horizon, marital status, tax situation, and other personal characteristics and needs.
The Statement of Additional Information (dated May 1, 2013), which contains additional information about the contracts and the Variable Account, has been filed with the SEC and is incorporated herein by reference. The table of contents for the Statement of Additional Information is on page 57. To obtain free copies of the Statement of Additional Information or to make any other service requests, contact Nationwide by one of the methods described in Contacting the Service Center.
Information about Nationwide and the variable annuity contract described in this prospectus (including the Statement of Additional Information) 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 (202) 551-8090. The SEC also maintains a web site (www.sec.gov) that contains the prospectus, the Statement of Additional Information, material incorporated by reference, and other information.
Variable annuities are not insured by the Federal Deposit Insurance Corporation or any other federal government agency, and are not deposits of, guaranteed by, or insured by the depository institution where offered or any of its affiliates. Variable annuity contracts involve investment risk and may lose value. 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 contract contains features that apply credits to the Contract Value. The benefit of the credits may be more than offset by the additional fees that the Contract Owner will pay in connection with the credits. A contract without credits may cost less.
The Sub-Accounts available under this contract invest in underlying mutual funds of the portfolio companies listed below.
• AllianceBernstein Variable Products Series Fund, Inc.
• American Century Variable Portfolios II, Inc.
• American Century Variable Portfolios, Inc.
• American Funds Insurance Series®
• BlackRock Variable Series Funds, Inc.
• Delaware VIP Trust
• Dreyfus
• Dreyfus Investment Portfolios
• Dreyfus Variable Investment Fund
• Fidelity Variable Insurance Products Fund
• Franklin Templeton Variable Insurance Products Trust
• Goldman Sachs Variable Insurance Trust
• Guggenheim Variable Fund
• Huntington VA Funds
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• Invesco
• Ivy Funds Variable Insurance Portfolios
• Janus Aspen Series
• MFS® Variable Insurance Trust
• MFS® Variable Insurance Trust II
• Nationwide Variable Insurance Trust
• Northern Lights Variable Trust
• Oppenheimer Variable Account Funds
• PIMCO Variable Insurance Trust
• T. Rowe Price Equity Series, Inc.
• Van Eck VIP Trust
• Wells Fargo Advantage Variable Trust
For a complete list of the available Sub-Accounts, refer to Appendix A: Underlying Mutual Funds. For more information on the underlying mutual funds, refer to the prospectus for the mutual fund.
Purchase payments not invested in the Sub-Accounts may be allocated to the Fixed Account.
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Glossary of Special Terms
Accumulation Unit – An accounting unit of measure used to calculate the Contract Value allocated to the Variable Account before the Annuitization Date.
Annuitant – The person(s) whose length of life determines how long annuity payments are paid.
Annuitization Date – The date on which annuity payments begin.
Annuity Commencement Date – The date on which annuity payments are scheduled to begin.
Annuity Unit – An accounting unit of measure used to calculate the value of variable annuity payments.
Charitable Remainder Trust – A trust meeting the requirements of Section 664 of the Internal Revenue Code.
Co-Annuitant – The person designated by the Contract Owner to receive the benefit associated with the Spousal Protection Feature.
Contingent Annuitant – The individual who becomes the Annuitant if the Annuitant dies before the Annuitization Date.
Contract Anniversary – Each recurring one-year anniversary of the date the contract was issued.
Contract Owner(s) – The person(s) who owns all rights under the contract.
Contract Value – The value of all Accumulation Units in a contract plus any amount held in the Fixed Account.
Contract Year – Each year the contract is in force beginning with the date the contract is issued.
Current Income Benefit Base – For purposes of the 7% Nationwide Lifetime Income Rider, it is equal to the Original Income Benefit Base adjusted throughout the life of the contract to account for subsequent purchase payments, excess withdrawals, and reset opportunities. This amount is multiplied by the Lifetime Withdrawal Percentage to arrive at the benefit amount for any given year.
Daily Net Assets – A figure that is calculated at the end of each Valuation Date and represents the sum of all the Contract Owners' interests in the Sub-Accounts after the deduction of underlying mutual fund expenses.
Fixed Account – An investment option that is funded by Nationwide's General Account. Amounts allocated to the Fixed Account will receive periodic interest subject to a guaranteed minimum crediting rate.
General Account – All assets of Nationwide other than those of the Variable Account or in other separate accounts of Nationwide.
Individual Retirement Account – An account that qualifies for favorable tax treatment under Section 408(a) of the Internal Revenue Code, but does not include Roth IRAs.
Individual Retirement Annuity or IRA – An annuity contract that qualifies for favorable tax treatment under Section 408(b) of the Internal Revenue Code, but does not include Roth IRAs or Simple IRAs.
Investment-Only Contract – A contract purchased by a qualified pension, profit-sharing, or stock bonus plan as defined by Section 401(a) of the Internal Revenue Code.
Lifetime Withdrawal – For purposes of the 7% Nationwide Lifetime Income Rider, it is a withdrawal of all or a portion of the Lifetime Withdrawal Amount.
Lifetime Withdrawal Amount – For purposes of the 7% Nationwide Lifetime Income Rider, the maximum amount that can be withdrawn between Contract Anniversaries without reducing the Current Income Benefit Base. It is calculated annually, on each Contract Anniversary, by multiplying the Current Income Benefit Base by the Lifetime Withdrawal Percentage.
Lifetime Withdrawal Percentage – An age-based percentage used to determine the annual amount available for withdrawal under the 7% Nationwide Lifetime Income Rider. The applicable percentage is multiplied by the Current Income Benefit Base to arrive at the Lifetime Withdrawal Amount for any given year.
Monthly Contract Anniversary – Each recurring one-month anniversary of the date the contract was issued.
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Nationwide – Nationwide Life Insurance Company.
Net Asset Value – The value of one share of an underlying mutual fund at the close of the New York Stock Exchange.
Non-Qualified Contract – A contract which does not qualify for favorable tax treatment as a Qualified Plan, IRA, Roth IRA, SEP IRA, Simple IRA, or Tax Sheltered Annuity.
Original Income Benefit Base – For purposes of the 7% Nationwide Lifetime Income Rider, the initial benefit base calculated on the date the option is elected, which is equal to the Contract Value.
Purchase Payment Credits or PPCs – Additional credits that Nationwide will apply to a contract when cumulative purchase payments reach certain aggregate levels.
Qualified Plan – A retirement plan that receives favorable tax treatment under Section 401 of the Internal Revenue Code, including Investment-Only Contracts. In this prospectus, all provisions applicable to Qualified Plans also apply to Investment-Only Contracts unless specifically stated otherwise.
Roth IRA – An annuity contract that qualifies for favorable tax treatment under Section 408A of the Internal Revenue Code.
SEC – Securities and Exchange Commission.
SEP IRA – An annuity contract which qualifies for favorable tax treatment under Section 408(k) of the Internal Revenue Code.
Service Center – The department of Nationwide responsible for receiving all service and transaction requests relating to the contract. For service and transaction requests submitted other than by telephone (including fax requests), the Service Center is Nationwide's mail and document processing facility. For service and transaction requests communicated by telephone, the Service Center is Nationwide's operations processing facility. Information on how to contact the Service Center is in the Contacting the Service Center provision.
Simple IRA – An annuity contract which qualifies for favorable tax treatment under Section 408(p) of the Internal Revenue Code.
Sub-Accounts – Divisions of the Variable Account, each of which invests in a single underlying mutual fund.
Tax Sheltered Annuity – An annuity that qualifies for favorable tax treatment under Section 403(b) of the Internal Revenue Code.
Valuation Date – Each day the New York Stock Exchange is open for business or any other day during which there is a sufficient degree of trading of underlying mutual fund shares such that their current Net Asset Value might be materially affected. Values of the Variable Account are determined as of the close of the New York Stock Exchange, which generally closes at 4:00 p.m. EST.
Valuation Period – The period of time commencing at the close of a Valuation Date and ending at the close of the New York Stock Exchange for the next succeeding Valuation Date.
Variable Account – Nationwide Variable Account-II, a separate account that Nationwide established to hold Contract Owner assets allocated to variable investment options. The Variable Account is divided into Sub-Accounts, each of which invests in a separate underlying mutual fund.
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Contract Expenses
The following tables describe the fees and expenses that a Contract Owner will pay when buying, owning, or surrendering the contract.
The first table describes the fees and expenses a Contract Owner will pay at the time the contract is purchased, surrendered, or when cash value is transferred between investment options.
Contract Owner Transaction Expenses
Maximum Contingent Deferred Sales Charge ("CDSC") (as a percentage of purchase payments withdrawn)
 7%
Range of CDSC over time:
Number of Completed Years from Date of Purchase Payment   0   1   2   3   4   5   6   7+  
CDSC Percentage   7%   7%   6%   5%   4%   3%   2%   0%  
 
Maximum Premium Tax Charge (as a percentage of purchase payments)
 5% 1
Maximum Short-Term Trading Fee (as a percentage of transaction amount2)
 1%
 
The next table describes the fees and expenses that a Contract Owner will pay periodically during the life of the contract (not including underlying mutual fund fees and expenses).
Recurring Contract Expenses
Maximum Annual Contract Maintenance Charge
 $30 3
Variable Account Annual Expenses (assessed as an annualized percentage of Daily Net Assets)
 		 
Mortality and Expense Risk Charge
 1.10%
Administrative Charge
 0.20%
Death Benefit Options (assessed as an annualized percentage of Daily Net Assets) (eligible applicants may purchase one)
 		 
One-Year Enhanced Death Benefit Option Charge
 0.20%
Total Variable Account Charges (including this option only)
 1.50%
One-Month Enhanced Death Benefit Option Charge
 0.35%
Total Variable Account Charges (including this option only)
 1.65%
Combination Enhanced Death Benefit Option Charge
 0.45%
Total Variable Account Charges (including this option only)
 1.75%
Beneficiary Protector II Option Charge (assessed as an annualized percentage of Daily Net Assets4)
 0.35%
Total Variable Account Charges (including this option only)
 1.65%
Additional Optional Riders (assessed annually as a percentage of the Current Income Benefit Base5)
 		 
Maximum 7% Nationwide Lifetime Income Rider Charge
 1.50% 6
Maximum Joint Option for the 7% Nationwide Lifetime Income Rider Charge
 0.40% 7
 
The next table shows the fees and expenses that a Contract Owner would pay if he/she elected all of the optional benefits available under the contract (and the most expensive of mutually exclusive optional benefits).

Summary of Maximum Contract Expenses
(annualized rate, as a percentage of the Daily Net Assets)
Mortality and Expense Risk Charge (applicable to all contracts)
 1.10%
Administrative Charge (applicable to all contracts)
 0.20%
Combination Enhanced Death Benefit Option Charge
 0.45%
Beneficiary Protector II Option Charge
 0.35%
Maximum 7% Nationwide Lifetime Income Rider Charge
 1.50% 8
Maximum Joint Option for the 7% Nationwide Lifetime Income Rider Charge
 0.40% 8
Maximum Possible Total Variable Account Charges
 4.00% 9
 
1 Nationwide will charge between 0% and 5% of purchase payments for premium taxes levied by state or other government entities. The amount assessed to the contract will equal the amount assessed by the state or government entity.
2 The transaction amount is the amount of the transfer determined to be engaged in short-term trading (see Short-Term Trading Fees).
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3 On each contract's Contract Anniversary, Nationwide deducts the Contract Maintenance Charge if the Contract Value is less than $50,000 on such Contract Anniversary. This charge is permanently waived for any contracts valued at $50,000 or more on any Contract Anniversary.
4 In addition to the 0.35% charge assessed to Variable Account allocations, allocations made to the Fixed Account will also be assessed a fee of 0.35% by decreasing the interest credited to amounts allocated to the Fixed Account.
5 For information about how the Current Income Benefit Base is calculated, see Determination of the Income Benefit Base Prior to the First Lifetime Withdrawal.
6 Currently, the charge associated with the 7% Nationwide Lifetime Income Rider is equal to 1.20% of the Current Income Benefit Base.
7 The Joint Option for the 7% Nationwide Lifetime Income Rider may only be elected if and when the 7% Nationwide Lifetime Income Rider is elected. For contracts issued on or after January 14, 2013, or the date of state approval (whichever is later), the charge associated with the Joint Option for the 7% Nationwide Lifetime Income Rider is equal to 0.30% of the Current Income Benefit Base. For contracts issued before January 14, 2013, or the date of state approval (whichever is later), there is no charge associated with the Joint Option for the 7% Nationwide Lifetime Income Rider.
8 This charge is a percentage of the Current Income Benefit Base. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.
9 The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.
Underlying Mutual Fund Annual Expenses
The next table provides the minimum and maximum total operating expenses, as of December 31, 2012, charged by the underlying mutual funds that the Contract Owner may pay periodically during the life of the contract. The table does not reflect Short-Term Trading Fees. More detail concerning each underlying mutual fund's fees and expenses is contained in the prospectus for each underlying mutual fund.
Total Annual Underlying Mutual Fund Operating Expenses
  Minimum   Maximum
(expenses that are deducted from underlying mutual fund assets, including management fees, distribution (12b-1) fees, and other expenses, as a percentage of average underlying mutual fund assets) 0.41%   4.21%
The minimum and maximum underlying mutual fund operating expenses indicated above do not reflect voluntary or contractual reimbursements and/or waivers applied to some underlying mutual funds. Therefore, actual expenses could be lower. Refer to the underlying mutual fund prospectuses for specific expense information.
Example
This Example is intended to help Contract Owners compare the cost of investing in the contract with the cost of investing in other variable annuity contracts. These costs include Contract Owner transaction expenses, contract fees, Variable Account annual expenses, and underlying mutual fund fees and expenses. The Example does not reflect premium taxes or short-term trading fees which, if reflected, would result in higher expenses.
The following Example assumes:
• a $10,000 investment in the contract for the time periods indicated;
• a 5% return each year;
• the maximum and the minimum fees and expenses of any of the underlying mutual funds;
• the maximum Contingent Deferred Sales Charge;
• a $30 Contract Maintenance Charge expressed as a percentage of the average contract account size; and
• the total Variable Account charges associated with the most expensive allowable combination of optional benefits (4.00%).1
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For those contracts that do not elect the most expensive combination of optional benefits, the expenses would be lower.
  If you surrender your contract
at the end of the applicable
time period 		  If you annuitize your contract
at the end of the applicable
time period 		  If you do not
surrender your contract
  1 Yr.   3 Yrs.   5 Yrs.   10 Yrs.   1 Yr.   3 Yrs.   5 Yrs.   10 Yrs.   1 Yr.   3 Yrs.   5 Yrs.   10 Yrs.
Maximum Total Underlying Mutual Fund Operating Expenses (4.21%)
 $1,594   $3,077   $4,430   $7,508   *   $2,577   $4,130   $7,508   $894   $2,577   $4,130   $7,508
Minimum Total Underlying Mutual Fund Operating Expenses (0.41%)
 $1,195   $1,984   $2,775   $4,958   *   $1,484   $2,475   $4,958   $495   $1,484   $2,475   $4,958
* The contracts sold under this prospectus do not permit annuitization during the first two Contract Years.
1 The total Variable Account charges associated with the most expensive allowable combination of optional benefits may be higher or lower depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.
Synopsis of the Contracts
The annuity described in this prospectus is intended to provide benefits to a single or joint owner and his/her beneficiaries. The contracts described in this prospectus are Individual Flexible Premium Deferred Variable Annuity Contracts.
The contracts can be categorized as:
• Charitable Remainder Trusts
• Individual Retirement Annuities ("IRAs")
• Investment-Only Contracts (Qualified Plans)
• Non-Qualified Contracts
• Roth IRAs
• Simplified Employee Pension IRAs ("SEP IRAs")
• Simple IRAs
For more detailed information with regard to the differences in contract types, see Appendix C: Contract Types and Tax Information.
Prospective purchasers may apply to purchase a contract through broker dealers that have entered into a selling agreement with Nationwide Investment Services Corporation.
Surrenders/Withdrawals
Contract Owners may generally withdraw some or all of their Contract Value at any time prior to annuitization by notifying the Service Center in writing (see Surrender/Withdrawal Prior to Annuitization). After the Annuitization Date, withdrawals are not permitted (see Surrender/Withdrawal After Annuitization).
Minimum Initial and Subsequent Purchase Payments
The minimum initial purchase payment is $10,000. A Contract Owner will meet the minimum initial purchase payment requirement by making purchase payments equal to the required minimum over the course of the first Contract Year. The minimum subsequent purchase payment is $1,000. However, for subsequent purchase payments sent via electronic deposit, the minimum subsequent purchase payment is $150.
Some states have different minimum initial and subsequent purchase payment amounts, and subsequent purchase payments may not be permitted in all states. Contact the Service Center for information on subsequent purchase payment requirements in a particular state.
Some optional benefits may restrict the Contract Owner's ability to make subsequent purchase payments.
Credits applied to the contract cannot be used to meet the minimum purchase payment requirements.
Nationwide reserves the right to refuse any purchase payment that would result in the cumulative total for all contracts issued by Nationwide on the life of any one Annuitant or owned by any one Contract Owner to exceed $1,000,000. Its decision as to whether or not to accept a purchase payment in excess of that amount will be based on one or more factors, including, but not limited to: age, spouse age (if applicable), Annuitant age, state of issue, total purchase payments, optional benefits elected, current market conditions, and current hedging costs. All such decisions will be based
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on internally established actuarial guidelines and will be applied in a non-discriminatory manner. In the event that Nationwide does not accept a purchase payment under these guidelines, the purchase payment will be immediately returned in its entirety in the same manner as it was received. If Nationwide accepts the purchase payment, it will be applied to the contract immediately and will receive the next calculated Accumulation Unit value. Any references in this prospectus to purchase payment amounts in excess of $1,000,000 are assumed to have been approved by Nationwide.
Nationwide prohibits subsequent purchase payments made after death of the Contract Owner(s), the Annuitant, or Co-Annuitant. If upon notification of death of the Contract Owner(s), the Annuitant, or Co-Annuitant, it is determined that death occurred prior to a subsequent purchase payment being made, Nationwide reserves the right to return the purchase payment.
Dollar Limit Restrictions
Certain features of the contract have additional purchase payment and/or Contract Value limitations associated with them:
Annuitization. Annuity payment options will be limited if the Contract Owner submits total purchase payments in excess of $2,000,000. Furthermore, if the amount to be annuitized is greater than $5,000,000, Nationwide may limit both the amount that can be annuitized on a single life and the annuity payment options (see Annuity Payment Options).
Death Benefit Calculations. Purchase payments up to $3,000,000 may result in a higher death benefit payment than purchase payments in excess of $3,000,000 (see Death Benefit Calculations).
Subsequent Purchase Payments. If the Contract Owner elects the 7% Nationwide Lifetime Income Rider, subsequent purchase payments may be limited to an aggregate total of $50,000 per calendar year.
Credits on Purchase Payments
Purchase Payment Credits ("PPCs") are additional credits that Nationwide will apply to a contract when cumulative purchase payments reach certain aggregate levels.
Each time a Contract Owner submits a purchase payment, Nationwide will perform a calculation to determine if and how many PPCs are payable as a result of that particular deposit. For purposes of all benefits and taxes under these contracts, PPCs are considered earnings, not purchase payments, and they will be allocated in the same proportion that purchase payments are allocated on the date the PPCs are applied.
If the Contract Owner cancels the contract pursuant to the contractual free look provision, Nationwide will recapture all PPCs applied to the contract. In those states that require the return of purchase payments for IRAs that are surrendered pursuant to the contractual free look, Nationwide will recapture all PPCs, but under no circumstances will the amount returned to the Contract Owner be less than the purchase payments made to the contract. In those states that allow a return of Contract Value, the Contract Owner will retain any earnings attributable to the PPCs, but all losses attributable to the PPCs will be incurred by Nationwide. All PPCs are fully vested after the end of the contractual free look period and are not subject to recapture.
Mortality and Expense Risk Charge
Nationwide deducts a Mortality and Expense Risk Charge equal to an annualized rate of 1.10% of the Daily Net Assets. The Mortality and Expense Risk Charge compensates Nationwide for providing the insurance benefits under the contract, including the contract's standard death benefit. It also compensates Nationwide for assuming the risk that Annuitants will live longer than assumed. Finally, the Mortality and Expense Risk Charge compensates Nationwide for guaranteeing that charges will not increase regardless of actual expenses. Nationwide may realize a profit from this charge.
Administrative Charge
Nationwide deducts an Administrative Charge equal to an annualized rate of 0.20% of the Daily Net Assets. The Administrative Charge reimburses Nationwide for administrative costs it incurs resulting from providing contract benefits, including preparation of the contract and prospectus, confirmation statements, annual account statements and annual reports, legal and accounting fees, as well as various related expenses. Nationwide may realize a profit from this charge.
Contract Maintenance Charge
A $30 Contract Maintenance Charge is assessed on each Contract Anniversary and upon full surrender of the contract. If on any Contract Anniversary (or on the date of a full surrender) the Contract Value is $50,000 or more, Nationwide will waive the Contract Maintenance Charge from that point forward.
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Contingent Deferred Sales Charge
Nationwide does not deduct a sales charge from purchase payments upon deposit into the contract. However, Nationwide may deduct a Contingent Deferred Sales Charge ("CDSC") if any amount is withdrawn from the contract. This CDSC reimburses Nationwide for sales expenses. The amount of the CDSC will not exceed 7% of purchase payments withdrawn.
Death Benefit Options
The contract contains a standard death benefit (the greater of (i) Contract Value or (ii) net purchase payments) at no additional charge. Optional death benefits are also available for an additional charge, which may provide a greater death benefit than the standard death benefit.
In lieu of the standard death benefit, an applicant may elect one of the following death benefit options at the time of application:
• The One-Year Enhanced Death Benefit Option is available for contracts with Annuitants age 80 or younger at the time of application. The charge for this option is equal to 0.20% of the Daily Net Assets.
• The One-Month Enhanced Death Benefit Option is available for contracts with Annuitants age 75 or younger at the time of application. The charge for this option is equal to 0.35% of the Daily Net Assets.
• The Combination Enhanced Death Benefit Option is available for contracts with Annuitants age 75 or younger at the time of application. The charge for this option is equal to 0.45% of the Daily Net Assets.
Changes in ownership and contract assignments could have a negative impact on the death benefit (see Death Benefits).
Beneficiary Protector II Option
An applicant may elect the Beneficiary Protector II Option at the time of application. This option provides that upon the death of the Annuitant (and potentially, the Co-Annuitant, if one is named), and in addition to any death benefit payable, Nationwide will credit an additional amount to the contract (the "benefit"). This benefit would be advantageous if the Contract Owner anticipates the assessment of taxes in connection with payment of the death benefit proceeds. This option is only available for contracts with Annuitants age 75 or younger at the time of application. If the applicant elects the Beneficiary Protector II Option, Nationwide will deduct an additional charge at an annualized rate of 0.35% of the Daily Net Assets. Additionally, allocations made to the Fixed Account will be assessed a fee of 0.35%.
7% Nationwide Lifetime Income Rider (formerly the 7% Lifetime Income Option)
The 7% Nationwide Lifetime Income Rider provides for Lifetime Withdrawals, up to a certain amount each year, even after the Contract Value is $0, provided that the Contract Owner does not deplete the Current Income Benefit Base by taking excess withdrawals and does not make certain assignments or Contract Owner changes. Investment restrictions apply. Additionally, if the Contract Owner delays taking Lifetime Withdrawals for 10 years, Nationwide will guarantee that the Current Income Benefit Base on the 10th Contract Anniversary will be no less than the Original Income Benefit Base plus simple interest at a rate of 7% annually for each of those 10 years. The 7% Nationwide Lifetime Income Rider is available under the contract at the time of application. The Contract Owner (or the Annuitant in the case of a non-natural Contract Owner) must be between age 45 and 85 at the time of application.
If the 7% Nationwide Lifetime Income Rider is elected, Nationwide will deduct an additional charge not to exceed 1.50% of the Current Income Benefit Base, which is the amount upon which the Lifetime Withdrawal Amount is based. Currently, the charge for the 7% Nationwide Lifetime Income Rider is 1.20% of the Current Income Benefit Base. The charge is deducted on each Contract Anniversary and is taken from the Sub-Accounts proportionally based on contract allocations at the time the charge is deducted.
Election of the 7% Nationwide Lifetime Income Rider requires that the Contract Owner, until annuitization, allocate the entire Contract Value to a limited set of investment options. If the Contract Value is greater than $0, Lifetime Withdrawals are paid from the Contract Owner's Contract Value. If the Contract Value is equal to or less than $0, Lifetime Withdrawals are paid from Nationwide's General Account. Lifetime Withdrawals paid from the General Account are subject to Nationwide's creditors and ultimately, its overall claims paying ability. The cost of the 7% Nationwide Lifetime Income Rider may exceed the benefit. Certain actions by the Contract Owner will terminate this optional benefit.
Withdrawals in excess of the Lifetime Withdrawal Amount that reduce the Current Income Benefit Base to $0 will automatically terminate the 7% Nationwide Lifetime Income Rider.
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Joint Option for the 7% Nationwide Lifetime Income Rider (formerly the 7% Spousal Continuation Benefit)
The Joint Option for the 7% Nationwide Lifetime Income Rider ("Joint Option") allows a surviving spouse to continue to receive, for the duration of his/her lifetime, the benefit associated with the 7% Nationwide Lifetime Income Rider, provided that certain conditions are satisfied. The Joint Option is only available for election if and when the 7% Nationwide Lifetime Income Rider is elected.
If the Joint Option is elected, Nationwide will deduct an additional charge not to exceed 0.40% of the Current Income Benefit Base. For contracts issued on or after January 14, 2013, or the date of state approval (whichever is later), the charge for the Joint Option is 0.30% of the Current Income Benefit Base and the Lifetime Withdrawal Percentages will be reduced.  For contracts issued before January 14, 2013, or the date of state approval (whichever is later), there is no charge for the Joint Option, however, the Lifetime Withdrawal Percentages will be reduced. The Contract Owner's spouse (or the Annuitant's spouse in the case of a non-natural Contract Owner) must be between age 45 and 85 at the time of application. If assessed, the charge is deducted at the same time and in the same manner as the 7% Nationwide Lifetime Income Rider charge. The cost of the Joint Option (including the reduction in the Lifetime Withdrawal Percentages) may exceed the benefit.
Charges for Optional Benefits
The charges associated with optional benefits are only assessed prior to annuitization.
Underlying Mutual Fund Annual Expenses
The underlying mutual funds charge fees and expenses that are deducted from underlying mutual fund assets. These fees and expenses are in addition to the fees and expenses assessed by the contract. The prospectus for each underlying mutual fund provides information regarding the fees and expenses applicable to the fund.
Short-Term Trading Fees
Some underlying mutual funds may assess (or reserve the right to assess) a short-term trading fee in connection with transfers from a Sub-Account that occur within 60 days after the date of allocation to the Sub-Account.
Any short-term trading fee assessed by any underlying mutual fund available in conjunction with the contracts described in this prospectus will equal 1% of the amount determined to be engaged in short-term trading.
Annuity Payments
On the Annuitization Date, annuity payments begin (see Annuitizing the Contract). Annuity payments will be based on the annuity payment option chosen prior to annuitization. Nationwide will send annuity payments no later than seven days after each annuity payment date.
Taxation
How distributions from an annuity contract are taxed depends on the type of contract issued and the purpose for which the contract is purchased. Generally, distributions from an annuity contract, including the payment of death benefits, are taxable to the extent they exceed investment in the contract. Nationwide will charge against the contract any premium taxes levied by any governmental authority. Premium tax rates currently range from 0% to 5% (see Premium Taxes and Appendix C: Contract Types and Tax Information).
Death Benefit
An applicant may elect either the standard death benefit (Return of Premium) or an available death benefit option that is offered under the contract for an additional charge. If no election is made at the time of application, the death benefit will be the standard death benefit.
Cancellation of the Contract
Under state insurance laws, Contract Owners have the right, during a limited period of time, to examine their contract and decide if they want to keep it or cancel it. This right is referred to as a "free look" right. The length of this time period depends on state law and may vary depending on whether the purchase is a replacement of another annuity contract.
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If the Contract Owner elects to cancel the contract pursuant to the free look provision, where required by law, Nationwide will return the greater of the Contract Value or the amount of purchase payment(s) applied during the free look period, less any Purchase Payment Credits, withdrawals from the contract, and applicable federal and state income tax withholding. Otherwise, Nationwide will return the Contract Value, less any Purchase Payment Credits, withdrawals from the contract, and applicable federal and state income tax withholding (see Right to Examine and Cancel).
Condensed Financial Information
The value of an Accumulation Unit is determined on the basis of changes in the per share value of the underlying mutual funds and the assessment of Variable Account charges which may vary from contract to contract (see Determining the Contract Value). Refer to Appendix B: Condensed Financial Information for information regarding the minimum and maximum class of Accumulation Unit values. All classes of Accumulation Unit values may be obtained free of charge by contacting the Service Center.
Financial Statements
Financial statements for the Variable Account and consolidated financial statements for Nationwide are located in the Statement of Additional Information. A current Statement of Additional Information may be obtained, without charge, by contacting the Service Center.
Nationwide Life Insurance Company
Nationwide, the depositor, is a stock life insurance company organized under Ohio law in March 1929, with its home office at One Nationwide Plaza, Columbus, Ohio 43215. Nationwide is a provider of life insurance, annuities, and retirement products. Nationwide is admitted to do business in all states, the District of Columbia, and Puerto Rico.
Nationwide is a member of the Nationwide group of companies. Nationwide Mutual Insurance Company and Nationwide Mutual Fire Insurance Company (the "Companies") are the ultimate controlling persons of the Nationwide group of companies. The Companies were organized under Ohio law in December 1925 and 1933 respectively. The Companies engage in a general insurance and reinsurance business, except life insurance.
Nationwide Investment Services Corporation
The contracts are distributed by the general distributor, Nationwide Investment Services Corporation ("NISC"), One Nationwide Plaza, Columbus, Ohio 43215. NISC is a wholly-owned subsidiary of Nationwide.
Investing in the Contract
The Variable Account and Underlying Mutual Funds
Nationwide Variable Account-II is a variable account that invests in the underlying mutual funds listed in Appendix A: Underlying Mutual Funds. Nationwide established the Variable Account on October 7, 1981 pursuant to Ohio law. Although the Variable Account is registered with the SEC as a unit investment trust pursuant to the Investment Company Act of 1940 ("1940 Act"), the SEC does not supervise the management of Nationwide or the Variable Account.
Income, gains, and losses credited to or charged against the Variable Account reflect the Variable Account's own investment experience and not the investment experience of Nationwide's other assets. The Variable Account's assets are held separately from Nationwide's assets and are not chargeable with liabilities incurred in any other business of Nationwide. Nationwide is obligated to pay all amounts promised to Contract Owners under the contracts.
The Variable Account is divided into Sub-Accounts, each of which invests in shares of a single underlying mutual fund. Nationwide uses the assets of each Sub-Account to buy shares of the underlying mutual funds based on Contract Owner instructions.
Contract Owners receive underlying mutual fund prospectuses when they make their initial Sub-Account allocations and any time they change those allocations. Contract Owners can obtain prospectuses for underlying mutual funds free of charge at any time by contacting the Service Center. Contract Owners should read these prospectuses carefully before investing.
Underlying mutual funds in the Variable Account are NOT publicly traded mutual funds. They are only available as investment options in variable life insurance policies or variable annuity contracts issued by life insurance companies, or in some cases, through participation in certain qualified pension or retirement plans.
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The investment advisers of the underlying mutual funds may manage publicly traded mutual funds with similar names and investment objectives. However, the underlying mutual funds are NOT directly related to any publicly traded mutual fund. Contract Owners should not compare the performance of a publicly traded fund with the performance of underlying mutual funds participating in the Variable 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 contract 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. Contract Owners will receive notice of any such changes that affect their contract. Additionally, the 7% Nationwide Lifetime Income Rider limits the list of Sub-Accounts available in connection with that option.
In the future, additional underlying mutual funds managed by certain financial institutions, brokerage firms, or their affiliates may be added to the Variable Account. These additional underlying mutual funds may be offered exclusively to purchasing customers of the particular financial institution or brokerage firm, or through other exclusive distribution arrangements.
Voting Rights
Contract Owners with assets allocated to Sub-Accounts are entitled to certain voting rights. Nationwide will vote Contract Owner shares at special shareholder meetings based on Contract Owner instructions. However, if the law changes and Nationwide is allowed to vote in its own right, it may elect to do so.
Contract Owners with voting interests in an underlying mutual fund will be notified of issues requiring the shareholders' vote as soon as possible before the shareholder meeting. Notification will contain proxy materials and a form with which to give Nationwide voting instructions. Nationwide will vote shares for which no instructions are received in the same proportion as those that are received. What this means is that when only a small number of Contract Owners vote, each vote has a greater impact on, and may control, the outcome.
The number of shares which a Contract Owner may vote is determined by dividing the cash value of the amount they have allocated to an underlying mutual fund by the Net Asset Value of that underlying mutual fund. Nationwide will designate a date for this determination not more than 90 days before the shareholder meeting.
Material Conflicts
The underlying mutual funds may be offered through separate accounts of other insurance companies, as well as through other separate accounts of Nationwide. Nationwide does not anticipate any disadvantages to this. However, it is possible that a conflict may arise between the interests of the Variable Account and one or more of the other separate accounts in which these underlying mutual funds participate.
Material conflicts may occur due to a change in law affecting the operations of variable life insurance policies and variable annuity contracts, or differences in the voting instructions of the Contract Owners and those of other companies. If a material conflict occurs, Nationwide will take whatever steps are necessary to protect Contract Owners and variable annuity payees, including withdrawal of the Variable Account from participation in the underlying mutual fund(s) involved in the conflict.
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 Contract Owners will be notified in the event there is a substitution, elimination, or combination of shares.
Deregistration of the Variable Account
Nationwide may deregister the Variable Account under the 1940 Act in the event the Variable 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.
No deregistration may take place without the prior approval of the SEC. All affected Contract Owners will be notified in the event Nationwide deregisters the Variable Account.
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The Fixed Account
The Fixed Account is an investment option that is funded by assets of Nationwide's General Account. The General Account contains all of Nationwide's assets other than those in this and other Nationwide separate accounts and is used to support Nationwide's annuity and insurance obligations. The General Account is not subject to the same laws as the Variable Account and the SEC has not reviewed material in this prospectus relating to the Fixed Account.
Purchase payments will be allocated to the Fixed Account by election of the Contract Owner. Nationwide reserves the right to limit or refuse purchase payments and/or transfers allocated to the Fixed Account at its sole discretion. Generally, Nationwide will invoke this right when interest rates are low by historical standards. The Fixed Account may not be available in every state.
The investment income earned by the Fixed Account will be allocated to the contracts at varying guaranteed interest rate(s) depending on the following categories of Fixed Account allocations:
• New Money Rate – The rate credited on the Fixed Account allocation when the contract is purchased or when subsequent purchase payments are made. Subsequent purchase payments may receive different New Money Rates than the rate when the contract was issued, since the New Money Rate is subject to change based on market conditions.
• Variable Account to Fixed Rate – Allocations transferred from any of the Sub-Accounts to the Fixed Account may receive a different rate. The rate may be lower than the New Money Rate. There may be limits on the amount and frequency of movements from the Sub-Accounts to the Fixed Account.
• Renewal Rate – The rate available for maturing Fixed Account allocations which are entering a new guarantee period. The Contract Owner will be notified of this rate in a letter issued with the quarterly statements when a Contract Owner's Fixed Account allocation matures. At that time, the Contract Owner will have an opportunity to leave the money in the Fixed Account and receive the Renewal Rate or the Contract Owner can move the money to any of the other investment options.
• Dollar Cost Averaging Rate – From time to time, Nationwide may offer a more favorable rate for an initial purchase payment into a new contract when used in conjunction with a Dollar Cost Averaging program. Rates will vary depending on the Dollar Cost Averaging program elected (see Contract Owner Services).
All of these rates are subject to change on a daily basis; however, once applied to the Fixed Account, the interest rates are guaranteed until the end of the calendar quarter during which the 12-month anniversary of the Fixed Account allocation occurs.
Credited interest rates are annualized rates – the effective yield of interest over a one-year period. Interest is credited to each contract on a daily basis. As a result, the credited interest rate is compounded daily to achieve the stated effective yield.
The guaranteed rate for any purchase payment will be effective for not less than 12 months. Nationwide guarantees that the rate will not be less than the minimum interest rate required by applicable state law. Any interest in excess of the minimum interest rate required by applicable state law will be credited to Fixed Account allocations at Nationwide's sole discretion.
Nationwide guarantees that the value of Fixed Account allocations will not be less than the amount of the purchase payments and Purchase Payment Credits allocated to the Fixed Account, plus interest credited as described above, less any withdrawals and any applicable charges including CDSC.
Fixed Account Interest Rate Guarantee Period
The Fixed Account interest rate guarantee period is the period of time that the Fixed Account interest rate is guaranteed to remain the same. During a Fixed Account interest rate guarantee period, transfers cannot be made from the Fixed Account, and amounts transferred to the Fixed Account must remain on deposit.
For new purchase payments allocated to the Fixed Account and transfers to the Fixed Account, the Fixed Account interest rate guarantee period begins on the date of deposit or transfer and ends on the one-year anniversary of the deposit or transfer. The guaranteed interest rate period may last for up to three months beyond the one-year anniversary because guaranteed terms end on the last day of a calendar quarter.
Fixed Account Charges Assessed for Certain Optional Benefits
All interest rates credited to the Fixed Account will be determined as previously described. However, for contracts with certain optional benefits elected, a charge is assessed to assets allocated to the Fixed Account by reducing the interest crediting rate. Consequently, the charge assessed for the optional benefit will result in a lower credited interest rate (reduced by the amount of the charge).
• The Beneficiary Protector II Option has a Fixed Account charge equal to 0.35%.
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Even if the credited interest rate is reduced by an optional benefit charge, Nationwide guarantees that the interest rate credited to any assets in the Fixed Account will never be less than the minimum interest rate required by applicable state law.
Contacting the Service Center
All inquiries, paperwork, information requests, service requests, and transaction requests should be made to the Service Center:
• by telephone at 1-800-848-6331 (TDD 1-800-238-3035)
• by mail to P.O. Box 182021, Columbus, Ohio 43218-2021
• by fax at 1-888-634-4472
• by Internet at www.nationwide.com.
Nationwide reserves the right to restrict or remove the ability to submit service requests via Internet, phone, or fax upon written notice.
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 Date they are received at the Service Center as long as the request is in good order. Good order generally means that all necessary information to process the request is complete and in a form acceptable to Nationwide. If a request is not in good order, Nationwide will take reasonable actions to obtain the information necessary to process the request. Requests that are not in good order may be delayed or returned. Nationwide reserves the right to process any purchase payment or withdrawal request sent to a location other than the Service Center on the Valuation Date it is received at the Service Center.
Nationwide may be required to provide information about one or more contracts to government regulators. If mandated under applicable law, Nationwide may be required to reject a purchase payment and to refuse to process transaction requests for transfers, withdrawals, loans, and/or death benefits until instructed otherwise by the appropriate regulator.
Nationwide will use reasonable procedures to confirm that instructions are genuine and will not be liable for following instructions that it reasonably determined to be genuine. Nationwide may record telephone requests. Telephone and computer systems may not always be available. Any telephone system or computer can experience outages or slowdowns for a variety of reasons. The outages or slowdowns could prevent or delay processing. Although Nationwide has taken precautions to support heavy use, it is still possible to incur an outage or delay. To avoid technical difficulties, submit transaction requests by mail.
The Contract in General
In order to comply with the USA Patriot Act and rules promulgated thereunder, Nationwide has implemented procedures designed to prevent contracts described in this prospectus from being used to facilitate money laundering or the financing of terrorist activities.
Due to state law variations, the options and benefits described in this prospectus may vary or may not be available depending on the state in which the contract is issued. Possible state law variations include, but are not limited to, minimum initial and subsequent purchase payment amounts, age issuance limitations, availability of certain investment options, optional benefits, free look rights, annuity paynment options, ownership and interests in the contract, assignment, death benefit calculations, and CDSC-free withdrawal privileges. This prospectus describes all the material features of the contract. To review a copy of the contract and any endorsements, contact the Service Center.
If the contract described in this prospectus is replacing another variable annuity, the mortality tables used to determine the amount of annuity payments for this contract may be less favorable than those in the contract being replaced. Additionally, upon replacement, all benefits accrued under the replaced contract are forfeited.
Except in certain circumstances involving fraud and where permitted by state law, Nationwide will not contest the contract after it has been in force during the lifetime of the Annuitant for two years after the date of contract issuance or effective date of certain contract changes, as defined in the contract.
The annuity described in this prospectus is intended to provide benefits to a single individual and his/her beneficiaries. It is not intended to be used by institutional investors, in connection with other Nationwide contracts that have the same Annuitant, or in connection with other Nationwide contracts that have different Annuitants, but the same Contract Owner. If Nationwide determines that the risks it intended to assume in issuing the contract have been altered by misusing the
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contract as described above, Nationwide reserves the right to take any action it deems necessary to reduce or eliminate the altered risk. Nationwide also reserves the right to take any action it deems necessary to reduce or eliminate altered risk resulting from materially false, misleading, incomplete, or otherwise deficient information provided by the Contract Owner.
These contracts are offered to customers of various financial institutions and brokerage firms. No financial institution or brokerage firm is responsible for any of the contractual insurance benefits and features guaranteed under the contracts. These guarantees are the sole responsibility of Nationwide.
In general, deferred variable annuities are long-term investments; they are not intended as short-term investments. The contracts associated with this prospectus are not intended to be sold to a terminally ill Contract Owner or Annuitant. Accordingly, Nationwide has designed the contract to offer features, pricing, and investment options that encourage long-term ownership. It is very important that Contract Owners and prospective purchasers understand all the costs associated with owning a contract, and if and how those costs change during the lifetime of the contract. Contract charges may not be the same in later Contract Years as they are in early Contract Years. The various contract charges are assessed in order to compensate Nationwide for administrative services, distribution and operational expenses, and assumed actuarial risks associated with the contract.
Following is a discussion of some relevant factors that may be of particular interest to prospective investors.
Distribution, Promotional, and Sales Expenses
Nationwide pays commissions to the firms that sell the contracts. The maximum gross commission that Nationwide will pay on the sale of the contracts is 8.00% of purchase payments. Note: The individual registered representatives typically receive only a portion of this amount; the remainder is retained by the firm. Nationwide may also, instead of a premium-based commission, pay an asset-based commission (sometimes referred to as "trails" or "residuals"), or a combination of the two.
In addition to or partially in lieu of commission, Nationwide may also pay the selling firms a marketing allowance, which is based on the firm's ability and demonstrated willingness to promote and market Nationwide's products. How any marketing allowance is spent is determined by the firm, but generally will be used to finance firm activities that may contribute to the promotion and marketing of Nationwide's products. For more information on the exact compensation arrangement associated with this contract, consult your sales representative.
Underlying Mutual Fund Payments
Nationwide's Relationship with the Underlying Mutual Funds
The underlying mutual funds incur expenses each time they sell, administer, or redeem their shares. The Variable Account aggregates Contract Owner purchase, redemption, and transfer requests and submits net or aggregated purchase/redemption requests to each underlying mutual fund daily. The Variable Account (not the Contract Owners) is the underlying mutual fund shareholder. When the Variable Account aggregates transactions, the underlying mutual fund does not incur the expense of processing individual transactions it would normally incur if it sold its shares directly to the public. Nationwide incurs these expenses instead.
Nationwide also incurs the distribution costs of selling the contract (as discussed above), which benefit the underlying mutual funds by providing Contract Owners with Sub-Account options that correspond to the underlying mutual funds.
An investment adviser or subadviser of an underlying mutual fund or its affiliates may provide Nationwide or its affiliates with wholesaling services that assist in the distribution of the contract and may pay Nationwide or its affiliates to participate in educational and/or marketing activities. These activities may provide the adviser or subadviser (or their affiliates) with increased exposure to persons involved in the distribution of the contract.
Types of Payments Nationwide Receives
In light of the above, the underlying mutual funds and their affiliates make certain payments to Nationwide or its affiliates (the "payments"). The amount of these payments is typically based on a percentage of assets invested in the underlying mutual funds attributable to the contracts and other variable contracts Nationwide and its affiliates issue, but in some cases may involve a flat fee. These payments may be used by Nationwide for any corporate purpose, which include reducing the prices of the contracts, paying expenses that Nationwide or its affiliates incur in promoting, marketing, and administering the contracts and the underlying mutual funds, and achieving a profit.
Nationwide or its affiliates receive the following types of payments:
• Underlying mutual fund 12b-1 fees, which are deducted from underlying mutual fund assets;
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• 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 adviser or subadviser (or its affiliates). Such payments may be derived, in whole or in part, from the advisory fee, which is deducted from underlying mutual fund assets and is reflected in mutual fund charges.
Furthermore, Nationwide benefits from assets invested in Nationwide's affiliated underlying mutual funds (i.e., Nationwide Variable Insurance Trust) because its affiliates also receive compensation from the underlying mutual funds for investment advisory, administrative, transfer agency, distribution, and/or other services. Thus, Nationwide may receive more revenue with respect to affiliated underlying mutual funds than unaffiliated underlying mutual funds.
Nationwide took into consideration the anticipated payments from the underlying mutual funds when it determined the charges imposed under the contracts (apart from fees and expenses imposed by the underlying mutual funds). Without these payments, Nationwide would have imposed higher charges under the contract.
Amount of Payments Nationwide Receives
For the year ended December 31, 2012, the underlying mutual fund payments Nationwide and its affiliates received from the underlying mutual funds did not exceed 0.75% (as a percentage of the average Daily Net Assets invested in the underlying mutual funds) offered through this contract or other variable contracts that Nationwide and its affiliates issue. Payments from investment advisers or subadvisers to participate in educational and/or marketing activities have not been taken into account in this percentage.
Most underlying mutual funds or their affiliates have agreed to make payments to Nationwide or its affiliates, although the applicable percentages may vary from underlying mutual fund to underlying mutual fund and some may not make any payments at all. Because the amount of the actual payments Nationwide and its affiliates receive depends on the assets of the underlying mutual funds attributable to the contract, Nationwide and its affiliates may receive higher payments from underlying mutual funds with lower percentages (but greater assets) than from underlying mutual funds that have higher percentages (but fewer assets).
Identification of Underlying Mutual Funds
Nationwide may consider several criteria when identifying the underlying mutual funds, including some or all of the following: investment objectives, investment process, investment performance, risk characteristics, investment capabilities, experience and resources, investment consistency, and fund expenses. Another factor Nationwide considers during the identification process is whether the underlying mutual fund's adviser or subadviser is a Nationwide affiliate or whether the underlying mutual fund, its adviser, its subadviser(s), or an affiliate will make payments to Nationwide or its affiliates.
There may be underlying mutual funds with lower fees, as well as other variable contracts that offer underlying mutual funds with lower fees. The purchaser should consider all of the fees and charges of the contract in relation to its features and benefits when making a decision to invest. Note: Higher contract and underlying mutual fund fees and charges have a direct effect on and may lower investment performance.
Treatment of Unclaimed Property
Every state has unclaimed property laws which generally declare annuity contracts to be abandoned after a period of inactivity of three to five years from the contract's Annuity Commencement Date or the date Nationwide becomes informed that a death benefit is due and payable. For example, if the payment of a death benefit has been triggered, but, if after a thorough search, Nationwide is still unable to locate the beneficiary of the death benefit, or the beneficiary does not come forward to claim the death benefit in a timely manner, Nationwide will escheat the death benefit to the abandoned property division or unclaimed property office of the state in which the beneficiary or the Contract Owner last resided, as shown on Nationwide's books and records, or to Ohio, Nationwide's state of domicile. If a claim is subsequently made, the state is obligated to pay any such amount (without interest) to the designated recipient upon presentation of proper documentation.
To prevent escheatment, it is important to update beneficiary designations - including complete names, complete addresses, phone numbers, and social security numbers - as they change. Such updates should be sent to the Service Center.
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Profitability
Nationwide does consider profitability when determining the charges in the contract. In early Contract Years, Nationwide does not anticipate earning a profit, since that is a time when administrative and distribution expenses are typically higher. Nationwide does, however, anticipate earning a profit in later Contract Years. In general, Nationwide's profit will be greater the higher the investment return and the longer the contract is held.
Contract Modification
Nationwide may modify the contract, but no modification will affect the amount or term of any contract unless a modification is required to conform the contract to applicable federal or state law. No modification will affect the method by which Contract Value is determined.
Standard Charges and Deductions
Mortality and Expense Risk Charge
Nationwide deducts a Mortality and Expense Risk Charge equal to an annualized rate of 1.10% of the Daily Net Assets. The Mortality and Expense Risk Charge compensates Nationwide for providing the insurance benefits under the contract, including the contract's standard death benefit. It also compensates Nationwide for assuming the risk that Annuitants will live longer than assumed. Finally, the Mortality and Expense Risk Charge compensates Nationwide for guaranteeing that charges will not increase regardless of actual expenses. Nationwide may realize a profit from this charge.
Administrative Charge
Nationwide deducts an Administrative Charge equal to an annualized rate of 0.20% of the Daily Net Assets. The Administrative Charge reimburses Nationwide for administrative costs it incurs resulting from providing contract benefits, including preparation of the contract and prospectus, confirmation statements, annual account statements and annual reports, legal and accounting fees, as well as various related expenses. Nationwide may realize a profit from this charge.
Contract Maintenance Charge
A $30 Contract Maintenance Charge is assessed on each Contract Anniversary and upon full surrender of the contract.
This charge reimburses Nationwide for administrative expenses involved in issuing and maintaining the contract. If on any Contract Anniversary (or on the date of a full surrender) the Contract Value is $50,000 or more, Nationwide will waive the Contract Maintenance Charge from that point forward.
The deduction of the Contract Maintenance Charge will be taken proportionally from each Sub-Account and the Fixed Account based on the value in each option as compared to the total Contract Value.
Nationwide will not reduce or eliminate the Contract Maintenance Charge where it would be discriminatory or unlawful.
Contingent Deferred Sales Charge
No sales charge deduction is made from purchase payments upon deposit into the contract. However, if any part of the contract is withdrawn, Nationwide may deduct a CDSC. The CDSC will not exceed 7% of purchase payments withdrawn.
The CDSC is calculated by multiplying the applicable CDSC percentage (noted in the following table) by the amount of purchase payments withdrawn. For purposes of calculating the CDSC, withdrawals are considered to come first from the oldest purchase payment made to the contract, then the next oldest purchase payment, and so forth. CDSC provisions vary by state. Refer to the contract for state specific information.
The CDSC applies as follows:
Number of Completed Years from Date of Purchase Payment   0   1   2   3   4   5   6   7+
CDSC Percentage
   7%   7%   6%   5%   4%   3%   2%   0%
Earnings are not subject to the CDSC, but may not be distributed prior to the distribution of all purchase payments. (For tax purposes, a withdrawal is usually treated as a withdrawal of earnings first.)
The CDSC is used to cover sales expenses, including commissions, production of sales material, and other promotional expenses. If expenses are greater than the CDSC, the shortfall will be made up from Nationwide's general assets, which may indirectly include portions of the Variable Account charges, since Nationwide may generate a profit from these charges.
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All or a portion of any withdrawal may be subject to federal income taxes. Contract Owners taking withdrawals before age 59½ may be subject to a 10% penalty tax.
Additional purchase payments made to the contract after receiving the benefit of the Spousal Protection Feature are subject to the same CDSC provisions that were applicable prior to receiving the benefit of the Spousal Protection Feature.
Waiver of Contingent Deferred Sales Charge
The maximum amount that can be withdrawn annually without a CDSC is the greatest of:
(1) 10% of the net difference of purchase payments that are subject to CDSC minus purchase payments previously withdrawn that were subject to CDSC;
(2) any amount withdrawn to meet minimum distribution requirements for this contract under the Internal Revenue Code; or
(3) for those contracts with the 7% Nationwide Lifetime Income Rider, withdrawals up to the annual benefit amount.
This CDSC-free withdrawal privilege is non-cumulative. Free amounts not taken during any given Contract Year cannot be taken as free amounts in a subsequent Contract Year.
Note: CDSC-free withdrawals do not count as "purchase payments previously withdrawn that were subject to CDSC" and, therefore, do not reduce the amount used to calculate subsequent CDSC-free withdrawal amounts.
In addition, no CDSC will be deducted:
(1) upon the annuitization of contracts which have been in force for at least two years;
(2) upon payment of a death benefit; or
(3) from any values which have been held under a contract for at least seven years.
No CDSC applies to transfers between or among the various investment options in the contract.
A contract held by a Charitable Remainder Trust (within the meaning of Internal Revenue Code Section 664) may withdraw CDSC-free the greater of the amount that would otherwise be available for withdrawal without a CDSC, and the difference between:
(a) the Contract Value at the close of the day prior to the date of the withdrawal; and
(b) the total purchase payments made to the contract as of the date of the withdrawal (less an adjustment for amounts previously withdrawn).
The CDSC will not be eliminated if to do so would be unfairly discriminatory or prohibited by state law.
The CDSC-free withdrawal privilege does not apply to full surrenders of the contract. For purposes of the CDSC-free withdrawal privilege, a full surrender is:
• multiple withdrawals taken within a Contract Year that deplete the entire Contract Value; or
• any single net withdrawal of 90% or more of the Contract Value.
Long-Term Care/Nursing Home and Terminal Illness Waiver
The contract includes a Long-Term Care/Nursing Home and Terminal Illness Waiver at no additional charge. This benefit may not be available in every state.
Under this provision, no CDSC will be charged if:
(1) the first Contract Anniversary has passed and the Contract Owner has been confined to a long-term care facility or hospital for a continuous 90-day period that began after the contract issue date; or
(2) the Contract Owner has been diagnosed by a physician at any time after contract issuance to have a terminal illness and Nationwide receives and records a letter from that physician indicating such diagnosis.
Written notice and proof of terminal illness or confinement for 90 days in a hospital or long-term care facility must be received in a form satisfactory to Nationwide and recorded at the Service Center prior to waiver of the CDSC.
In the case of joint ownership, the waivers will apply if either joint owner meets the qualifications listed above.
For those contracts that have a non-natural person as Contract Owner as an agent for a natural person, the Annuitant may exercise the right of the Contract Owner for purposes described in this provision. If the non-natural Contract Owner does not own the contract as an agent for a natural person (e.g., the Contract Owner is a corporation or a trust for the benefit of an entity), the Annuitant may not exercise the rights described in this provision.
Note: The benefit associated with this feature is the waiver of CDSC under certain circumstances. This feature is not intended to provide or imply that the contract provides long-term care or nursing home insurance coverage.
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Premium Taxes
Nationwide will charge against the Contract Value any premium taxes levied by a state or other government entity. Premium tax rates currently range from 0% to 5% and vary from state to state. This range is subject to change. Nationwide will assess premium taxes to the contract at the time Nationwide is assessed the premium taxes by the state. Premium taxes may be deducted from death benefit proceeds.
Short-Term Trading Fees
Some underlying mutual funds may assess (or reserve the right to assess) a short-term trading fee 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 underlying mutual fund (and Contract Owners with interests in the underlying mutual fund) for the negative impact on fund performance that may result from frequent, short-term trading strategies. Short-term trading fees are not intended to affect the large majority of Contract Owners not engaged in such strategies.
Any short-term trading fee assessed by any underlying mutual fund available in conjunction with the contracts described in this prospectus 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 underlying mutual funds that charge such fees (see the underlying mutual fund prospectus). Contract Owners are responsible for monitoring the length of time allocations are held in any particular Sub-Account. Nationwide will not provide advance notice of the assessment of any applicable short-term trading fee.
To determine whether a particular underlying mutual fund assesses (or reserves the right to assess) a short-term trading fee, see Appendix A: Underlying Mutual Funds.
If a short-term trading fee is assessed, the underlying mutual fund will charge the Variable Account 1% of the amount determined to be engaged in short-term trading. The Variable Account will then pass the short-term trading fee on to the specific Contract Owner that engaged in short-term trading by deducting an amount equal to the short-term trading fee from that Contract Owner's Sub-Account value. All such fees will be remitted to the underlying mutual fund; none of the fee proceeds will be retained by Nationwide or the Variable Account.
When multiple purchase payments (or exchanges) are made to a Sub-Account that is subject to short-term trading fees, transfers 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, units held the longest time will be treated as being transferred first, and units held for the shortest time will be treated as being transferred last.
Some transactions are not subject to the short-term trading fees, including:
• scheduled and systematic transfers;
• withdrawals, including CDSC-free withdrawals;
• withdrawals of Annuity Units to make annuity payments;
• withdrawals of Accumulation Units to pay the Contract Maintenance Charge;
• withdrawals of Accumulation Units to pay a death benefit; or
• transfers made upon annuitization of the contract.
New share classes of currently available underlying mutual funds may be added as investment options under the contracts. These new share classes may require the assessment of short-term trading fees. When these new share classes are added, new purchase payment allocations and exchange reallocations to the underlying mutual funds in question may be limited to the new share class.
Optional Contract Benefits, Charges, and Deductions
For an additional charge, the following optional benefits are available to applicants. Not all optional benefits are available in every state. Unless otherwise indicated:
(1) optional benefits must be elected at the time of application;
(2) optional benefits, once elected, may not be terminated;
(3) the charges associated with the optional benefits are calculated and deducted daily as part of the Accumulation Unit value calculation; and
(4) the charges associated with the optional benefits will be assessed until annuitization.
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Death Benefit Options
For an additional charge, the applicant may elect one of the following death benefit options in lieu of the standard death benefit.
Changes in ownership and contract assignments could have a negative impact on the death benefit (see Death Benefits).
One-Year Enhanced Death Benefit Option
For an additional charge at an annualized rate of 0.20% of the Daily Net Assets, an applicant can elect the One-Year Enhanced Death Benefit Option. The One-Year Enhanced Death Benefit Option is only available for contracts with Annuitants age 80 or younger at the time of application. Nationwide may realize a profit from the charge assessed for this option.
If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is less than or equal to $3,000,000, the death benefit will be the greatest of:
(1) the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit;
(2) the total of all purchase payments, less an adjustment for amounts withdrawn; or
(3) the highest Contract Value on any Contract Anniversary prior to the Annuitant's 86th birthday, less an adjustment for amounts subsequently withdrawn, plus purchase payments received after that Contract Anniversary.
Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
Note: For Contract Owners who have elected this option, if the total of all purchase payments made to the contract is greater than $3,000,000, the death benefit calculation will be adjusted as described in the Death Benefit Calculations provision.
The One-Year Enhanced Death Benefit Option also includes the Spousal Protection Feature, which allows a surviving spouse to continue the contract while receiving the economic benefit of the death benefit upon the death of the other spouse.
One-Month Enhanced Death Benefit Option
For an additional charge at an annualized rate of 0.35% of the Daily Net Assets, an applicant can elect the One-Month Enhanced Death Benefit Option. The One-Month Enhanced Death Benefit Option is only available for contracts with Annuitants age 75 or younger at the time of application. Nationwide may realize a profit from the charge assessed for this option.
If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is less than or equal to $3,000,000, the death benefit will be the greatest of:
(1) the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit;
(2) the total of all purchase payments, less an adjustment for amounts withdrawn; or
(3) the highest Contract Value on any Monthly Contract Anniversary prior to the Annuitant's 81st birthday, less an adjustment for amounts subsequently withdrawn, plus purchase payments received after that Monthly Contract Anniversary.
Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
Note: For Contract Owners who have elected this option, if the total of all purchase payments made to the contract is greater than $3,000,000, the death benefit calculation will be adjusted as described in the Death Benefit Calculations provision.
The One-Month Enhanced Death Benefit Option also includes the Spousal Protection Feature, which allows a surviving spouse to continue the contract while receiving the economic benefit of the death benefit upon the death of the other spouse.
Combination Enhanced Death Benefit Option
For an additional charge at an annualized rate of 0.45% of the Daily Net Assets, an applicant can elect the Combination Enhanced Death Benefit Option. The Combination Enhanced Death Benefit Option is only available for contracts with Annuitants age 75 or younger at the time of application. Nationwide may realize a profit from the charge assessed for this option.
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If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is less than or equal to $3,000,000, the death benefit will be the greatest of:
(1) the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit;
(2) the total of all purchase payments, less an adjustment for amounts withdrawn;
(3) the highest Contract Value on any Contract Anniversary before the Annuitant's 81st birthday, less an adjustment for amounts subsequently withdrawn, plus purchase payments received after that Contract Anniversary; or
(4) the 5% interest anniversary value.
The 5% interest anniversary value is equal to purchase payments, accumulated at 5% annual compound interest until the last Contract Anniversary prior to the Annuitant's 81st birthday, proportionately adjusted for amounts withdrawn. The adjustment for amounts withdrawn will reduce the accumulated value as of the most recent Contract Anniversary prior to each partial withdrawal in the same proportion that the Contract Value was reduced on the date of the partial withdrawal. Such total accumulated amount, after the withdrawal adjustment, shall not exceed 200% of purchase payments adjusted for amounts withdrawn.
Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
Note: For Contract Owners who have elected this option, if the total of all purchase payments made to the contract is greater than $3,000,000, the death benefit calculation will be adjusted as described in the Death Benefit Calculations provision.
The Combination Enhanced Death Benefit Option also includes the Spousal Protection Feature, which allows a surviving spouse to continue the contract while receiving the economic benefit of the death benefit upon the death of the other spouse.
Beneficiary Protector II Option
The Beneficiary Protector II Option provides that upon the death of the Annuitant (and potentially, the Co-Annuitant, if one is named), and in addition to any death benefit payable, Nationwide will credit an additional amount to the contract (the "benefit"). This benefit would be advantageous if the Contract Owner anticipates the assessment of taxes in connection with the payment of the death benefit proceeds. Nationwide makes no assurances that the benefit associated with this option will offset all taxes. In addition, the Beneficiary Protector II Option will not provide a benefit if there are no earnings in connection with the payment of the death benefit proceeds. Consult a qualified tax advisor.
The amount of the benefit depends on the Annuitant's age at the time of application and, if applicable, the Co-Annuitant's age at the time of the first Annuitant's death.
The charge associated with the Beneficiary Protector II Option is equal to an annualized rate of 0.35% of the Daily Net Assets. In addition, allocations to the Fixed Account will be assessed a fee of 0.35%. Nationwide may realize a profit from the charge assessed for this option. The Beneficiary Protector II Option is only available for contracts with Annuitants age 75 or younger at the time of application.
After the death of the last surviving Annuitant or after all applicable benefits have been credited to the contract, the charge associated with the Beneficiary Protector II Option will be removed and the beneficiary may:
(a) take distribution of the contract in the form of the death benefit or required distributions as applicable; or
(b) if the beneficiary is the deceased Annuitant's surviving spouse, continue the contract as the Contract Owner or new beneficial Contract Owner, and subject to any mandatory distribution rules.
Calculation of the First Benefit
The formula for determining the first benefit, which is paid upon the first Annuitant's death, is as follows:
Earnings Percentage x Adjusted Earnings
If the Annuitant is age 70 or younger at the time of application, the Earnings Percentage will be 40%. If the Annuitant is age 71 through age 75 at the time of application, the Earnings Percentage will be 25%.
Adjusted Earnings = (a) – (b); where:
a = the Contract Value on the date the death benefit is calculated and prior to any death benefit calculation; and
b = purchase payments, proportionally adjusted for withdrawals.
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The adjustment for amounts withdrawn will reduce purchase payments in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
There is a limit on the amount of Adjusted Earnings used in the first benefit calculation.
Maximum Adjusted Earnings = 200% of the total of all purchase payments that were applied to the contract more than 12 months before the date of the Annuitant's death (if there are Co-Annuitants, then the date of death of the first Co-Annuitant to die) proportionally adjusted for any and all withdrawals taken before the Annuitant's death.
If there is no Co-Annuitant named, the benefit will be paid in addition to the death benefit.
If there is a Co-Annuitant named, the benefit will be credited to the contract. The Beneficiary Protector II Option will remain on the contract (including the associated charge) until the death of the Co-Annuitant.
Calculation of the Second Benefit
If a Co-Annuitant is named under the contract, a second benefit will be paid upon the death of the Co-Annuitant if the Co-Annuitant is age 75 or younger at the date of the first Annuitant's death. If the Co-Annuitant is older than age 75 at the date of the first Annuitant's death, no second benefit will be paid and the charge associated with the Beneficiary Protector II Option will be removed.
The calculation of the second benefit will be based on earnings to the contract after the first benefit was calculated. The formula for calculating the second benefit is as follows:
Earnings Percentage x Adjusted Earnings from the Date of the First Benefit
If the Co-Annuitant is age 70 or younger at the time of the first Annuitant's death, the Earnings Percentage will be 40%. If the Co-Annuitant is age 71 through age 75 at the time of the first Annuitant's death, the Earnings Percentage will be 25%.
Adjusted Earnings from the Date of the First Benefit = (a) – (b) – (c), where:
a = Contract Value on the date the second death benefit is calculated (before the second death benefit is calculated);
b = the Contract Value on the date the first benefit and the first death benefit were calculated (after the first benefit and the first death benefit were applied), proportionately adjusted for withdrawals; and
c = purchase payments made after the first benefit was applied, proportionately adjusted for withdrawals.
The adjustment for amounts withdrawn will reduce the beginning Contract Value and purchase payments in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
There is a limit on the amount of Adjusted Earnings from the Date of the First Benefit used in the second benefit calculation.
Maximum Adjusted Earnings from the Date of the First Benefit = 200% of the total of all purchase payments that were applied to the contract more than 12 months before the date of the Co-Annuitant's death (regardless of the date of the first Annuitant's death), proportionally adjusted for any and all withdrawals taken from the contract.
After the second benefit is applied, the charge associated with the Beneficiary Protector II Option will be removed.
How the Benefit is Allocated
Any amounts credited to the contract pursuant to the Beneficiary Protector II Option will be allocated among the investment options in the same proportion as each purchase payment is allocated to the contract on the date the benefit is applied.
7% Nationwide Lifetime Income Rider (formerly the 7% Lifetime Income Option)
The 7% Nationwide Lifetime Income (the "7% Nationwide L.inc") Rider provides for Lifetime Withdrawals, up to a certain amount each year, even after the Contract Value is $0, provided that the Contract Owner does not deplete the Current Income Benefit Base by taking excess withdrawals and does not make certain assignments or Contract Owner changes. Investment restrictions apply. The age of the person upon which the benefit depends (the "determining life") must be between 45 and 85 years old at the time of application. For most contracts, the determining life is that of the Contract Owner. For those contracts where the Contract Owner is a non-natural person, for purposes of this option, the determining life is that of the Annuitant, and all references in this option to "Contract Owner" shall mean Annuitant. If, in addition to the Annuitant, a Co-Annuitant or Joint Annuitant has been elected, the determining life will be that of the primary Annuitant as named on the application. The determining life may not be changed.
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Availability
The 7% Nationwide Lifetime Income Rider is available under the contract at the time of application. The 7% Nationwide L.inc Rider is not available on beneficially owned contracts – those contracts that are inherited by a beneficiary and the beneficiary continues to hold the contract as a beneficiary (as opposed to treating the contract as his/her own) for tax purposes. However, contracts that are purchased in the normal course of business with the 7% Nationwide L.inc Rider may keep the 7% Nationwide L.inc Rider even after such contract becomes beneficially owned. However, once a contract becomes beneficially owned, the contract will not receive the benefit of the RMD privilege discussed later in this section.
7% Nationwide L.inc Rider Charge
In exchange for Lifetime Withdrawals, Nationwide will assess an annual charge not to exceed 1.50% of the Current Income Benefit Base. Currently, the charge for the 7% Nationwide Lifetime Income Rider is 1.20% of the Current Income Benefit Base. The current charge will not change, except, possibly, upon the Contract Owner's election to reset the benefit base, as discussed herein. If the current charge does change, it will not exceed the maximum charge of 1.50% of the Current Income Benefit Base.
The charge will be assessed on each Contract Anniversary and will be deducted via redemption of Accumulation Units. A prorated charge will also be deducted upon full surrender of the contract. Accumulation Units will be redeemed proportionally from each Sub-Account in which the Contract Owner is invested at the time the charge is taken. Amounts redeemed as the 7% Nationwide L.inc Rider charge will not negatively impact calculations associated with other benefits elected or available under the contract, will not be subject to a CDSC, and will not reduce amounts available under the CDSC-free withdrawal privilege.
Lifetime Income Rider Investment Requirements
Election of the 7% Nationwide L.inc Rider requires that the Contract Owner, until annuitization, allocate the entire Contract Value to a limited set of investment options currently available in the contract. For the list of available investment options, see Income Benefit Investment Options. Allocation requests to investment options other than those listed in the Income Benefit Investment Options section will not be honored; they will be treated as though no allocation request was submitted. Nationwide may offer Dollar Cost Averaging for Living Benefits described in the Contract Owner Services provision. Allocation to the Fixed Account is not permitted (except as the originating account when the Contract Owner elects Dollar Cost Averaging for Living Benefits).
Transfers Among Permitted Investment Options
The Contract Owner may reallocate the Contract Value among the limited set of investment options in accordance with the Transfers Prior to Annuitization provision. The Contract Owner may reallocate the Contract Value within the Custom Portfolio Asset Rebalancing Service in accordance with that provision. Additionally, Contract Owners may change from the Custom Portfolio Asset Rebalancing Service to the permitted investment options, and vice versa.
Subsequent Purchase Payments
Subsequent purchase payments are permitted under the 7% Nationwide L.inc Rider as long as the Contract Value is greater than $0. There may be instances where a subsequent purchase payment creates a financial risk that Nationwide is unwilling to bear. If this occurs, Nationwide may exercise its right to refuse subsequent purchase payments which total in aggregate $50,000 or more in any calendar year. The $50,000 threshold will take into consideration all contracts issued by Nationwide to a particular Contract Owner or using the same determining life. If Nationwide exercises this right to refuse a purchase payment, the entire purchase payment that causes the aggregate amount to exceed $50,000 will be immediately returned to the Contract Owner in the same form in which it was received. Generally, Nationwide may invoke this right in times of economic instability. Contract Owners may contact the Service Center to find out if Nationwide will accept a particular subsequent purchase payment.
Determination of the Income Benefit Base Prior to the First Lifetime Withdrawal
Upon contract issuance, the Original Income Benefit Base is equal to the Contract Value. Thereafter, Nationwide tracks, on a continuous basis, the Current Income Benefit Base which is used to calculate the benefit amount. The Current Income Benefit Base from the date of contract issuance until the first Lifetime Withdrawal will reflect any additional purchase payments, Purchase Payment Credits, and reset opportunities, as described below.
Provided no withdrawals are taken from the contract, the Current Income Benefit Base for the 7% Nationwide L.inc Rider will equal the greater of:
(1) the highest Contract Value on any Contract Anniversary plus purchase payments submitted and any Purchase Payment Credits applied after that Contract Anniversary; or
(2) the 7% roll-up amount, which is equal to the sum of the following calculations:
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(a) Original Income Benefit Base with Roll-up: the Original Income Benefit Base, plus 7% of the Original Income Benefit Base for each Contract Anniversary up to and including the 10th Contract Anniversary; plus
(b) Purchase Payments with Roll-up: any purchase payments submitted after contract issuance and before the 10th Contract Anniversary, plus any Purchase Payment Credits applied, increased by simple interest at an annual rate of 7% each year from the date of the purchase payment through the 10th Contract Anniversary; plus
(c) Purchase Payments with No Roll-up: any purchase payments submitted after the 10th Contract Anniversary plus any Purchase Payment Credits applied.
When a purchase payment and any Purchase Payment Credits are applied on a date other than a Contract Anniversary, simple interest is calculated using a prorated method based upon the number of days from the date of the purchase payment to the next Contract Anniversary. However, if at any time prior to the first Lifetime Withdrawal the Contract Value equals $0, no additional purchase payments will be accepted and no further benefit base calculations will be made. The Current Income Benefit Base will be set equal to the benefit base calculated on the most recent Contract Anniversary minus adjustments made for excess withdrawals after that date, and the Lifetime Withdrawal Amount will be based on that Current Income Benefit Base. Since the roll-up is only calculated for the first 10 Contract Years or prior to the first Lifetime Withdrawal, whichever comes first, any purchase payments the Contract Owner makes during that time period will increase the Current Income Benefit Base more than purchase payments made after that time period.
Lifetime Withdrawals
At any time after the 7% Nationwide L.inc Rider is elected, the Contract Owner may begin taking the lifetime income benefit by taking a Lifetime Withdrawal from the contract. The first withdrawal under the contract constitutes the first Lifetime Withdrawal, even if such withdrawal is taken to meet minimum distribution requirements under the Internal Revenue Code. Nationwide will surrender Accumulation Units proportionally from the Sub-Accounts as of the date of the withdrawal request. As with any withdrawal, Lifetime Withdrawals reduce the Contract Value and consequently, the amount available for annuitization.
At the time of the first Lifetime Withdrawal, the Current Income Benefit Base is locked in and will not change unless the Contract Owner takes excess withdrawals, elects a reset opportunity (both discussed later in this provision), or submits additional purchase payments. Additional purchase payments submitted after the first Lifetime Withdrawal from the contract will increase the Current Income Benefit Base by the amount of the purchase payment.
Simultaneously, the Lifetime Withdrawal Percentage is determined based on the age of the Contract Owner as indicated in the following table:
Contract Owner's Age
(at time of first withdrawal) 		  45 up to 59½   59½ through 64   65 through 80   81 and older
Lifetime Withdrawal Percentage
   3.00%   4.00%   5.00%   6.00%
A Contract Owner will receive the greatest Lifetime Withdrawal Percentage only if he or she does not take a withdrawal from the contract prior to age 81.
For contracts that elect the Joint Option for the 7% Nationwide Lifetime Income Rider, the Lifetime Withdrawal Percentages will be equal to or less than the Lifetime Withdrawal Percentages in the previous table.
Note: The Internal Revenue Code requires that IRAs, SEP IRAs, Simple IRAs, and Investment-Only Contracts begin distributions no later than April 1 of the calendar year following the calendar year in which the Contract Owner reaches age 70½. Contract Owners subject to minimum required distribution rules may not be able to take advantage of the Lifetime Withdrawal Percentages available at higher age bands if distributions are taken from the contract to meet these Internal Revenue Code requirements. Contract Owners who elect not to take minimum required distributions from this contract, i.e., they take minimum required distributions from other sources, may be able to take advantage of Lifetime Withdrawal Percentages at the higher age bands. Consult a qualified tax advisor for more information.
At the time of the first Lifetime Withdrawal and on each Contract Anniversary thereafter, the Lifetime Withdrawal Percentage is multiplied by the Current Income Benefit Base to determine the Lifetime Withdrawal Amount for that year. The Lifetime Withdrawal Amount is the maximum amount that can be withdrawn from the contract before the next Contract Anniversary without reducing the Current Income Benefit Base. The ability to withdraw the Lifetime Withdrawal Amount will continue until the earlier of the Contract Owner's death or annuitization.
The Contract Owner can elect to set up Systematic Withdrawals or can request each Lifetime Withdrawal separately. All Lifetime Withdrawal requests must be made on a Nationwide form available by contacting the Service Center.
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Each year's Lifetime Withdrawal Amount is non-cumulative. A Contract Owner cannot take a previous year's Lifetime Withdrawal Amount in a subsequent year without causing an excess withdrawal (discussed herein) that will reduce the Current Income Benefit Base. Although Lifetime Withdrawals up to the Lifetime Withdrawal Amount do not reduce the Current Income Benefit Base, they do reduce the Contract Value and the death benefit.
Impact of Withdrawals in Excess of the Lifetime Withdrawal Amount
The Contract Owner is permitted to withdraw Contract Value in excess of that year's Lifetime Withdrawal Amount provided that the Contract Value is greater than $0. Withdrawals in excess of the Lifetime Withdrawal Amount will reduce the Current Income Benefit Base, and consequently, the Lifetime Withdrawal Amount calculated for subsequent years. In the event of excess withdrawals, the Current Income Benefit Base will be reduced by the greater of:
(1) the dollar amount of the withdrawal in excess of the Lifetime Withdrawal Amount; or
(2) a figure representing the proportional amount of the withdrawal. This amount is determined by the following formula:
 
dollar amount of the excess withdrawal X Current Income Benefit Base
prior to the withdrawal
Contract Value (reduced by the amount
of the Lifetime Withdrawal Amount withdrawn)
In situations where the Contract Value exceeds the existing Current Income Benefit Base, excess withdrawals will typically result in a dollar amount reduction to the new Current Income Benefit Base. In situations where the Contract Value is less than the existing Current Income Benefit Base, excess withdrawals will typically result in a proportional reduction to the new Current Income Benefit Base.
Currently, Nationwide allows for an "RMD privilege" whereby Nationwide permits a Contract Owner to withdraw Contract Value in excess of the Lifetime Withdrawal Amount without reducing the Current Income Benefit Base if such excess withdrawal is for the sole purpose of meeting Internal Revenue Code required minimum distributions for this contract. This RMD privilege does not apply to beneficially owned contracts. In order to qualify for the RMD privilege, the Contract Owner must:
(1) be at least 70½ years old as of the date of the request;
(2) own the contract as an IRA, SEP IRA, Simple IRA, or Investment-Only Contract; and
(3) submit a completed administrative form in advance of the withdrawal to the Service Center.
Nationwide reserves the right to modify or eliminate the RMD privilege if there is any change to the Internal Revenue Code or IRS rules relating to required minimum distributions, including the issuance of relevant IRS guidance. If Nationwide exercises this right, Nationwide will provide notice to Contract Owners and any withdrawal in excess of the Lifetime Withdrawal Amount will reduce the remaining Current Income Benefit Base.
Once the Contract Value falls to $0, the Contract Owner is no longer permitted to submit additional purchase payments or take withdrawals in excess of the Lifetime Withdrawal Amount. Additionally, there is no Contract Value to annuitize, making the payment of the benefit associated with this option the only income stream producing benefit remaining in the contract.
Reset Opportunities
Nationwide offers an automatic reset of the Current Income Benefit Base. If, on any Contract Anniversary, the Contract Value exceeds the Current Income Benefit Base, Nationwide will automatically reset the Current Income Benefit Base to equal that Contract Value. This higher amount will be the new Current Income Benefit Base. This automatic reset will continue until either the current price or the list of permitted investment options associated with the 7% Nationwide L.inc Rider changes.
In the event the current price or the list of permitted investment options of the 7% Nationwide L.inc Rider changes, the reset opportunities still exist, but are no longer automatic. An election to reset the Current Income Benefit Base must be made by the Contract Owner to Nationwide. On or about each Contract Anniversary, Nationwide will provide the Contract Owner with information necessary to make this determination. Specifically, Nationwide will provide: the Contract Value; the Current Income Benefit Base; the current terms and conditions associated with the 7% Nationwide L.inc Rider; and instructions on how to communicate an election to reset the benefit base.
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If the Contract Owner elects to reset the Current Income Benefit Base, it will be at the then current terms and conditions of the option as described in the most current prospectus. If Nationwide does not receive a Contract Owner's election to reset the Current Income Benefit Base within 60 days after the Contract Anniversary, Nationwide will assume that the Contract Owner does not wish to reset the Current Income Benefit Base. If the Current Income Benefit Base is not reset, it will remain the same and the terms and conditions of the 7% Nationwide L.inc Rider will not change (as applicable to that particular contract).
Contract Owners may cancel the automatic reset feature of the 7% Nationwide L.inc Rider by notifying Nationwide as to such election.
Settlement Options
If a Contract Owner's Contract Value falls to $0 and there is still a positive Current Income Benefit Base, Nationwide will provide the Contract Owner with settlement options. Specifically, Nationwide will provide a notification to the Contract Owner describing the following three options, along with instructions on how to submit the election to Nationwide:
(1) The Contract Owner can take Lifetime Withdrawals of the Lifetime Withdrawal Amount until the death of the Contract Owner;
(2) The Contract Owner can elect the Age Based Lump Sum Settlement Option, as described below; or
(3) If the Contract Owner qualifies after a medical examination, the Contract Owner can elect the Underwritten Lump Sum Settlement Option, as described below.
The options above each result in a different amount ultimately received under the 7% Nationwide L.inc Rider. The Underwritten Lump Sum Settlement Option will generally pay a larger amount than the Age Based Lump Sum Settlement Option when a Contract Owner is healthier than the normal population. Regardless of age or health, the Underwritten Lump Sum Settlement Option amount will never be less than the Age Based Lump Sum Settlement Option amount. Election of the Age Based Lump Sum Settlement Option enables the Contract Owner to receive payment without a medical exam, which could potentially delay payment. Before selecting a settlement option, consult with a qualified financial advisor to determine which option is best based on the Contract Owner's individual financial situation and needs.
The Contract Owner will have 60 days from the date of Nationwide's notification letter to make an election ("Notification Period"). Once the Contract Owner makes an election, the election is irrevocable. If the Contract Owner is receiving Systematic Withdrawals of the Lifetime Withdrawal Amount and does not make an election within the Notification Period, Nationwide will continue sending Systematic Withdrawals of the full amount of the Lifetime Withdrawal Amount to the Contract Owner. If the Contract Owner had requested Systematic Withdrawals of only a portion of the Lifetime Withdrawal Amount prior to the notice, Systematic Withdrawals will continue, but Nationwide will increase the Lifetime Withdrawals to the full amount of the Lifetime Withdrawal Amount.
If the Contract Owner is not taking Systematic Withdrawals of the Lifetime Withdrawal Amount and does not make an election within the Notification Period, Nationwide will initiate Systematic Withdrawals of the Lifetime Withdrawal Amount on behalf of the Contract Owner and will begin mailing to the Contract Owner on an annual basis an amount equal to the Lifetime Withdrawal Amount. If Nationwide initiates Systematic Withdrawals of the Lifetime Withdrawal Amount on behalf of the Contract Owner, it will be irrevocable. If Nationwide initiates Systematic Withdrawals of the Lifetime Withdrawal Amount on behalf of the Contract Owner, the first payment of the Lifetime Withdrawal Amount will be sent on the next business day following the Notification Period ("Settlement Payment Date"). Nationwide will then send the Contract Owner the Lifetime Withdrawal Amount annually on the anniversary of the Settlement Payment Date (or the next business day if the anniversary of the Settlement Payment Date does not fall on a business day). Nationwide will mail a check to the Contract Owner's address on record. The Contract Owner may contact the Service Center at any time to change the frequency of the Systematic Withdrawals.
Note: In any event, if the Contract Owner does not make an election within the Notification Period, Nationwide will send the Contract Owner the full amount of the Lifetime Withdrawal Amount to which he/she is entitled to each year. There may be tax consequences if Nationwide increases or initiates the Lifetime Withdrawals on behalf of a Contract Owner. Consult a qualified tax advisor.
Age Based Lump Sum Settlement Option
Under the Age Based Lump Sum Settlement Option, in lieu of taking Lifetime Withdrawals of the Lifetime Withdrawal Amount, Nationwide will pay the Contract Owner a lump sum equal to the Contract Owner's most recently calculated Lifetime Withdrawal Amount multiplied by the Annual Benefit Multiplier listed below:
Contract Owner's Age*   Up to Age 70   71-75   76-80   81-85   86-90   91-95   96+
Annual Benefit Multiplier
   5.5   4.5   3.5   2.5   2.0   1.5   1.0
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* As of the date the Age Based Lump Sum Option is elected.
For contracts that have elected the Joint Option for the 7% Nationwide Lifetime Income Rider, if both spouses are living on the date the Age Based Lump Sum Settlement Option is elected, Nationwide will use the age of the younger spouse minus three years to determine the Annual Benefit Multiplier. If only one spouse is living on the date the Age Based Lump Sum Settlement Option is elected, Nationwide will use the age of the living spouse to determine the Annual Benefit Multiplier.
Underwritten Lump Sum Settlement Option
Under the Underwritten Lump Sum Settlement Option, in lieu of taking Lifetime Withdrawals of the Lifetime Withdrawal Amount, for those who qualify based on a medical exam, Nationwide will pay the Contract Owner a lump sum based upon the attained age, sex, and health of the Contract Owner (and spouse if the Joint Option for the 7% Nationwide Lifetime Income Rider is elected). Once Nationwide receives the Contract Owner's election to take the Underwritten Lump Sum Settlement Option, Nationwide will provide the Contract Owner with a medical examination form, which must be completed by a certified physician chosen by the Contract Owner and returned to the Service Center within 30 days. Upon completion of underwriting by Nationwide, the lump sum settlement amount (determined as of the date that Nationwide received all of the necessary information) is issued to the Contract Owner. If Nationwide does not receive the completed form within the 30-day period, Nationwide will pay the Contract Owner the amount that would be payable under the Age Based Lump Sum Settlement Option.
Annuitization
If the Contract Owner elects to annuitize the contract, this option will terminate. Specifically, the charge associated with the option will no longer be assessed and all benefits associated with the 7% Nationwide L.inc Rider will terminate.
Death of Determining Life
For contracts with no Joint Option for the 7% Nationwide Lifetime Income Rider, upon the death of the determining life, the benefits associated with the option terminate. If the Contract Owner is also the Annuitant, the death benefit will be paid in accordance with the Death Benefits provision. If the Contract Owner is not the Annuitant, the Contract Value will be distributed as described in Appendix C: Contract Types and Tax Information.
For contracts with the Joint Option for the 7% Nationwide Lifetime Income Rider, upon the death of the determining life, the surviving spouse continues to receive the same benefit associated with the 7% Nationwide L.inc Rider which had been received by the deceased spouse, for the remainder of the survivor's lifetime. The Contract Value will reflect the death benefit and the Spousal Protection Feature.
Tax Treatment
Although the tax treatment for Lifetime Withdrawals under withdrawal benefits such as the 7% Nationwide L.inc Rider is not clear, Nationwide will treat a portion of each Lifetime Withdrawal as a taxable distribution, as follows:
First, Nationwide determines which is greater: (1) the Contract Value immediately before the Lifetime Withdrawal; or (2) the Lifetime Withdrawal Amount immediately before the Lifetime Withdrawal. That amount (the greater of (1) or (2)) minus any remaining investment in the contract at the time of the Lifetime Withdrawal will be reported as a taxable distribution.
For any Lifetime Withdrawal taken when the Contract Value is less than or equal to the total investment in the contract, Nationwide treats the Lifetime Withdrawal as a tax-free return of investment until the entire investment in the contract has been received tax-free. Once the entire investment in the contract has been received tax-free, Lifetime Withdrawals will be reported as taxable distributions. Consult a qualified tax advisor.
Automatic Termination of the 7% Nationwide L.inc Rider
Withdrawals in excess of the Lifetime Withdrawal Amount that reduce the Current Income Benefit Base to $0 will automatically terminate the 7% Nationwide L.inc Rider. If this option terminates, then Nationwide will no longer assess the fee associated with this option.
In addition, where permitted under state law, the 7% Nationwide L.inc Rider will automatically terminate if the Contract Owner is changed or if the contract is assigned (including a collateral assignment), except as follows:
(1) The new Contract Owner or assignee assumes full ownership of the contract and is essentially the same person (e.g., individual ownership is changed to ownership by a personal revocable trust, a change to the Contract Owner's spouse during the Contract Owner's lifetime, a change to a court appointed guardian representing the Contract Owner during the Contract Owner's lifetime, etc.);
(2) Ownership of a contract issued as an IRA or Roth IRA is being changed from one custodian to another, from the determining life to a custodian, or from a custodian to the determining life;
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(3) The assignment is for the purpose of effectuating an exchange pursuant to Section 1035 under the Internal Revenue Code; or
(4) The change is merely the removal of a Contract Owner where the contract is jointly owned.
Contract Owners contemplating changes to the ownership of their contract, including assignments, should contact their registered representative to determine how the changes impact the benefit associated with the 7% Nationwide L.inc Rider.
Joint Option for the 7% Nationwide Lifetime Income Rider (formerly the 7% Spousal Continuation Benefit)
At the time the 7% Nationwide Lifetime Income ("7% Nationwide L.inc") Rider is elected (at time of application), the Contract Owner may elect the Joint Option for the 7% Nationwide Lifetime Income Rider ("Joint Option") (not available for contracts issued as Charitable Remainder Trusts). The Joint Option allows a surviving spouse to continue to receive, for the duration of his/her lifetime, the benefit associated with the 7% Nationwide L.inc Rider, provided certain conditions are met. Once the Joint Option is elected, it may not be removed from the contract, except as provided in the Marriage Termination section. If the Joint Option is elected, the determining life for purposes of the 7% Nationwide L.inc Rider will be that of the younger spouse.
The charge for the Joint Option will not exceed 0.40% of the Current Income Benefit Base. For contracts issued on or after January 14, 2013, or the date of state approval (whichever is later), the charge for the Joint Option is 0.30% of the Current Income Benefit Base. For contracts issued before January 14, 2013, or the date of state approval (whichever is later), there is no charge for the Joint Option. If the Contract Owner elects the Joint Option, Nationwide will reduce the Lifetime Withdrawal Percentages associated with the 7% Nationwide L.inc Rider as follows:
For contracts issued on or after January 14, 2013, or the date of state approval (whichever is later):
Contract Owner's Age
(at time of first withdrawal) 		  45 up to 59½   59½ through 64   65 through 80   81 and older
Lifetime Withdrawal Percentage
   3.00%   3.75%   4.75%   5.75%
For contracts issued before January 14, 2013, or the date of state approval (whichever is later):
Contract Owner's Age
(at time of first withdrawal) 		  45 up to 59½   59½ through 64   65 through 80   81 and older
Lifetime Withdrawal Percentage
   3.00%   3.50%   4.50%   5.50%
The Lifetime Withdrawal Percentage will be based on the age of the younger spouse as of the date of the first withdrawal from the contract.
To be eligible for the Joint Option, the following conditions must be met:
(1) Both spouses must be between 45 and 85 years old at the time of application;
(2) Both spouses must be at least age 45 before either spouse is eligible to begin withdrawals. Note: the Internal Revenue Code imposes a penalty tax if a distribution is made before the Contract Owner reaches age 59½ unless certain exceptions are met (see Appendix C: Contract Types and Tax Information);
(3) If the Contract Owner is a non-natural person, both spouses must be named as Co-Annuitants;
(4) One or both spouses (or a revocable trust of which either or both of the spouses is/are grantor(s)) must be named as the Contract Owner. For contracts issued as IRAs and Roth IRAs, only the person for whom the IRA or Roth IRA was established may be named as the Contract Owner;
(5) Both spouses must be named as primary beneficiaries;
(6) No person other than the spouse may be named as Contract Owner, Annuitant, or primary beneficiary; and
(7) If both spouses are alive upon annuitization, the Contract Owner must specify which spouse is the Annuitant upon whose continuation of life any annuity payments involving life contingencies depend (for IRA and Roth IRA contracts, this person must be the Contract Owner).
Note: The Joint Option is distinct from the Spousal Protection Feature associated with the death benefits. The Joint Option allows a surviving spouse to continue receiving the Lifetime Withdrawals associated with the 7% Nationwide L.inc Rider. In contrast, the Spousal Protection Feature is a death benefit bump-up feature associated with the death benefit.
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Marriage Termination
If, prior to taking any withdrawals from the contract, the marriage terminates due to divorce, dissolution, or annulment, the Contract Owner may remove the Joint Option from the contract. Nationwide will remove the benefit and the associated charge after the Contract Owner submits to the Service Center a written request and evidence of the marriage termination satisfactory to Nationwide. Once the Joint Option is removed from the contract, the benefit may not be re-elected or added to cover a subsequent spouse.
If, after taking any withdrawals from the contract, the marriage terminates due to divorce, dissolution, or annulment, the Contract Owner may not remove the Joint Option from the contract.
Risks Associated with Electing the Joint Option
There are situations where a Contract Owner who elects the Joint Option will not receive the benefits associated with the option. This will occur if:
(1) the Contract Owner's spouse (Co-Annuitant) dies before him/her;
(2) the contract is annuitized; or
(3) after the first withdrawal, the marriage terminates due to divorce, dissolution, or annulment.
Additionally, in the situations described in (1) and (3) above, not only will the Contract Owner not receive the benefit associated with the Joint Option, but he/she must continue to pay any applicable charge until annuitization.
Income Benefit Investment Options
Following is a list of the investment options that are permitted when the 7% Nationwide Lifetime Income Rider is elected. Only the investment options shown are available for election.
• American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2
• Custom Portfolio Asset Rebalancing Service - Balanced
• Custom Portfolio Asset Rebalancing Service - Conservative
• Custom Portfolio Asset Rebalancing Service - Moderately Conservative
• Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2
• Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Managed Growth & Income Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Managed Growth Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Investor Destinations Managed Growth & Income Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Investor Destinations Managed Growth Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II
• Static Asset Allocation Models - American Funds Option (33% American Funds NVIT Asset Allocation Fund, 33% American Funds NVIT Bond Fund and 34% American Funds NVIT Growth-Income Fund)
Note: Some of the investment options listed are funds of funds. Additionally, some of the indicated investment options may not be available to a particular Contract Owner due to the date the contract was issued. Refer to Appendix A: Underlying Mutual Funds for more information.
Removal of Variable Account Charges
For certain optional benefits, a charge is assessed only for a specified period of time. To remove the charge, Nationwide systematically re-rates the contract. This re-rating results in lower contract charges, but no change in Contract Value or any other contractual benefit.
Re-rating involves two steps: the adjustment of contract expenses and the adjustment of the number of units in the contract.
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The first step, the adjustment of contract expenses, involves removing the charge from the unit value calculation. For example, on a contract where the only optional benefit elected is the Beneficiary Protector II Option, the Variable Account value will be calculated using unit values with Variable Account charges of 1.65%. After the benefit is paid, the charge associated with the Beneficiary Protector II Option will be removed. From that point on, the Variable Account value will be calculated using the unit values with Variable Account charges at 1.30%. Thus, the Beneficiary Protector II Option charge is no longer included in the daily Sub-Account valuation for the contract.
The second step of the re-rating process, the adjustment of the number of units in the contract, is necessary in order to keep the re-rating process from altering the Contract Value. Generally, for any given Sub-Account, the higher the Variable Account charges, the lower the unit value, and vice versa. For example, Sub-Account X with charges of 1.65% will have a lower unit value than Sub-Account X with charges of 1.30% (higher expenses result in lower unit values). When, upon re-rating, the unit values used in calculating Variable Account value are dropped from the higher expense level to the lower expense level, the higher unit values will cause an incidental increase in the Contract Value. In order to avoid this incidental increase, Nationwide adjusts the number of units in the contract down so that the Contract Value after the re-rating is the same as the Contract Value before the re-rating.
Ownership and Interests in the Contract
Contract Owner
Prior to the Annuitization Date, the Contract Owner has all rights under the contract, unless a joint owner is named. If a joint owner is named, each joint owner has all rights under the contract. Purchasers who name someone other than themselves as the Contract Owner will have no rights under the contract.
On the Annuitization Date, the Annuitant becomes the Contract Owner, unless the Contract Owner is a Charitable Remainder Trust. If the Contract Owner is a Charitable Remainder Trust, the Charitable Remainder Trust continues to be the Contract Owner after annuitization.
Contract Owners of Non-Qualified Contracts may name a new Contract Owner at any time before the Annuitization Date. Any change of Contract Owner automatically revokes any prior Contract Owner designation. Changes in contract ownership may result in federal income taxation and may be subject to state and federal gift taxes.
Changes in ownership and contract assignments could have a negative impact on certain benefits under the contract, including the death benefit and the 7% Nationwide Lifetime Income Rider.
Joint Owner
Joint owners each own an undivided interest in the contract.
Non-Qualified Contract Owners can name a joint owner at any time before annuitization. However, joint owners must be spouses at the time joint ownership is requested, unless state law requires Nationwide to allow non-spousal joint owners. Joint ownership is not permitted on contracts owned by a non-natural Contract Owner.
Generally, the exercise of any ownership rights under the contract must be in writing and signed by both joint owners. However, if a written election, signed by both Contract Owners, authorizing Nationwide to allow the exercise of ownership rights independently by either joint owner is submitted, Nationwide will permit joint owners to act independently. If such an authorization is submitted, Nationwide will not be liable for any loss, liability, cost, or expense for acting in accordance with the instructions of either joint owner.
If either joint owner dies before the Annuitization Date, the contract continues with the surviving joint owner as the remaining Contract Owner.
Contingent Owner
The contingent owner succeeds to the rights of a Contract Owner if a Contract Owner who is not the Annuitant dies before the Annuitization Date and there is no surviving joint owner.
If a Contract Owner who is the Annuitant dies before the Annuitization Date, the contingent owner will not have any rights under the contract, unless such contingent owner is also the beneficiary.
The Contract Owner may name a contingent owner at any time before the Annuitization Date.
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Annuitant
The Annuitant is the person who will receive annuity payments and upon whose continuation of life any annuity payment involving life contingencies depends. This person must be age 85 or younger at the time of contract issuance, unless Nationwide approves a request for an Annuitant of greater age.
Only Non-Qualified Contract Owners may name someone other than himself/herself as the Annuitant.
The Contract Owner may not name a new Annuitant without Nationwide's consent.
Contingent Annuitant
If the Annuitant dies before the Annuitization Date, the contingent annuitant becomes the Annuitant. The contingent annuitant must be age 85 or younger at the time of contract issuance, unless Nationwide approves a request for a contingent annuitant of greater age.
If a contingent annuitant is named, all provisions of the contract that are based on the Annuitant's death prior to the Annuitization Date will be based on the death of the last survivor of the Annuitant and contingent annuitant.
Co-Annuitant
A Co-Annuitant, if named, must be the Annuitant's spouse. The Co-Annuitant must be named at the time of application and will receive the benefit of the Spousal Protection Feature, provided all of the requirements set forth in the Spousal Protection Feature section are met.
If either Co-Annuitant dies before the Annuitization Date, the surviving Co-Annuitant may continue the contract and will receive the benefit of the Spousal Protection Feature.
Joint Annuitant
The joint annuitant is designated as a second person (in addition to the Annuitant) upon whose continuation of life any annuity payment involving life contingencies depends. The joint annuitant is named at the time of annuitization.
Beneficiary and Contingent Beneficiary
The beneficiary is the person who is entitled to the death benefit if the Annuitant (and contingent annuitant, if applicable) dies before the Annuitization Date and there is no joint owner. The Contract Owner can name more than one beneficiary. Multiple beneficiaries will share the death benefit equally, unless otherwise specified.
A contingent beneficiary will succeed to the rights of the beneficiary if no beneficiary is alive when a death benefit is paid. The Contract Owner can name more than one contingent beneficiary. Multiple contingent beneficiaries will share the death benefit equally, unless otherwise specified.
Changes to the Parties to the Contract
Prior to the Annuitization Date (and subject to any existing assignments), the Contract Owner may request to change the following:
• Contract Owner (Non-Qualified Contracts only);
• Joint Owner (must be the Contract Owner's spouse);
• Contingent Owner;
• Annuitant (subject to Nationwide's underwriting and approval);
• contingent annuitant (subject to Nationwide's underwriting and approval);
• Co-Annuitant (must be the Annuitant's spouse);
• beneficiary; or
• contingent beneficiary.
The Contract Owner must submit the request to Nationwide in writing and Nationwide must receive the request at the Service Center before the Annuitization Date. Once Nationwide receives and records the change request, the change will be effective as of the date the written request was signed (unless otherwise specified by the Contract Owner), whether or not the Contract Owner or Annuitant is living at the time it was recorded. The change will not affect any action taken by Nationwide before the change was recorded.
Any request to change the Contract Owner must be signed by the existing Contract Owner and the person designated as the new Contract Owner. Nationwide may require a signature guarantee.
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If the Contract Owner is not a natural person and there is a change of the Annuitant, distributions will be made as if the Contract Owner died at the time of the change, regardless of whether the Contract Owner named a contingent annuitant.
Nationwide reserves the right to reject any change request that would alter the nature of the risk that Nationwide assumed when it originally issued the contract.
Operation of the Contract
Purchase Payment Credits
Purchase Payment Credits ("PPCs") are additional credits that Nationwide will apply to a contract when cumulative purchase payments reach certain aggregate levels.
When determining PPCs Nationwide will include the purchase payments in this contract, as well as the purchase payments of any other Nationwide annuity contract issued to an immediate family member within the 12 months before the purchase of this contract. Immediate family members include spouses, children, or other family members living within the Contract Owner's household. In order to be considered for PPCs, the Contract Owner must notify Nationwide in writing of all Nationwide annuity contracts owned by the Contract Owner or immediate family members.
Each time a Contract Owner submits a purchase payment, Nationwide will perform a calculation to determine if and how many PPCs are payable as a result of that particular deposit.
The formula used to determine the amount of the PPC is as follows:
(Cumulative Purchase Payments x PPC%) - PPCs Paid to Date = PPCs Payable
Cumulative Purchase Payments = the total of all purchase payments applied to the contract(s) eligible to receive a PPC, including the current deposit, minus any withdrawals.
PPC% = either 0.0%, 0.5%, or 1.0%, depending on the level of Cumulative Purchase Payments as follows:
If Cumulative Purchase Payments are   Then the PPC% is
$0 - $499,999
   0.0% (no PPC is payable)
$500,000 - $999,999
   0.5%  
$1,000,000 or more
   1.0%  
PPCs Paid to Date = the total PPCs that Nationwide has already applied to this contract.
PPCs Payable = the PPCs that Nationwide will apply to the contract as a result of the current deposit.
For example, on March 1, Ms. Z makes an initial deposit of $200,000 to her contract. Her contract is the only one eligible to receive PPCs. For this deposit, she does not receive a PPC since her Cumulative Purchase Payments are less than $500,000.
On April 1, Ms. Z applies additional purchase payments of $350,000. Cumulative Purchase Payments now equal $550,000. Nationwide will apply PPCs to Ms. Z's contract equal to $2,750, which is (0.5% x $550,000) - $0.
On May 1, Ms. Z takes a withdrawal of $150,000. Cumulative Purchase Payments now equal $400,000.
On June 1, Ms. Z applies additional purchase payments of $500,000. Cumulative Purchase Payments now equal $900,000. Nationwide will apply PPCs to Ms. Z's contract equal to $1,750, which is ($900,000 x 0.5%) - $2,750. At this point in time, a total of $4,500 in PPCs have been applied to Ms. Z's contract.
On July 1, Ms. Z applies additional purchase payments of $300,000. Cumulative Purchase Payments now equal $1,200,000. Nationwide will apply PPCs to Ms. Z's contract equal to $7,500, which is ($1,200,000 x 1.0%) - $4,500. At this point in time, a total of $12,000 in PPCs have been applied to Ms. Z's contract. For purposes of all benefits and taxes under these contracts, PPCs are considered earnings, not purchase payments, and they will be allocated in the same proportion that purchase payments are allocated on the date the PPCs are applied.
Recapture of Purchase Payment Credits
If the Contract Owner cancels the contract pursuant to the contractual free look provision, Nationwide will recapture all PPCs applied to the contract. In those states that require the return of purchase payments for IRAs that are surrendered pursuant to the contractual free look, Nationwide will recapture all PPCs, but under no circumstances will the amount returned to the Contract Owner be less than the purchase payments made to the contract. In those states that allow a return of Contract Value, the Contract Owner will retain any earnings attributable to the PPCs, but all losses attributable to the PPCs will be incurred by Nationwide. All PPCs are fully vested after the end of the contractual free look period and are not subject to recapture.
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Pricing
Generally, Nationwide prices Accumulation Units on each day that the New York Stock Exchange is open. (Pricing is the calculation of a new Accumulation Unit value that reflects that day's investment experience.)
Accumulation Units are not priced when the New York Stock Exchange is closed or on the following nationally recognized holidays:
• New Year's Day
• Martin Luther King, Jr. Day
• Presidents' Day
• Good Friday
• Memorial Day
• Independence Day
• Labor Day
• Thanksgiving
• Christmas
Nationwide also will not price purchase payments, withdrawals, or transfers if:
(1) trading on the New York Stock Exchange is restricted;
(2) an emergency exists making disposal or valuation of securities held in the Variable Account impracticable; or
(3) the SEC, by order, permits a suspension or postponement for the protection of security holders.
Rules and regulations of the SEC will govern as to when the conditions described in (2) and (3) exist. If Nationwide is closed on days when the New York Stock Exchange is open, Contract Value may change and Contract Owners will not have access to their accounts.
Application and Allocation of Purchase Payments
Initial Purchase Payments
Initial purchase payments will be priced at the Accumulation Unit value next determined no later than two business days after receipt of an order to purchase if the application and all necessary information are complete and are received at the Service Center before the close of the New York Stock Exchange, which generally occurs at 4:00 p.m. EST. If the order is received after the close of the New York Stock Exchange, the initial purchase payment will be priced within two business days after the next Valuation Date.
If an incomplete application is not completed within five business days after receipt at the Service Center, the prospective purchaser will be informed of the reason for the delay. The purchase payment will be returned unless the prospective purchaser specifically consents to allow Nationwide to hold the purchase payment until the application is completed.
Generally, initial purchase payments are allocated according to Contract Owner instructions on the application. However, in some states, Nationwide will allocate initial purchase payments to the money market Sub-Account during the free look period. After the free look period, Nationwide will reallocate the Contract Value among the investment options based on the instructions contained on the application. In other states, Nationwide will immediately allocate initial purchase payments to the investment options based on the instructions contained on the application.
Subsequent Purchase Payments
Any subsequent purchase payment received at the Service Center (along with all necessary information) before the close of the New York Stock Exchange on any Valuation Date will be priced at the Accumulation Unit value next determined after receipt of the purchase payment. If a subsequent purchase payment is received at the Service Center (along with all necessary information) after the close of the New York Stock Exchange, it will be priced at the Accumulation Unit value determined on the following Valuation Date.
Allocation of Purchase Payments
Nationwide allocates purchase payments to Sub-Accounts as instructed by the Contract Owner. Shares of the underlying mutual funds allocated to the Sub-Accounts are purchased at Net Asset Value, then converted into Accumulation Units.
Contract Owners can change allocations or make exchanges among the Sub-Accounts after the time of application by submitting a written request to the Service Center. However, no change may be made that would result in an amount less than 1% of the purchase payments being allocated to any Sub-Account. In the event that Nationwide receives such a request, Nationwide will inform the Contract Owner that the allocation instructions are invalid and that the contract's allocations among the Sub-Accounts prior to the request will remain in effect. Certain transactions may be subject to conditions imposed by the underlying mutual funds.
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Determining the Contract Value
The Contract Value is the sum of the value of amounts (including any PPCs) allocated to the Sub-Accounts plus any amount held in the Fixed Account. If charges are assessed against the whole Contract Value, Nationwide will deduct a proportionate amount from each Sub-Account and the Fixed Account based on current cash values.
Determining Variable Account Value - Valuing an Accumulation Unit
Sub-Account allocations are accounted for in Accumulation Units. Accumulation Unit values (for each Sub-Account) are determined by calculating the Net Investment Factor for the Sub-Accounts for the current Valuation Period and multiplying that result with the Accumulation Unit values determined on the previous Valuation Period. For each Sub-Account, the Net Investment Factor is the investment performance of the underlying mutual fund in which a particular Sub-Account invests, including the charges assessed against that Sub-Account for a Valuation Period.
Nationwide uses the Net Investment Factor as a way to calculate the investment performance of a Sub-Account from Valuation Period to Valuation Period.
The Net Investment Factor for any particular Sub-Account before the Annuitization Date is determined by dividing (a) by (b), and then subtracting (c) from the result, where:
(a) is the sum of:
(1) the Net Asset Value of the underlying mutual fund as of the end of the current Valuation Period; and
(2) the per share amount of any dividend or income distributions made by the underlying mutual fund (if the date of the dividend or income distribution occurs during the current Valuation Period).
(b) is the Net Asset Value of the underlying mutual fund determined as of the end of the preceding Valuation Period.
(c) is a factor representing the daily total Variable Account charges, which may include charges for optional benefits elected by the Contract Owner. The factor is equal to an annualized rate ranging from 1.30% to 2.10% of the Daily Net Assets, depending on which optional benefits the Contract Owner elects.
Note: The range shown above reflects only those Variable Account charges that are assessed daily as part of the daily Accumulation Unit calculation. It does not reflect the cost of other optional benefits that assess charges via the redemption of Accumulation Units.
Based on the change in the Net Investment Factor, the value of an Accumulation Unit may increase or decrease. Changes in the Net Investment Factor may not be directly proportional to changes in the Net Asset Value of the underlying mutual fund shares because of the deduction of Variable Account charges.
Though the number of Accumulation Units will not change as a result of investment experience, the value of an Accumulation Unit may increase or decrease from Valuation Period to Valuation Period.
Determining Fixed Account Value
Nationwide determines the value of the Fixed Account by:
(1) adding all amounts allocated to the Fixed Account (including any Purchase Payment Credits applied to the contract), minus amounts previously transferred or withdrawn from the Fixed Account;
(2) adding any interest earned on the amounts allocated to the Fixed Account; and
(3) subtracting charges deducted in accordance with the contract.
Transfer Requests
Contract Owners may submit transfer requests in writing, over the telephone, or via the Internet to the Service Center. Some benefits or features under the contract may limit the manner in which transfer requests can be submitted, as indicated in the respective provision. Nationwide may restrict or withdraw the telephone and/or Internet transfer privilege at any time.
Generally, Sub-Account transfers will receive the Accumulation Unit value next computed after the transfer request is received at the Service Center. However, if a contract that is limited to submitting transfer requests via U.S. mail submits a transfer request via the Internet or telephone pursuant to Nationwide's one-day delay policy, the transfer will be executed on the next Valuation Date after the exchange request is received at the Service Center (see Managers of Multiple Contracts).
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Transfer Restrictions
Neither the contracts described in this prospectus nor the underlying mutual funds are designed to support active trading strategies that require frequent movement between or among Sub-Accounts (sometimes referred to as "market-timing" or "short-term trading"). A Contract Owner who intends to use an active trading strategy should consult his/her registered representative and request information on other Nationwide variable annuity contracts that offer investment in underlying mutual funds that are designed specifically to support active trading strategies.
Nationwide discourages (and will take action to deter) short-term trading in this contract because the frequent movement between or among Sub-Accounts may negatively impact other investors in the contract. Short-term trading can result in:
• the dilution of the value of the investors' interests in the underlying mutual fund;
• underlying mutual fund managers taking actions that negatively impact performance (keeping a larger portion of the underlying 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 contract from the negative impact of these practices, Nationwide has implemented, or reserves the right to implement, several processes and/or restrictions aimed at eliminating the negative impact of active trading strategies. Nationwide makes no assurances that all risks associated with short-term trading will be completely eliminated by these processes and/or restrictions.
Nationwide cannot guarantee that its attempts to deter active trading strategies will be successful. If Nationwide is unable to deter active trading strategies, the performance of the Sub-Accounts that are actively traded may be adversely impacted.
Redemption Fees
Some underlying mutual funds assess a short-term trading fee in connection with transfers from a Sub-Account that occur within 60 days after the date of the allocation to the Sub-Account. The fee is assessed against the amount transferred and is paid to the underlying mutual fund. Redemption fees compensate the underlying mutual fund for any negative impact on fund performance resulting from short-term trading.
U.S. Mail Restrictions
Nationwide monitors transfer activity in order to identify those who may be engaged in harmful trading practices. Transaction reports are produced and examined. Generally, a contract may appear on these reports if the Contract 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 on a given trading day (Valuation Period). For example, if a Contract Owner executes multiple transfers involving 10 investment options in one day, this counts as one transfer event. A single transfer occurring on a given trading day and involving only two investment options will also count as one transfer event.
As a result of this monitoring process, Nationwide may restrict the method of communication by which transfer orders will be accepted. In general, Nationwide will adhere to the following guidelines:
Trading Behavior Nationwide's Response
Six or more transfer events in one calendar quarter Nationwide will mail a letter to the Contract 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 Contract Owner will be limited to submitting transfer requests via U.S. mail on a Nationwide issued form.
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 Contract Owner to submitting transfer requests via U.S. mail on a Nationwide issued form.
For purposes of Nationwide's transfer policy, U.S. mail includes standard U.S. mail, overnight U.S. mail, and overnight delivery via private carrier.
Each January 1, Nationwide will start the monitoring anew, so that each contract starts with 0 transfer events each January 1. See, however, the Other Restrictions provision.
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Managers of Multiple Contracts
Some investment advisors/representatives manage the assets of multiple Nationwide contracts pursuant to trading authority granted or conveyed by multiple Contract Owners. These multi-contract advisors will generally be required by Nationwide to submit all transfer requests via U.S. mail.
Nationwide may, as an administrative practice, implement a "one-day delay" program for these multi-contract advisors, which they can use in addition to or in lieu of submitting transfer requests via U.S. mail. The one-day delay option permits multi-contract advisors to continue to submit transfer requests via the Internet or telephone. However, transfer requests submitted by multi-contract advisors via the Internet or telephone will not receive the next available Accumulation Unit value. Rather, they will receive the Accumulation Unit value that is calculated on the following Valuation Date. Transfer requests submitted under the one-day delay program are irrevocable. Multi-contract advisors will receive advance notice of being subject to the one-day delay program.
Other Restrictions
Contract Owners that are required to submit transfer requests via U.S. mail will be required to use a Nationwide issued form for their transfer request. Nationwide will refuse transfer requests that either do not use the Nationwide issued form for their transfer request or fail to provide accurate and complete information on their transfer request form. In the event that a Contract Owner's transfer request is refused by Nationwide, they will receive notice in writing by U.S. mail and will be required to resubmit their transfer request on a Nationwide issued form.
Nationwide reserves the right to refuse or limit transfer requests, or take any other action it deems necessary in order to protect Contract Owners, Annuitants, and beneficiaries from the negative investment results that may result from short-term trading or other harmful investment practices employed by some Contract Owners (or third parties acting on their behalf). In particular, trading strategies designed to avoid or take advantage of Nationwide's monitoring procedures (and other measures aimed at curbing harmful trading practices) that are nevertheless determined by Nationwide to constitute harmful trading practices, may be restricted.
Any restrictions that Nationwide implements will be applied consistently and uniformly.
Underlying Mutual Fund Restrictions and Prohibitions
Pursuant to regulations adopted by the SEC, Nationwide is required to enter into written agreements with the underlying mutual funds which allow the underlying mutual funds to:
(1) request the taxpayer identification number, international taxpayer identification number, or other government issued identifier of any Contract Owner;
(2) request the amounts and dates of any purchase, redemption, transfer, or exchange request ("transaction information"); and
(3) instruct Nationwide to restrict or prohibit further purchases or exchanges by Contract Owners that violate policies established by the underlying mutual fund (whose policies may be more restrictive than Nationwide's policies).
Nationwide is required to provide such transaction information to the underlying mutual funds upon their request. In addition, Nationwide is required to restrict or prohibit further purchases or requests to exchange into a specific Sub-Account upon instruction from the underlying mutual fund in which that Sub-Account invests. Nationwide and any affected Contract Owner may not have advance notice of such instructions from an underlying mutual fund to restrict or prohibit further purchases or requests to exchange. If an underlying mutual fund refuses to accept a purchase or request to exchange into the Sub-Account associated with the underlying mutual fund submitted by Nationwide, Nationwide will keep any affected Contract Owner in their current Sub-Account allocation.
Transfers Prior to Annuitization
Transfers from the Fixed Account
A Contract Owner may request to transfer allocations from the Fixed Account to the Sub-Accounts only upon reaching the end of a Fixed Account interest rate guarantee period. Fixed Account transfers must be made within 45 days after the end of the interest rate guarantee period.
Normally, Nationwide will permit 100% of the maturing Fixed Account allocations to be transferred. However, Nationwide may limit the amount that can be transferred from the Fixed Account. Nationwide will determine the amount that may be transferred and will declare this amount at the end of the Fixed Account interest rate guarantee period. The maximum transferable amount will never be less than 10% of the Fixed Account allocation reaching the end of a Fixed Account interest rate guarantee period.
Contract Owners who use Dollar Cost Averaging may transfer from the Fixed Account under the terms of that program.
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Nationwide is required by state law to reserve the right to postpone payment or transfer of assets from the Fixed Account for a period of up to six months from the date of the withdrawal or transfer request.
Transfers from the Sub-Accounts
A Contract Owner may request to transfer allocations from the Sub-Accounts to the Fixed Account at any time.
Nationwide reserves the right to limit or refuse transfers to the Fixed Account. Generally, Nationwide will invoke this right when interest rates are low by historical standards.
Transfers Among the Sub-Accounts
A Contract Owner may request to transfer allocations among the Sub-Accounts at any time, subject to terms and conditions imposed by this prospectus and the underlying mutual funds.
Transfers After Annuitization
After annuitization, the portion of the Contract Value allocated to fixed annuity payments and the portion of the Contract Value allocated to variable annuity payments may not be changed.
After annuitization, transfers among Sub-Accounts may only be made once per calendar year.
Right to Examine and Cancel
If the Contract Owner elects to cancel the contract, he/she may return it to the Service Center within a certain period of time known as the "free look" period. Depending on the state in which the contract was purchased (and, in some states, if the contract is purchased as a replacement for another annuity contract), the free look period may be 10 days or longer. For ease of administration, Nationwide will honor any free look cancellation that is received at the Service Center or postmarked within 30 days after the contract issue date. The contract issue date is the date the initial purchase payment is applied to the contract.
Where state law requires the return of purchase payments for free look cancellations, Nationwide will return all purchase payments applied to the contract, less any withdrawals from the contract and any applicable federal and state income tax withholding. Nationwide will recapture all of the Purchase Payment Credits applied to the contract, but under no circumstances will the amount returned be less than the purchase payments made to the contract.
Where state law requires the return of Contract Value for free look cancellations, Nationwide will return the Contract Value as of the date of the cancellation, less any withdrawals from the contract and any applicable federal and state income tax withholding. Nationwide will recapture all of the Purchase Payment Credits applied to the contract. The Contract Owner will retain any earnings attributable to the Purchase Payment Credits, but all losses attributable to the Purchase Payment Credits will be incurred by Nationwide.
Liability of the Variable Account under this provision is limited to the Contract Value in each Sub-Account on the date of revocation. Any additional amounts refunded to the Contract Owner will be paid by Nationwide.
Allocation of Purchase Payments during Free Look Period
Where state law requires the return of purchase payments for free look cancellations, Nationwide will allocate initial purchase payments allocated to Sub-Accounts to the money market Sub-Account during the free look period.
Where state law requires the return of Contract Value for free look cancellations, Nationwide will immediately allocate initial purchase payments to the investment options based on the instructions contained on the application.
Surrender/Withdrawal Prior to Annuitization
Prior to annuitization and before the Annuitant's death, Contract Owners may generally withdraw some or all of their Contract Value. Withdrawals from the contract may be subject to federal income tax and/or a tax penalty (see Appendix C: Contract Types and Tax Information). Withdrawal requests must be submitted in writing to the Service Center and Nationwide may require additional information. When taking a full surrender, the contract must accompany the written request. Nationwide may require a signature guarantee.
Surrender and withdrawal requests will receive the Accumulation Unit value next determined at the end of the current Valuation Period if the request and all necessary information is received at the Service Center before the close of the New York Stock Exchange (generally, 4:00 pm EST). If the request and all necessary information is received after the close of the New York Stock Exchange, the request will receive the Accumulation Unit value determined at the end of the next Valuation Day.
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Nationwide will pay any amounts withdrawn from the Sub-Accounts within seven days after the request is received in good order at the Service Center (see Determining the Contract Value). However, Nationwide may suspend or postpone payment when it is unable to price a purchase payment or transfer.
Nationwide is required by state law to reserve the right to postpone payment or transfer of assets from the Fixed Account for a period of up to six months from the date of the withdrawal or transfer request.
Partial Withdrawals
If a Contract Owner requests a partial withdrawal, Nationwide will redeem Accumulation Units from the Sub-Accounts and an amount from the Fixed Account. The amount withdrawn from each investment option will be in proportion to the value in each option at the time of the withdrawal request, unless Nationwide is instructed otherwise.
Partial withdrawals are subject to the CDSC provisions of the contract. If a CDSC is assessed, the Contract Owner may elect to have the CDSC deducted from either:
(a) the amount requested; or
(b) the Contract Value remaining after the Contract Owner has received the amount requested.
If the Contract Owner does not make a specific election, any applicable CDSC will be deducted from the amount requested by the Contract Owner.
The CDSC deducted is a percentage of the amount requested by the Contract Owner. Amounts deducted for CDSC are not subject to subsequent CDSC.
Partial Withdrawals to Pay Investment Advisory Fees
Some Contract Owners utilize an investment advisor(s) to manage their assets, for which the investment advisor assesses a fee. Investment advisors are not endorsed or affiliated with Nationwide and Nationwide makes no representation as to their qualifications. The fees for these investment advisory services are specified in the respective account agreements and are separate from and in addition to the contract fees and expenses described in this prospectus. Some Contract Owners authorize their investment advisor to take a partial withdrawal(s) from the contract in order to collect investment advisory fees. Withdrawals taken from this contract to pay advisory or investment management fees are subject to the CDSC provisions of the contract and may be subject to income tax and/or tax penalties. In addition, withdrawals taken from the contract to pay advisory or investment management fees may negatively impact the benefit associated with the 7% Nationwide Lifetime Income Rider.
Full Surrenders
Upon full surrender, the Contract Value may be more or less than the total of all purchase payments made to the contract. The Contract Value will reflect:
• Variable Account charges
• underlying mutual fund charges
• the investment performance of the underlying mutual funds
• amounts allocated to the Fixed Account and any interest credited
• charges associated with the 7% Nationwide Lifetime Income Rider and Joint Option (if elected)
• Purchase Payment Credits, if applicable
• a $30 Contract Maintenance Charge (this charge will be waived upon full surrender if the Contract Value is equal to or greater than $50,000 at the time of the full surrender or on any Contract Anniversary prior to the full surrender)
The CDSC-free withdrawal privilege does not apply to full surrenders of the contract. For purposes of the CDSC-free withdrawal privilege, a full surrender is:
• multiple withdrawals taken within a Contract Year that deplete the entire Contract Value; or
• any single net withdrawal of 90% or more of the Contract Value.
Surrender/Withdrawal After Annuitization
After the Annuitization Date, withdrawals other than regularly scheduled annuity payments are not permitted.
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Assignment
Contracts other than Non-Qualified Contracts may not be assigned, pledged or otherwise transferred except where allowed by law.
A Non-Qualified Contract Owner may assign some or all rights under the contract subject to Nationwide's consent. Additionally, Nationwide reserves the right to refuse to recognize assignments on a non-discriminatory basis. Nationwide is not responsible for the validity or tax consequences of any assignment and Nationwide is not liable for any payment or settlement made before the assignment is recorded. Assignments will not be recorded until Nationwide receives sufficient direction from the Contract Owner and the assignee regarding the proper allocation of contract rights.
Where permitted under state law, an assignment or collateral assignment may negatively impact certain benefits under this contract, including the death benefit and the 7% Nationwide Lifetime Income Rider.
Contract Owner Services
Asset Rebalancing
Asset Rebalancing is the automatic reallocation of Contract Values to the Sub-Accounts on a predetermined percentage basis. Asset Rebalancing is not available for assets held in the Fixed Account. Requests for Asset Rebalancing must be on a Nationwide form and submitted to the Service Center. Once Asset Rebalancing is elected, it will only be terminated upon specific instruction from the Contract Owner; manual transfers will not automatically terminate the program.
Asset Rebalancing occurs every three months or on another frequency if permitted by Nationwide. If the last day of the designated rebalancing period falls on a Saturday, Sunday, recognized holiday, or any other day when the New York Stock Exchange is closed, Asset Rebalancing will occur on the next business day. Each Asset Rebalancing reallocation is considered a transfer event.
Contract Owners should consult a financial advisor to discuss the use of Asset Rebalancing.
Nationwide reserves the right to stop establishing new Asset Rebalancing programs.
Dollar Cost Averaging
Dollar Cost Averaging is a long-term transfer program that allows the Contract Owner to make regular, level investments over time. Dollar Cost Averaging involves the automatic transfer of a specific amount from the Fixed Account and/or certain Sub-Accounts into other Sub-Accounts. With this service, the Contract Owner benefits from the ability to invest in the Sub-Accounts over a period of time, thereby smoothing out the effects of market volatility. Nationwide does not guarantee that this program will result in profit or protect Contract Owners from loss.
Contract Owners direct Nationwide to automatically transfer specified amounts from the Fixed Account and the following Sub-Accounts (if available):
• Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I
• Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I
• Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II
• PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class
to any other Sub-Account(s). Dollar Cost Averaging transfers may not be directed to the Fixed Account. Transfers from the Fixed Account must be equal to or less than 1/30th of the Fixed Account value at the time the program is requested. Contract Owners that wish to utilize Dollar Cost Averaging should first inquire whether any Enhanced Fixed Account Dollar Cost Averaging programs are available.
Transfers occur monthly or on another frequency if permitted by Nationwide. Nationwide will process transfers until either the value in the originating investment option is exhausted or the Contract Owner instructs Nationwide to stop the transfers. When a Contract Owner instructs Nationwide to stop the transfers, all amounts remaining in the originating Fixed Account or Sub-Account will remain allocated to the Fixed Account or Sub-Account, unless Nationwide is instructed otherwise. Dollar Cost Averaging transfers are not considered transfer events.
Nationwide reserves the right to stop establishing new Dollar Cost Averaging programs.
Nationwide is required by state law to reserve the right to postpone payment or transfer of assets from the Fixed Account for a period of up to six months from the date of the withdrawal or transfer request.
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Enhanced Fixed Account Dollar Cost Averaging
Nationwide may, periodically, offer Dollar Cost Averaging programs with an enhanced interest rate referred to as "Enhanced Fixed Account Dollar Cost Averaging." Enhanced Fixed Account Dollar Cost Averaging involves the automatic transfer of a specific amount from an enhanced rate Fixed Account into any Sub-Account(s). With this service, the Contract Owner benefits from the ability to invest in the Sub-Accounts over a period of time, thereby smoothing out the effects of market volatility. Nationwide does not guarantee that this program will result in profit or protect Contract Owners from loss.
Only new purchase payments to the contract are eligible for Enhanced Fixed Account Dollar Cost Averaging. Enhanced Fixed Account Dollar Cost Averaging transfers may not be directed to the Fixed Account. Amounts allocated to the enhanced rate Fixed Account as part of an Enhanced Fixed Account Dollar Cost Averaging program earn a higher rate of interest than assets allocated to the standard Fixed Account. Each enhanced rate is guaranteed for as long as the corresponding program is in effect.
Transfers occur monthly or on another frequency if permitted by Nationwide. Nationwide will process transfers until either amounts allocated to the Fixed Account as part of an Enhanced Fixed Account Dollar Cost Averaging program are exhausted or the Contract Owner instructs Nationwide to stop the transfers. When a Contract Owner instructs Nationwide to stop the transfers, Nationwide will automatically reallocate any amount remaining in the enhanced rate Fixed Account according to future investment allocation instructions, unless directed otherwise. Enhanced Fixed Account Dollar Cost Averaging transfers are not considered transfer events.
Nationwide reserves the right to stop establishing new Enhanced Fixed Account Dollar Cost Averaging programs.
Nationwide is required by state law to reserve the right to postpone payment or transfer of assets from the Fixed Account for a period of up to six months from the date of the withdrawal or transfer request.
Dollar Cost Averaging for Living Benefits
Nationwide may periodically offer Dollar Cost Averaging programs with the 7% Nationwide Lifetime Income Rider referred to as "Dollar Cost Averaging for Living Benefits." Dollar Cost Averaging for Living Benefits involves the automatic transfer of a specific amount from the Fixed Account into another Sub-Account(s). With this service, the Contract Owner benefits from the ability to invest in the Sub-Account over a period of time, thereby smoothing out the effects of market volatility. Nationwide does not guarantee that this program will result in profit or protect Contract Owners from loss.
Only new purchase payments to the contract are eligible for Dollar Cost Averaging for Living Benefits. Only those investment options available with the elected option are available for use in Dollar Cost Averaging for Living Benefits. If a Contract Owner elected Custom Portfolio, Dollar Cost Averaging for Living Benefits transfers into the elected model will be allocated to the Sub-Accounts in the same percentages as the model allocations to those Sub-Accounts. Refer to the Income Benefit Investment Options provision for the investment options available for the 7% Nationwide Lifetime Income Rider.
Once a Dollar Cost Averaging for Living Benefits program has begun, no transfers among or between Sub-Accounts are permitted until the Dollar Cost Averaging for Living Benefits program is completed or terminated.
Transfers occur monthly or on another frequency if permitted by Nationwide. Nationwide will process transfers until either amounts allocated to the Fixed Account as part of a Dollar Cost Averaging for Living Benefits program are exhausted or the Contract Owner instructs Nationwide to stop the transfers. When a Contract Owner instructs Nationwide to stop the transfers, Nationwide will automatically reallocate any amount remaining in the Fixed Account according to future investment allocation instructions, unless directed otherwise. Dollar Cost Averaging for Living Benefits transfers are not considered transfer events.
Nationwide reserves the right to stop establishing new Dollar Cost Averaging for Living Benefits programs.
Nationwide is required by state law to reserve the right to postpone payment or transfer of assets from the Fixed Account for a period of up to six months from the date of the withdrawal or transfer request.
Fixed Account Interest Out Dollar Cost Averaging
Nationwide may, periodically, offer a Dollar Cost Averaging program that permits the transfer of interest earned on Fixed Account allocations referred to as "Fixed Account Interest Out Dollar Cost Averaging." Fixed Account Interest Out Dollar Cost Averaging involves the automatic transfer of the interest earned on Fixed Account allocations into any other Sub-Account(s). With this service, the Contract Owner benefits from the ability to invest in the Sub-Accounts over a period of time, thereby smoothing out the effects of market volatility. Nationwide does not guarantee that this program will result in profit or protect Contract Owners from loss.
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Fixed Account Interest Out Dollar Cost Averaging transfers may not be directed to the Fixed Account.
Transfers occur monthly or on another frequency if permitted by Nationwide. Nationwide will continue to process transfers until the Contract Owner instructs Nationwide in writing to stop the transfers. Fixed Account Interest Out Dollar Cost Averaging transfers are not considered transfer events.
Nationwide reserves the right to stop establishing new Fixed Account Interest Out Dollar Cost Averaging programs.
Nationwide is required by state law to reserve the right to postpone payment or transfer of assets from the Fixed Account for a period of up to six months from the date of the withdrawal or transfer request.
Systematic Withdrawals
Systematic Withdrawals allow Contract Owners to receive a specified amount (of at least $100) on a monthly, quarterly, semi-annual, or annual basis. Requests for Systematic Withdrawals and requests to discontinue Systematic Withdrawals must be submitted in writing to the Service Center.
The withdrawals will be taken from the Sub-Accounts and the Fixed Account proportionally unless Nationwide is instructed otherwise.
Nationwide will withhold federal income taxes from Systematic Withdrawals unless otherwise instructed by the Contract Owner. The Internal Revenue Service may impose a 10% penalty tax if the Contract Owner is under age 59½ unless the Contract Owner has made an irrevocable election of distributions of substantially equal payments.
A CDSC may apply to amounts taken through Systematic Withdrawals. If the Contract Owner takes Systematic Withdrawals, the maximum amount that can be withdrawn annually without a CDSC is the greater of the amount available under the CDSC-free withdrawal privilege (see Contingent Deferred Sales Charge), and a given percentage of the Contract Value that is based on the Contract Owner's age, as shown in the following table:

Contract Owner's Age 		  Percentage of Contract Value
Under age 59½
  5%
59½ through age 61
   7%
62 through age 64
   8%
65 through age 74
   10%
75 and over
   13%
The Contract Owner's age is determined as of the date the request for Systematic Withdrawals is recorded by the Service Center. For joint owners, the older joint owner's age will be used.
The CDSC-free withdrawal privilege for Systematic Withdrawals is non-cumulative. Free amounts not taken during any Contract Year cannot be taken as free amounts in a subsequent Contract Year. In any given Contract Year, any amount withdrawn in excess of the amount permitted under this program will be subject to the CDSC provisions (see Contingent Deferred Sales Charge).
Nationwide reserves the right to stop establishing new Systematic Withdrawal programs. Systematic Withdrawals are not available before the end of the free look period.
Custom Portfolio Asset Rebalancing Service
For Contract Owners that have elected the 7% Nationwide Lifetime Income Rider, Nationwide makes available the Custom Portfolio Asset Rebalancing Service ("Custom Portfolio") at no extra charge. Custom Portfolio is an asset allocation program that Contract Owners can use to build their own customized portfolio of investments, subject to certain limitations. Asset allocation is the process of investing in different asset classes (such as equity funds, fixed income funds, and money market funds) and may reduce the risk and volatility of investing. There are no guarantees that Custom Portfolio will result in a profit or protect against loss in a declining market.
Each model is comprised of different percentages of standardized asset categories designed to meet different investment goals, risk tolerances, and investment time horizons. The Contract Owner selects their model, then selects the specific Sub-Accounts (also classified according to standardized asset categories) and investment percentages within the model's parameters, enabling the Contract Owner to create their own unique "Custom Portfolio." Only one Custom Portfolio may be created and in effect at a time and the entire Variable Account Contract Value must participate in the model.
Note: Contract Owners should consult with a qualified investment advisor regarding the use of Custom Portfolio and to determine which model is appropriate for them.
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Once the Contract Owner creates their Custom Portfolio, that Contract Owner's model is static. This means that the percentage allocated to each Sub-Account will not change over time, except for quarterly rebalancing, as described below. Note: Allocation percentages within a particular model may subsequently change, but any such changes will not apply to existing model participants; the changes will only apply to participants that elect the model after the change implementation date.
To participate in Custom Portfolio, eligible Contract Owners must submit the proper administrative form to the Service Center. While Custom Portfolio is elected, Contract Owners cannot participate in Asset Rebalancing.
Asset Allocation Models Available with Custom Portfolio
The following models are available with Custom Portfolio:
Conservative: Designed for Contract Owners that are willing to accept very little risk but still want to see a small amount of growth.
Moderately Conservative: Designed for Contract Owners that are willing to accept some market volatility in exchange for greater potential income and growth.
Balanced: Designed for Contract Owners that are willing to accept some market volatility in exchange for potential long-term returns.
The specific Sub-Accounts available to comprise the equity and fixed income components of the models are contained in the election form, which is provided to Contract Owners at the time Custom Portfolio is elected. At that time, Contract Owners elect their model and the specific Sub-Accounts and percentages that will comprise their Custom Portfolio. The availability of some models may be restricted (see Income Benefit Investment Options).
Quarterly Rebalancing
At the end of each calendar quarter, Nationwide will reallocate the Sub-Account allocations so that the percentages allocated to each Sub-Account match the most recently provided percentages provided by the Contract Owner. If the end of a calendar quarter is a Saturday, Sunday, recognized holiday, or any other day that the New York Stock Exchange is closed, the quarterly rebalancing will occur on the next business day. Rebalancing will be priced using the unit value determined on the last Valuation Date of the calendar quarter. Each quarterly rebalancing is considered a transfer event. However, quarterly rebalancing transfers are not subject to short-term trading fees.
Changing Models or Underlying Mutual Fund Allocations
Contract Owners who have elected the 7% Nationwide Lifetime Income Rider may change the Sub-Account allocations within their elected model, percentages within their elected model and/or may change models and create a new Custom Portfolio within that new model. To implement one of these changes, Contract Owners must submit new allocation instructions to the Service Center in writing on Nationwide's administrative form. Any model and percentage changes will be subject to Short-Term Trading Fees and will count as a transfer event, as described in the Transfer Restrictions provision.
Nationwide reserves the right to limit the number of model changes a Contract Owner can make each year.
Terminating Participation in Custom Portfolio
Contract Owners can terminate participation in Custom Portfolio by submitting a written request to the Service Center. In order for the termination to be effective, the termination request must contain valid reallocation instructions that are in accordance with the terms and conditions of the the 7% Nationwide Lifetime Income Rider. Termination is effective on the date the termination request is received at the Service Center in good order.
Static Asset Allocation Model
For Contract Owners that have elected the 7% Nationwide Lifetime Income Rider, Nationwide makes available as a permitted investment option the following Static Asset Allocation Model(s): American Funds Option (33% NVIT - American Funds NVIT Asset Allocation Fund, 33% NVIT - American Funds NVIT Bond Fund, and 34% NVIT - American Funds NVIT Growth-Income Fund). The availability of some models may be restricted (see Income Benefit Investment Options).
A Static Asset Allocation Model is an allocation strategy comprised of two or more underlying mutual funds that together provide a unique allocation mix not available as a single underlying mutual fund. Contract Owners that elect a Static Asset Allocation Model directly own Sub-Account units of the underlying mutual funds that comprise the particular model. In other words, a Static Asset Allocation Model is not a portfolio of underlying mutual funds with one Accumulation Unit value, but rather, direct investment in a certain allocation of Sub-Accounts. There is no additional charge associated with investing in a Static Asset Allocation Model.
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A Static Asset Allocation Model is just that: static. The allocations or "split" between one or more Sub-Accounts is not monitored and adjusted to reflect changing market conditions. However, a Contract Owner's investment in a Static Asset Allocation Model is rebalanced quarterly to ensure that the assets are allocated to the percentages in the same proportion that they were allocated at the time of election. The entire Contract Value must be allocated to the elected model.
With respect to transferring into and out of a Static Asset Allocation Model, the model is treated like a Sub-Account and is subject to the Transfers Prior to Annuitization provision. The Contract Owner may request to transfer from a model to a permitted Sub-Account. Each transfer into or out of a Static Asset Allocation Model is considered one transfer event.
For additional information about the underlying mutual funds that comprise a Static Asset Allocation Model, see Appendix A: Underlying Mutual Funds.
Death Benefit
Death of Contract Owner
If a Contract Owner (including a Joint Owner) who is not the Annuitant dies before the Annuitization Date, no death benefit is payable and the surviving Joint Owner becomes the Contract Owner. If there is no surviving Joint Owner, the Contingent Owner becomes the Contract Owner. If there is no surviving Contingent Owner, the beneficiary becomes the Contract Owner. If there is no surviving beneficiary, the last surviving Contract Owner's estate becomes the Contract Owner.
Distributions will be made as described in Appendix C: Contract Types and Tax Information.
Death of Annuitant
If the Annuitant who is not a Contract Owner dies before the Annuitization Date, the Contingent Annuitant becomes the Annuitant and no death benefit is payable. If no Contingent Annuitant is named, a death benefit is payable to the beneficiary. Multiple beneficiaries will share the death benefit equally unless otherwise specified. If no beneficiaries survive the Annuitant, the contingent beneficiary receives the death benefit. Multiple contingent beneficiaries will share the death benefit equally unless otherwise specified. If no beneficiaries or contingent beneficiaries survive the Annuitant, the Contract Owner or the last surviving Contract Owner's estate will receive the death benefit.
If the Annuitant dies after the Annuitization Date, any benefit that may be payable will be paid according to the selected annuity payment option.
If the Contract Owner is a Charitable Remainder Trust and the Annuitant dies before the Annuitization Date, the death benefit will accrue to the Charitable Remainder Trust. Any designation in conflict with the Charitable Remainder Trust's right to the death benefit will be void.
Death of Contract Owner/Annuitant
If a Contract Owner (including a Joint Owner) who is also the Annuitant dies before the Annuitization Date, a death benefit is payable to the surviving Joint Owner. If there is no surviving Joint Owner, the death benefit is payable to the beneficiary. Multiple beneficiaries will share the death benefit equally unless otherwise specified. If no beneficiaries survive the Contract Owner/Annuitant, the contingent beneficiary receives the death benefit. Multiple contingent beneficiaries will share the death benefit equally unless otherwise specified. If no contingent beneficiaries survive the Contract Owner/Annuitant, the last surviving Contract Owner's estate will receive the death benefit.
If the Contract Owner/Annuitant dies after the Annuitization Date, any benefit that may be payable will be paid according to the selected annuity payment option.
Death Benefit Payment
The recipient of the death benefit may elect to receive the death benefit:
(1) in a lump sum;
(2) as an annuity (see Annuity Payment Options); or
(3) in any other manner permitted by law and approved by Nationwide.
Premium taxes may be deducted from death benefit proceeds. Nationwide will pay (or will begin to pay) the death benefit after it receives proof of death and the instructions as to the payment of the death benefit. Death benefit claims must be submitted to the Service Center. If the recipient of the death benefit does not elect the form in which to receive the death benefit payment, Nationwide will pay the death benefit in a lump sum. Contract Value will continue to be allocated according to the most recent allocation instructions until the death benefit is paid.
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If the contract has multiple beneficiaries entitled to receive a portion of the death benefit, the Contract Value will continue to be allocated according to the most recent allocation instructions until the first beneficiary provides Nationwide with all the information necessary to pay that beneficiary's portion of the death benefit proceeds. At the time the first beneficiary's proceeds are paid, the remaining portion(s) of the death benefit proceeds that are allocated to Sub-Accounts will be reallocated to the available money market Sub-Account until instructions are received from the remaining beneficiary(ies).
Any Contract Value not allocated to the Sub-Accounts will remain invested and will not be reallocated to the available money market Sub-Account.
Impact of Ownership Changes and Assignment on the Death Benefits
Where permitted under state law, if the Contract Owner is changed or if the contract is assigned (including a collateral assignment), the elected death benefit will be forfeited and replaced with a death benefit equal to the Contract Value on the date Nationwide receives proper proof of the Annuitant's death, an election specifying the distribution method, and any state required forms. Where prohibited by state law, or if any of the following situations apply, the death benefit forfeiture will not apply:
(1) The new Contract Owner or assignee assumes full ownership of the contract and is essentially the same person (e.g., individual ownership is changed to ownership by a personal revocable trust, a change to the Contract Owner's spouse during the Contract Owner's lifetime, a change to a court appointed guardian representing the Contract Owner during the Contract Owner's lifetime, etc.);
(2) Ownership of a contract issued as an IRA or Roth IRA is being changed from one custodian to another, from the determining life to a custodian, or from a custodian to the determining life;
(3) The assignment is for the purpose of effectuating an exchange pursuant to Section 1035 under the Internal Revenue Code; or
(4) The change is merely the removal of a Contract Owner where the contract is jointly owned.
Contract Owners contemplating changes to the ownership of their contract, including assignments, should contact their registered representative to determine how the changes impact the death benefit.
Death Benefit Calculations
An applicant may elect either the standard death benefit (Return of Premium) or an available death benefit option that is offered under the contract for an additional charge. If no election is made at the time of application, the death benefit will be the standard death benefit.
As indicated previously, the death benefit calculations discussed in this provision may not apply if the Contract Owner has been changed or the contract has been assigned.
The value of each component of the death benefit calculation will be determined as of the date of the Annuitant's death, except for the Contract Value component, which will be determined as of the date Nationwide receives:
(1) proper proof of the Annuitant's death;
(2) an election specifying the distribution method; and
(3) any state required form(s).
Nationwide reserves the right to refuse any purchase payment that would result in the cumulative total for all contracts issued by Nationwide on the life of any one Annuitant or owned by any one Contract Owner to exceed $1,000,000. If a Contract Owner does not submit purchase payments in excess of $1,000,000, or if Nationwide has refused to accept purchase payments in excess of $1,000,000, the references in this provision to purchase payments in excess of $1,000,000 will not apply.
Standard Death Benefit (Return of Premium)
If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is less than or equal to $3,000,000, the death benefit will be the greater of:
(1) the Contract Value; or
(2) the total of all purchase payments, less an adjustment for amounts withdrawn.
Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
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If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is greater than $3,000,000, the death benefit will be determined using the following formula:
(A x F) + B(1 - F), where
A = the greater of:
    (1) the Contract Value; or
    (2) the total of all purchase payments, less an adjustment for amounts withdrawn.
B = the Contract Value; and
F = the ratio of $3,000,000 to the total of all purchase payments made to the contract.
Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
The practical effect of this formula is that, in down markets, the beneficiary recovers a lesser percentage of purchase payments in excess of $3,000,000 than for purchase payments up to $3,000,000. In up markets, the formula is less likely to have a negative effect. In no event will the beneficiary receive less than the Contract Value.
The standard death benefit (Return of Premium) also includes the Spousal Protection Feature, which allows a surviving spouse to continue the contract while receiving the economic benefit of the death benefit upon the death of the other spouse.
One-Year Enhanced Death Benefit Option
For an additional charge at an annualized rate of 0.20% of the Daily Net Assets, an applicant can elect the One-Year Enhanced Death Benefit Option. The One-Year Enhanced Death Benefit Option is only available for contracts with Annuitants age 80 or younger at the time of application. Nationwide may realize a profit from the charge assessed for this option.
If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is less than or equal to $3,000,000, the death benefit will be the greatest of:
(1) the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit;
(2) the total of all purchase payments, less an adjustment for amounts withdrawn; or
(3) the highest Contract Value on any Contract Anniversary prior to the Annuitant's 86th birthday, less an adjustment for amounts subsequently withdrawn, plus purchase payments received after that Contract Anniversary.
Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
If Nationwide does not receive all information necessary to pay the death benefit within one year of the Annuitant's death, the death benefit will be the greater of (1) or (2) above.
If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is greater than $3,000,000, the death benefit will be determined using the following formula:
(A x F) + B(1 - F), where
A = the greatest of:
    (1) the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit;
    (2) the total of all purchase payments, less an adjustment for amounts withdrawn; or
    (3) the highest Contract Value on any Contract Anniversary prior to the Annuitant's 86th birthday, less an adjustment for amounts subsequently withdrawn, plus purchase payments received after that Contract Anniversary.
  If Nationwide does not receive all information necessary to pay the death benefit within one year of the Annuitant's death, the calculation for A above will be the greater of (1) or (2) above.
B = the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit; and
F = the ratio of $3,000,000 to the total of all purchase payments made to the contract.
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Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
The practical effect of this formula is that, in down markets, the beneficiary recovers a lesser percentage of purchase payments in excess of $3,000,000 than for purchase payments up to $3,000,000. In up markets, the formula is less likely to have a negative effect. In no event will the beneficiary receive less than the Contract Value.
The One-Year Enhanced Death Benefit Option also includes the Spousal Protection Feature, which allows a surviving spouse to continue the contract while receiving the economic benefit of the death benefit upon the death of the other spouse.
One-Month Enhanced Death Benefit Option
For an additional charge at an annualized rate of 0.35% of the Daily Net Assets, an applicant can elect the One-Month Enhanced Death Benefit Option. The One-Month Enhanced Death Benefit Option is only available for contracts with Annuitants age 75 or younger at the time of application. Nationwide may realize a profit from the charge assessed for this option.
If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is less than or equal to $3,000,000, the death benefit will be the greatest of:
(1) the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit;
(2) the total of all purchase payments, less an adjustment for amounts withdrawn; or
(3) the highest Contract Value on any Monthly Contract Anniversary prior to the Annuitant's 81st birthday, less an adjustment for amounts subsequently withdrawn, plus purchase payments received after that Monthly Contract Anniversary.
Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
If Nationwide does not receive all information necessary to pay the death benefit within one year of the Annuitant's death, the death benefit will be the greater of (1) or (2) above.
If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is greater than $3,000,000, the death benefit will be determined using the following formula:
(A x F) + B(1 - F), where
A = the greatest of:
    (1) the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit;
    (2) the total of all purchase payments, less an adjustment for amounts withdrawn; or
    (3) the highest Contract Value on any Monthly Contract Anniversary prior to the Annuitant's 81st birthday, less an adjustment for amounts subsequently withdrawn, plus purchase payments received after that Monthly Contract Anniversary.
  If Nationwide does not receive all information necessary to pay the death benefit within one year of the Annuitant's death, the calculation for A above will be the greater of (1) or (2) above.
B = the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit; and
F = the ratio of $3,000,000 to the total of all purchase payments made to the contract.
Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
The practical effect of this formula is that, in down markets, the beneficiary recovers a lesser percentage of purchase payments in excess of $3,000,000 than for purchase payments up to $3,000,000. In up markets, the formula is less likely to have a negative effect. In no event will the beneficiary receive less than the Contract Value.
The One-Month Enhanced Death Benefit Option also includes the Spousal Protection Feature, which allows a surviving spouse to continue the contract while receiving the economic benefit of the death benefit upon the death of the other spouse.
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Combination Enhanced Death Benefit Option
For an additional charge at an annualized rate of 0.45% of the Daily Net Assets, an applicant can elect the Combination Enhanced Death Benefit Option. The Combination Enhanced Death Benefit Option is only available for contracts with Annuitants age 75 or younger at the time of application. Nationwide may realize a profit from the charge assessed for this option.
If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is less than or equal to $3,000,000, the death benefit will be the greatest of:
(1) the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit;
(2) the total of all purchase payments, less an adjustment for amounts withdrawn;
(3) the highest Contract Value on any Contract Anniversary before the Annuitant's 81st birthday, less an adjustment for amounts subsequently withdrawn, plus purchase payments received after that Contract Anniversary; or
(4) the 5% interest anniversary value.
The 5% interest anniversary value is equal to purchase payments, accumulated at 5% annual compound interest until the last Contract Anniversary prior to the Annuitant's 81st birthday, proportionately adjusted for amounts withdrawn. The adjustment for amounts withdrawn will reduce the accumulated value as of the most recent Contract Anniversary prior to each partial withdrawal in the same proportion that the Contract Value was reduced on the date of the partial withdrawal. Such total accumulated amount, after the withdrawal adjustment, shall not exceed 200% of purchase payments adjusted for amounts withdrawn.
Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
If Nationwide does not receive all information necessary to pay the death benefit within one year of the Annuitant's death, the death benefit will be the greater of (1) or (2) above.
If, after the first contract anniversary, the Fixed Account allocation becomes greater than 30% of the Contract Value due to the application of additional purchase payments, additional surrenders, or transfers among investment options, then for purposes of calculating the 5% interest anniversary value, 0% will accrue for that year. The 30% threshold will come into effect only as a result of an action or actions by the Contract Owner (e.g., additional purchase payment, surrender or transfers). If the 30% threshold is reached because of a combination of market performance and Contract Owner actions, and would not have been reached but for the market performance, interest will continue to accrue at 5%.
If the Annuitant dies prior to the Annuitization Date and the total of all purchase payments made to the contract is greater than $3,000,000, the death benefit will be determined using the following formula:
(A x F) + B(1 - F), where
A = the greatest of:
    (1) the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit;
    (2) the total of all purchase payments, less an adjustment for amounts withdrawn;
    (3) the highest Contract Value on any Contract Anniversary before the Annuitant's 81st birthday, less an adjustment for amounts subsequently withdrawn, plus purchase payments received after that Contract Anniversary; or
    (4) the 5% interest anniversary value.
  If Nationwide does not receive all information necessary to pay the death benefit within one year of the Annuitant's death, the calculation for A above will be the greater of (1) or (2) above.
B = the Contract Value as of the date that Nationwide receives all the information necessary to pay the death benefit; and
F = the ratio of $3,000,000 to the total of all purchase payments made to the contract.
Any adjustment for amounts withdrawn will reduce the applicable factor above in the same proportion that the Contract Value was reduced on the date(s) of the partial withdrawal(s).
The practical effect of this formula is that, in down markets, the beneficiary recovers a lesser percentage of purchase payments in excess of $3,000,000 than for purchase payments up to $3,000,000. In up markets, the formula is less likely to have a negative effect. In no event will the beneficiary receive less than the Contract Value.
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The Combination Enhanced Death Benefit Option also includes the Spousal Protection Feature, which allows a surviving spouse to continue the contract while receiving the economic benefit of the death benefit upon the death of the other spouse.
Spousal Protection Feature
The standard death benefit and all of the death benefit options include a Spousal Protection Feature at no additional charge. The Spousal Protection Feature is not available for contracts issued as Charitable Remainder Trusts. The Spousal Protection Feature allows a surviving spouse to continue the contract while receiving the economic benefit of the death benefit upon the death of the other spouse, provided the conditions described below are satisfied:
(1) One or both spouses (or a revocable trust of which either or both of the spouses is/are grantor(s)) must be named as the Contract Owner. For contracts issued as an IRA or Roth IRA, only the person for whom the IRA or Roth IRA was established may be named as the Contract Owner;
(2) The spouses must be Co-Annuitants;
(3) Both spouses must be age 85 or younger at the time the contract is issued; however, if a death benefit option is elected, both spouses must meet the age requirements for the respective death benefit option at the time of application;
(4) Both spouses must be named as beneficiaries;
(5) No person other than the spouse may be named as Contract Owner, Annuitant, or primary beneficiary;
(6) If both spouses are alive upon annuitization, the Contract Owner must specify which spouse is the Annuitant upon whose continuation of life any annuity payments involving life contingencies depend (for an IRA  or Roth IRA contract, this person must be the Contract Owner); and
(7) If the Contract Owner requests to add a Co-Annuitant after contract issuance, the date of marriage must be after the contract issue date and Nationwide will require the Contract Owner to provide a copy of the marriage certificate.
If a Co-Annuitant dies before the Annuitization Date, the surviving spouse may continue the contract as its sole Contract Owner. Additionally, if the death benefit value is higher than the Contract Value at the time of the first Co-Annuitant's death, Nationwide will adjust the Contract Value to equal the death benefit value. The surviving Co-Annuitant may then name a new beneficiary but may not name another Co-Annuitant.
If the marriage of the Co-Annuitants terminates due to the death of a spouse, divorce, dissolution, or annulment, the Spousal Protection Feature terminates and the Contract Owner is not permitted to cover a subsequent spouse.
The Spousal Protection Feature may not apply if certain Contract Owner changes or assignments are made to the contract. Contract Owners contemplating changes to the ownership of their contract, including assignments, should contact their registered representative to determine how the changes impact the Spousal Protection Feature.
Additional purchase payments made to the contract after receiving the benefit of the Spousal Protection Feature are subject to the same CDSC provisions that were applicable prior to receiving the benefit of the Spousal Protection Feature.
Annuity Commencement Date
The Annuity Commencement Date is the date on which annuity payments are scheduled to begin. Generally, the Contract Owner designates the Annuity Commencement Date at the time of application. If no Annuity Commencement Date is designated at the time of application, Nationwide will establish the Annuity Commencement Date as the date the Annuitant reaches age 90.
The Contract Owner may change the Annuity Commencement Date before annuitization. This change must be submitted in writing to the Service Center and approved by Nationwide. The Annuity Commencement Date may not be later than the first day of the first calendar month after the Annuitant's 90th birthday (or the 90th birthday of the oldest Annuitant if there are joint annuitants) unless approved by Nationwide.
Generally, Nationwide will not initiate annuitization until specifically directed to do so. However, for Non-Qualified Contracts only, Nationwide will automatically initiate annuitization within 45 days after the Annuity Commencement Date (whether default or otherwise), unless (1) Nationwide has had direct contact with the Contract Owner (indicating that the contract is not abandoned); or (2) the Contract Owner has taken some type of action which is inconsistent with the desire to annuitize.
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Annuity Commencement Date and the 7% Nationwide Lifetime Income Rider
If the Contract Owner elected the 7% Nationwide Lifetime Income Rider, Nationwide will, approximately three months before the Annuity Commencement Date, notify the Contract Owner of the impending Annuity Commencement Date and give the Contract Owner the opportunity to defer the Annuity Commencement Date in order to preserve the benefit associated with the 7% Nationwide Lifetime Income Rider.
Annuitizing the Contract
Annuitization Date
The Annuitization Date is the date that annuity payments begin. If the Contract Owner has elected the 7% Nationwide Lifetime Income Rider, an election to begin annuity payments will terminate all benefits, conditions, guarantees, and charges associated with the elected option.
The Annuitization Date will be the first day of a calendar month unless otherwise agreed. Unless otherwise required by state law, the Annuitization Date must be at least two years after the contract is issued, but may not be later than either:
• the age (or date) specified in the contract; or
• the age (or date) specified by state law, where applicable.
The Internal Revenue Code may require that distributions be made prior to the Annuitization Date (see Appendix C: Contract Types and Tax Information).
On the Annuitization Date, the Annuitant becomes the Contract Owner unless the Contract Owner is a Charitable Remainder Trust.
Annuitization
Annuitization is the period during which annuity payments are received. It is irrevocable once payments have begun. Upon arrival of the Annuitization Date, the Annuitant must choose:
(1) an annuity payment option; and
(2) either a fixed payment annuity, variable payment annuity, or an available combination.
Actual purchase rates used to determine annuity payments will be those in effect on the Annuitization Date.
Nationwide guarantees that each payment under a fixed payment annuity will be the same throughout annuitization. Under a variable payment annuity, the amount of each payment will vary with the performance of the Sub-Accounts elected.
The Custom Portfolio Asset Rebalancing Service and the Static Asset Allocation Models are not available after annuitization.
Any allocations in the Fixed Account that are to be annuitized as a variable payment annuity must be transferred to one or more Sub-Accounts prior to the Annuitization Date. There are no restrictions on Fixed Account transfers made in anticipation of annuitization.
Any allocations in the Sub-Accounts that are to be annuitized as a fixed payment annuity must be transferred to the Fixed Account prior to the Annuitization Date. Short-term trading fees do not apply to transfers made in anticipation of annuitization.
Fixed Annuity Payments
Fixed annuity payments provide for level annuity payments. Premium taxes are deducted prior to determining fixed annuity payments. The fixed annuity payments will remain level unless the annuity payment option provides otherwise.
Variable Annuity Payments
Variable annuity payments will vary depending on the performance of the Sub-Accounts selected. The Sub-Accounts available during annuitization are those Sub-Accounts corresponding to the underlying mutual funds shown in Appendix A: Underlying Mutual Funds.
First Variable Annuity Payment
A number of factors determine the amount of the first variable annuity payment, including, but not limited to:
• the portion of purchase payments allocated to provide variable annuity payments;
• the Variable Account value on the Annuitization Date;
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• the adjusted age and sex of the Annuitant (and joint annuitant, if any) in accordance with the contract;
• the annuity payment option elected;
• the frequency of annuity payments;
• the Annuitization Date;
• the assumed investment return (the net investment return required to maintain level variable annuity payments);
• the deduction of applicable premium taxes; and
• the date the contract was issued.
Assumed Investment Return
An assumed investment return is the net investment return required to maintain level variable annuity payments. Nationwide uses a 3.5% assumed investment return factor. Therefore, if the net investment performance of each Sub-Account in which the Contract Owner invests exactly equals 3.5% for every payment period, then each payment will be the same amount. To the extent that investment performance is not equal to 3.5% for given payment periods, the amount of the payments in those periods will not be the same. Payments will increase from one payment date to the next if the annualized net rate of return is greater than 3.5% during that time. Conversely, payments will decrease from one payment to the next if the annualized net rate of return is less than 3.5% during that time.
Nationwide uses the assumed investment rate of return to determine the amount of the first variable annuity payment.
Subsequent Variable Annuity Payments
Variable annuity payments after the first will vary with the performance of the Sub-Accounts chosen by the Contract Owner after the investment performance is adjusted by the assumed investment return factor.
The dollar amount of each subsequent variable annuity payment is determined by taking the portion of the first annuity payment funded by a particular Sub-Account divided by the Annuity Unit value for that Sub-Account as of the Annuitization Date. This establishes the number of Annuity Units provided by each Sub-Account for each variable annuity payment after the first.
The number of Annuity Units comprising each variable annuity payment, on a Sub-Account basis, will remain constant, unless the Contract Owner transfers value from one Sub-Account to another. After annuitization, transfers among Sub-Accounts may only be made once per calendar year.
The number of Annuity Units for each Sub-Account is multiplied by the Annuity Unit value for that Sub-Account for the Valuation Period for which the payment is due. The sum of these results for all the Sub-Accounts in which the Contract Owner invests establishes the dollar amount of the variable annuity payment.
Subsequent variable annuity payments may be more or less than the previous variable annuity payment, depending on whether the net investment performance of the elected Sub-Accounts is greater or lesser than the assumed investment return.
Value of an Annuity Unit
Annuity Unit values for Sub-Accounts are determined by:
(1) multiplying the Annuity Unit value for each Sub-Account for the immediately preceding Valuation Period by the Net Investment Factor for the Sub-Account for the subsequent Valuation Period; and then
(2) multiplying the result from (1) by a factor to neutralize the assumed investment return factor.
The Net Investment Factor for any particular Sub-Account on or after the Annuitization Date is determined by dividing (a) by (b), and then subtracting (c) from the result, where:
(a) is the sum of:
(1) the Net Asset Value of the underlying mutual fund as of the end of the current Valuation Period; and
(2) the per share amount of any dividend or income distributions made by the underlying mutual fund (if the date of the dividend or income distribution occurs during the current Valuation Period).
(b) is the Net Asset Value of the underlying mutual fund determined as of the end of the preceding Valuation Period.
(c) is a factor representing the daily Variable Account charges, which is equal to 1.30% of the Daily Net Assets.
Based on the change in the Net Investment Factor, the value of an Annuity Unit may increase or decrease. Changes in the Net Investment Factor may not be directly proportional to changes in the Net Asset Value of the underlying mutual fund shares because of the deduction of Variable Account charges.
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Though the number of Annuity Units will not change as a result of investment experience, the value of an Annuity Unit may increase or decrease from Valuation Period to Valuation Period.
Frequency and Amount of Annuity Payments
Annuity payments are based on the annuity payment option elected.
If the net amount to be annuitized is less than $2,000, Nationwide reserves the right to pay this amount in a lump sum instead of periodic annuity payments.
Nationwide reserves the right to change the frequency of payments if the amount of any payment becomes less than $100. The payment frequency will be changed to an interval that will result in payments of at least $100. Nationwide will send annuity payments no later than seven days after each annuity payment date.
Annuity Payment Options
The Annuitant must elect an annuity payment option before the Annuitization Date. If the Annuitant does not elect an annuity payment option, a variable payment Single Life with a 20 Year Term Certain annuity payment option will be assumed as the automatic form of payment upon annuitization. Once elected or assumed, the annuity payment option may not be changed.
Not all of the annuity payment options may be available in all states. Additionally, the annuity payment options available may be limited based on the Annuitant's age (and the joint annuitant's age, if applicable) or requirements under the Internal Revenue Code.
Nationwide reserves the right to refuse any purchase payment that would result in the cumulative total for all contracts issued by Nationwide on the life of any one Annuitant or owned by any one Contract Owner to exceed $1,000,000. If a Contract Owner does not submit purchase payments in excess of $1,000,000, or if Nationwide has refused to accept purchase payments in excess of $1,000,000, the references in this provision to purchase payments in excess of $1,000,000 will not apply. If the Contract Owner is permitted to submit purchase payments in excess of $1,000,000, additional restrictions apply, as follows.
Annuity Payment Options for Contracts with Total Purchase Payments and Contract Value Annuitized Less Than or Equal to $2,000,000
If, at the Annuitization Date, the total of all purchase payments made to the contract and the Contract Value annuitized is less than or equal to $2,000,000, the annuity payment options available are:
• Single Life;
• Standard Joint and Survivor; and
• Single Life with a 10 or 20 Year Term Certain.
Each of the annuity payment options is discussed more thoroughly below.
Single Life
The Single Life annuity payment option provides for annuity payments to be paid during the lifetime of the Annuitant. This option is not available if the Annuitant is 86 or older on the Annuitization Date.
Payments will cease with the last payment before the Annuitant's death. For example, if the Annuitant dies before the second annuity payment date, the Annuitant will receive only one payment. The Annuitant will only receive two annuity payments if he or she dies before the third payment date, and so on. No death benefit will be paid.
No withdrawals other than the scheduled annuity payments are permitted.
Standard Joint and Survivor
The Standard Joint and Survivor annuity payment option provides for annuity payments to continue during the joint lifetimes of the Annuitant and joint annuitant. After the death of either the Annuitant or joint annuitant, payments will continue for the life of the survivor. This option is not available if the Annuitant or joint Annuitant is 86 or older on the Annuitization Date.
Payments will cease with the last payment due prior to the death of the last survivor of the Annuitant and joint annuitant. As is the case of the Single Life annuity payment option, there is no guaranteed number of payments. Therefore, it is possible that if the Annuitant dies before the second annuity payment date, the Annuitant will receive only one annuity payment. No death benefit will be paid.
No withdrawals other than the scheduled annuity payments are permitted.
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Single Life with a 10 or 20 Year Term Certain
The Single Life with a 10 or 20 Year Term Certain annuity payment option provides that monthly annuity payments will be paid during the Annuitant's lifetime or for the term selected, whichever is longer. The term may be either 10 or 20 years.
If the Annuitant dies before the end of the 10 or 20 year term, payments will be paid to the beneficiary for the remainder of the term.
No withdrawals other than the scheduled annuity payments are permitted.
Any Other Option
Annuity payment options not set forth in this provision may be available. Any annuity payment option not set forth in this provision must be approved by Nationwide.
Annuity Payment Options for Contracts with Total Purchase Payments and/or Contract Value Annuitized Greater Than $2,000,000
If, at the Annuitization Date, the total of all purchase payments made to the contract and/or the Contract Value to be annuitized is greater than $2,000,000, Nationwide may limit the annuity payment option to the longer of:
(1) a Fixed Life Annuity with a 20 Year Term Certain; or
(2) a Fixed Life Annuity with a Term Certain to Age 95.
Annuitization of Amounts Greater than $5,000,000
Additionally, Nationwide may limit the amount that may be annuitized on a single life to $5,000,000. If the total amount to be annuitized is greater than $5,000,000 under this contract and/or for all Nationwide issued annuity contracts with the same Annuitant, the Contract Owner must:
(1) reduce the amount to be annuitized to $5,000,000 or less by taking a partial withdrawal from the contract;
(2) reduce the amount to be annuitized to $5,000,000 or less by exchanging the portion of the Contract Value in excess of $5,000,000 to another annuity contract; or
(3) annuitize the portion of the Contract Value in excess of $5,000,000 under an annuity payment option with a term certain, if available.
Statements and Reports
Nationwide will mail Contract Owners statements and reports. Therefore, Contract Owners should promptly notify the Service Center of any address change.
These mailings will contain:
• statements showing the contract's quarterly activity;
• confirmation statements showing transactions that affect the contract's value. Confirmation statements will not be sent for recurring transactions (i.e., Dollar Cost Averaging or salary reduction programs). Instead, confirmation of recurring transactions will appear in the contract's quarterly statements; and
• semi-annual and annual reports of allocated underlying mutual funds.
Contract Owners can receive information from Nationwide faster and reduce the amount of mail received by signing up for Nationwide's eDelivery program. Nationwide will notify Contract Owners by email when important documents (statements, prospectuses, and other documents) are ready for a Contract Owner to view, print, or download from Nationwide's secure server. To choose this option, go to: www.nationwide.com/login.
Contract Owners should review statements and confirmations carefully. All errors or corrections must be reported to Nationwide immediately to assure proper crediting to the contract. Unless Nationwide is notified within 30 days of receipt of the statement, Nationwide will assume statements and confirmation statements are correct.
IMPORTANT NOTICE REGARDING DELIVERY OF SECURITY OWNER 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 Contract Owners in the same household, Nationwide will mail only one copy of each document, unless notified otherwise by the Contract Owner(s). Household delivery will continue for the life of the contracts.
A Contract Owner can revoke their consent to household delivery and reinstitute individual delivery by contacting the Service Center. Nationwide will reinstitute individual delivery within 30 days after receiving such notification.
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Legal Proceedings
Nationwide Life Insurance Company
Nationwide Financial Services, Inc. (NFS, or collectively with its subsidiaries, "the Company") was formed in November 1996. NFS is the holding company for Nationwide Life Insurance Company (NLIC), Nationwide Life and Annuity Insurance Company (NLAIC) and other companies that comprise the life insurance and retirement savings operations of the Nationwide group of companies (Nationwide). This group includes Nationwide Financial Network (NFN), an affiliated distribution network that markets directly to its customer base. NFS is incorporated in Delaware and maintains its principal executive offices in Columbus, Ohio.
The Company is subject to legal and regulatory proceedings in the ordinary course of its business. The Company's legal and regulatory matters include proceedings specific to the Company and other proceedings generally applicable to business practices in the industries in which the Company operates. 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 litigation matters. Furthermore, it is often not possible to determine the ultimate outcomes of the pending regulatory investigations and legal proceedings or to provide reasonable ranges of potential losses with any degree of certainty. Some matters, including certain of those referred to below, are in very preliminary stages, and the Company does not have sufficient information to make an assessment of the plaintiffs' claims for liability or damages. In some of the cases seeking to be certified as class actions, the court has not yet decided whether a class will be certified or (in the event of certification) the size of the class and class period. In many of the cases, the plaintiffs are seeking undefined amounts of damages or other relief, including punitive damages and equitable remedies, which are difficult to quantify and cannot be defined based on the information currently available. The Company believes, however, that based on currently known information, the ultimate outcome of all pending legal and regulatory matters is not likely to have a material adverse effect on the Company's consolidated financial position. Nonetheless, given the large or indeterminate amounts sought in certain of these matters and the inherent unpredictability of litigation, it is possible that such outcomes could materially affect the Company's consolidated financial position or results of operations 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 Nationwide Mutual Insurance Company (NMIC) in responding to these inquiries to the extent that any inquiries encompass 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.
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 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
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the Coker (Gwin) class action, and dismissed NLIC. The Company has resolved the indemnification claims of ASEA. On February 13, 2013, the Court issued its Order determining the amount of fees due to PEBCO on its indemnification claim. On March 28, 2013, the Company filed a notice of appeal to the Alabama Supreme Court. NRS continues to defend this case vigorously.
On August 15, 2001, NFS and NLIC were named in a lawsuit filed in the United States District Court for the District of Connecticut entitled Lou Haddock, as trustee of the Flyte Tool & Die, Incorporated Deferred Compensation Plan, et al v. Nationwide Financial Services, Inc. and Nationwide Life Insurance Company. On November 18, 2009, the plaintiffs filed a sixth amended complaint amending the list of named plaintiffs and claiming to represent a class of qualified retirement plan trustees under the Employee Retirement Income Security Act of 1974 (ERISA) that purchased variable annuities from NLIC. The plaintiffs allege that they invested ERISA plan assets in their variable annuity contracts and that NLIC and NFS breached ERISA fiduciary duties by allegedly accepting service payments from certain mutual funds. The complaint seeks 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 November 6, 2009, order granting class certification and remanded the class back to the District Court for further consideration. The plaintiffs have renewed their motion for class certification. On December 18, 2012, the District Court heard oral argument on the motion for class certification. 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 lower court granted Nationwide's motion to dismiss. Plaintiffs appealed. The Court of Appeals affirmed the dismissal on October 24, 2012. Plaintiffs filed a petition for rehearing en banc on November 5, 2012. The Court of Appeals denied the petition on December 14, 2012. Plaintiff filed a notice of appeal to the Ohio Supreme Court on January 24, 2013. Nationwide has 30 days to file an opposition memorandum. Nationwide filed its memorandum in opposition to plaintiffs' petition for jurisdiction to the Ohio Supreme Court on February 27, 2013.
Lehman Brothers Holdings, Inc. (Debtors) and Giddens, James v NLIC and NMIC, et al. In 2012 the Plaintiff, Debtor in Possession Lehman Brothers Special Financing, Inc., filed a class action in the United States Bankruptcy Court for the Southern District of New York seeking the recovery of nearly $3 billion in assets from all the named defendants including NLIC and NMIC. This litigation arises from two collateralized debt obligation transactions, 801 Grand and Alta, which resulted in payments to NLIC and NMIC. In 2008, the Plaintiff and its parent company, Lehman Brothers Holding, Inc. filed for bankruptcy which triggered an early termination of the above transactions. The Plaintiff seeks to have sums returned to the bankruptcy estate in addition to prejudgment interest and costs. The case is currently stayed and on February 13, 2013, the Court extended the stay. Responsive pleadings are now due September 5, 2013. Lehman recently sent correspondence out to all defendants inviting settlement discussions which is under review.
Nationwide Investment Services Corporation
The general distributor, NISC, is not engaged in any litigation of any material nature.
Contents of Statement of Additional Information
General Information and History
Services
Purchase of Securities Being Offered
Underwriters
Advertising
Annuity Payments
Condensed Financial Information
Financial Statements
Investment Company Act of 1940 Registration File No. 811-03330
Securities Act of 1933 Registration File No. 333-177439
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Appendix A: Underlying Mutual Funds
This appendix contains information about the underlying mutual funds in which the Sub-Accounts 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. Refer to the prospectus for each underlying mutual fund for more detailed information.
   
Designations Key:
STTF: The underlying mutual fund assesses (or reserves the right to assess) a short-term trading fee (see Short-Term Trading Fees).
FF: The underlying mutual fund primarily invests in other mutual funds. Therefore, a proportionate share of the fees and expenses of any acquired funds are indirectly borne by investors. As a result, investors in this Sub-Account may incur higher charges than if the assets were invested in an underlying mutual fund that does not invest in other mutual funds. Refer to the prospectus for this underlying mutual fund for more information.
VOL: The underlying mutual fund was developed primarily for use in connection with living benefits that are available in this contract or other contracts that Nationwide offers. The underlying mutual fund is designed to help reduce a Contract Owner's exposure to equity investments when equity markets are more volatile. The fund uses a volatility overlay to minimize the costs and risks to Nationwide of supporting the living benefit guarantees. This could create a conflict of interest between the beneficial shareholders and Nationwide. In light of the fund's design, additional consideration should be given to whether investment in this fund is appropriate without election of a living benefit.
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein Small/Mid Cap Value Portfolio: Class B
Investment Advisor: AllianceBernstein L.P.
Investment Objective: Long-term growth of capital.
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein VPS Dynamic Asset Allocation Portfolio: Class B
Investment Advisor: AllianceBernstein L.P.
Investment Objective: Maximize total return consistent with the Adviser's determination of reasonable risk.
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II
Investment Advisor: American Century Investment Management, Inc.
Investment Objective: Long-term total return using a strategy that seeks to protect against U.S. inflation.
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class II
Investment Advisor: American Century Investment Management, Inc.
Investment Objective: Long-term capital growth with income as a secondary objective.
American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2
Investment Advisor: Capital Research and Management Company
Sub-advisor: Milliman Financial Risk Management LLC
Investment Objective: To provide high total return (including income and capital gains) consistent with preservation of capital over the long term while seeking to manage volatility.
Designation: VOL
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class III
Investment Advisor: BlackRock Advisors, LLC
Sub-advisor: BlackRock Investment Management, LLC; BlackRock International Limited
Investment Objective: Seeks high total investment return.
Delaware VIP Trust - Delaware VIP Small Cap Value Series: Service Class
Investment Advisor: Delaware Management Company, Inc.
Investment Objective: The fund seeks capital appreciation.
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares
This underlying mutual fund is only available in contracts for which good order applications were received before May 1, 2013
Investment Advisor: The Dreyfus Corporation
Investment Objective: To match performance of the S&P SmallCap 600 Index®.
Dreyfus Stock Index Fund, Inc.: Service Shares
This underlying mutual fund is only available in contracts for which good order applications were received before May 1, 2013
Investment Advisor: The Dreyfus Corporation
Investment Objective: To match performance of the S&P 500.
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Dreyfus Variable Investment Fund - Appreciation Portfolio: Service Shares
Investment Advisor: The Dreyfus Corporation
Sub-advisor: Fayez Sarofim & Co.
Investment Objective: Long-term capital growth consistent with the preservation of capital.
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2
Investment Advisor: Strategic Advisers Inc. Boston MA
Sub-advisor: FMR Co., Inc., Fidelity Research & Analysis Company
Investment Objective: High total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.
Designation: FF
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class 2
Investment Advisor: Strategic Advisers Inc. Boston MA
Sub-advisor: FMR Co., Inc., Fidelity Research & Analysis Company
Investment Objective: High total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.
Designation: FF
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class 2
Investment Advisor: Strategic Advisers Inc. Boston MA
Sub-advisor: FMR Co., Inc., Fidelity Research & Analysis Company
Investment Objective: High total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.
Designation: FF
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Research & Analysis Company
Investment Objective: Capital appreciation.
Designation: STTF
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Service Class 2
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Management & Research (U.K.) Inc., Fidelity Research & Analysis Company, Fidelity Investments Japan Limited, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited
Investment Objective: Reasonable income.
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Service Class 2
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Management & Research (U.K.) Inc., Fidelity Research & Analysis Company, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited, Fidelity Investments Japan Limited
Investment Objective: Capital appreciation.
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class 2
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: Fidelity Investments Money Management, Inc., Fidelity Research & Analysis Company, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited
Investment Objective: High level of current income.
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class 2
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Management & Research (U.K.) Inc., Fidelity Research & Analysis Company, Fidelity Investments Japan Limited, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited
Investment Objective: Long-term growth of capital.
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Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class 2R
Investment Advisor: Fidelity Management & Research Company
Sub-advisor: FMR Co., Inc., Fidelity Management & Research (U.K.) Inc., Fidelity Research & Analysis Company, Fidelity International Investment Advisors, Fidelity International Investment Advisors (U.K.) Limited, Fidelity Investments Japan Limited
Investment Objective: Long-term capital growth.
Designation: STTF
Franklin Templeton Variable Insurance Products Trust - Franklin Income Securities Fund: Class 2
Investment Advisor: Franklin Advisers, Inc.
Investment Objective: Maximum income while maintaining prospects for capital appreciation.
Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value Securities Fund: Class 2
This underlying mutual fund is only available in contracts for which good order applications were received before May 1, 2013
Investment Advisor: Franklin Advisory Services, LLC
Investment Objective: Long-term total return.
Franklin Templeton Variable Insurance Products Trust - Franklin Templeton VIP Founding Funds Allocation Fund: Class 2
Investment Advisor: Franklin Templeton Services, LLC
Investment Objective: Capital appreciation with income as a secondary goal.
Designation: FF
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond Securities Fund: Class 3
Investment Advisor: Franklin Advisers, Inc.
Investment Objective: High current income, consistent with preservation of capital, with capital appreciation as a secondary consideration.
Designation: STTF
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Markets Navigator Fund: Service Shares
Investment Advisor: Goldman Sachs Asset Management, L.P.
Investment Objective: Seeks to achieve investment results that approximate the performance of the GS Global Markets Navigator Index (the "Index").
Guggenheim Variable Fund - Multi-Hedge Strategies
Investment Advisor: Security Investors, LLC
Investment Objective: Capital appreciation consistent with the return and risk characteristics of the hedge fund universe and, secondarily, to achieve these returns with low correlation to and less volatility than equity indices.
Huntington VA Funds - Huntington VA International Equity Fund
Investment Advisor: Huntington Asset Advisors, Inc.
Investment Objective: Seeks total return on its assets.
Huntington VA Funds - Huntington VA Situs Fund
Investment Advisor: Huntington Asset Advisors, Inc.
Investment Objective: Seeks long-term capital appreciation.
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series II
Investment Advisor: Invesco Advisers, Inc.
Investment Objective: Long-term growth of capital.
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 - 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 - Mid Cap Growth
Investment Advisor: Waddell & Reed Investment Management Company
Investment Objective: Seeks to provide growth of investment.
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Janus Aspen Series - Forty Portfolio: Service Shares
Investment Advisor: Janus Capital Management LLC
Investment Objective: Long-term growth of capital.
Janus Aspen Series - Global Technology Portfolio: Service Shares
Investment Advisor: Janus Capital Management LLC
Investment Objective: Long-term growth of capital.
Janus Aspen Series - Overseas Portfolio: Service Shares
Investment Advisor: Janus Capital Management LLC
Investment Objective: Long-term growth of capital.
MFS® Variable Insurance Trust - MFS New Discovery Series: Service Class
Investment Advisor: Massachusetts Financial Services Company
Investment Objective: To seek capital appreciation.
MFS® Variable Insurance Trust - MFS Value Series: Service Class
Investment Advisor: Massachusetts Financial Services Company
Investment Objective: To seek capital appreciation.
MFS® Variable Insurance Trust II - MFS International Value Portfolio: Service Class
Investment Advisor: Massachusetts Financial Services Company
Investment Objective: The fund's investment objective is to seek capital appreciation. MFS normally invests the fund's assets primarily in foreign equity securities, including emerging market equity securities.
Nationwide Variable Insurance Trust - American Century NVIT Growth Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: American Century Investment Management, Inc.
Investment Objective: Seeks long-term capital appreciation.
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: American Century Investment Management, Inc.
Investment Objective: The Fund seeks capital appreciation, and secondarily current income.
Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II
Investment Advisor: Capital Research and Management Company
Investment Objective: The fund seeks to provide high total return (including income and capital gains) consistent with the preservation of capital over the long term.
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II
Investment Advisor: Capital Research and Management Company
Investment Objective: The Fund seeks to maximize an investors level of current income and preserve the investor's capital.
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II
Investment Advisor: Capital Research and Management Company
Investment Objective: The Fund is designed for investors seeking capital appreciation through stocks.
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II
Investment Advisor: Capital Research and Management Company
Investment Objective: The Fund is designed for investors seeking capital appreciation principally through investment in stocks.
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II
Investment Advisor: Capital Research and Management Company
Investment Objective: The fund seeks returns from both capital gains as well as income generated by dividends paid by stock issuers.
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class III
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Federated Investment Management Company
Investment Objective: The Fund seeks to provide high current income.
Designation: STTF
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Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class II (formerly, Nationwide Variable Insurance Trust - Van Kampen NVIT Comstock Value Fund: Class II)
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Invesco Advisers, Inc.
Investment Objective: The Fund's investment objective is to seek capital growth and income through investments in equity securities, including common stocks, preferred stocks, and convertible securities.
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class II
This underlying mutual fund is only available in contracts for which good order applications were received before May 1, 2013
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Neuberger Berman Management LLC
Investment Objective: The fund seeks long-term capital growth.
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Neuberger Berman Management LLC
Investment Objective: The Fund seeks long-term total return by investing primarily in securities of companies that meet the fund's financial criteria and social policy.
Nationwide Variable Insurance Trust - NVIT CardinalSM Aggressive Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Aggressive Fund seeks maximum growth of capital consistent with a more aggressive level of risk as compared to other Cardinal Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT CardinalSMBalanced Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Fund seeks a high level of total return through investment in both equity and fixed income securities.
Designation: FF
Nationwide Variable Insurance Trust - NVIT CardinalSM Capital Appreciation Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Fund seeks growth of capital, but also seeks income consistent with a less aggressive level of risk as compared to other Cardinal Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT CardinalSM Conservative Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Fund seeks a high level of total return consistent with a conservative level of risk as compared to other Cardinal Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT CardinalSM Managed Growth & Income Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: Seeks a high level of total return through investment in both equity and fixed-income securities, consistent with preservation of capital.
Designation: FF, VOL
Nationwide Variable Insurance Trust - NVIT CardinalSM Managed Growth Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: Seeks growth primarily and investment income secondarily.
Designation: FF, VOL
Nationwide Variable Insurance Trust - NVIT CardinalSM Moderate Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Fund seeks a high level of total return consistent with a moderate level of risk as compared to other Cardinal Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT CardinalSM Moderately Aggressive Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The Fund seeks growth of capital, but also seeks income consistent with a moderately aggressive level of risk as compared to other Cardinal Funds.
Designation: FF
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Nationwide Variable Insurance Trust - NVIT CardinalSM Moderately Conservative Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The fund seeks a high level of total return consistent with a moderately conservative level of risk.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Nationwide Asset Management, LLC
Investment Objective: The Fund seeks a high level of current income consistent with preserving capital.
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Neuberger Berman Fixed Income LLC
Investment Objective: The Fund seeks long-term total return consistent with reasonable risk.
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class VI
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: The Boston Company Asset Management, LLC
Investment Objective: The Fund seeks long-term capital growth by investing primarily in equity securities of companies located in emerging market countries.
Designation: STTF
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Nationwide Asset Management, LLC
Investment Objective: The fund seeks as high level of income as is consistent with the preserving of capital.
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class VI
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Invesco Advisers, Inc.
Investment Objective: The Fund seeks long-term capital growth by investing primarily in equity securities of companies in Europe, Australasia, the Far East and other regions, including developing countries.
Designation: STTF
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class VIII
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: The Fund seeks to match the performance of the MSCI, Inc. Europe, Australasia and Far East Index ("MSCI EAFE»Index") as closely as possible before the deduction of Fund expenses.
Designation: STTF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Aggressive Fund seeks maximum growth of capital consistent with a more aggressive level of risk as compared to other Investor Destinations Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Balanced Fund seeks a high level of total return through investment in both equity and fixed-income securities.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Capital Appreciation Fund seeks growth of capital, but also seeks income consistent with a less aggressive level of risk as compared to other NVIT Investor Destinations Funds.
Designation: FF
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Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Conservative Fund seeks a high level of total return consistent with a conservative level of risk as compared to other Investor Destinations Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Managed Growth & Income Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: Seeks a high level of total return through investment in both equity and fixed-income securities, consistent with preservation of capital.
Designation: FF, VOL
Nationwide Variable Insurance Trust - NVIT Investor Destinations Managed Growth Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: Seeks growth primarily and investment income secondarily.
Designation: FF, VOL
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Moderate Fund seeks a high level of total return consistent with a moderate level of risk as compared to other Investor Destinations Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Moderately Aggressive Fund seeks growth of capital, but also seeks income consistent with a moderately aggressive level of risk as compared to other Investor Destinations Funds.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Investment Objective: The NVIT Investor Destinations Moderately Conservative Fund seeks a high level of total return consistent with a moderately conservative level of risk.
Designation: FF
Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: OppenheimerFunds, Inc.
Investment Objective: The Fund seeks long-term capital growth.
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: The Fund seeks capital appreciation.
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Federated Investment Management Company
Investment Objective: The Fund seeks as high a level of current income as is consistent with preserving capital and maintaining liquidity.
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Logan Circle Partners, L.P.
Investment Objective: The Fund seeks to provide above average total return over a market cycle of three to five years.
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class VI
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Invesco Advisers, Inc. and American Century Investment Management, Inc.
Investment Objective: The fund seeks long-term capital growth.
Designation: STTF
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Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class VI
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: AllianceBernstein L.P.; JPMorgan Investment Management, Inc.
Investment Objective: The Fund seeks long-term capital appreciation.
Designation: STTF
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Winslow Capital Management, Inc.; Neuberger Berman Management Inc. and Wells Capital Management, Inc.;
Investment Objective: The fund seeks long-term capital growth.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Goldman Sachs Asset Management, L.P.; Wellington Management Company, LLP; The Boston Company Asset Management, LLC
Investment Objective: The fund seeks long-term capital growth.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Neuberger Berman Management LLC; Wells Capital Management, Inc.
Investment Objective: The fund seeks long-term capital growth.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: American Century Investment Management, Inc.; Columbia Management Investment Advisers, LLC; Thompson, Siegel & Walmsley LLC
Investment Objective: The fund seeks long-term capital appreciation.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: OppenheimerFunds, Inc.; Wellington Management Company, LLP
Investment Objective: The Fund seeks capital growth.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Aberdeen Asset Management, Inc.; Epoch Investment Partners, Inc.; J.P. Morgan Investment Management Inc.
Investment Objective: The Fund seeks capital appreciation.
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Aberdeen Asset Management, Inc.; Morgan Stanley Investment Management; Neuberger Berman Management, Inc.; Putnam Investment Management, LLC; and Waddell & Reed Investment Management Company
Investment Objective: The Fund seeks capital appreciation.
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Aberdeen Asset Management, Inc. and Diamond Hill Capital Management, Inc.
Investment Objective: The Fund seeks total return through a flexible combination of capital appreciation and current income.
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Brookfield Investment Management Inc.
Investment Objective: The Fund seeks current income and long-term capital appreciation.
Nationwide Variable Insurance Trust - NVIT S&P 500® Index Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: Long-term capital appreciation.
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Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Nationwide Asset Management, LLC
Investment Objective: The Fund seeks to provide a high level of current income while preserving capital and minimizing fluctuations in share value.
Nationwide Variable Insurance Trust - NVIT Small Cap Index Fund: Class II
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: BlackRock Investment Management, LLC
Investment Objective: The Fund seeks to match the performance of the Russell 2000® Index.
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class III
Investment Advisor: Nationwide Fund Advisors
Sub-advisor: Templeton Investment Counsel, LLC
Investment Objective: The Fund seeks to maximize total return consisting of capital appreciation and/or current income.
Designation: STTF
Northern Lights Variable Trust - TOPS Protected Balanced ETF Portfolio: Class 4
Investment Advisor: ValMark Advisers, Inc.
Sub-advisor: Milliman, Inc.
Investment Objective: Seeks to provide income and capital appreciation with less volatility than the fixed income and equity markets.
Designation: FF, VOL
Northern Lights Variable Trust - TOPS Protected Growth ETF Portfolio: Class 4
Investment Advisor: ValMark Advisers, Inc.
Sub-advisor: Milliman, Inc.
Investment Objective: Seeks capital appreciation with less volatility than the equity markets.
Designation: FF, VOL
Northern Lights Variable Trust - TOPS Protected Moderate Growth ETF Portfolio: Class 4
Investment Advisor: ValMark Advisers, Inc.
Sub-advisor: Milliman, Inc.
Investment Objective: Seeks capital appreciation with less volatility than the equity markets.
Designation: FF, VOL
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Class 4 (formerly, Oppenheimer Variable Account Funds - Oppenheimer Global Securities Fund/VA: Class 4)
Investment Advisor: OFI Global Asset Management, Inc.
Sub-advisor: OppenheimerFunds, Inc.
Investment Objective: The Fund seeks long-term capital appreciation by investing a substantial portion of its assets in securities of foreign issuers, "growth-type" companies, cyclical industries and special situations that are considered to have appreciation possibilities.
Designation: STTF
Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Service Shares
Investment Advisor: OppenheimerFunds, Inc.
Investment Objective: High total return which includes growth in the value of its shares as well as current income from equity and debt securities.
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Service Shares (formerly, Oppenheimer Variable Account Funds - Oppenheimer Main Street Small- & Mid-Cap Fund®/VA: Service Shares)
Investment Advisor: OppenheimerFunds, Inc.
Investment Objective: Capital appreciation.
PIMCO Variable Insurance Trust - All Asset Portfolio: Advisor Class
Investment Advisor: Pacific Investment Management Company LLC
Sub-advisor: Research Affiliates
Investment Objective: The fund seeks maximum real return, consistent with preservation of real capital and prudent investment management.
Designation: FF
66
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Advisor Class
Investment Advisor: Pacific Investment Management Company LLC
Investment Objective: Seeks maximum total return consistent with preservation of capital and prudent investment management. The Portfolio seeks to achieve its investment objective by investing under normal circumstances at least 80% of its assets in Fixed Income Instruments that are economically tied to foreign (non-U.S.) countries, representing at least three foreign countries, which may be represented by forwards or derivatives such as options, futures contracts or swap agreements.
PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class
Investment Advisor: Pacific Investment Management Company LLC
Investment Objective: Seeks maximum total return, consistent with preservation of capital and prudent investment management.
PIMCO Variable Insurance Trust - Total Return Portfolio: Advisor Class
Investment Advisor: Pacific Investment Management Company LLC
Investment Objective: The fund seeks maximum total return, consistent with preservation of capital and prudent investment management.
T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II
Investment Advisor: T. Rowe Price Associates, Inc.
Investment Objective: Long-term capital appreciation.
Van Eck VIP Trust - Van Eck VIP Global Hard Assets Fund: Service Class
Investment Advisor: Van Eck Associates Corporation
Investment Objective: Long-term capital appreciation by investing primarily in hard asset securities. Income is a secondary consideration.
Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2
Investment Advisor: Wells Fargo Funds Management, LLC
Sub-advisor: Wells Capital Management Inc.
Investment Objective: Long-term capital appreciation.
67
Appendix B: Condensed Financial Information
The following tables list the Condensed Financial Information (the Accumulation Unit value information for Accumulation Units outstanding) for contracts with no optional benefits (the minimum Variable Account charge of 1.30%) and contracts with the most expensive combination of allowable optional benefits as of December 31, 2012 (the maximum Variable Account charge of 2.10%). The term "Period" is defined as a complete calendar year, unless otherwise noted. Those Periods with an asterisk (*) reflect Accumulation Unit information for a partial year only. To obtain a copy of the Condensed Financial Information for any other Variable Account expense tier, contact the Service Center and request a copy of the Statement of Additional Information, which is available free of charge.
The following Sub-Accounts were added to the Variable Account after December 31, 2012; therefore, no Condensed Financial Information is available:
• Delaware Variable Insurance Product Trust - Delaware VIP Small Cap Value Series: Service Class
• Guggenheim Variable Fund - Multi-Hedge Strategies
• Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Managed Growth & Income Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Managed Growth Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Investor Destinations Managed Growth & Income Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Investor Destinations Managed Growth Fund: Class II
• Nationwide Variable Insurance Trust - NVIT S&P 500 Index Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Small Cap Index Fund: Class II
 
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein Small/Mid Cap Value Portfolio: Class B - Q/NQ
2012
   20.073992   23.471632   16.93%   19,400
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein VPS Dynamic Asset Allocation Portfolio: Class B - Q/NQ
2012*
   10.000000   10.154217   1.54%   2,112
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II - Q/NQ
2012
   14.297491   15.153413   5.99%   163,567
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class II - Q/NQ
2012
   14.053082   16.120711   14.71%   40,969
American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2 - Q/NQ
2012*
   10.000000   10.119675   1.20%   311,738
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class III - Q/NQ
2012
   12.438632   13.500145   8.53%   37,576
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares - Q/NQ
2012
   15.129971   17.283516   14.23%   24,312
Dreyfus Stock Index Fund, Inc.: Service Shares - Q/NQ
2012
   14.107815   16.078646   13.97%   83,769
Dreyfus Variable Investment Fund - Appreciation Portfolio: Service Shares - Q/NQ
2012
   15.138702   16.456156   8.70%   86,315
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2 - Q/NQ
2012
   12.219959   13.457741   10.13%   256,748
68
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class 2 - Q/NQ
2012
   12.194817   13.609100   11.60%   33,859
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class 2 - Q/NQ
2012
   11.881588   13.507103   13.68%   936
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2 - Q/NQ
2012
   15.989239   16.528028   3.37%   8,657
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Service Class 2 - Q/NQ
2012
   14.023439   16.201274   15.53%   105,348
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Service Class 2 - Q/NQ
2012
   13.707490   15.477413   12.91%   114,816
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class 2 - Q/NQ
2012
   14.063004   14.657541   4.23%   106,405
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class 2 - Q/NQ
2012
   22.954492   25.954620   13.07%   32,912
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class 2R - Q/NQ
2012
   10.873789   12.926834   18.88%   29,433
Franklin Templeton Variable Insurance Products Trust - Franklin Income Securities Fund: Class 2 - Q/NQ
2012
   11.890259   13.220142   11.18%   44,603
Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value Securities Fund: Class 2 - Q/NQ
2012
   19.839372   23.181387   16.85%   11,895
Franklin Templeton Variable Insurance Products Trust - Franklin Templeton VIP Founding Funds Allocation Fund: Class 2 - Q/NQ
2012
   8.970568   10.211201   13.83%   27,063
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond Securities Fund: Class 3 - Q/NQ
2012
   16.223704   18.423935   13.56%   36,665
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Markets Navigator Fund: Service Shares - Q/NQ
2012*
   10.000000   10.222938   2.23%   0
Huntington VA Funds - Huntington VA International Equity Fund - Q/NQ
2012
   9.003854   10.133800   12.55%   28,907
Huntington VA Funds - Huntington VA Situs Fund - Q/NQ
2012
   11.040989   13.362779   21.03%   61,309
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series II - Q/NQ
2012*
   10.000000   9.958708   -0.41%   12,855
69
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
Ivy Funds Variable Insurance Portfolios - Asset Strategy - Q/NQ
2012
   11.653053   13.706700   17.62%   55,057
Ivy Funds Variable Insurance Portfolios - High Income - Q/NQ
2012*
   10.000000   10.815203   8.15%   59,413
Ivy Funds Variable Insurance Portfolios - Mid Cap Growth - Q/NQ
2012*
   10.000000   10.068050   0.68%   36,287
Janus Aspen Series - Forty Portfolio: Service Shares - Q/NQ
2012
   8.583266   10.492598   22.24%   47,208
Janus Aspen Series - Global Technology Portfolio: Service Shares - Q/NQ
2012
   4.640225   5.456761   17.60%   17,031
Janus Aspen Series - Overseas Portfolio: Service Shares - Q/NQ
2012
   11.103975   12.403811   11.71%   9,878
MFS® Variable Insurance Trust - MFS New Discovery Series: Service Class - Q/NQ
2012*
   10.000000   10.228022   2.28%   5,281
MFS® Variable Insurance Trust - MFS Value Series: Service Class - Q/NQ
2012
   15.809554   18.081786   14.37%   42,318
MFS® Variable Insurance Trust II - MFS International Value Portfolio: Service Class - Q/NQ
2012
   10.421665   11.924574   14.42%   68,486
Nationwide Variable Insurance Trust - American Century NVIT Growth Fund: Class II - Q/NQ
2012
   9.079969   10.196613   12.30%   51,228
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class II - Q/NQ
2012
   13.782314   15.567756   12.95%   41,728
Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II - Q/NQ
2012
   10.194744   11.643296   14.21%   2,024,891
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II - Q/NQ
2012
   11.414478   11.825276   3.60%   2,008,735
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II - Q/NQ
2012
   10.098071   12.167775   20.50%   78,307
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II - Q/NQ
2012
   9.392119   10.882845   15.87%   148,355
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II - Q/NQ
2012
   8.172677   9.442516   15.54%   2,659,626
70
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class III - Q/NQ
2012
   13.600599   15.397710   13.21%   45,986
Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class II - Q/NQ
2012
   15.263091   17.801528   16.63%   25,318
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class II - Q/NQ
2012
   7.660316   8.833333   15.31%   7,769
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class II - Q/NQ
2012
   9.237127   10.154564   9.93%   14,172
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Aggressive Fund: Class II - Q/NQ
2012
   8.499356   9.743653   14.64%   4,585
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class II - Q/NQ
2012
   9.938199   10.893639   9.61%   4,163,199
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Capital Appreciation Fund: Class II - Q/NQ
2012
   9.324356   10.458384   12.16%   7,767
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class II - Q/NQ
2012
   10.675245   11.326218   6.10%   720,334
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class II - Q/NQ
2012
   9.636061   10.686963   10.91%   562,998
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Aggressive Fund: Class II - Q/NQ
2012
   8.984882   10.161260   13.09%   5,187
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class II - Q/NQ
2012
   10.211873   11.091106   8.61%   1,150,497
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II - Q/NQ
2012
   11.651623   12.360305   6.08%   8,697
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class II - Q/NQ
2012
   12.634477   13.357432   5.72%   61,011
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class VI - Q/NQ
2012
   17.400876   20.079508   15.39%   7,575
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - NQ
2012
   58.094578   59.090227   1.71%   4,195
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - Q
2012
   58.248425   59.246711   1.71%   4,005
71
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class VI - Q/NQ
2012
   6.911842   7.860500   13.73%   14,891
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class VIII - Q/NQ
2012
   7.628054   8.899785   16.67%   12,416
Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II - Q/NQ
2012
   13.008386   14.880689   14.39%   253
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II - Q/NQ
2012
   12.453829   13.445256   7.96%   2,633,689
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II - Q/NQ
2012
   13.080661   14.491720   10.79%   12,087
Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II - Q/NQ
2012
   12.871264   13.361029   3.81%   839,247
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II - Q/NQ
2012
   13.271179   14.514442   9.37%   413,304
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II - Q/NQ
2012
   13.288387   14.919941   12.28%   5,789
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II - Q/NQ
2012
   13.336642   14.221146   6.63%   775,576
Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class II - Q/NQ
2012
   13.322678   15.571403   16.88%   14,525
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I - Q/NQ
2012
   16.652215   19.306983   15.94%   22,561
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I - Q/NQ
2012
   27.365352   27.008645   -1.30%   119,072
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I - Q/NQ
2012
   16.173014   17.917617   10.79%   49,234
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class VI - Q/NQ
2012
   8.171995   9.317313   14.02%   6,029
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class VI - Q/NQ
2012
   9.039737   10.433935   15.42%   21,642
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class II - Q/NQ
2012
   8.754200   10.034666   14.63%   19,005
72
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class II - Q/NQ
2012
   8.163084   9.474025   16.06%   28,898
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class II - Q/NQ
2012
   9.150703   10.354080   13.15%   10,106
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II - Q/NQ
2012
   9.820513   11.276879   14.83%   11,457
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class II - Q/NQ
2012
   13.311867   14.858613   11.62%   5,186
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class II - Q/NQ
2012
   18.682235   22.182797   18.74%   3,666
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class II - Q/NQ
2012
   18.396109   20.921043   13.73%   4,544
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class II - Q/NQ
2012
   13.019696   14.629438   12.36%   2,183
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class II - Q/NQ
2012
   9.656214   11.015389   14.08%   33,424
Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II - Q/NQ
2012
   10.532312   10.761332   2.17%   93,424
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class III - Q/NQ
2012
   11.723024   13.833939   18.01%   63,571
Northern Lights Variable Trust - TOPS Protected Balanced ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.149856   1.50%   0
Northern Lights Variable Trust - TOPS Protected Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.268646   2.69%   0
Northern Lights Variable Trust - TOPS Protected Moderate Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.286304   2.86%   0
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Class 4 - Q/NQ
2012
   13.161506   15.712150   19.38%   51,041
Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Service Shares - Q/NQ
2012
   13.654221   15.714632   15.09%   33,038
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Service Shares - Q/NQ
2012
   18.845528   21.886628   16.14%   5,623
73
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
PIMCO Variable Insurance Trust - All Asset Portfolio: Advisor Class - Q/NQ
2012*
   10.000000   10.624494   6.24%   91,098
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Advisor Class - Q/NQ
2012
   12.557857   13.042689   3.86%   9,686
PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class - Q/NQ
2012
   11.334165   11.829684   4.37%   375,967
PIMCO Variable Insurance Trust - Total Return Portfolio: Advisor Class - Q/NQ
2012
   10.004024   10.811694   8.07%   467,986
T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II - Q/NQ
2012
   11.488675   14.854028   29.29%   14,930
Van Eck VIP Trust - Van Eck VIP Global Hard Assets Fund: Service Class - Q/NQ
2012*
   10.000000   9.639938   -3.60%   24,158
Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2 - Q/NQ
2012
   15.617243   16.626985   6.47%   11,731
74
Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein Small/Mid Cap Value Portfolio: Class B - Q/NQ
2012
   19.364694   22.458355   15.98%   0
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein VPS Dynamic Asset Allocation Portfolio: Class B - Q/NQ
2012*
   10.000000   10.099288   0.99%   9,102
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II - Q/NQ
2012
   13.288066   13.969137   5.13%   7,213
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class II - Q/NQ
2012
   13.311218   15.145649   13.78%   67
American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2 - Q/NQ
2012*
   10.000000   10.106422   1.06%   0
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class III - Q/NQ
2012
   12.171792   13.103201   7.65%   7,361
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares - Q/NQ
2012
   19.835131   22.474371   13.31%   1,317
Dreyfus Stock Index Fund, Inc.: Service Shares - Q/NQ
2012
   14.303996   16.169811   13.04%   2,854
Dreyfus Variable Investment Fund - Appreciation Portfolio: Service Shares - Q/NQ
2012
   15.477413   16.687695   7.82%   149
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2 - Q/NQ
2012
   11.574966   12.643856   9.23%   0
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class 2 - Q/NQ
2012
   11.551050   12.785948   10.69%   0
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class 2 - Q/NQ
2012
   11.254305   12.690069   12.76%   0
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2 - Q/NQ
2012
   15.144867   15.527989   2.53%   3,097
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Service Class 2 - Q/NQ
2012
   14.098424   16.155606   14.59%   2,556
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Service Class 2 - Q/NQ
2012
   14.253099   15.962768   12.00%   619
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class 2 - Q/NQ
2012
   12.770479   13.202218   3.38%   14,528
75
Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class 2 - Q/NQ
2012
   22.202713   24.900640   12.15%   40
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class 2R - Q/NQ
2012
   10.216457   12.046769   17.92%   0
Franklin Templeton Variable Insurance Products Trust - Franklin Income Securities Fund: Class 2 - Q/NQ
2012
   11.354426   12.521814   10.28%   0
Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value Securities Fund: Class 2 - Q/NQ
2012
   19.837005   22.990371   15.90%   234
Franklin Templeton Variable Insurance Products Trust - Franklin Templeton VIP Founding Funds Allocation Fund: Class 2 - Q/NQ
2012
   8.706930   9.830592   12.91%   0
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond Securities Fund: Class 3 - Q/NQ
2012
   15.367574   17.309916   12.64%   2,828
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Markets Navigator Fund: Service Shares - Q/NQ
2012*
   10.000000   10.167635   1.68%   0
Huntington VA Funds - Huntington VA International Equity Fund - Q/NQ
2012
   8.919009   9.956762   11.64%   0
Huntington VA Funds - Huntington VA Situs Fund - Q/NQ
2012
   10.937073   13.129492   20.05%   0
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series II - Q/NQ
2012*
   10.000000   9.904825   -0.95%   2,581
Ivy Funds Variable Insurance Portfolios - Asset Strategy - Q/NQ
2012
   11.403036   13.303702   16.67%   3,449
Ivy Funds Variable Insurance Portfolios - High Income - Q/NQ
2012*
   10.000000   10.756707   7.57%   2,202
Ivy Funds Variable Insurance Portfolios - Mid Cap Growth - Q/NQ
2012*
   10.000000   10.013576   0.14%   119
Janus Aspen Series - Forty Portfolio: Service Shares - Q/NQ
2012
   16.689381   20.236256   21.25%   91
Janus Aspen Series - Global Technology Portfolio: Service Shares - Q/NQ
2012*
   10.000000   9.905487   -0.95%   0
Janus Aspen Series - Overseas Portfolio: Service Shares - Q/NQ
2012
   25.708882   28.484938   10.80%   0
76
Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
MFS® Variable Insurance Trust - MFS New Discovery Series: Service Class - Q/NQ
2012*
   10.000000   10.172689   1.73%   84
MFS® Variable Insurance Trust - MFS Value Series: Service Class - Q/NQ
2012
   15.905352   18.043582   13.44%   0
MFS® Variable Insurance Trust II - MFS International Value Portfolio: Service Class - Q/NQ
2012
   10.281748   11.668920   13.49%   1,868
Nationwide Variable Insurance Trust - American Century NVIT Growth Fund: Class II - Q/NQ
2012
   9.031059   10.059319   11.39%   4,552
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class II - Q/NQ
2012
   13.486709   15.110100   12.04%   1,519
Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II - Q/NQ
2012
   9.735254   11.028213   13.28%   23,351
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II - Q/NQ
2012
   10.900226   11.200755   2.76%   2,871
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II - Q/NQ
2012
   9.642894   11.524943   19.52%   74
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II - Q/NQ
2012
   8.968657   10.307778   14.93%   0
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II - Q/NQ
2012
   7.868002   9.016676   14.60%   8,227
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class III - Q/NQ
2012
   12.882880   14.466680   12.29%   0
Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class II - Q/NQ
2012
   14.199541   16.426574   15.68%   1,874
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class II - Q/NQ
2012
   7.435009   8.503886   14.38%   0
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class II - Q/NQ
2012
   8.965523   9.775903   9.04%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Aggressive Fund: Class II - Q/NQ
2012
   8.249469   9.380363   13.71%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class II - Q/NQ
2012
   9.646172   10.487632   8.72%   0
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Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Capital Appreciation Fund: Class II - Q/NQ
2012
   9.050311   10.068560   11.25%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class II - Q/NQ
2012
   10.361633   10.904150   5.24%   2,682
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class II - Q/NQ
2012
   9.352918   10.288671   10.00%   1,749
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Aggressive Fund: Class II - Q/NQ
2012
   8.720778   9.782469   12.17%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class II - Q/NQ
2012
   9.911812   10.677747   7.73%   0
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II - Q/NQ
2012
   11.309423   11.899810   5.22%   0
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class II - Q/NQ
2012
   12.263446   12.859829   4.86%   13,332
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class VI - Q/NQ
2012
   16.349230   18.712714   14.46%   1,169
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - Q/NQ
2012
   12.402888   12.512938   0.89%   0
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class VI - Q/NQ
2012
   6.708630   7.567435   12.80%   0
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class VIII - Q/NQ
2012
   7.284044   8.429405   15.72%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II - Q/NQ
2012
   15.547767   17.641099   13.46%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II - Q/NQ
2012
   12.186662   13.049928   7.08%   4,089
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II - Q/NQ
2012
   12.800099   14.065705   9.89%   5,747
Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II - Q/NQ
2012
   12.191753   12.552822   2.96%   4,716
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II - Q/NQ
2012
   14.138667   15.337575   8.48%   11,672
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Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II - Q/NQ
2012
   15.085484   16.800084   11.37%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II - Q/NQ
2012
   13.329259   14.097796   5.77%   938
Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class II - Q/NQ
2012
   13.036939   15.113690   15.93%   993
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I - Q/NQ
2012
   19.708343   22.664722   15.00%   803
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I - Q/NQ
2012
   9.633102   9.430266   -2.11%   0
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I - Q/NQ
2012
   13.145245   14.444925   9.89%   2,435
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class VI - Q/NQ
2012
   7.931754   8.969949   13.09%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class VI - Q/NQ
2012
   8.493214   9.723482   14.49%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class II - Q/NQ
2012
   8.496867   9.660589   13.70%   1,855
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class II - Q/NQ
2012
   7.923076   9.120782   15.12%   1,650
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class II - Q/NQ
2012
   8.881687   9.968046   12.23%   1,520
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II - Q/NQ
2012
   9.531795   10.856424   13.90%   1,387
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class II - Q/NQ
2012
   13.390907   14.825411   10.71%   1,356
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class II - Q/NQ
2012
   18.693871   22.016351   17.77%   925
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class II - Q/NQ
2012
   18.196320   20.525741   12.80%   0
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class II - Q/NQ
2012
   13.182567   14.692112   11.45%   0
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Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class II - Q/NQ
2012
   9.372044   10.604401   13.15%   6,108
Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II - Q/NQ
2012
   10.222898   10.360309   1.34%   15,540
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class III - Q/NQ
2012
   11.471486   13.427157   17.05%   0
Northern Lights Variable Trust - TOPS Protected Balanced ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.136567   1.37%   0
Northern Lights Variable Trust - TOPS Protected Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.255208   2.55%   0
Northern Lights Variable Trust - TOPS Protected Moderate Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.272839   2.73%   0
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Class 4 - Q/NQ
2012
   12.365987   14.642563   18.41%   2,642
Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Service Shares - Q/NQ
2012
   13.771324   15.720688   14.16%   0
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Service Shares - Q/NQ
2012
   19.117619   22.022269   15.19%   328
PIMCO Variable Insurance Trust - All Asset Portfolio: Advisor Class - Q/NQ
2012*
   10.000000   10.567028   5.67%   11,964
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Advisor Class - Q/NQ
2012
   12.288357   12.659052   3.02%   6,665
PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class - Q/NQ
2012
   11.090916   11.481716   3.52%   7,454
PIMCO Variable Insurance Trust - Total Return Portfolio: Advisor Class - Q/NQ
2012
   9.950190   10.666107   7.20%   16,121
T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II - Q/NQ
2012
   11.334453   14.535657   28.24%   821
Van Eck VIP Trust - Van Eck VIP Global Hard Assets Fund: Service Class - Q/NQ
2012*
   10.000000   9.587752   -4.12%   2,918
Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2 - Q/NQ
2012
   14.737338   15.562679   5.60%   64
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Appendix C: Contract Types and Tax Information
Types of Contracts
The contracts described in this prospectus are classified according to the tax treatment to which they are subject under the Internal Revenue Code (the "Code"). Following is a general description of the various contract types. Eligibility requirements, tax benefits (if any), limitations, and other features of the contracts will differ depending on contract type.
Non-Qualified Contracts
A non-qualified contract is a contract that does not qualify for certain tax benefits under the Code, and which is not an IRA, Roth IRA, SEP IRA, Simple IRA, or tax sheltered annuity.
Upon the death of the owner of a non-qualified contract, mandatory distribution requirements are imposed to ensure distribution of the entire balance in the contract within a required period.
Non-qualified contracts that are owned by natural persons allow the deferral of taxation on the income earned in the contract until it is distributed or deemed to be distributed. Non-qualified contracts that are owned by non-natural persons, such as trusts, corporations, and partnerships are generally subject to current income tax on the income earned inside the contract, unless the non-natural person owns the contract as an agent of a natural person.
Charitable Remainder Trusts
Charitable Remainder Trusts are trusts that meet the requirements of Section 664 of the Code. Non-Qualified Contracts that are issued to Charitable Remainder Trusts will differ from other Non-Qualified Contracts in three respects:
(1) Waiver of sales charges. In addition to any sales load waivers included in the contract, Charitable Remainder Trusts may also withdraw the difference between:
(a) the contract value on the day before the withdrawal; and
(b) the total amount of purchase payments made to the contract (less an adjustment for amounts surrendered).
(2) Contract ownership at annuitization. On the annuitization date, if the contract owner is a Charitable Remainder Trust, the Charitable Remainder Trust will continue to be the contract owner and the annuitant will NOT become the contract owner.
(3) Recipient of death benefit proceeds. With respect to the death benefit proceeds, if the contract owner is a Charitable Remainder Trust, the death benefit is payable to the Charitable Remainder Trust. Any designation in conflict with the Charitable Remainder Trust's right to the death benefit will be void.
While these provisions are intended to facilitate a Charitable Remainder Trust's ownership of this contract, the rules governing Charitable Remainder Trusts are numerous and complex. A Charitable Remainder Trust that is considering purchasing this contract should seek the advice of a qualified tax and/or financial advisor prior to purchasing the contract. An annuity that has a Charitable Remainder Trust endorsement is not a Charitable Remainder Trust; the endorsement is merely to facilitate ownership of the contract by a Charitable Remainder Trust.
Individual Retirement Annuities (IRAs)
IRAs are contracts that satisfy the provisions of Section 408(b) of the Code, including the following requirements:
• the contract is not transferable by the owner;
• the premiums are not fixed;
• if the contract owner is younger than age 50, the annual premium cannot exceed $5,500; if the contract owner is age 50 or older, the annual premium cannot exceed $6,500 (although rollovers of greater amounts from Qualified Plans, Tax Sheltered Annuities, and other IRAs can be received);
• certain minimum distribution requirements must be satisfied after the owner attains the age of 70½;
• the entire interest of the owner in the contract is nonforfeitable; and
• after the death of the owner, additional distribution requirements may be imposed to ensure distribution of the entire balance in the contract within the statutory period of time.
Depending on the circumstance of the owner, all or a portion of the contributions made to the account may be deducted for federal income tax purposes.
IRAs may receive rollover contributions from other individual retirement accounts, other individual retirement annuities, tax sheltered annuities, certain 457 governmental plans, and qualified retirement plans (including 401(k) plans).
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When the owner of an IRA attains the age of 70½, the Code requires that certain minimum distributions be made. In addition, upon the death of the owner of an IRA, mandatory distribution requirements are imposed by the Code to ensure distribution of the entire contract value within the required statutory period. Due to recent changes in Treasury Regulations, the amount used to compute the mandatory distributions may exceed the contract value.
Failure to make the mandatory distributions can result in an additional penalty tax of 50% of the excess of the amount required to be distributed over the amount that was actually distributed.
For further details regarding IRAs, refer to the disclosure statement provided when the IRA was established and the annuity contract's IRA endorsement.
As used herein, the term "individual retirement plans" shall refer to both individual retirement annuities and individual retirement accounts that are described in Section 408 of the Code.
Roth IRAs
Roth IRA contracts are contracts that satisfy the provisions of Section 408A of the Code, including the following requirements:
• the contract is not transferable by the owner;
• the premiums are not fixed;
• if the contract owner is younger than age 50, the annual premium cannot exceed $5,500; if the contract owner is age 50 or older, the annual premium cannot exceed $6,500 (although rollovers of greater amounts from other Roth IRAs and other individual retirement plans can be received);
• the entire interest of the owner in the contract is nonforfeitable; and
• after the death of the owner, certain distribution requirements may be imposed to ensure distribution of the entire balance in the contract within the statutory period of time.
A Roth IRA can receive a rollover from an individual retirement plan or another eligible retirement plan; however, the amount rolled over from the individual retirement plan or other eligible retirement plan to the Roth IRA is required to be included in the owner's federal gross income at the time of the rollover, and will be subject to federal income tax.
There are income limitations on eligibility to participate in a Roth IRA.
For further details regarding Roth IRAs, please refer to the disclosure statement provided when the Roth IRA was established and the annuity contract's IRA endorsement.
Simplified Employee Pension IRAs (SEP IRA)
A SEP IRA is a written plan established by an employer for the benefit of employees which permits the employer to make contributions to an IRA established for the benefit of each employee.
An employee may make deductible contributions to a SEP IRA subject to the same restrictions and limitations as an IRA. In addition, the employer may make contributions to the SEP IRA, subject to dollar and percentage limitations imposed by both the Code and the written plan.
A SEP IRA plan must satisfy:
• minimum participation rules;
• top-heavy contribution rules;
• nondiscriminatory allocation rules; and
• requirements regarding a written allocation formula.
In addition, the plan cannot restrict withdrawals of non-elective contributions, and must restrict withdrawals of elective contributions before March 15th of the following year.
When the owner of a SEP IRA attains the age of 70½, the Code requires that certain minimum distributions be made. Due to recent changes in Treasury Regulations, the amount used to compute the minimum distributions may exceed the contract value. In addition, upon the death of the owner of a SEP IRA, mandatory distribution requirements are imposed by the Code to ensure distribution of the entire contract value within the required statutory period.
Simple IRAs
A Simple IRA is an Individual Retirement Annuity that is funded exclusively by a qualified salary reduction arrangement and satisfies:
• vesting requirements;
• participation requirements; and
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• administrative requirements.
The funds contributed to a Simple IRA cannot be commingled with funds in other individual retirement plans or SEP IRAs.
A Simple IRA cannot receive rollover distributions except from another Simple IRA.
When the owner of a Simple IRA attains the age of 70½, the Code requires that certain minimum distributions be made. Due to recent changes in Treasury Regulations, the amount used to compute the minimum distributions may exceed the contract value. In addition, upon the death of the owner of a Simple IRA, mandatory distribution requirements are imposed by the Code to ensure distribution of the entire contract value within the required statutory period.
Investment Only (Qualified Plans)
Contracts that are owned by Qualified Plans are not intended to confer tax benefits on the beneficiaries of the plan; they are used as investment vehicles for the plan. The income tax consequences to the beneficiary of a Qualified Plan are controlled by the operation of the plan, not by operation of the assets in which the plan invests.
Beneficiaries of Qualified Plans should contact their employer and/or trustee of the plan to obtain and review the plan, trust, summary plan description and other documents for the tax and other consequences of being a participant in a Qualified Plan.
Federal Tax Considerations
Federal Income Taxes
The tax consequences of purchasing a contract described in this prospectus will depend on:
• the type of contract purchased;
• the purposes for which the contract is purchased; and
• the personal circumstances of individual investors having interests in the contracts.
Existing tax rules are subject to change, and may affect individuals differently depending on their situation. Nationwide does not guarantee the tax status of any contracts or any transactions involving the contracts.
Representatives of the Internal Revenue Service have informally suggested, from time to time, that the number of underlying mutual funds available or the number of transfer opportunities available under a variable product may be relevant in determining whether the product qualifies for the desired tax treatment. In 2003, the Internal Revenue Service issued formal guidance, in Revenue Ruling 2003-91, that indicates that if the number of underlying mutual funds available in a variable insurance product does not exceed 20, the number of underlying mutual funds alone would not cause the contract to not qualify for the desired tax treatment. The Internal Revenue Service has also indicated that exceeding 20 investment options may be considered a factor, along with other factors including the number of transfer opportunities available under the contract, when determining whether the contract qualifies for the desired tax treatment. The revenue ruling did not indicate the actual number of underlying mutual funds that would cause the contract 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 mutual funds, transfers between underlying mutual funds, exchanges of underlying mutual funds or changes in investment objectives of underlying mutual funds such that the contract would no longer qualify for tax deferred treatment under Section 72 of the Code, Nationwide will take whatever steps are available to remain in compliance.
If the contract is purchased as an investment of certain retirement plans (such as qualified retirement plans, Individual Retirement Accounts, and custodial accounts as described in Sections 401 and 408(a) of the Code), tax advantages enjoyed by the contract owner and/or annuitant may relate to participation in the plan rather than ownership of the annuity contract. Such plans are permitted to purchase investments other than annuities and retain tax-deferred status.
The following is a brief summary of some of the federal income tax considerations related to the types of contracts sold in connection with this prospectus. In addition to the federal income tax, distributions from annuity contracts may be subject to state and local income taxes. Nothing in this prospectus should be considered to be tax advice. Purchasers and prospective purchasers of the contract should consult a financial consultant, tax advisor, or legal counsel to discuss the taxation and use of the contracts.
IRAs, SEP IRAs, and Simple IRAs
Distributions from IRAs, SEP IRAs, and Simple IRAs are generally taxed as ordinary income when received. If any of the amounts contributed to the Individual Retirement Annuity was non-deductible for federal income tax purposes, then a portion of each distribution is excludable from income.
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If distributions of income from an IRA are made prior to the date that the owner attains the age of 59½ years, the income is subject to the regular income tax, and an additional penalty tax of 10% is generally applicable. (For Simple IRAs, the 10% penalty is increased to 25% if the distribution is made during the 2-year period beginning on the date that the individual first participated in the Simple IRA.) The 10% penalty tax can be avoided if the distribution is:
• made to a beneficiary on or after the death of the owner;
• attributable to the owner becoming disabled (as defined in the Code);
• part of a series of substantially equal periodic payments made not less frequently than annually made for the life (or life expectancy) of the owner, or the joint lives (or joint life expectancies) of the owner and his or her designated beneficiary;
• used for qualified higher education expenses; or
• used for expenses attributable to the purchase of a home for a qualified first-time buyer.
If the contract owner dies before the contract is completely distributed, the balance will be included in the contract owner's gross estate for tax purposes.
Roth IRAs
Distributions of earnings from Roth IRAs are taxable or nontaxable depending upon whether they are "qualified distributions" or "non-qualified distributions." A "qualified distribution" is one that satisfies the five-year rule and meets one of the following requirements:
• it is made on or after the date on which the contract owner attains age 59½;
• it is made to a beneficiary (or the contract owner's estate) on or after the death of the contract owner;
• it is attributable to the contract owner's disability; or
• it is used for expenses attributable to the purchase of a home for a qualified first-time buyer.
The five-year rule generally is satisfied if the distribution is not made within the five-year period beginning with the first taxable year in which a contribution is made to any Roth IRA established for the owner.
A qualified distribution is not included in gross income for federal income tax purposes.
A non-qualified distribution is not includable in gross income to the extent that the distribution, when added to all previous distributions, does not exceed the total amount of contributions made to the Roth IRA. Any non-qualified distribution in excess of total contributions is includable in the contract owner's gross income as ordinary income in the year that it is distributed to the contract owner.
Special rules apply for Roth IRAs that have proceeds received from an individual retirement plan prior to January 1, 1999 if the owner elected the special four-year income averaging provisions that were in effect for 1998.
If non-qualified distributions of income from a Roth IRA are made prior to the date that the owner attains the age of 59½ years, the income is subject to both the regular income tax and an additional penalty tax of 10%. The penalty tax can be avoided if the distribution is:
• made to a beneficiary on or after the death of the owner;
• attributable to the owner becoming disabled (as defined in the Code);
• part of a series of substantially equal periodic payments made not less frequently than annually made for the life (or life expectancy) of the owner, or the joint lives (or joint life expectancies) of the owner and his or her designated beneficiary;
• for qualified higher education expenses; or
• used for expenses attributable to the purchase of a home for a qualified first-time buyer.
If the contract owner dies before the contract is completely distributed, the balance will be included in the contract owner's gross estate for tax purposes.
Non-Qualified Contracts - Natural Persons as Contract Owners
Generally, the income earned inside a non-qualified annuity contract that is owned by a natural person is not taxable until it is distributed from the contract.
Distributions before the annuitization date are taxable to the contract owner to the extent that the cash value of the contract exceeds the contract owner's investment in the contract at the time of the distribution. In general, the investment in the contract is equal to the purchase payments made with after-tax dollars reduced by any nontaxable distribution. Distributions, for this purpose, include full and partial surrenders, any portion of the contract that is assigned or pledged, amounts borrowed from the contract, or any portion of the contract that is transferred by gift. For these purposes, a transfer by gift may occur upon annuitization if the contract owner and the annuitant are not the same individual.
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With respect to annuity distributions on or after the annuitization date, a portion of each annuity payment is excludable from taxable income. The amount excludable from each annuity payment is determined by multiplying the annuity payment by a fraction which is equal to the contract owner's investment in the contract, divided by the expected return on the contract. Once the entire investment in the contract is recovered, all distributions are fully includable in income. The maximum amount excludable from income is the investment in the contract. If the annuitant dies before the entire investment in the contract has been excluded from income, and as a result of the annuitant's death no more payments are due under the contract, then the unrecovered investment in the contract may be deducted on his or her final tax return.
Commencing after December 31, 2010, the Code provides that if only a portion of a non-qualified annuity contract is annuitized for either (a) a period of 10 years or greater, or (b) for the life or lives of one or more persons, then the portion of the contract that has been annuitized would be treated as if it were a separate annuity contract. This means that an annuitization date can be established for a portion of the annuity contract (rather than requiring the entire contract to be annuitized at once) and the above description of the taxation of annuity distributions after the annuitization date would apply to the portion of the contract that has been annuitized. The investment in the contract is required to be allocated pro rata between the portion of the contract that is annuitized and the portion that is not. All other benefits under the contract (e.g., death benefit) would also be reduced pro rata. For example, if 1/3 of the cash value of the contract were to be annuitized, the death benefit would also be reduced by 1/3.
In determining the taxable amount of a distribution that is made prior to the annuitization date, all annuity contracts issued after October 21, 1988 by the same company to the same contract owner during the same calendar year will be treated as one annuity contract.
A special rule applies to distributions from contracts that have investments that were made prior to August 14, 1982. For those contracts, distributions that are made prior to the annuitization date are treated first as the nontaxable recovery of the investment in the contract as of that date. A distribution in excess of the amount of the investment in the contract as of August 14, 1982, will be treated as taxable income.
The Code imposes a penalty tax if a distribution is made before the contract owner reaches age 59½. The amount of the penalty is 10% of the portion of any distribution that is includable in gross income. The penalty tax does not apply if the distribution is:
• the result of a contract owner's death;
• the result of a contract owner's disability (as defined in the Code);
• one of a series of substantially equal periodic payments made over the life (or life expectancy) of the contract owner or the joint lives (or joint life expectancies) of the contract owner and the beneficiary selected by the contract owner to receive payment under the annuity payment option selected by the contract owner; or
• is allocable to an investment in the contract before August 14, 1982.
If the contract owner dies before the contract is completely distributed, the balance will be included in the contract owner's gross estate for tax purposes.
Non-Qualified Contracts - Non-Natural Persons as Contract Owners
The previous discussion related to the taxation of non-qualified contracts owned by individuals. Different rules (the so-called "non-natural persons" rules) apply if the contract owner is not a natural person.
Generally, contracts owned by corporations, partnerships, trusts, and similar entities are not treated as annuity contracts for most purposes of the Code. Therefore, income earned under a non-qualified contract that is owned by a non-natural person is taxed as ordinary income during the taxable year in which it is earned. Taxation is not deferred, even if the income is not distributed out of the contract. The income is taxable as ordinary income, not capital gain.
The non-natural persons rules do not apply to all entity-owned contracts. For purposes of the non-natural persons rule, a contract that is owned by a non-natural person as an agent of an individual is treated as owned by the individual. This would cause the contract to be treated as an annuity under the Code, allowing tax deferral. However, this exception does not apply when the non-natural person is an employer that holds the contract under a non-qualified deferred compensation arrangement for one or more employees.
The non-natural persons rules also do not apply to contracts that are:
• acquired by the estate of a decedent by reason of the death of the decedent;
• issued in connection with certain qualified retirement plans and individual retirement plans;
• purchased by an employer upon the termination of certain qualified retirement plans; or
• immediate annuities within the meaning of Section 72(u) of the Code.
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If the annuitant dies before the contract is completely distributed, the balance may be included in the annuitant's gross estate for tax purposes, depending on the obligations that the non-natural owner may have owed to the annuitant.
Exchanges
As a general rule, federal income tax law treats exchanges of property in the same manner as a sale of the property. However, pursuant to Section 1035 of the Code, an annuity contract may be exchanged tax-free for another annuity, provided that the obligee (the person to whom the annuity obligation is owed) is the same for both contracts. If the exchange includes the receipt of property in addition to another annuity contract, such as cash, special rules may cause a portion of the transaction to be taxable to the extent of the value of the property, other than the annuity contract received in the exchange.
Tax Treatment of a Partial 1035 Exchange With Subsequent Withdrawal
In June 2011, the Internal Revenue Service issued Rev. Proc. 2011-38, which addresses the income tax consequences of the direct transfer of a portion of the cash value of an annuity contract in exchange for the issuance of a second annuity contract. Rev. Proc. 2011-38 modified and superseded prior guidance that was contained in Rev. Proc. 2008-24. A direct transfer that satisfies the revenue procedure will be treated as a tax-free exchange under Section 1035 of the Code if, for a period of at least 180 days from the date of the direct transfer, there are no distributions or surrenders from either annuity contract involved in the exchange. In addition, the 180-day period will be deemed to have been satisfied with respect to amounts received as an annuity for a period of 10 years or more, or as an annuity for the life of one or more persons. The taxation of distributions (other than distributions described in the immediately preceding sentence) received within the 180-day period will be determined using general tax principles to determine the substance of those payments. For example, they could be treated as taxable "boot" in an otherwise tax-free exchange, or as a distribution from the new contract. Rev. Proc. 2011-38 also removed numerous exceptions to the 180-day waiting period that Rev. Proc. 2008-11 provided for in its 12-month waiting period. Please discuss any tax consequences concerning any contemplated or completed transactions with a professional tax advisor.
Taxation of Lifetime Withdrawals Under the 7% Nationwide Lifetime Income Rider
While the tax treatment for withdrawals for benefits such as 7% Nationwide Lifetime Income Rider is not clear under federal tax law, Nationwide intends to treat withdrawals under these options as taxable to the extent that the cash value of the contract exceeds the contract owner's investment at the time of the withdrawal. Specifically, Nationwide intends to treat the following amount of each withdrawal as a taxable distribution:
The greater of:
(1) A–C; or
(2) B–C,
Where:
A = the contract value immediately before the withdrawal;
B = the guaranteed annual benefit amount immediately before the withdrawal; and
C = the remaining investment in the contract.
In certain circumstances, this treatment could result in the contract value being less than the investment in the contract after such a withdrawal. If the Contract Owner subsequently withdraws the contract under such circumstances, the Contract Owner would have a loss that may be deductible. If the Contract Owner purchases one of these options in an IRA, withdrawals in excess of the annual benefit amount may be required to satisfy the minimum distribution requirements under the Code. Consult a qualified tax adviser.
Same-Sex Marriages, Domestic Partnership, and Other Similar Relationships
Pursuant to Section 3 of the federal Defense of Marriage Act ("DOMA"), same-sex marriages currently are not recognized for purposes of federal law. Therefore, the favorable income-deferral options afforded by federal tax law to an opposite-sex spouse under Code Sections 72(s) and 401(a)(9) are currently NOT available to a same-sex spouse. Same-sex spouses who own or are considering the purchase of annuity products that provide benefits based upon status as a spouse should consult a tax advisor. To the extent that an annuity contract or certificate accords to spouses other rights or benefits that are not affected by DOMA, same-sex spouses remain entitled to such rights or benefits to the same extent as any annuity holder's spouse.
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Withholding
Pre-death distributions from the contracts are subject to federal income tax. Nationwide is required to withhold the tax from the distributions unless the contract owner requests otherwise. If the distribution is from a Tax Sheltered Annuity, it will be subject to mandatory 20% withholding that cannot be waived, unless:
• the distribution is made directly to another Tax Sheltered Annuity, qualified pension or profit-sharing plan described in Section 401(a), an eligible deferred compensation plan described in Section 457(b) which is maintained by an eligible employer described in section 457(e)(1)(A) or individual reatirement plan; or
• the distribution satisfies the minimum distribution requirements imposed by the Code.
• In addition, under some circumstances, the Code will not permit contract owners to waive withholding. Such circumstances include:
• if the payee does not provide Nationwide with a taxpayer identification number; or
• if Nationwide receives notice from the Internal Revenue Service that the taxpayer identification number furnished by the payee is incorrect.
If a contract owner is prohibited from waiving withholding, as described above, the distribution will be subject to withholding rates established by Section 3405 of the Code and is applied against the amount of income that is distributed.
Non-Resident Aliens
Generally, a pre-death distribution from a contract to a non-resident alien is subject to federal income tax at a rate of 30% of the amount of income that is distributed.
Nationwide is required to withhold this amount and send it to the Internal Revenue Service. Some distributions to non-resident aliens may be subject to a lower (or no) tax if a treaty applies. In order to obtain the benefits of such a treaty, the non-resident alien must:
(1) provide Nationwide with a properly completed withholding certificate claiming the treaty benefit of a lower tax rate or exemption from tax; and
(2) provide Nationwide with an individual taxpayer identification number.
If the non-resident alien does not meet the above conditions, Nationwide will withhold 30% of income from the distribution.
Another exemption from the 30% withholding rate is for the non-resident alien to provide Nationwide with sufficient evidence that:
(1) the distribution is connected to the non-resident alien's conduct of business in the United States;
(2) the distribution is includable in the non-resident alien's gross income for United States federal income tax purposes; and
(3) provide Nationwide with a properly completed withholding certificate claiming the exemption.
Note that for the preceding exemption, the distributions would be subject to the same withholding rules that are applicable to payments to United States persons.
This prospectus does not address any tax matters that may arise by reason of application of the laws of a non-resident alien's country of citizenship and/or country of residence. Purchasers and prospective purchasers should consult a financial consultant, tax advisor or legal counsel to discuss the applicability of laws of those jurisdictions to the purchase or ownership of a contract.
Federal Estate, Gift and Generation Skipping Transfer Taxes
The following transfers may be considered a gift for federal gift tax purposes:
• a transfer of the contract from one contract owner to another; or
• a distribution to someone other than a contract owner.
Upon the contract owner's death, the value of the contract may be subject to estate taxes, even if all or a portion of the value is also subject to federal income taxes.
Section 2612 of the Code may require Nationwide to determine whether a death benefit or other distribution is a "direct skip" and the amount of the resulting generation skipping transfer tax, if any. A direct skip is when property is transferred to, or a death benefit or other distribution is made to:
a) an individual who is two or more generations younger than the contract owner; or
b) certain trusts, as described in Section 2613 of the Code (generally, trusts that have no beneficiaries who are not two or more generations younger than the contract owner).
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If the contract owner is not an individual, then for this purpose only, "contract owner" refers to any person:
• who would be required to include the contract, death benefit, distribution, or other payment in his or her federal gross estate at his or her death; or
• who is required to report the transfer of the contract, death benefit, distribution, or other payment for federal gift tax purposes.
If a payment is subject to the generation skipping transfer tax, Nationwide may be required to deduct the amount of the transfer tax from the death benefit, distribution or other payment, and remit it directly to the Internal Revenue Service.
Charge for Tax
Nationwide is not required to maintain a capital gain reserve liability on non-qualified contracts. If tax laws change requiring a reserve, Nationwide may implement and adjust a tax charge.
Diversification
Code Section 817(h) contains rules on diversification requirements for variable annuity contracts. A variable annuity contract that does not meet these diversification requirements will not be treated as an annuity, unless:
• the failure to diversify was accidental;
• the failure is corrected; and
• a fine is paid to the Internal Revenue Service.
The amount of the fine will be the amount of tax that would have been paid by the contract owner if the income, for the period the contract was not diversified, had been received by the contract owner.
If the violation is not corrected, the contract owner will be considered the owner of the underlying securities and will be taxed on the earnings of his or her contract. Nationwide believes that the investments underlying this contract meet these diversification requirements.
Required Distributions
The Code requires that certain distributions be made from the contracts issued in conjunction with this prospectus. Following is an overview of the required distribution rules applicable to each type of contract. Consult a qualified tax or financial advisor for more specific required distribution information.
If the Contract Owner purchases the 7% Nationwide Lifetime Income Rider, withdrawals in excess of the annual benefit amount may be required to satisfy the minimum distribution requirements under the Code. Consult a qualified tax adviser.
Required Distributions – General Information
In general, a beneficiary is an individual or other entity that the contract owner designates to receive death proceeds upon the contract owner's death. The distribution rules in the Code make a distinction between "beneficiary" and "designated beneficiary" when determining the life expectancy that may be used for payments that are made from IRAs, SEP IRAs, Simple IRAs, Roth IRAs and Tax Sheltered Annuities after the death of the contract owner, or that are made from non-qualified contracts after the death of the contract owner. A designated beneficiary is a natural person who is designated by the contract owner as the beneficiary under the contract. Non-natural beneficiaries (e.g. charities or certain trusts) are not designated beneficiaries for the purpose of required distributions and the life expectancy of such a beneficiary is zero.
Life expectancies and joint life expectancies will be determined in accordance with the relevant guidance provided by the Internal Revenue Service and the Treasury Department, including but not limited to Treasury Regulation 1.72-9 and Treasury Regulation 1.401(a)(9)-9.
Required distributions paid upon the death of the contract owner are paid to the beneficiary or beneficiaries stipulated by the contract owner. How quickly the distributions must be made may be determined with respect to the life expectancies of the beneficiaries. For non-qualified contracts, the beneficiaries used in the determination of the distribution period are those in effect on the date of the contract owner's death. For contracts other than non-qualified contracts, the beneficiaries used in the determination of the distribution period do not have to be determined until September 30 of the year following the contract owner's death. If there is more than one beneficiary, the life expectancy of the beneficiary with the shortest life expectancy is used to determine the distribution period. Any beneficiary that is not a designated beneficiary has a life expectancy of zero.
Required Distributions for Non-Qualified Contracts
Code Section 72(s) requires Nationwide to make certain distributions when a contract owner dies. The following distributions will be made in accordance with the following requirements:
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(1) If any contract owner dies on or after the annuitization date and before the entire interest in the contract has been distributed, then the remaining interest must be distributed at least as rapidly as the distribution method in effect on the contract owner's death.
(2) If any contract owner dies before the annuitization date, then the entire interest in the contract (consisting of either the death benefit or the contract value reduced by charges set forth elsewhere in the contract) will be distributed within five years of the contract owner's death, provided however:
(a) any interest payable to or for the benefit of a designated beneficiary may be distributed over the life of the designated beneficiary or over a period not longer than the life expectancy of the designated beneficiary. Payments must begin within one year of the contract owner's death unless otherwise permitted by federal income tax regulations; and
(b) if the designated beneficiary is the surviving spouse of the deceased contract owner, the spouse can choose to become the contract owner instead of receiving a death benefit. Any distributions required under these distribution rules will be made upon that spouse's death.
In the event that the contract owner is not a natural person (e.g., a trust or corporation), but is acting as an agent for a natural person, for purposes of these distribution provisions:
(a) the death of the annuitant will be treated as the death of a contract owner;
(b) any change of annuitant will be treated as the death of a contract owner; and
(c) in either case, the appropriate distribution will be made upon the death or change, as the case may be.
These distribution provisions do not apply to any contract exempt from Section 72(s) of the Code by reason of Section 72(s)(5) or any other law or rule.
Required Distributions for IRAs,  SEP IRAs, Simple IRAs, and Roth IRAs
Distributions from IRA, SEP IRA, or Simple IRA must begin no later than April 1 of the calendar year following the calendar year in which the contract owner reaches age 70½. Distributions may be paid in a lump sum or in substantially equal payments over:
(a) the life of the contract owner or the joint lives of the contract owner and the contract owner's designated beneficiary; or
(b) a period not longer than the period determined under the table in Treasury Regulation 1.401(a)(9)-9, which is the deemed joint life expectancy of the contract owner and a person 10 years younger than the contract owner. If the designated beneficiary is the spouse of the Co contract owner, the period may not exceed the longer of the period determined under such table or the joint life expectancy of the contract owner and the contract owner's spouse, determined in accordance with Treasury Regulation 1.72-9, or such additional guidance as may be provided pursuant to Treasury Regulation 1.401(a)(9)-9.
For IRAs, SEP IRAs, and Simple IRAs, required distributions do not have to be withdrawn from this contract if they are being withdrawn from another IRA, SEP IRA, or Simple IRA of the contract owner.
If the contract owner's entire interest in IRA, SEP IRA, or Simple IRA will be distributed in equal or substantially equal payments over a period described in (a) or (b) above, the payments must begin on or before the required beginning date. The required beginning date is April 1 of the calendar year following the calendar year in which the contract owner reaches age 70½. The rules for Roth IRAs do not require distributions to begin during the contract owner's lifetime, therefore, the required beginning date is not applicable to Roth IRAs.
Due to recent changes in Treasury Regulations, the amount used to compute the minimum distribution requirement may exceed the contract value.
If the contract owner dies before the required beginning date (in the case of IRA, SEP IRA, or Simple IRA) or before the entire contract value is distributed (in the case of a Roth IRA), any remaining interest in the contract must be distributed over a period not exceeding the applicable distribution period, which is determined as follows:
(a) if the designated beneficiary is the contract owner's spouse, the applicable distribution period is the surviving spouse's remaining life expectancy using the surviving spouse's birthday for each distribution calendar year after the calendar year of the contract owner's death. For calendar years after the death of the contract owner's surviving spouse, the applicable distribution period is the spouse's remaining life expectancy using the spouse's age in the calendar year of the spouse's death, reduced by one for each calendar year that elapsed since the calendar year immediately following the calendar year of the spouse's death;
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(b) if the designated beneficiary is not the contract owner's surviving spouse, the applicable distribution period is the designated beneficiary's remaining life expectancy using the designated beneficiary's birthday in the calendar year immediately following the calendar year of the contract owner's death, reduced by one for each calendar year that elapsed thereafter; and
(c) if there is no designated beneficiary, the entire balance of the contract must be distributed by December 31 of the fifth year following the contract owner's death.
If the contract owner dies on or after the required beginning date, the interest in the IRA, SEP IRA, or Simple IRA must be distributed over a period not exceeding the applicable distribution period, which is determined as follows:
(a) if the designated beneficiary is the contract owner's spouse, the applicable distribution period is the surviving spouse's remaining life expectancy using the surviving spouse's birthday for each distribution calendar year after the calendar year of the contract owner's death. For calendar years after the death of the contract owner's surviving spouse, the applicable distribution period is the greater of (a) the contract owner's remaining life expectancy using the contract owner's birthday in the calendar year of the contract owner's death, reduced by one for each year thereafter; or (b) the spouse's remaining life expectancy using the spouse's age in the calendar year of the spouse's death, reduced by one for each calendar year that elapsed since the calendar year immediately following the calendar year of the spouse's death;
(b) if the designated beneficiary is not the contract owner's surviving spouse, the applicable distribution period is the greater of (a) the contract owner's remaining life expectancy using the contract owner's birthday in the calendar year of the contract owner's death, reduced by one for each year thereafter; or (b) the designated beneficiary's remaining life expectancy using the designated beneficiary's birthday in the calendar year immediately following the calendar year of the contract owner's death, reduced by one for each calendar year that elapsed thereafter; and
(c) if there is no designated beneficiary, the applicable distribution period is the contract owner's remaining life expectancy using the contract owner's birthday in the calendar year of the contract owner's death, reduced by one for each year thereafter.
If distribution requirements are not met, a penalty tax of 50% is levied on the difference between the amount that should have been distributed for that year and the amount that actually was distributed for that year.
For IRAs, SEP IRAs, and Simple IRAs, all or a portion of each distribution will be included in the recipient's gross income and taxed at ordinary income tax rates. The portion of a distribution that is taxable is based on the ratio between the amount by which non-deductible purchase payments exceed prior non-taxable distributions and total account balances at the time of the distribution. The owner of an IRA, SEP IRA, or Simple IRA must annually report the amount of non-deductible purchase payments, the amount of any distribution, the amount by which non-deductible purchase payments for all years exceed non taxable distributions for all years, and the total balance of all IRAs, SEP IRAs, or Simple IRAs.
Distributions from Roth IRAs may be either taxable or nontaxable, depending upon whether they are "qualified distributions" or "non-qualified distributions."
Tax Changes
The foregoing tax information is based on Nationwide's understanding of federal tax laws. It is NOT intended as tax advice. All information is subject to change without notice. You should consult with your personal tax and/or financial advisor for more information.
In 2001, the Economic Growth and Tax Relief Reconciliation Act (EGTRRA) was enacted. EGTRRA made numerous changes to the Code, including the following:
• generally lowering federal income tax rates;
• increasing the amounts that may be contributed to various retirement plans, such as individual retirement plans, Tax Sheltered Annuities, and Qualified Plans;
• increasing the portability of various retirement plans by permitting individual retirement plans, Tax Sheltered Annuities, Qualified Plans and certain governmental 457 plans to "roll" money from one plan to another;
• eliminating and/or reducing the highest federal estate tax rates;
• increasing the estate tax credit; and
• for persons dying after 2009, repealing the estate tax.
In 2006, the Pension Protection Act of 2006 made permanent the EGTRRA provisions noted above that increase the amounts that may be contributed to various retirement plans and that increase the portability of various retirement plans. However, all of the other changes resulting from EGTRRA were scheduled to "sunset," or become ineffective, after
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December 31, 2010 unless they were extended by additional legislation. The American Taxpayer Relief Act (ATRA) was enacted on January 1, 2013 and made permanent the lower federal income tax rates established under EGTRRA, except for individuals with taxable income above $400,000 ($450,000 for married couples) whose tax rate will revert to the pre-EGTRRA tax rate of 39.6%. ATRA also permanently provides for a maximum federal estate tax rate of 40% with an annually inflation-adjusted $5 million exclusion for estates of persons dying after December 31, 2012. Consult a qualified tax or financial advisor for further information relating to these and other tax issues.
State Taxation
The tax rules across the various states and localities are not uniform and therefore are not discussed in this prospectus. Tax rules that may apply to contracts issued in U.S. territories such as Puerto Rico and Guam are also not discussed. Purchasers and prospective purchasers should consult a financial consultant, tax advisor or legal counsel to discuss the taxation and use of the contracts.
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Table of Contents
STATEMENT OF ADDITIONAL INFORMATION
May 1, 2013
Individual Flexible Premium Deferred Variable Annuity Contracts
Issued by Nationwide Life Insurance Company
through its Nationwide Variable Account-II
This Statement of Additional Information is not a prospectus. It contains information in addition to and more detailed than set forth in the prospectus and should be read in conjunction with the prospectus dated May 1, 2013. The prospectus may be obtained from Nationwide Life Insurance Company by writing P.O. Box 182021, Columbus, Ohio 43218-2021, or calling 1-800-848-6331, TDD 1-800-238-3035. Capitalized terms in this Statement of Additional Information correspond to terms defined in the prospectus.
TABLE OF CONTENTS
General Information and History
Nationwide Variable Account-II (the "Variable Account") is a separate investment account of Nationwide Life Insurance Company ("Nationwide"). Nationwide is a stock life insurance company organized under the laws of the State of Ohio in March 1929 with its Home Office at One Nationwide Plaza, Columbus, Ohio 43215. Nationwide provides life insurance, annuities and retirement products. Nationwide is admitted to do business in all states, the District of Columbia and Puerto Rico. Nationwide is a member of the Nationwide group of companies and all of its common stock is owned by Nationwide Financial Services, Inc. ("NFS"), a holding company. Nationwide Corporation owns all of NFS's common stock and is a holding company, as well. All of Nationwide Corporation's common stock is held by Nationwide Mutual Insurance Company (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), the ultimate controlling persons of the Nationwide group of companies. The Nationwide group of companies is one of America's largest insurance and financial services family of companies, with combined assets of over $168.3 billion as of December 31, 2012.
Services
Nationwide, which has responsibility for administration of the contracts and the Variable Account, maintains records of the name, address, taxpayer identification number, and other pertinent information for each Contract Owner, the number and type of contract issued to each Contract Owner, and records with respect to the Contract Value.
The custodian of the assets of the Variable Account is Nationwide. Nationwide will maintain a record of all purchases and redemptions of shares of the underlying mutual funds. Nationwide or its affiliates may have entered into agreements with the underlying mutual funds and/or their affiliates. The agreements relate to services furnished by Nationwide or an affiliate of Nationwide. 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 Contract Owners to execute trades in the funds. Nationwide also acts as a limited agent for each underlying mutual fund for purposes of accepting the trades. See Underlying Mutual Fund Payments located in the prospectus.
Distribution, Promotional, and Sales Expenses
In addition to or partially in lieu of commission, Nationwide may pay the selling firms a marketing allowance, which is based on the firm's ability and demonstrated willingness to promote and market Nationwide's products. How any marketing allowance is spent is determined by the firm, but generally will be used to finance firm activities, such as training and education, that may contribute to the promotion and marketing of Nationwide's products. Nationwide makes certain assumptions about the amount of marketing allowance it will pay and takes these assumptions into consideration when it determines the charges that will be assessed under the contracts. For the contracts described in the prospectus, Nationwide assumed 0.75% (of the purchase payment amount) for marketing allowance when determining the charges for the contracts. The actual amount of the marketing allowance may be higher or lower than this assumption. If the actual amount of marketing allowance paid is more than what was assumed, Nationwide will fund the difference. Nationwide generally does not profit from any excess marketing allowance if the amount assumed was higher than what is actually paid. Any excess would be spent on additional marketing for the contracts. For more information about marketing allowance or how a particular selling firm uses marketing allowances, consult with your registered representative.
Independent Registered Public Accounting Firm
The financial statements of Nationwide Variable Account-II and the consolidated financial statements and schedules of Nationwide Life Insurance Company for the periods indicated have been included herein in reliance upon the reports of KPMG LLP, independent registered public accounting firm, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing. KPMG LLP is located at 191 West Nationwide Blvd., Suite 500, Columbus, Ohio 43215.
Purchase of Securities Being Offered
The contracts will be sold by licensed insurance agents in the states where the contracts may be lawfully sold. Such agents will be registered representatives of broker-dealers registered under the Securities Exchange Act of 1934 who are members of the Financial Industry Regulatory Authority (FINRA).
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Underwriters
The contracts, which are offered continuously, are distributed by Nationwide Investment Services Corporation ("NISC"), One Nationwide Plaza, Columbus, Ohio 43215, a wholly owned subsidiary of Nationwide. For contracts issued in Michigan, all references to NISC will mean Nationwide Investment Svcs. Corporation. No underwriting commissions have been paid by Nationwide to NISC for each of this Variable Account's last three fiscal years.
Advertising
Money Market Yields
Nationwide may advertise the "yield" and "effective yield" for the money market Sub-Account. Yield and effective yield are annualized, which means that it is assumed that the underlying mutual fund generates the same level of net income throughout a year.
Yield is a measure of the net dividend and interest income earned over a specific seven-day period (which period will be stated in the advertisement) expressed as a percentage of the offering price of the underlying mutual fund's units. The effective yield is calculated similarly, but reflects assumed compounding, calculated under rules prescribed by the SEC. Thus, effective yield will be slightly higher than yield, due to the compounding.
Historical Performance of the Sub-Accounts
Nationwide will advertise historical performance of the Sub-Accounts in accordance with SEC prescribed calculations. Performance information is annualized. However, if a Sub-Account has been available in the Variable Account for less than one year, the performance information for that Sub-Account is not annualized.
Performance information is based on historical earnings and is not intended to predict or project future results.
Standardized performance will reflect the maximum Variable Account charges possible under the contract. Non-standardized performance, which will be accompanied by standardized performance, will reflect other expense structures contemplated under the contract. The expense assumptions will be stated in the advertisement.
Additional Materials
Nationwide may provide information on various topics to owners and prospective purchasers in advertising, sales literature, or other materials.
Performance Comparisons
Each Sub-Account may, from time to time, include in advertisements the ranking of its performance figures compared with performance figures of other annuity contracts' Sub-Accounts with the same investment objectives which are created by Lipper Analytical Services, Morningstar, Inc. or other recognized ranking services.
Annuity Payments
See Annuitizing the Contract located in the prospectus.
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Condensed Financial Information
The following charts represent the Accumulation Unit values for all fee levels as of December 31, 2012. The term "Period" is defined as a complete calendar year unless otherwise noted. Those periods with an asterisk (*) reflect Accumulation Unit information for a partial year only. The value of an Accumulation Unit is determined on the basis of changes in the per share value of the underlying mutual funds and Variable Account charges which may vary from contract to contract (for more information on the calculation of Accumulation Unit values, see Determining Variable Account Value – Valuing an Accumulation Unit in the prospectus).
The following Sub-Accounts were added to the Variable Account after December 31, 2012; therefore, no Condensed Financial Information is available:
• Delaware Variable Insurance Product Trust - Delaware VIP Small Cap Value Series: Service Class
• Guggenheim Variable Fund - Multi-Hedge Strategies
• Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Managed Growth & Income Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Managed Growth Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Investor Destinations Managed Growth & Income Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Investor Destinations Managed Growth Fund: Class II
• Nationwide Variable Insurance Trust - NVIT S&P 500 Index Fund: Class II
• Nationwide Variable Insurance Trust - NVIT Small Cap Index Fund: Class II
 
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein Small/Mid Cap Value Portfolio: Class B - Q/NQ
2012
   20.073992   23.471632   16.93%   19,400
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein VPS Dynamic Asset Allocation Portfolio: Class B - Q/NQ
2012*
   10.000000   10.154217   1.54%   2,112
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II - Q/NQ
2012
   14.297491   15.153413   5.99%   163,567
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class II - Q/NQ
2012
   14.053082   16.120711   14.71%   40,969
American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2 - Q/NQ
2012*
   10.000000   10.119675   1.20%   311,738
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class III - Q/NQ
2012
   12.438632   13.500145   8.53%   37,576
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares - Q/NQ
2012
   15.129971   17.283516   14.23%   24,312
Dreyfus Stock Index Fund, Inc.: Service Shares - Q/NQ
2012
   14.107815   16.078646   13.97%   83,769
Dreyfus Variable Investment Fund - Appreciation Portfolio: Service Shares - Q/NQ
2012
   15.138702   16.456156   8.70%   86,315
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2 - Q/NQ
2012
   12.219959   13.457741   10.13%   256,748
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No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class 2 - Q/NQ
2012
   12.194817   13.609100   11.60%   33,859
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class 2 - Q/NQ
2012
   11.881588   13.507103   13.68%   936
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2 - Q/NQ
2012
   15.989239   16.528028   3.37%   8,657
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Service Class 2 - Q/NQ
2012
   14.023439   16.201274   15.53%   105,348
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Service Class 2 - Q/NQ
2012
   13.707490   15.477413   12.91%   114,816
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class 2 - Q/NQ
2012
   14.063004   14.657541   4.23%   106,405
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class 2 - Q/NQ
2012
   22.954492   25.954620   13.07%   32,912
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class 2R - Q/NQ
2012
   10.873789   12.926834   18.88%   29,433
Franklin Templeton Variable Insurance Products Trust - Franklin Income Securities Fund: Class 2 - Q/NQ
2012
   11.890259   13.220142   11.18%   44,603
Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value Securities Fund: Class 2 - Q/NQ
2012
   19.839372   23.181387   16.85%   11,895
Franklin Templeton Variable Insurance Products Trust - Franklin Templeton VIP Founding Funds Allocation Fund: Class 2 - Q/NQ
2012
   8.970568   10.211201   13.83%   27,063
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond Securities Fund: Class 3 - Q/NQ
2012
   16.223704   18.423935   13.56%   36,665
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Markets Navigator Fund: Service Shares - Q/NQ
2012*
   10.000000   10.222938   2.23%   0
Huntington VA Funds - Huntington VA International Equity Fund - Q/NQ
2012
   9.003854   10.133800   12.55%   28,907
Huntington VA Funds - Huntington VA Situs Fund - Q/NQ
2012
   11.040989   13.362779   21.03%   61,309
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series II - Q/NQ
2012*
   10.000000   9.958708   -0.41%   12,855
5
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
Ivy Funds Variable Insurance Portfolios - Asset Strategy - Q/NQ
2012
   11.653053   13.706700   17.62%   55,057
Ivy Funds Variable Insurance Portfolios - High Income - Q/NQ
2012*
   10.000000   10.815203   8.15%   59,413
Ivy Funds Variable Insurance Portfolios - Mid Cap Growth - Q/NQ
2012*
   10.000000   10.068050   0.68%   36,287
Janus Aspen Series - Forty Portfolio: Service Shares - Q/NQ
2012
   8.583266   10.492598   22.24%   47,208
Janus Aspen Series - Global Technology Portfolio: Service Shares - Q/NQ
2012
   4.640225   5.456761   17.60%   17,031
Janus Aspen Series - Overseas Portfolio: Service Shares - Q/NQ
2012
   11.103975   12.403811   11.71%   9,878
MFS® Variable Insurance Trust - MFS New Discovery Series: Service Class - Q/NQ
2012*
   10.000000   10.228022   2.28%   5,281
MFS® Variable Insurance Trust - MFS Value Series: Service Class - Q/NQ
2012
   15.809554   18.081786   14.37%   42,318
MFS® Variable Insurance Trust II - MFS International Value Portfolio: Service Class - Q/NQ
2012
   10.421665   11.924574   14.42%   68,486
Nationwide Variable Insurance Trust - American Century NVIT Growth Fund: Class II - Q/NQ
2012
   9.079969   10.196613   12.30%   51,228
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class II - Q/NQ
2012
   13.782314   15.567756   12.95%   41,728
Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II - Q/NQ
2012
   10.194744   11.643296   14.21%   2,024,891
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II - Q/NQ
2012
   11.414478   11.825276   3.60%   2,008,735
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II - Q/NQ
2012
   10.098071   12.167775   20.50%   78,307
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II - Q/NQ
2012
   9.392119   10.882845   15.87%   148,355
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II - Q/NQ
2012
   8.172677   9.442516   15.54%   2,659,626
6
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class III - Q/NQ
2012
   13.600599   15.397710   13.21%   45,986
Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class II - Q/NQ
2012
   15.263091   17.801528   16.63%   25,318
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class II - Q/NQ
2012
   7.660316   8.833333   15.31%   7,769
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class II - Q/NQ
2012
   9.237127   10.154564   9.93%   14,172
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Aggressive Fund: Class II - Q/NQ
2012
   8.499356   9.743653   14.64%   4,585
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class II - Q/NQ
2012
   9.938199   10.893639   9.61%   4,163,199
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Capital Appreciation Fund: Class II - Q/NQ
2012
   9.324356   10.458384   12.16%   7,767
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class II - Q/NQ
2012
   10.675245   11.326218   6.10%   720,334
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class II - Q/NQ
2012
   9.636061   10.686963   10.91%   562,998
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Aggressive Fund: Class II - Q/NQ
2012
   8.984882   10.161260   13.09%   5,187
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class II - Q/NQ
2012
   10.211873   11.091106   8.61%   1,150,497
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II - Q/NQ
2012
   11.651623   12.360305   6.08%   8,697
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class II - Q/NQ
2012
   12.634477   13.357432   5.72%   61,011
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class VI - Q/NQ
2012
   17.400876   20.079508   15.39%   7,575
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - NQ
2012
   58.094578   59.090227   1.71%   4,195
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - Q
2012
   58.248425   59.246711   1.71%   4,005
7
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class VI - Q/NQ
2012
   6.911842   7.860500   13.73%   14,891
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class VIII - Q/NQ
2012
   7.628054   8.899785   16.67%   12,416
Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II - Q/NQ
2012
   13.008386   14.880689   14.39%   253
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II - Q/NQ
2012
   12.453829   13.445256   7.96%   2,633,689
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II - Q/NQ
2012
   13.080661   14.491720   10.79%   12,087
Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II - Q/NQ
2012
   12.871264   13.361029   3.81%   839,247
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II - Q/NQ
2012
   13.271179   14.514442   9.37%   413,304
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II - Q/NQ
2012
   13.288387   14.919941   12.28%   5,789
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II - Q/NQ
2012
   13.336642   14.221146   6.63%   775,576
Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class II - Q/NQ
2012
   13.322678   15.571403   16.88%   14,525
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I - Q/NQ
2012
   16.652215   19.306983   15.94%   22,561
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I - Q/NQ
2012
   27.365352   27.008645   -1.30%   119,072
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I - Q/NQ
2012
   16.173014   17.917617   10.79%   49,234
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class VI - Q/NQ
2012
   8.171995   9.317313   14.02%   6,029
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class VI - Q/NQ
2012
   9.039737   10.433935   15.42%   21,642
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class II - Q/NQ
2012
   8.754200   10.034666   14.63%   19,005
8
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class II - Q/NQ
2012
   8.163084   9.474025   16.06%   28,898
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class II - Q/NQ
2012
   9.150703   10.354080   13.15%   10,106
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II - Q/NQ
2012
   9.820513   11.276879   14.83%   11,457
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class II - Q/NQ
2012
   13.311867   14.858613   11.62%   5,186
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class II - Q/NQ
2012
   18.682235   22.182797   18.74%   3,666
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class II - Q/NQ
2012
   18.396109   20.921043   13.73%   4,544
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class II - Q/NQ
2012
   13.019696   14.629438   12.36%   2,183
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class II - Q/NQ
2012
   9.656214   11.015389   14.08%   33,424
Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II - Q/NQ
2012
   10.532312   10.761332   2.17%   93,424
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class III - Q/NQ
2012
   11.723024   13.833939   18.01%   63,571
Northern Lights Variable Trust - TOPS Protected Balanced ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.149856   1.50%   0
Northern Lights Variable Trust - TOPS Protected Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.268646   2.69%   0
Northern Lights Variable Trust - TOPS Protected Moderate Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.286304   2.86%   0
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Class 4 - Q/NQ
2012
   13.161506   15.712150   19.38%   51,041
Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Service Shares - Q/NQ
2012
   13.654221   15.714632   15.09%   33,038
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Service Shares - Q/NQ
2012
   18.845528   21.886628   16.14%   5,623
9
No Additional Contract Options Elected Total - 1.30%
Variable account charges of the daily net assets of the variable account - 1.30%
Period   Beginning Value   Ending Value   Percentage Change   Units
PIMCO Variable Insurance Trust - All Asset Portfolio: Advisor Class - Q/NQ
2012*
   10.000000   10.624494   6.24%   91,098
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Advisor Class - Q/NQ
2012
   12.557857   13.042689   3.86%   9,686
PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class - Q/NQ
2012
   11.334165   11.829684   4.37%   375,967
PIMCO Variable Insurance Trust - Total Return Portfolio: Advisor Class - Q/NQ
2012
   10.004024   10.811694   8.07%   467,986
T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II - Q/NQ
2012
   11.488675   14.854028   29.29%   14,930
Van Eck VIP Trust - Van Eck VIP Global Hard Assets Fund: Service Class - Q/NQ
2012*
   10.000000   9.639938   -3.60%   24,158
Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2 - Q/NQ
2012
   15.617243   16.626985   6.47%   11,731
10
Additional Contract Options Elected Total - 1.50%
Variable account charges of the daily net assets of the variable account - 1.50%
Period   Beginning Value   Ending Value   Percentage Change   Units
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein Small/Mid Cap Value Portfolio: Class B - Q/NQ
2012
   20.443677   23.855345   16.69%   3,084
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein VPS Dynamic Asset Allocation Portfolio: Class B - Q/NQ
2012*
   10.000000   10.140494   1.40%   1,523
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II - Q/NQ
2012
   14.038950   14.849176   5.77%   46,997
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class II - Q/NQ
2012
   13.864384   15.871948   14.48%   18,177
American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2 - Q/NQ
2012*
   10.000000   10.116372   1.16%   50,584
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class III - Q/NQ
2012
   12.371587   13.400106   8.31%   156,846
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares - Q/NQ
2012
   20.940231   23.872229   14.00%   9,139
Dreyfus Stock Index Fund, Inc.: Service Shares - Q/NQ
2012
   15.100981   17.175596   13.74%   56,422
Dreyfus Variable Investment Fund - Appreciation Portfolio: Service Shares - Q/NQ
2012
   16.339629   17.725526   8.48%   45,508
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2 - Q/NQ
2012
   12.055916   13.250120   9.91%   32,385
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class 2 - Q/NQ
2012
   12.031099   13.399134   11.37%   35,303
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class 2 - Q/NQ
2012
   11.722046   13.298675   13.45%   343
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2 - Q/NQ
2012
   15.774479   16.272913   3.16%   4,599
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Service Class 2 - Q/NQ
2012
   14.884062   17.160639   15.30%   26,242
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Service Class 2 - Q/NQ
2012
   15.047317   16.955741   12.68%   22,788
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class 2 - Q/NQ
2012
   13.481898   14.023325   4.02%   29,736
11
Additional Contract Options Elected Total - 1.50%
Variable account charges of the daily net assets of the variable account - 1.50%
Period   Beginning Value   Ending Value   Percentage Change   Units
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class 2 - Q/NQ
2012
   23.439599   26.449304   12.84%   15,694
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class 2R - Q/NQ
2012
   10.706096   12.701650   18.64%   12,569
Franklin Templeton Variable Insurance Products Trust - Franklin Income Securities Fund: Class 2 - Q/NQ
2012
   11.754372   13.042512   10.96%   41,809
Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value Securities Fund: Class 2 - Q/NQ
2012
   20.942325   24.420447   16.61%   3,317
Franklin Templeton Variable Insurance Products Trust - Franklin Templeton VIP Founding Funds Allocation Fund: Class 2 - Q/NQ
2012
   8.904117   10.114985   13.60%   25,742
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond Securities Fund: Class 3 - Q/NQ
2012
   16.005974   18.139767   13.33%   29,157
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Markets Navigator Fund: Service Shares - Q/NQ
2012*
   10.000000   10.209122   2.09%   4,009
Huntington VA Funds - Huntington VA International Equity Fund - Q/NQ
2012
   8.982637   10.089386   12.32%   4,363
Huntington VA Funds - Huntington VA Situs Fund - Q/NQ
2012
   11.014999   13.304255   20.78%   9,889
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series II - Q/NQ
2012*
   10.000000   9.945246   -0.55%   2,677
Ivy Funds Variable Insurance Portfolios - Asset Strategy - Q/NQ
2012
   11.590239   13.605136   17.38%   102,491
Ivy Funds Variable Insurance Portfolios - High Income - Q/NQ
2012*
   10.000000   10.800595   8.01%   177,329
Ivy Funds Variable Insurance Portfolios - Mid Cap Growth - Q/NQ
2012*
   10.000000   10.054450   0.54%   71,304
Janus Aspen Series - Forty Portfolio: Service Shares - Q/NQ
2012
   17.619325   21.494993   22.00%   15,993
Janus Aspen Series - Global Technology Portfolio: Service Shares - Q/NQ
2012*
   10.000000   9.946570   -0.53%   5,085
Janus Aspen Series - Overseas Portfolio: Service Shares - Q/NQ
2012
   27.141314   30.256865   11.48%   1,502
12
Additional Contract Options Elected Total - 1.50%
Variable account charges of the daily net assets of the variable account - 1.50%
Period   Beginning Value   Ending Value   Percentage Change   Units
MFS® Variable Insurance Trust - MFS New Discovery Series: Service Class - Q/NQ
2012*
   10.000000   10.214213   2.14%   6,537
MFS® Variable Insurance Trust - MFS Value Series: Service Class - Q/NQ
2012
   16.791481   19.165838   14.14%   17,094
MFS® Variable Insurance Trust II - MFS International Value Portfolio: Service Class - Q/NQ
2012
   10.386610   11.860324   14.19%   54,860
Nationwide Variable Insurance Trust - American Century NVIT Growth Fund: Class II - Q/NQ
2012
   9.067741   10.162203   12.07%   64,792
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class II - Q/NQ
2012
   13.708059   15.452427   12.73%   2,948
Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II - Q/NQ
2012
   10.078216   11.486841   13.98%   417,039
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II - Q/NQ
2012
   11.284076   11.666419   3.39%   281,607
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II - Q/NQ
2012
   9.982671   12.004302   20.25%   36,442
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II - Q/NQ
2012
   9.284769   10.736608   15.64%   87,555
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II - Q/NQ
2012
   8.095662   9.334537   15.30%   429,735
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class III - Q/NQ
2012
   13.418047   15.160187   12.98%   8,757
Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class II - Q/NQ
2012
   14.990766   17.448408   16.39%   13,332
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class II - Q/NQ
2012
   7.603512   8.750033   15.08%   21,822
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class II - Q/NQ
2012
   9.168679   10.058850   9.71%   391
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Aggressive Fund: Class II - Q/NQ
2012
   8.436374   9.651801   14.41%   22,616
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class II - Q/NQ
2012
   9.864594   10.790994   9.39%   439,201
13
Additional Contract Options Elected Total - 1.50%
Variable account charges of the daily net assets of the variable account - 1.50%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Capital Appreciation Fund: Class II - Q/NQ
2012
   9.255266   10.359815   11.93%   78,932
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class II - Q/NQ
2012
   10.596201   11.219522   5.88%   139,278
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class II - Q/NQ
2012
   9.564729   10.586292   10.68%   269,739
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Aggressive Fund: Class II - Q/NQ
2012
   8.918301   10.065473   12.86%   69,359
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class II - Q/NQ
2012
   10.136240   10.986603   8.39%   194,460
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II - Q/NQ
2012
   11.565384   12.243899   5.87%   13,107
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class II - Q/NQ
2012
   12.540931   13.231603   5.51%   10,527
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class VI - Q/NQ
2012
   17.132621   19.729798   15.16%   8,399
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - Q/NQ
2012
   13.093826   13.291183   1.51%   11,536
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class VI - Q/NQ
2012
   6.860618   7.786405   13.49%   39,760
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class VIII - Q/NQ
2012
   7.540827   8.780151   16.43%   926
Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II - Q/NQ
2012
   16.414092   18.738447   14.16%   35,297
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II - Q/NQ
2012
   12.386680   13.345609   7.74%   296,626
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II - Q/NQ
2012
   13.010184   14.384375   10.56%   187,121
Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II - Q/NQ
2012
   12.870975   13.333587   3.59%   197,068
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II - Q/NQ
2012
   14.926410   16.291577   9.15%   78,290
14
Additional Contract Options Elected Total - 1.50%
Variable account charges of the daily net assets of the variable account - 1.50%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II - Q/NQ
2012
   15.925956   17.845023   12.05%   12,563
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II - Q/NQ
2012
   14.071828   14.974615   6.42%   276,788
Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class II - Q/NQ
2012
   13.250874   15.456042   16.64%   5,359
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I - Q/NQ
2012
   20.806439   24.074509   15.71%   5,633
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I - Q/NQ
2012
   10.172213   10.019216   -1.50%   87,094
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I - Q/NQ
2012
   13.877508   15.343265   10.56%   29,617
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class VI - Q/NQ
2012
   8.111439   9.229482   13.78%   6,369
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class VI - Q/NQ
2012
   8.900341   10.252169   15.19%   4,975
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class II - Q/NQ
2012
   8.689350   9.940116   14.39%   4,416
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class II - Q/NQ
2012
   8.102602   9.384732   15.82%   9,113
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class II - Q/NQ
2012
   9.082922   10.256516   12.92%   3,310
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II - Q/NQ
2012
   9.747754   11.170595   14.60%   2,885
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class II - Q/NQ
2012
   14.137076   15.747665   11.39%   591
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class II - Q/NQ
2012
   19.735508   23.385855   18.50%   803
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class II - Q/NQ
2012
   19.210199   21.802509   13.49%   1,617
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class II - Q/NQ
2012
   13.917143   15.606084   12.14%   259
15
Additional Contract Options Elected Total - 1.50%
Variable account charges of the daily net assets of the variable account - 1.50%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class II - Q/NQ
2012
   9.584620   10.911512   13.84%   16,452
Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II - Q/NQ
2012
   10.454338   10.659964   1.97%   7,748
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class III - Q/NQ
2012
   11.659822   13.731408   17.77%   16,506
Northern Lights Variable Trust - TOPS Protected Balanced ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.146540   1.47%   7,375
Northern Lights Variable Trust - TOPS Protected Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.265293   2.65%   14,563
Northern Lights Variable Trust - TOPS Protected Moderate Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.282947   2.83%   7,277
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Class 4 - Q/NQ
2012
   12.958556   15.438457   19.14%   12,102
Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Service Shares - Q/NQ
2012
   14.538622   16.698524   14.86%   7,005
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Service Shares - Q/NQ
2012
   20.182810   23.392100   15.90%   4,036
PIMCO Variable Insurance Trust - All Asset Portfolio: Advisor Class - Q/NQ
2012*
   10.000000   10.610149   6.10%   61,680
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Advisor Class - Q/NQ
2012
   12.490136   12.945992   3.65%   3,444
PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class - Q/NQ
2012
   11.273050   11.741977   4.16%   134,145
PIMCO Variable Insurance Trust - Total Return Portfolio: Advisor Class - Q/NQ
2012
   9.990587   10.775226   7.85%   258,854
T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II - Q/NQ
2012
   11.450026   14.774016   29.03%   7,988
Van Eck VIP Trust - Van Eck VIP Global Hard Assets Fund: Service Class - Q/NQ
2012*
   10.000000   9.626904   -3.73%   20,583
Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2 - Q/NQ
2012
   15.393121   16.355079   6.25%   5,575
16
Additional Contract Options Elected Total - 1.65%
Variable account charges of the daily net assets of the variable account - 1.65%
Period   Beginning Value   Ending Value   Percentage Change   Units
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein Small/Mid Cap Value Portfolio: Class B - Q/NQ
2012
   20.169062   23.498981   16.51%   610
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein VPS Dynamic Asset Allocation Portfolio: Class B - Q/NQ
2012*
   10.000000   10.130211   1.30%   0
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II - Q/NQ
2012
   13.847781   14.624601   5.61%   9,547
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class II - Q/NQ
2012
   13.724321   15.687623   14.31%   3,919
American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2 - Q/NQ
2012*
   10.000000   10.113887   1.14%   537
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class III - Q/NQ
2012
   12.321456   13.325434   8.15%   20,358
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares - Q/NQ
2012
   20.658938   23.515604   13.83%   2,081
Dreyfus Stock Index Fund, Inc.: Service Shares - Q/NQ
2012
   14.898131   16.919025   13.56%   8,819
Dreyfus Variable Investment Fund - Appreciation Portfolio: Service Shares - Q/NQ
2012
   16.120166   17.460762   8.32%   3,839
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2 - Q/NQ
2012
   11.934095   13.096219   9.74%   12,249
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class 2 - Q/NQ
2012
   11.909512   13.243470   11.20%   0
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class 2 - Q/NQ
2012
   11.603570   13.144174   13.28%   0
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2 - Q/NQ
2012
   15.615016   16.083805   3.00%   68
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Service Class 2 - Q/NQ
2012
   14.684086   16.904240   15.12%   8,405
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Service Class 2 - Q/NQ
2012
   14.845147   16.702413   12.51%   1,751
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class 2 - Q/NQ
2012
   13.300838   13.813877   3.86%   5,178
17
Additional Contract Options Elected Total - 1.65%
Variable account charges of the daily net assets of the variable account - 1.65%
Period   Beginning Value   Ending Value   Percentage Change   Units
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class 2 - Q/NQ
2012
   23.124802   26.054250   12.67%   3,865
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class 2R - Q/NQ
2012
   10.581819   12.535043   18.46%   206
Franklin Templeton Variable Insurance Products Trust - Franklin Income Securities Fund: Class 2 - Q/NQ
2012
   11.653327   12.910664   10.79%   1,027
Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value Securities Fund: Class 2 - Q/NQ
2012
   20.660964   24.055596   16.43%   1,472
Franklin Templeton Variable Insurance Products Trust - Franklin Templeton VIP Founding Funds Allocation Fund: Class 2 - Q/NQ
2012
   8.854528   10.043302   13.43%   0
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond Securities Fund: Class 3 - Q/NQ
2012
   15.844268   17.929089   13.16%   970
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Markets Navigator Fund: Service Shares - Q/NQ
2012*
   10.000000   10.198760   1.99%   535
Huntington VA Funds - Huntington VA International Equity Fund - Q/NQ
2012
   8.966729   10.056154   12.15%   720
Huntington VA Funds - Huntington VA Situs Fund - Q/NQ
2012
   10.995515   13.260459   20.60%   1,580
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series II - Q/NQ
2012*
   10.000000   9.935147   -0.65%   169
Ivy Funds Variable Insurance Portfolios - Asset Strategy - Q/NQ
2012
   11.543254   13.529317   17.21%   17,112
Ivy Funds Variable Insurance Portfolios - High Income - Q/NQ
2012*
   10.000000   10.789629   7.90%   1,012
Ivy Funds Variable Insurance Portfolios - Mid Cap Growth - Q/NQ
2012*
   10.000000   10.044239   0.44%   1,273
Janus Aspen Series - Forty Portfolio: Service Shares - Q/NQ
2012
   17.382589   21.173835   21.81%   0
Janus Aspen Series - Global Technology Portfolio: Service Shares - Q/NQ
2012*
   10.000000   9.936310   -0.64%   112
Janus Aspen Series - Overseas Portfolio: Service Shares - Q/NQ
2012
   26.776690   29.804798   11.31%   0
18
Additional Contract Options Elected Total - 1.65%
Variable account charges of the daily net assets of the variable account - 1.65%
Period   Beginning Value   Ending Value   Percentage Change   Units
MFS® Variable Insurance Trust - MFS New Discovery Series: Service Class - Q/NQ
2012*
   10.000000   10.203835   2.04%   1,371
MFS® Variable Insurance Trust - MFS Value Series: Service Class - Q/NQ
2012
   16.565938   18.879545   13.97%   21,124
MFS® Variable Insurance Trust II - MFS International Value Portfolio: Service Class - Q/NQ
2012
   10.360352   11.812291   14.01%   12,789
Nationwide Variable Insurance Trust - American Century NVIT Growth Fund: Class II - Q/NQ
2012
   9.058584   10.136450   11.90%   38,093
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class II - Q/NQ
2012
   13.652497   15.366307   12.55%   285
Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II - Q/NQ
2012
   9.991547   11.370678   13.80%   151,156
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II - Q/NQ
2012
   11.187080   11.548489   3.23%   80,828
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II - Q/NQ
2012
   9.896797   11.882881   20.07%   3,860
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II - Q/NQ
2012
   9.204869   10.627978   15.46%   2,588
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II - Q/NQ
2012
   8.038264   9.254218   15.13%   101,605
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class III - Q/NQ
2012
   13.282530   14.984178   12.81%   0
Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class II - Q/NQ
2012
   14.789355   17.187714   16.22%   652
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class II - Q/NQ
2012
   7.561134   8.687989   14.90%   0
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class II - Q/NQ
2012
   9.117565   9.987496   9.54%   436
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Aggressive Fund: Class II - Q/NQ
2012
   8.389357   9.583379   14.23%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class II - Q/NQ
2012
   9.809665   10.714519   9.22%   58,656
19
Additional Contract Options Elected Total - 1.65%
Variable account charges of the daily net assets of the variable account - 1.65%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Capital Appreciation Fund: Class II - Q/NQ
2012
   9.203721   10.286396   11.76%   6,296
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class II - Q/NQ
2012
   10.537207   11.140023   5.72%   163
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class II - Q/NQ
2012
   9.511460   10.511275   10.51%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Aggressive Fund: Class II - Q/NQ
2012
   8.868653   9.994167   12.69%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class II - Q/NQ
2012
   10.079800   10.908749   8.22%   33,374
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II - Q/NQ
2012
   11.500995   12.157146   5.71%   1,393
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class II - Q/NQ
2012
   12.471155   13.137892   5.35%   0
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class VI - Q/NQ
2012
   16.933751   19.471025   14.98%   7,097
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - Q/NQ
2012
   12.917941   13.092624   1.35%   277
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class VI - Q/NQ
2012
   6.822389   7.731207   13.32%   1,096
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class VIII - Q/NQ
2012
   7.475938   8.691317   16.26%   3,099
Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II - Q/NQ
2012
   16.193584   18.458503   13.99%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II - Q/NQ
2012
   12.336491   13.271239   7.58%   44,545
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II - Q/NQ
2012
   12.957463   14.304216   10.39%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II - Q/NQ
2012
   12.698037   13.134348   3.44%   25,693
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II - Q/NQ
2012
   14.725918   16.048214   8.98%   0
20
Additional Contract Options Elected Total - 1.65%
Variable account charges of the daily net assets of the variable account - 1.65%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II - Q/NQ
2012
   15.712035   17.578460   11.88%   1,507
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II - Q/NQ
2012
   13.882794   14.750895   6.25%   16,440
Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class II - Q/NQ
2012
   13.197181   15.369911   16.46%   664
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I - Q/NQ
2012
   20.526948   23.714870   15.53%   578
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I - Q/NQ
2012
   10.034988   9.868965   -1.65%   15,794
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I - Q/NQ
2012
   13.691103   15.114071   10.39%   11,794
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class VI - Q/NQ
2012
   8.066245   9.164052   13.61%   7,687
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class VI - Q/NQ
2012
   8.796978   10.117643   15.01%   7,686
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class II - Q/NQ
2012
   8.640935   9.869637   14.22%   271
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class II - Q/NQ
2012
   8.057449   9.318191   15.65%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class II - Q/NQ
2012
   9.032284   10.183767   12.75%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II - Q/NQ
2012
   9.693418   11.091371   14.42%   492
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class II - Q/NQ
2012
   13.947162   15.512400   11.22%   199
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class II - Q/NQ
2012
   19.470383   23.036487   18.32%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class II - Q/NQ
2012
   18.952108   21.476771   13.32%   0
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class II - Q/NQ
2012
   13.730201   15.372947   11.96%   102
21
Additional Contract Options Elected Total - 1.65%
Variable account charges of the daily net assets of the variable account - 1.65%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class II - Q/NQ
2012
   9.531130   10.834078   13.67%   2,187
Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II - Q/NQ
2012
   10.396146   10.584447   1.81%   13,311
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class III - Q/NQ
2012
   11.612565   13.654891   17.59%   7,517
Northern Lights Variable Trust - TOPS Protected Balanced ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.144054   1.44%   536
Northern Lights Variable Trust - TOPS Protected Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.262777   2.63%   0
Northern Lights Variable Trust - TOPS Protected Moderate Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.280422   2.80%   0
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Class 4 - Q/NQ
2012
   12.808168   15.236004   18.96%   0
Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Service Shares - Q/NQ
2012
   14.343366   16.449118   14.68%   970
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Service Shares - Q/NQ
2012
   19.911734   23.042708   15.72%   5,205
PIMCO Variable Insurance Trust - All Asset Portfolio: Advisor Class - Q/NQ
2012*
   10.000000   10.599374   5.99%   16,588
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Advisor Class - Q/NQ
2012
   12.439490   12.873813   3.49%   0
PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class - Q/NQ
2012
   11.227334   11.676512   4.00%   10,202
PIMCO Variable Insurance Trust - Total Return Portfolio: Advisor Class - Q/NQ
2012
   9.980493   10.747901   7.69%   44,385
T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II - Q/NQ
2012
   11.421095   14.714212   28.83%   646
Van Eck VIP Trust - Van Eck VIP Global Hard Assets Fund: Service Class - Q/NQ
2012*
   10.000000   9.617126   -3.83%   2,086
Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2 - Q/NQ
2012
   15.226889   16.153750   6.09%   0
22
Additional Contract Options Elected Total - 1.75%
Variable account charges of the daily net assets of the variable account - 1.75%
Period   Beginning Value   Ending Value   Percentage Change   Units
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein Small/Mid Cap Value Portfolio: Class B - Q/NQ
2012
   19.987746   23.263995   16.39%   6,417
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein VPS Dynamic Asset Allocation Portfolio: Class B - Q/NQ
2012*
   10.000000   10.123337   1.23%   49,919
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II - Q/NQ
2012
   13.721610   14.476590   5.50%   68,816
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class II - Q/NQ
2012
   13.631589   15.565748   14.19%   22,656
American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2 - Q/NQ
2012*
   10.000000   10.112232   1.12%   9,900
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class III - Q/NQ
2012
   12.288096   13.275810   8.04%   275,628
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares - Q/NQ
2012
   20.473298   23.280544   13.71%   16,720
Dreyfus Stock Index Fund, Inc.: Service Shares - Q/NQ
2012
   14.764267   16.749922   13.45%   146,953
Dreyfus Variable Investment Fund - Appreciation Portfolio: Service Shares - Q/NQ
2012
   15.975323   17.286242   8.21%   22,368
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2 - Q/NQ
2012
   11.853500   12.994518   9.63%   32,757
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class 2 - Q/NQ
2012
   11.829064   13.140604   11.09%   16,660
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class 2 - Q/NQ
2012
   11.525200   13.042099   13.16%   12,484
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2 - Q/NQ
2012
   15.509505   15.958849   2.90%   30,802
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Service Class 2 - Q/NQ
2012
   14.552109   16.735236   15.00%   47,447
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Service Class 2 - Q/NQ
2012
   14.711717   16.535427   12.40%   45,141
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class 2 - Q/NQ
2012
   13.181320   13.675795   3.75%   17,869
23
Additional Contract Options Elected Total - 1.75%
Variable account charges of the daily net assets of the variable account - 1.75%
Period   Beginning Value   Ending Value   Percentage Change   Units
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class 2 - Q/NQ
2012
   22.916990   25.793803   12.55%   27,738
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class 2R - Q/NQ
2012
   10.499655   12.425045   18.34%   16,587
Franklin Templeton Variable Insurance Products Trust - Franklin Income Securities Fund: Class 2 - Q/NQ
2012
   11.586341   12.823360   10.68%   105,252
Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value Securities Fund: Class 2 - Q/NQ
2012
   20.475326   23.815169   16.31%   5,072
Franklin Templeton Variable Insurance Products Trust - Franklin Templeton VIP Founding Funds Allocation Fund: Class 2 - Q/NQ
2012
   8.821565   9.995709   13.31%   27,586
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond Securities Fund: Class 3 - Q/NQ
2012
   15.737289   17.789885   13.04%   63,071
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Markets Navigator Fund: Service Shares - Q/NQ
2012*
   10.000000   10.191846   1.92%   961
Huntington VA Funds - Huntington VA International Equity Fund - Q/NQ
2012
   8.956120   10.034011   12.04%   13,216
Huntington VA Funds - Huntington VA Situs Fund - Q/NQ
2012
   10.982532   13.231297   20.48%   8,022
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series II - Q/NQ
2012*
   10.000000   9.928417   -0.72%   2,804
Ivy Funds Variable Insurance Portfolios - Asset Strategy - Q/NQ
2012
   11.512000   13.478931   17.09%   127,043
Ivy Funds Variable Insurance Portfolios - High Income - Q/NQ
2012*
   10.000000   10.782323   7.82%   46,575
Ivy Funds Variable Insurance Portfolios - Mid Cap Growth - Q/NQ
2012*
   10.000000   10.037435   0.37%   33,023
Janus Aspen Series - Forty Portfolio: Service Shares - Q/NQ
2012
   17.226388   20.962185   21.69%   25,425
Janus Aspen Series - Global Technology Portfolio: Service Shares - Q/NQ
2012*
   10.000000   9.929462   -0.71%   17,334
Janus Aspen Series - Overseas Portfolio: Service Shares - Q/NQ
2012
   26.536056   29.506835   11.20%   3,016
24
Additional Contract Options Elected Total - 1.75%
Variable account charges of the daily net assets of the variable account - 1.75%
Period   Beginning Value   Ending Value   Percentage Change   Units
MFS® Variable Insurance Trust - MFS New Discovery Series: Service Class - Q/NQ
2012*
   10.000000   10.196918   1.97%   5,319
MFS® Variable Insurance Trust - MFS Value Series: Service Class - Q/NQ
2012
   16.417040   18.690785   13.85%   17,719
MFS® Variable Insurance Trust II - MFS International Value Portfolio: Service Class - Q/NQ
2012
   10.342861   11.780323   13.90%   42,169
Nationwide Variable Insurance Trust - American Century NVIT Growth Fund: Class II - Q/NQ
2012
   9.052463   10.119285   11.78%   29,687
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class II - Q/NQ
2012
   13.615559   15.309114   12.44%   2,932
Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II - Q/NQ
2012
   9.934130   11.293817   13.69%   419,350
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II - Q/NQ
2012
   11.122824   11.470453   3.13%   172,079
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II - Q/NQ
2012
   9.839907   11.802543   19.95%   63,357
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II - Q/NQ
2012
   9.151941   10.556109   15.34%   76,308
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II - Q/NQ
2012
   8.000182   9.200983   15.01%   270,765
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class III - Q/NQ
2012
   13.192786   14.867761   12.70%   16,001
Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class II - Q/NQ
2012
   14.656457   17.015902   16.10%   22,677
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class II - Q/NQ
2012
   7.532982   8.646821   14.79%   22,846
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class II - Q/NQ
2012
   9.083641   9.940186   9.43%   1,466
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Aggressive Fund: Class II - Q/NQ
2012
   8.358114   9.537949   14.12%   253,226
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class II - Q/NQ
2012
   9.773150   10.663756   9.11%   1,024,145
25
Additional Contract Options Elected Total - 1.75%
Variable account charges of the daily net assets of the variable account - 1.75%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Capital Appreciation Fund: Class II - Q/NQ
2012
   9.169449   10.237652   11.65%   79,278
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class II - Q/NQ
2012
   10.497989   11.087244   5.61%   293,591
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class II - Q/NQ
2012
   9.476046   10.461468   10.40%   405,764
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Aggressive Fund: Class II - Q/NQ
2012
   8.835604   9.946771   12.58%   88,956
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class II - Q/NQ
2012
   10.042298   10.857085   8.11%   293,343
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II - Q/NQ
2012
   11.458211   12.099576   5.60%   10,452
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class II - Q/NQ
2012
   12.424769   13.075685   5.24%   29,759
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class VI - Q/NQ
2012
   16.802345   19.300241   14.87%   24,086
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - Q/NQ
2012
   12.801881   12.961773   1.25%   17,943
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class VI - Q/NQ
2012
   6.796997   7.694573   13.21%   12,368
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class VIII - Q/NQ
2012
   7.432925   8.632502   16.14%   2,617
Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II - Q/NQ
2012
   16.048045   18.273978   13.87%   119,631
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II - Q/NQ
2012
   12.303112   13.221841   7.47%   409,760
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II - Q/NQ
2012
   12.922393   14.250979   10.28%   42,183
Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II - Q/NQ
2012
   12.584001   13.003124   3.33%   288,494
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II - Q/NQ
2012
   14.593590   15.887798   8.87%   174,158
26
Additional Contract Options Elected Total - 1.75%
Variable account charges of the daily net assets of the variable account - 1.75%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II - Q/NQ
2012
   15.570810   17.402708   11.76%   50,432
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II - Q/NQ
2012
   13.758057   14.603455   6.14%   146,175
Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class II - Q/NQ
2012
   13.161472   15.312714   16.34%   13,127
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I - Q/NQ
2012
   20.342486   23.477812   15.41%   13,822
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I - Q/NQ
2012
   9.944406   9.769905   -1.75%   221,045
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I - Q/NQ
2012
   13.568081   14.962997   10.28%   7,039
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class VI - Q/NQ
2012
   8.036198   9.120622   13.49%   3,818
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class VI - Q/NQ
2012
   8.728658   10.028843   14.90%   7,885
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class II - Q/NQ
2012
   8.608756   9.822877   14.10%   15,157
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class II - Q/NQ
2012
   8.027444   9.274032   15.53%   24,170
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class II - Q/NQ
2012
   8.998670   10.135533   12.63%   6,864
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II - Q/NQ
2012
   9.657332   11.038815   14.31%   1,748
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class II - Q/NQ
2012
   13.821797   15.357297   11.11%   9,751
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class II - Q/NQ
2012
   19.295405   22.806201   18.19%   4,258
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class II - Q/NQ
2012
   18.781832   21.262124   13.21%   3,599
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class II - Q/NQ
2012
   13.606781   15.219252   11.85%   1,479
27
Additional Contract Options Elected Total - 1.75%
Variable account charges of the daily net assets of the variable account - 1.75%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class II - Q/NQ
2012
   9.495610   10.782698   13.55%   40,505
Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II - Q/NQ
2012
   10.357453   10.534295   1.71%   38,551
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class III - Q/NQ
2012
   11.581113   13.604035   17.47%   5,397
Northern Lights Variable Trust - TOPS Protected Balanced ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.142390   1.42%   20,092
Northern Lights Variable Trust - TOPS Protected Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.261092   2.61%   185
Northern Lights Variable Trust - TOPS Protected Moderate Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.278741   2.79%   217
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Class 4 - Q/NQ
2012
   12.708710   15.102289   18.83%   13,962
Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Service Shares - Q/NQ
2012
   14.214463   16.284679   14.56%   10,287
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Service Shares - Q/NQ
2012
   19.732795   22.812364   15.61%   14,315
PIMCO Variable Insurance Trust - All Asset Portfolio: Advisor Class - Q/NQ
2012*
   10.000000   10.592193   5.92%   93,008
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Advisor Class - Q/NQ
2012
   12.405808   12.825863   3.39%   17,804
PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class - Q/NQ
2012
   11.196933   11.633026   3.89%   153,816
PIMCO Variable Insurance Trust - Total Return Portfolio: Advisor Class - Q/NQ
2012
   9.973762   10.729699   7.58%   405,430
T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II - Q/NQ
2012
   11.401817   14.674413   28.70%   24,158
Van Eck VIP Trust - Van Eck VIP Global Hard Assets Fund: Service Class - Q/NQ
2012*
   10.000000   9.610602   -3.89%   25,322
Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2 - Q/NQ
2012
   15.116906   16.020725   5.98%   8,979
28
Additional Contract Options Elected Total - 1.85%
Variable account charges of the daily net assets of the variable account - 1.85%
Period   Beginning Value   Ending Value   Percentage Change   Units
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein Small/Mid Cap Value Portfolio: Class B - Q/NQ
2012
   19.807956   23.031215   16.27%   0
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein VPS Dynamic Asset Allocation Portfolio: Class B - Q/NQ
2012*
   10.000000   10.116462   1.16%   0
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II - Q/NQ
2012
   13.596485   14.329952   5.39%   0
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class II - Q/NQ
2012
   13.539412   15.444726   14.07%   0
American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2 - Q/NQ
2012*
   10.000000   10.110570   1.11%   0
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class III - Q/NQ
2012
   12.254789   13.226327   7.93%   0
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares - Q/NQ
2012
   20.289105   23.047568   13.60%   0
Dreyfus Stock Index Fund, Inc.: Service Shares - Q/NQ
2012
   14.631439   16.582303   13.33%   0
Dreyfus Variable Investment Fund - Appreciation Portfolio: Service Shares - Q/NQ
2012
   15.831612   17.113277   8.10%   0
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2 - Q/NQ
2012
   11.773339   12.893469   9.51%   0
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class 2 - Q/NQ
2012
   11.749070   13.038437   10.97%   0
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class 2 - Q/NQ
2012
   11.447241   12.940657   13.05%   0
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2 - Q/NQ
2012
   15.404595   15.834717   2.79%   0
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Service Class 2 - Q/NQ
2012
   14.421183   16.567748   14.88%   0
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Service Class 2 - Q/NQ
2012
   14.579335   16.369918   12.28%   0
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class 2 - Q/NQ
2012
   13.062768   13.538964   3.65%   0
29
Additional Contract Options Elected Total - 1.85%
Variable account charges of the daily net assets of the variable account - 1.85%
Period   Beginning Value   Ending Value   Percentage Change   Units
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class 2 - Q/NQ
2012
   22.710878   25.535746   12.44%   0
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class 2R - Q/NQ
2012
   10.418061   12.315924   18.22%   0
Franklin Templeton Variable Insurance Products Trust - Franklin Income Securities Fund: Class 2 - Q/NQ
2012
   11.519704   12.736606   10.56%   2,017
Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value Securities Fund: Class 2 - Q/NQ
2012
   20.291086   23.576811   16.19%   0
Franklin Templeton Variable Insurance Products Trust - Franklin Templeton VIP Founding Funds Allocation Fund: Class 2 - Q/NQ
2012
   8.788696   9.948307   13.19%   0
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond Securities Fund: Class 3 - Q/NQ
2012
   15.630919   17.651621   12.93%   728
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Markets Navigator Fund: Service Shares - Q/NQ
2012*
   10.000000   10.184936   1.85%   0
Huntington VA Funds - Huntington VA International Equity Fund - Q/NQ
2012
   8.945515   10.011908   11.92%   642
Huntington VA Funds - Huntington VA Situs Fund - Q/NQ
2012
   10.969534   13.202155   20.35%   0
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series II - Q/NQ
2012*
   10.000000   9.921681   -0.78%   0
Ivy Funds Variable Insurance Portfolios - Asset Strategy - Q/NQ
2012
   11.480811   13.428712   16.97%   0
Ivy Funds Variable Insurance Portfolios - High Income - Q/NQ
2012*
   10.000000   10.775009   7.75%   1,192
Ivy Funds Variable Insurance Portfolios - Mid Cap Growth - Q/NQ
2012*
   10.000000   10.030618   0.31%   0
Janus Aspen Series - Forty Portfolio: Service Shares - Q/NQ
2012
   17.071424   20.752441   21.56%   0
Janus Aspen Series - Global Technology Portfolio: Service Shares - Q/NQ
2012*
   10.000000   9.922620   -0.77%   0
Janus Aspen Series - Overseas Portfolio: Service Shares - Q/NQ
2012
   26.297382   29.211587   11.08%   220
30
Additional Contract Options Elected Total - 1.85%
Variable account charges of the daily net assets of the variable account - 1.85%
Period   Beginning Value   Ending Value   Percentage Change   Units
MFS® Variable Insurance Trust - MFS New Discovery Series: Service Class - Q/NQ
2012*
   10.000000   10.189999   1.90%   630
MFS® Variable Insurance Trust - MFS Value Series: Service Class - Q/NQ
2012
   16.269377   18.503779   13.73%   1,388
MFS® Variable Insurance Trust II - MFS International Value Portfolio: Service Class - Q/NQ
2012
   10.325388   11.748430   13.78%   0
Nationwide Variable Insurance Trust - American Century NVIT Growth Fund: Class II - Q/NQ
2012
   9.046352   10.102135   11.67%   0
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class II - Q/NQ
2012
   13.578667   15.252060   12.32%   0
Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II - Q/NQ
2012
   9.876964   11.217368   13.57%   6,739
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II - Q/NQ
2012
   11.058827   11.392820   3.02%   6,496
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II - Q/NQ
2012
   9.783291   11.722659   19.82%   0
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II - Q/NQ
2012
   9.099247   10.484616   15.23%   1,225
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II - Q/NQ
2012
   7.962252   9.148015   14.89%   8,532
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class III - Q/NQ
2012
   13.103626   14.752224   12.58%   0
Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class II - Q/NQ
2012
   14.524582   16.845598   15.98%   0
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class II - Q/NQ
2012
   7.504897   8.605792   14.67%   0
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class II - Q/NQ
2012
   9.049793   9.893050   9.32%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Aggressive Fund: Class II - Q/NQ
2012
   8.326964   9.492713   14.00%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class II - Q/NQ
2012
   9.736744   10.613196   9.00%   0
31
Additional Contract Options Elected Total - 1.85%
Variable account charges of the daily net assets of the variable account - 1.85%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Capital Appreciation Fund: Class II - Q/NQ
2012
   9.135318   10.189136   11.54%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class II - Q/NQ
2012
   10.458904   11.034695   5.51%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class II - Q/NQ
2012
   9.440750   10.411868   10.29%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Aggressive Fund: Class II - Q/NQ
2012
   8.802675   9.899609   12.46%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class II - Q/NQ
2012
   10.004897   10.805629   8.00%   0
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II - Q/NQ
2012
   11.415554   12.042223   5.49%   0
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class II - Q/NQ
2012
   12.378536   13.013750   5.13%   0
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class VI - Q/NQ
2012
   16.671772   19.130712   14.75%   671
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - Q/NQ
2012
   12.686748   12.832090   1.15%   0
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class VI - Q/NQ
2012
   6.771668   7.658091   13.09%   0
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class VIII - Q/NQ
2012
   7.390148   8.574084   16.02%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II - Q/NQ
2012
   15.903701   18.091136   13.75%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II - Q/NQ
2012
   12.269767   13.172548   7.36%   11,353
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II - Q/NQ
2012
   12.887370   14.197850   10.17%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II - Q/NQ
2012
   12.470780   12.872988   3.23%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II - Q/NQ
2012
   14.462282   15.728790   8.76%   69,757
32
Additional Contract Options Elected Total - 1.85%
Variable account charges of the daily net assets of the variable account - 1.85%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II - Q/NQ
2012
   15.430735   17.228554   11.65%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II - Q/NQ
2012
   13.634356   14.457393   6.04%   0
Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class II - Q/NQ
2012
   13.125810   15.255643   16.23%   0
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I - Q/NQ
2012
   20.159477   23.242853   15.29%   0
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I - Q/NQ
2012
   9.854573   9.671770   -1.86%   0
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I - Q/NQ
2012
   13.446101   14.813348   10.17%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class VI - Q/NQ
2012
   8.006280   9.077393   13.38%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class VI - Q/NQ
2012
   8.660822   9.940755   14.78%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class II - Q/NQ
2012
   8.576687   9.776303   13.99%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class II - Q/NQ
2012
   7.997515   9.230031   15.41%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class II - Q/NQ
2012
   8.965139   10.087466   12.52%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II - Q/NQ
2012
   9.621339   10.986464   14.19%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class II - Q/NQ
2012
   13.697455   15.203622   11.00%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class II - Q/NQ
2012
   19.121810   22.577981   18.07%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class II - Q/NQ
2012
   18.612848   21.049325   13.09%   0
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class II - Q/NQ
2012
   13.484355   15.066929   11.74%   0
33
Additional Contract Options Elected Total - 1.85%
Variable account charges of the daily net assets of the variable account - 1.85%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class II - Q/NQ
2012
   9.460182   10.731513   13.44%   599
Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II - Q/NQ
2012
   10.318874   10.484347   1.60%   0
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class III - Q/NQ
2012
   11.549727   13.553328   17.35%   0
Northern Lights Variable Trust - TOPS Protected Balanced ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.140730   1.41%   0
Northern Lights Variable Trust - TOPS Protected Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.259416   2.59%   0
Northern Lights Variable Trust - TOPS Protected Moderate Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.277058   2.77%   0
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Class 4 - Q/NQ
2012
   12.609991   14.969688   18.71%   0
Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Service Shares - Q/NQ
2012
   14.086578   16.121711   14.45%   0
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Service Shares - Q/NQ
2012
   19.555273   22.584078   15.49%   0
PIMCO Variable Insurance Trust - All Asset Portfolio: Advisor Class - Q/NQ
2012*
   10.000000   10.585007   5.85%   0
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Advisor Class - Q/NQ
2012
   12.372183   12.778050   3.28%   0
PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class - Q/NQ
2012
   11.166580   11.589647   3.79%   0
PIMCO Variable Insurance Trust - Total Return Portfolio: Advisor Class - Q/NQ
2012
   9.967028   10.711515   7.47%   0
T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II - Q/NQ
2012
   11.382550   14.634667   28.57%   0
Van Eck VIP Trust - Van Eck VIP Global Hard Assets Fund: Service Class - Q/NQ
2012*
   10.000000   9.604073   -3.96%   0
Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2 - Q/NQ
2012
   15.007617   15.888672   5.87%   0
34
Additional Contract Options Elected Total - 2.00%
Variable account charges of the daily net assets of the variable account - 2.00%
Period   Beginning Value   Ending Value   Percentage Change   Units
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein Small/Mid Cap Value Portfolio: Class B - Q/NQ
2012
   19.540947   22.685955   16.09%   139
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein VPS Dynamic Asset Allocation Portfolio: Class B - Q/NQ
2012*
   10.000000   10.106163   1.06%   0
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II - Q/NQ
2012
   13.410674   14.112464   5.23%   0
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class II - Q/NQ
2012
   13.402114   15.264684   13.90%   0
American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2 - Q/NQ
2012*
   10.000000   10.108080   1.08%   0
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class III - Q/NQ
2012
   12.204946   13.152347   7.76%   7,739
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares - Q/NQ
2012
   20.015618   22.702082   13.42%   0
Dreyfus Stock Index Fund, Inc.: Service Shares - Q/NQ
2012
   14.434186   16.333683   13.16%   0
Dreyfus Variable Investment Fund - Appreciation Portfolio: Service Shares - Q/NQ
2012
   15.618215   16.856739   7.93%   40,160
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2 - Q/NQ
2012
   11.653935   12.743149   9.35%   0
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class 2 - Q/NQ
2012
   11.629948   12.886464   10.80%   0
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class 2 - Q/NQ
2012
   11.331155   12.789803   12.87%   0
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2 - Q/NQ
2012
   15.248274   15.650026   2.63%   197
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Service Class 2 - Q/NQ
2012
   14.226743   16.319340   14.71%   0
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Service Class 2 - Q/NQ
2012
   14.382815   16.124534   12.11%   25,499
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class 2 - Q/NQ
2012
   12.886699   13.336017   3.49%   0
35
Additional Contract Options Elected Total - 2.00%
Variable account charges of the daily net assets of the variable account - 2.00%
Period   Beginning Value   Ending Value   Percentage Change   Units
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class 2 - Q/NQ
2012
   22.404753   25.152950   12.27%   0
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class 2R - Q/NQ
2012
   10.296645   12.153747   18.04%   0
Franklin Templeton Variable Insurance Products Trust - Franklin Income Securities Fund: Class 2 - Q/NQ
2012
   11.420312   12.607377   10.39%   0
Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value Securities Fund: Class 2 - Q/NQ
2012
   20.017536   23.223340   16.01%   137
Franklin Templeton Variable Insurance Products Trust - Franklin Templeton VIP Founding Funds Allocation Fund: Class 2 - Q/NQ
2012
   8.739564   9.877544   13.02%   10,389
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond Securities Fund: Class 3 - Q/NQ
2012
   15.472452   17.445911   12.75%   0
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Markets Navigator Fund: Service Shares - Q/NQ
2012*
   10.000000   10.174559   1.75%   0
Huntington VA Funds - Huntington VA International Equity Fund - Q/NQ
2012
   8.929610   9.978802   11.75%   0
Huntington VA Funds - Huntington VA Situs Fund - Q/NQ
2012
   10.950060   13.158540   20.17%   0
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series II - Q/NQ
2012*
   10.000000   9.911560   -0.88%   0
Ivy Funds Variable Insurance Portfolios - Asset Strategy - Q/NQ
2012
   11.434104   13.353591   16.79%   4,709
Ivy Funds Variable Insurance Portfolios - High Income - Q/NQ
2012*
   10.000000   10.764030   7.64%   8,063
Ivy Funds Variable Insurance Portfolios - Mid Cap Growth - Q/NQ
2012*
   10.000000   10.020404   0.20%   0
Janus Aspen Series - Forty Portfolio: Service Shares - Q/NQ
2012
   16.841270   20.441302   21.38%   0
Janus Aspen Series - Global Technology Portfolio: Service Shares - Q/NQ
2012*
   10.000000   9.912337   -0.88%   0
Janus Aspen Series - Overseas Portfolio: Service Shares - Q/NQ
2012
   25.942858   28.773624   10.91%   0
36
Additional Contract Options Elected Total - 2.00%
Variable account charges of the daily net assets of the variable account - 2.00%
Period   Beginning Value   Ending Value   Percentage Change   Units
MFS® Variable Insurance Trust - MFS New Discovery Series: Service Class - Q/NQ
2012*
   10.000000   10.179611   1.80%   0
MFS® Variable Insurance Trust - MFS Value Series: Service Class - Q/NQ
2012
   16.050085   18.226412   13.56%   84
MFS® Variable Insurance Trust II - MFS International Value Portfolio: Service Class - Q/NQ
2012
   10.299191   11.700669   13.61%   265
Nationwide Variable Insurance Trust - American Century NVIT Growth Fund: Class II - Q/NQ
2012
   9.037179   10.076431   11.50%   0
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class II - Q/NQ
2012
   13.523452   15.166777   12.15%   0
Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II - Q/NQ
2012
   9.791710   11.103511   13.40%   9,179
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II - Q/NQ
2012
   10.963430   11.277224   2.86%   0
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II - Q/NQ
2012
   9.698831   11.603661   19.64%   2
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II - Q/NQ
2012
   9.020713   10.378207   15.05%   6
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II - Q/NQ
2012
   7.905590   9.069012   14.72%   0
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class III - Q/NQ
2012
   12.970799   14.580316   12.41%   58,810
Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class II - Q/NQ
2012
   14.328796   16.593071   15.80%   0
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class II - Q/NQ
2012
   7.462924   8.544554   14.49%   0
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class II - Q/NQ
2012
   8.999172   9.822647   9.15%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Aggressive Fund: Class II - Q/NQ
2012
   8.280415   9.425192   13.83%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class II - Q/NQ
2012
   9.682343   10.537733   8.83%   0
37
Additional Contract Options Elected Total - 2.00%
Variable account charges of the daily net assets of the variable account - 2.00%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Capital Appreciation Fund: Class II - Q/NQ
2012
   9.084214   10.116615   11.36%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class II - Q/NQ
2012
   10.400470   10.956237   5.34%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class II - Q/NQ
2012
   9.387965   10.337789   10.12%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Aggressive Fund: Class II - Q/NQ
2012
   8.753487   9.829209   12.29%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class II - Q/NQ
2012
   9.948976   10.728763   7.84%   0
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II - Q/NQ
2012
   11.351786   11.956622   5.33%   0
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class II - Q/NQ
2012
   12.309376   12.921209   4.97%   0
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class VI - Q/NQ
2012
   16.477568   18.878910   14.57%   0
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - Q/NQ
2012
   12.515767   12.639749   0.99%   0
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class VI - Q/NQ
2012
   6.733779   7.603572   12.92%   0
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class VIII - Q/NQ
2012
   7.326348   8.487033   15.84%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II - Q/NQ
2012
   15.689283   17.819897   13.58%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II - Q/NQ
2012
   12.219870   13.098884   7.19%   11,524
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II - Q/NQ
2012
   12.834965   14.118461   10.00%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II - Q/NQ
2012
   12.302669   12.679994   3.07%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II - Q/NQ
2012
   14.267335   15.492993   8.59%   0
38
Additional Contract Options Elected Total - 2.00%
Variable account charges of the daily net assets of the variable account - 2.00%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II - Q/NQ
2012
   15.222735   16.970293   11.48%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II - Q/NQ
2012
   13.450525   14.240613   5.87%   0
Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class II - Q/NQ
2012
   13.072444   15.170352   16.05%   0
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I - Q/NQ
2012
   19.887711   22.894411   15.12%   2
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I - Q/NQ
2012
   9.721147   9.526205   -2.01%   4,471
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I - Q/NQ
2012
   13.264856   14.591290   10.00%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class VI - Q/NQ
2012
   7.961507   9.012807   13.20%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class VI - Q/NQ
2012
   8.559930   9.809898   14.60%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class II - Q/NQ
2012
   8.528738   9.706761   13.81%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class II - Q/NQ
2012
   7.952786   9.164345   15.23%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class II - Q/NQ
2012
   8.915007   10.015678   12.35%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II - Q/NQ
2012
   9.567551   10.908304   14.01%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class II - Q/NQ
2012
   13.512761   14.975638   10.83%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class II - Q/NQ
2012
   18.863996   22.239445   17.89%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class II - Q/NQ
2012
   18.361916   20.733729   12.92%   0
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class II - Q/NQ
2012
   13.302572   14.841038   11.57%   0
39
Additional Contract Options Elected Total - 2.00%
Variable account charges of the daily net assets of the variable account - 2.00%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class II - Q/NQ
2012
   9.407227   10.655105   13.27%   25,730
Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II - Q/NQ
2012
   10.261206   10.409778   1.45%   6
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class III - Q/NQ
2012
   11.502750   13.477526   17.17%   0
Northern Lights Variable Trust - TOPS Protected Balanced ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.138231   1.38%   0
Northern Lights Variable Trust - TOPS Protected Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.256891   2.57%   0
Northern Lights Variable Trust - TOPS Protected Moderate Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.274529   2.75%   0
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Class 4 - Q/NQ
2012
   12.463084   14.772635   18.53%   0
Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Service Shares - Q/NQ
2012
   13.896643   15.879991   14.27%   0
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Service Shares - Q/NQ
2012
   19.291662   22.245507   15.31%   1
PIMCO Variable Insurance Trust - All Asset Portfolio: Advisor Class - Q/NQ
2012*
   10.000000   10.574216   5.74%   0
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Advisor Class - Q/NQ
2012
   12.321835   12.706539   3.12%   0
PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class - Q/NQ
2012
   11.121145   11.524803   3.63%   3,490
PIMCO Variable Insurance Trust - Total Return Portfolio: Advisor Class - Q/NQ
2012
   9.956927   10.684266   7.30%   52,704
T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II - Q/NQ
2012
   11.353689   14.575218   28.37%   0
Van Eck VIP Trust - Van Eck VIP Global Hard Assets Fund: Service Class - Q/NQ
2012*
   10.000000   9.594282   -4.06%   0
Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2 - Q/NQ
2012
   14.844951   15.692372   5.71%   0
40
Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein Small/Mid Cap Value Portfolio: Class B - Q/NQ
2012
   19.364694   22.458355   15.98%   0
AllianceBernstein Variable Products Series Fund, Inc. - AllianceBernstein VPS Dynamic Asset Allocation Portfolio: Class B - Q/NQ
2012*
   10.000000   10.099288   0.99%   9,102
American Century Variable Portfolios II, Inc. - American Century VP Inflation Protection Fund: Class II - Q/NQ
2012
   13.288066   13.969137   5.13%   7,213
American Century Variable Portfolios, Inc. - American Century VP Mid Cap Value Fund: Class II - Q/NQ
2012
   13.311218   15.145649   13.78%   67
American Funds Insurance Series® - Protected Asset Allocation Fund: Class P2 - Q/NQ
2012*
   10.000000   10.106422   1.06%   0
BlackRock Variable Series Funds, Inc. - BlackRock Global Allocation V.I. Fund: Class III - Q/NQ
2012
   12.171792   13.103201   7.65%   7,361
Dreyfus Investment Portfolios - Small Cap Stock Index Portfolio: Service Shares - Q/NQ
2012
   19.835131   22.474371   13.31%   1,317
Dreyfus Stock Index Fund, Inc.: Service Shares - Q/NQ
2012
   14.303996   16.169811   13.04%   2,854
Dreyfus Variable Investment Fund - Appreciation Portfolio: Service Shares - Q/NQ
2012
   15.477413   16.687695   7.82%   149
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2010 Portfolio: Service Class 2 - Q/NQ
2012
   11.574966   12.643856   9.23%   0
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2020 Portfolio: Service Class 2 - Q/NQ
2012
   11.551050   12.785948   10.69%   0
Fidelity Variable Insurance Products Fund - Fidelity VIP Freedom Fund 2030 Portfolio: Service Class 2 - Q/NQ
2012
   11.254305   12.690069   12.76%   0
Fidelity Variable Insurance Products Fund - VIP Energy Portfolio: Service Class 2 - Q/NQ
2012
   15.144867   15.527989   2.53%   3,097
Fidelity Variable Insurance Products Fund - VIP Equity-Income Portfolio: Service Class 2 - Q/NQ
2012
   14.098424   16.155606   14.59%   2,556
Fidelity Variable Insurance Products Fund - VIP Growth Portfolio: Service Class 2 - Q/NQ
2012
   14.253099   15.962768   12.00%   619
Fidelity Variable Insurance Products Fund - VIP Investment Grade Bond Portfolio: Service Class 2 - Q/NQ
2012
   12.770479   13.202218   3.38%   14,528
41
Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
Fidelity Variable Insurance Products Fund - VIP Mid Cap Portfolio: Service Class 2 - Q/NQ
2012
   22.202713   24.900640   12.15%   40
Fidelity Variable Insurance Products Fund - VIP Overseas Portfolio: Service Class 2R - Q/NQ
2012
   10.216457   12.046769   17.92%   0
Franklin Templeton Variable Insurance Products Trust - Franklin Income Securities Fund: Class 2 - Q/NQ
2012
   11.354426   12.521814   10.28%   0
Franklin Templeton Variable Insurance Products Trust - Franklin Small Cap Value Securities Fund: Class 2 - Q/NQ
2012
   19.837005   22.990371   15.90%   234
Franklin Templeton Variable Insurance Products Trust - Franklin Templeton VIP Founding Funds Allocation Fund: Class 2 - Q/NQ
2012
   8.706930   9.830592   12.91%   0
Franklin Templeton Variable Insurance Products Trust - Templeton Global Bond Securities Fund: Class 3 - Q/NQ
2012
   15.367574   17.309916   12.64%   2,828
Goldman Sachs Variable Insurance Trust - Goldman Sachs Global Markets Navigator Fund: Service Shares - Q/NQ
2012*
   10.000000   10.167635   1.68%   0
Huntington VA Funds - Huntington VA International Equity Fund - Q/NQ
2012
   8.919009   9.956762   11.64%   0
Huntington VA Funds - Huntington VA Situs Fund - Q/NQ
2012
   10.937073   13.129492   20.05%   0
Invesco - Invesco V.I. Mid Cap Core Equity Fund: Series II - Q/NQ
2012*
   10.000000   9.904825   -0.95%   2,581
Ivy Funds Variable Insurance Portfolios - Asset Strategy - Q/NQ
2012
   11.403036   13.303702   16.67%   3,449
Ivy Funds Variable Insurance Portfolios - High Income - Q/NQ
2012*
   10.000000   10.756707   7.57%   2,202
Ivy Funds Variable Insurance Portfolios - Mid Cap Growth - Q/NQ
2012*
   10.000000   10.013576   0.14%   119
Janus Aspen Series - Forty Portfolio: Service Shares - Q/NQ
2012
   16.689381   20.236256   21.25%   91
Janus Aspen Series - Global Technology Portfolio: Service Shares - Q/NQ
2012*
   10.000000   9.905487   -0.95%   0
Janus Aspen Series - Overseas Portfolio: Service Shares - Q/NQ
2012
   25.708882   28.484938   10.80%   0
42
Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
MFS® Variable Insurance Trust - MFS New Discovery Series: Service Class - Q/NQ
2012*
   10.000000   10.172689   1.73%   84
MFS® Variable Insurance Trust - MFS Value Series: Service Class - Q/NQ
2012
   15.905352   18.043582   13.44%   0
MFS® Variable Insurance Trust II - MFS International Value Portfolio: Service Class - Q/NQ
2012
   10.281748   11.668920   13.49%   1,868
Nationwide Variable Insurance Trust - American Century NVIT Growth Fund: Class II - Q/NQ
2012
   9.031059   10.059319   11.39%   4,552
Nationwide Variable Insurance Trust - American Century NVIT Multi Cap Value Fund: Class II - Q/NQ
2012
   13.486709   15.110100   12.04%   1,519
Nationwide Variable Insurance Trust - American Funds NVIT Asset Allocation Fund: Class II - Q/NQ
2012
   9.735254   11.028213   13.28%   23,351
Nationwide Variable Insurance Trust - American Funds NVIT Bond Fund: Class II - Q/NQ
2012
   10.900226   11.200755   2.76%   2,871
Nationwide Variable Insurance Trust - American Funds NVIT Global Growth Fund: Class II - Q/NQ
2012
   9.642894   11.524943   19.52%   74
Nationwide Variable Insurance Trust - American Funds NVIT Growth Fund: Class II - Q/NQ
2012
   8.968657   10.307778   14.93%   0
Nationwide Variable Insurance Trust - American Funds NVIT Growth-Income Fund: Class II - Q/NQ
2012
   7.868002   9.016676   14.60%   8,227
Nationwide Variable Insurance Trust - Federated NVIT High Income Bond Fund: Class III - Q/NQ
2012
   12.882880   14.466680   12.29%   0
Nationwide Variable Insurance Trust - Invesco NVIT Comstock Value Fund: Class II - Q/NQ
2012
   14.199541   16.426574   15.68%   1,874
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Multi Cap Opportunities Fund: Class II - Q/NQ
2012
   7.435009   8.503886   14.38%   0
Nationwide Variable Insurance Trust - Neuberger Berman NVIT Socially Responsible Fund: Class II - Q/NQ
2012
   8.965523   9.775903   9.04%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Aggressive Fund: Class II - Q/NQ
2012
   8.249469   9.380363   13.71%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Balanced Fund: Class II - Q/NQ
2012
   9.646172   10.487632   8.72%   0
43
Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Capital Appreciation Fund: Class II - Q/NQ
2012
   9.050311   10.068560   11.25%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Conservative Fund: Class II - Q/NQ
2012
   10.361633   10.904150   5.24%   2,682
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderate Fund: Class II - Q/NQ
2012
   9.352918   10.288671   10.00%   1,749
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Aggressive Fund: Class II - Q/NQ
2012
   8.720778   9.782469   12.17%   0
Nationwide Variable Insurance Trust - NVIT Cardinal(SM) Moderately Conservative Fund: Class II - Q/NQ
2012
   9.911812   10.677747   7.73%   0
Nationwide Variable Insurance Trust - NVIT Core Bond Fund: Class II - Q/NQ
2012
   11.309423   11.899810   5.22%   0
Nationwide Variable Insurance Trust - NVIT Core Plus Bond Fund: Class II - Q/NQ
2012
   12.263446   12.859829   4.86%   13,332
Nationwide Variable Insurance Trust - NVIT Emerging Markets Fund: Class VI - Q/NQ
2012
   16.349230   18.712714   14.46%   1,169
Nationwide Variable Insurance Trust - NVIT Government Bond Fund: Class I - Q/NQ
2012
   12.402888   12.512938   0.89%   0
Nationwide Variable Insurance Trust - NVIT International Equity Fund: Class VI - Q/NQ
2012
   6.708630   7.567435   12.80%   0
Nationwide Variable Insurance Trust - NVIT International Index Fund: Class VIII - Q/NQ
2012
   7.284044   8.429405   15.72%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Aggressive Fund: Class II - Q/NQ
2012
   15.547767   17.641099   13.46%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Balanced Fund: Class II - Q/NQ
2012
   12.186662   13.049928   7.08%   4,089
Nationwide Variable Insurance Trust - NVIT Investor Destinations Capital Appreciation Fund: Class II - Q/NQ
2012
   12.800099   14.065705   9.89%   5,747
Nationwide Variable Insurance Trust - NVIT Investor Destinations Conservative Fund: Class II - Q/NQ
2012
   12.191753   12.552822   2.96%   4,716
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderate Fund: Class II - Q/NQ
2012
   14.138667   15.337575   8.48%   11,672
44
Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Aggressive Fund: Class II - Q/NQ
2012
   15.085484   16.800084   11.37%   0
Nationwide Variable Insurance Trust - NVIT Investor Destinations Moderately Conservative Fund: Class II - Q/NQ
2012
   13.329259   14.097796   5.77%   938
Nationwide Variable Insurance Trust - NVIT Large Cap Growth Fund: Class II - Q/NQ
2012
   13.036939   15.113690   15.93%   993
Nationwide Variable Insurance Trust - NVIT Mid Cap Index Fund: Class I - Q/NQ
2012
   19.708343   22.664722   15.00%   803
Nationwide Variable Insurance Trust - NVIT Money Market Fund: Class I - Q/NQ
2012
   9.633102   9.430266   -2.11%   0
Nationwide Variable Insurance Trust - NVIT Multi Sector Bond Fund: Class I - Q/NQ
2012
   13.145245   14.444925   9.89%   2,435
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Growth Fund: Class VI - Q/NQ
2012
   7.931754   8.969949   13.09%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager International Value Fund: Class VI - Q/NQ
2012
   8.493214   9.723482   14.49%   0
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Growth Fund: Class II - Q/NQ
2012
   8.496867   9.660589   13.70%   1,855
Nationwide Variable Insurance Trust - NVIT Multi-Manager Large Cap Value Fund: Class II - Q/NQ
2012
   7.923076   9.120782   15.12%   1,650
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Growth Fund: Class II - Q/NQ
2012
   8.881687   9.968046   12.23%   1,520
Nationwide Variable Insurance Trust - NVIT Multi-Manager Mid Cap Value Fund: Class II - Q/NQ
2012
   9.531795   10.856424   13.90%   1,387
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Growth Fund: Class II - Q/NQ
2012
   13.390907   14.825411   10.71%   1,356
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Cap Value Fund: Class II - Q/NQ
2012
   18.693871   22.016351   17.77%   925
Nationwide Variable Insurance Trust - NVIT Multi-Manager Small Company Fund: Class II - Q/NQ
2012
   18.196320   20.525741   12.80%   0
Nationwide Variable Insurance Trust - NVIT Nationwide Fund: Class II - Q/NQ
2012
   13.182567   14.692112   11.45%   0
45
Maximum Additional Contract Options Elected Total - 2.10%
Variable account charges of the daily net assets of the variable account - 2.10%
Period   Beginning Value   Ending Value   Percentage Change   Units
Nationwide Variable Insurance Trust - NVIT Real Estate Fund: Class II - Q/NQ
2012
   9.372044   10.604401   13.15%   6,108
Nationwide Variable Insurance Trust - NVIT Short Term Bond Fund: Class II - Q/NQ
2012
   10.222898   10.360309   1.34%   15,540
Nationwide Variable Insurance Trust - Templeton NVIT International Value Fund: Class III - Q/NQ
2012
   11.471486   13.427157   17.05%   0
Northern Lights Variable Trust - TOPS Protected Balanced ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.136567   1.37%   0
Northern Lights Variable Trust - TOPS Protected Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.255208   2.55%   0
Northern Lights Variable Trust - TOPS Protected Moderate Growth ETF Portfolio: Class 4 - Q/NQ
2012*
   10.000000   10.272839   2.73%   0
Oppenheimer Variable Account Funds - Oppenheimer Global Fund/VA: Class 4 - Q/NQ
2012
   12.365987   14.642563   18.41%   2,642
Oppenheimer Variable Account Funds - Oppenheimer Main Street Fund®/VA: Service Shares - Q/NQ
2012
   13.771324   15.720688   14.16%   0
Oppenheimer Variable Account Funds - Oppenheimer Main Street Small Cap Fund®/VA: Service Shares - Q/NQ
2012
   19.117619   22.022269   15.19%   328
PIMCO Variable Insurance Trust - All Asset Portfolio: Advisor Class - Q/NQ
2012*
   10.000000   10.567028   5.67%   11,964
PIMCO Variable Insurance Trust - Foreign Bond Portfolio (Unhedged): Advisor Class - Q/NQ
2012
   12.288357   12.659052   3.02%   6,665
PIMCO Variable Insurance Trust - Low Duration Portfolio: Advisor Class - Q/NQ
2012
   11.090916   11.481716   3.52%   7,454
PIMCO Variable Insurance Trust - Total Return Portfolio: Advisor Class - Q/NQ
2012
   9.950190   10.666107   7.20%   16,121
T. Rowe Price Equity Series, Inc. - T. Rowe Price Health Sciences Portfolio: II - Q/NQ
2012
   11.334453   14.535657   28.24%   821
Van Eck VIP Trust - Van Eck VIP Global Hard Assets Fund: Service Class - Q/NQ
2012*
   10.000000   9.587752   -4.12%   2,918
Wells Fargo Advantage Variable Trust - Wells Fargo Advantage VT Small Cap Growth Fund: Class 2 - Q/NQ
2012
   14.737338   15.562679   5.60%   64
46

Table of Contents

Report of Independent Registered Public Accounting Firm

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

Contract Owners of Nationwide Variable Account-II:

We have audited the accompanying statement of assets, liabilities and contract owners’ equity of Nationwide Variable Account-II (comprised of the sub-accounts listed in note 1(b), (collectively, “the Accounts”)) as of December 31, 2012, and the related statements of operations for the period then ended, the statements of changes in contract owners’ equity for each of the periods in the two-year period then ended, and the financial highlights for each of the periods in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Accounts’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2012, 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, 2012, 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, 2013

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2012

 

Assets:

         

Investments at fair value:

      

Mid Cap Growth Portfolio - Class S Shares (ALMCS)

      
   30,830 shares (cost $377,905)    $      402,333    

VPS Dynamic Asset Allocation Portfolio - Class B (ALVDAB)

      
   189,632 shares (cost $1,929,673)         1,991,133    

Growth Fund - Class 1 (AFGF)

      
   175,988 shares (cost $9,065,122)         10,717,694    

High-Income Bond Fund - Class 1 (AFHY)

      
   175,356 shares (cost $2,047,088)         1,956,975    

Protected Asset Allocation Fund - Class P2 (AVPAP2)

      
   1,317,344 shares (cost $13,151,460)         13,160,266    

U.S. Government/AAA-Rated Securities Fund - Class 1 (AFGC)

      
   85,939 shares (cost $1,027,837)         1,095,723    

Global Allocation V.I. Fund - Class III (MLVGA3)

      
   10,740,278 shares (cost $150,693,253)         154,015,587    

Money Market Portfolio(TM) (CHSMM)

      
   10,825,862 shares (cost $10,825,862)         10,825,862    

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

      
   6,563,894 shares (cost $180,816,562)         209,125,650    

Stock Index Fund, Inc. - Service Shares (DSIFS)

      
   4,110,567 shares (cost $119,103,534)         131,127,102    

The Dreyfus Socially Responsible Growth Fund, Inc. - Initial Shares (DSRG)

      
   1,153,068 shares (cost $25,521,824)         38,327,993    

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

      
   55,111 shares (cost $557,826)         570,952    

VA International Equity Fund (HVIE)

      
   651,608 shares (cost $8,732,696)         9,272,386    

VA Situs Fund (HVSIT)

      
   1,224,664 shares (cost $19,014,465)         22,301,138    

V.I. Mid Cap Core Equity - Series II Shares (IVMCC2)

      
   121,297 shares (cost $1,467,691)         1,525,916    

Van Kampen V.I. Mid Cap Growth Fund - Series II Shares (IVKMG2)

      
   5,472,892 shares (cost $21,735,512)         21,399,009    

Mid Cap Value Portfolio: Class 1 (JPMMV1)

      
   1,258,108 shares (cost $7,890,878)         10,278,740    

Janus Aspen Series - Balanced Portfolio - Service Shares (JABS)

      
   413,769 shares (cost $11,407,835)         11,759,305    

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

      
   3,507,175 shares (cost $115,105,723)         141,269,002    

Janus Aspen Series - Global Technology Portfolio - Service Shares (JAGTS)

      
   2,812,013 shares (cost $17,148,299)         17,321,998    

Janus Aspen Series - Overseas Portfolio - Service Shares (JAIGS)

      
   2,172,626 shares (cost $88,333,265)         80,452,325    

Investors Growth Stock Series - Service Class (MIGSC)

      
   689,032 shares (cost $6,782,013)         8,220,147    

New Discovery Series - Service Class (MNDSC)

      
   169,998 shares (cost $2,504,954)         2,551,667    

Value Series - Service Class (MVFSC)

      
   21,709,921 shares (cost $227,068,630)         308,715,081    

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

      
   4,543,220 shares (cost $70,598,545)         77,870,796    

Core Plus Fixed Income Portfolio - Class I (MSVFI)

      
   133,517 shares (cost $1,361,607)         1,420,626    

Core Plus Fixed Income Portfolio - Class II (MSVF2)

      
   1,747,536 shares (cost $16,748,641)         18,558,828    

Emerging Markets Debt Portfolio - Class I (MSEM)

      
   356,506 shares (cost $2,776,389)         3,393,937    

Emerging Markets Debt Portfolio - Class II (MSEMB)

      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2012

 

   106,359 shares (cost $823,865)         1,006,158    

Global Real Estate Portfolio - Class II (VKVGR2)

      
   6,310 shares (cost $55,539)         59,696    

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

      
   2,202 shares (cost $29,627)         34,326    

U.S. Real Estate Portfolio - Class II (MSVREB)

      
   310 shares (cost $4,805)         4,817    

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

      
   3,206,557 shares (cost $44,967,576)         48,932,065    

American Century NVIT Multi Cap Value Fund - Class II (NVAMV2)

      
   9,388,734 shares (cost $131,160,518)         142,802,648    

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

      
   193,104,058 shares (cost $3,224,873,843)         3,804,149,948    

American Funds NVIT Bond Fund - Class II (GVABD2)

      
   105,420,379 shares (cost $1,149,322,625)         1,236,581,042    

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

      
   6,003,601 shares (cost $122,235,986)         142,585,522    

American Funds NVIT Growth Fund - Class II (GVAGR2)

      
   3,751,208 shares (cost $197,549,748)         226,798,034    

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

      
   30,395,163 shares (cost $1,019,518,210)         1,257,447,875    

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

      
   876,361 shares (cost $5,971,686)         6,046,891    

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

      
   14,639,511 shares (cost $99,492,095)         101,012,627    

NVIT Emerging Markets Fund - Class I (GEM)

      
   17,692 shares (cost $187,441)         209,644    

NVIT Emerging Markets Fund - Class II (GEM2)

      
   92,791 shares (cost $1,043,139)         1,087,515    

NVIT Emerging Markets Fund - Class III (GEM3)

      
   1,877,097 shares (cost $19,791,346)         22,206,053    

NVIT Emerging Markets Fund - Class VI (GEM6)

      
   4,437,243 shares (cost $46,824,085)         52,315,092    

NVIT International Equity Fund - Class I (GIG)

      
   4,144 shares (cost $36,984)         38,002    

NVIT International Equity Fund - Class III (GIG3)

      
   2,666,646 shares (cost $19,795,389)         24,479,807    

Variable Insurance Trust: NVIT International Equity Fund - Class VI (NVIE6)

      
   2,684,217 shares (cost $21,979,304)         24,533,748    

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

      
   8,451,727 shares (cost $66,190,528)         70,487,404    

Neuberger Berman NVIT Multi Cap Opportunities Fund - Class II (NVNMO2)

      
   2,917,280 shares (cost $24,954,795)         24,155,079    

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

      
   218,014 shares (cost $2,380,341)         2,387,258    

Neuberger Berman NVIT Socially Responsible Fund - Class II (NVNSR2)

      
   13,918,120 shares (cost $111,493,619)         152,403,419    

NVIT Cardinal Aggressive Fund - Class II (NVCRA2)

      
   3,157,262 shares (cost $27,787,530)         28,162,773    

NVIT Cardinal Balanced Fund - Class II (NVCRB2)

      
   144,857,106 shares (cost $1,410,863,789)         1,561,559,598    

NVIT Cardinal Capital Appreciation Fund - Class II (NVCCA2)

      
   229,904,784 shares (cost $2,161,945,094)         2,418,598,331    

NVIT Cardinal Conservative Fund - Class II (NVCCN2)

      
   71,128,008 shares (cost $739,183,020)         761,069,688    

NVIT Cardinal Moderate Fund - Class II (NVCMD2)

      
   211,115,987 shares (cost $2,023,015,209)         2,246,274,100    

NVIT Cardinal Moderately Aggressive Fund - Class II (NVCMA2)

      
   36,485,947 shares (cost $307,740,661)         369,237,784    

NVIT Cardinal Moderately Conservative Fund - Class II (NVCMC2)

      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2012

 

   66,961,074 shares (cost $670,483,053)         723,179,604    

NVIT Core Bond Fund - Class I (NVCBD1)

      
   290,853 shares (cost $3,236,273)         3,289,545    

NVIT Core Bond Fund - Class II (NVCBD2)

      
   10,585,887 shares (cost $111,386,613)         119,408,802    

NVIT Core Plus Bond Fund - Class II (NVLCP2)

      
   4,123,554 shares (cost $47,122,172)         48,657,938    

NVIT Nationwide Fund - Class I (TRF)

      
   11,753,526 shares (cost $116,063,123)         119,768,429    

NVIT Nationwide Fund - Class II (TRF2)

      
   14,672,006 shares (cost $109,524,024)         148,920,863    

NVIT Government Bond Fund - Class I (GBF)

      
   31,686,225 shares (cost $375,580,308)         368,510,793    

American Century NVIT Growth Fund - Class I (CAF)

      
   2,063,831 shares (cost $19,558,942)         32,195,760    

American Century NVIT Growth Fund -Class II (CAF2)

      
   2,278,123 shares (cost $21,918,235)         23,350,759    

NVIT International Index Fund - Class VIII (GVIX8)

      
   2,426,248 shares (cost $19,675,697)         20,283,435    

NVIT Investor Destinations Aggressive Fund - Class II (GVIDA)

      
   22,961,895 shares (cost $234,380,030)         229,389,328    

NVIT Investor Destinations Balanced Fund - Class II (NVDBL2)

      
   53,153,451 shares (cost $682,943,910)         725,544,610    

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

      
   78,444,600 shares (cost $1,095,105,878)         1,182,944,569    

NVIT Investor Destinations Conservative Fund - Class II (GVIDC)

      
   64,632,587 shares (cost $649,262,989)         672,178,900    

NVIT Investor Destinations Moderate Fund - Class II (GVIDM)

      
   217,051,655 shares (cost $2,402,089,607)         2,444,001,632    

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

      
   105,707,441 shares (cost $1,206,002,534)         1,179,695,047    

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

      
   72,333,513 shares (cost $761,240,884)         794,945,313    

NVIT Mid Cap Index Fund - Class I (MCIF)

      
   5,556,132 shares (cost $95,745,554)         105,733,198    

NVIT Money Market Fund - Class I (SAM)

      
   669,958,479 shares (cost $669,958,479)         669,958,479    

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

      
   3,340,195 shares (cost $25,683,601)         33,602,357    

NVIT Multi-Manager International Growth Fund - Class VI (NVMIG6)

      
   16,063,480 shares (cost $126,754,742)         161,277,337    

NVIT Multi-Manager International Value Fund - Class II (GVDIV2)

      
   53,082 shares (cost $716,681)         517,549    

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

      
   520,232 shares (cost $5,092,851)         5,067,064    

NVIT Multi-Manager International Value Fund - Class VI (GVDIV6)

      
   6,220,136 shares (cost $55,895,385)         60,210,912    

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

      
   872,211 shares (cost $8,198,672)         9,193,101    

NVIT Multi-Manager Large Cap Growth Fund - Class II (NVMLG2)

      
   10,141,040 shares (cost $87,663,389)         106,379,509    

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

      
   342,394 shares (cost $3,038,553)         3,208,227    

NVIT Multi-Manager Large Cap Value Fund - Class II (NVMLV2)

      
   5,182,244 shares (cost $42,655,835)         48,453,978    

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

      
   16,225,738 shares (cost $125,704,624)         172,641,852    

NVIT Multi-Manager Mid Cap Growth Fund - Class II (NVMMG2)

      
   11,329,158 shares (cost $92,399,663)         118,956,160    

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

      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2012

 

   24,879,299 shares (cost $216,958,742)         257,003,156    

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

      
   380,035 shares (cost $6,364,840)         6,608,810    

NVIT Multi-Manager Small Cap Growth Fund - Class II (SCGF2)

      
   1,033,254 shares (cost $16,521,712)         17,492,995    

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

      
   2,738,156 shares (cost $29,427,823)         32,310,236    

NVIT Multi-Manager Small Cap Value Fund - Class II (SCVF2)

      
   2,023,781 shares (cost $16,948,604)         23,536,572    

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

      
   3,610,444 shares (cost $69,027,482)         70,656,395    

NVIT Multi-Manager Small Company Fund - Class II (SCF2)

      
   2,266,994 shares (cost $32,847,063)         43,231,578    

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

      
   17,876,958 shares (cost $154,026,999)         169,652,329    

NVIT Short Term Bond Fund - Class II (NVSTB2)

      
   7,426,666 shares (cost $77,046,341)         78,202,798    

NVIT Large Cap Growth Fund - Class I (NVOLG1)

      
   19,001,754 shares (cost $287,921,278)         328,920,360    

NVIT Large Cap Growth Fund - Class II (NVOLG2)

      
   12,999,503 shares (cost $196,531,644)         224,501,419    

Templeton NVIT International Value Fund - Class III (NVTIV3)

      
   20,001,622 shares (cost $232,566,289)         244,219,803    

Van Kampen NVIT Comstock Value Fund - Class II (EIF2)

      
   11,725,441 shares (cost $100,721,410)         133,201,014    

NVIT Real Estate Fund - Class I (NVRE1)

      
   6,830,725 shares (cost $50,443,393)         64,686,965    

NVIT Real Estate Fund - Class II (NVRE2)

      
   7,384,703 shares (cost $61,154,831)         69,637,748    

TOPS Protected Balanced ETF Portfolio - Class 4 (NOTB4)

      
   26,571 shares (cost $283,597)         284,047    

TOPS Protected Growth ETF Portfolio - Class 4 (NOTG4)

      
   14,727 shares (cost $151,795)         151,394    

TOPS Protected Moderate Growth ETF Portfolio - Class 4 (NOTMG4)

      
   7,195 shares (cost $77,151)         77,058    

VPS Balanced Wealth Strategy Portfolio - Class B (ALVBWB)

      
   15,643 shares (cost $179,049)         187,871    

VPS Growth and Income Portfolio - Class B (ALVGIB)

      
   299,833 shares (cost $6,083,776)         6,194,556    

VPS Small/Mid Cap Value Portfolio: Class B (ALVSVB)

      
   3,556,661 shares (cost $54,795,112)         62,526,105    

VP Balanced Fund - Class I (ACVB)

      
   4,850,069 shares (cost $31,629,884)         34,580,989    

VP Capital Appreciation Fund - Class I (ACVCA)

      
   4,894 shares (cost $54,396)         71,166    

VP Income & Growth Fund - Class I (ACVIG)

      
   2,034,945 shares (cost $13,316,212)         14,041,119    

VP Income & Growth Fund - Class II (ACVIG2)

      
   626,496 shares (cost $4,099,141)         4,322,820    

American Century VP Inflation Protection Fund - Class II (ACVIP2)

      
   23,288,387 shares (cost $257,438,128)         280,159,299    

VP International Fund - Class I (ACVI)

      
   1,301 shares (cost $11,453)         11,618    

VP International Fund - Class III (ACVI3)

      
   10 shares (cost $87)         92    

VP Mid Cap Value Fund - Class I (ACVMV1)

      
   499,336 shares (cost $6,776,945)         7,280,325    

VP Mid Cap Value Fund - Class II (ACVMV2)

      
   5,519,737 shares (cost $69,225,595)         80,532,956    

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

      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2012

 

   263 shares (cost $3,021)         4,580    

Small Cap Stock Index Portfolio - Service Shares (DVSCS)

      
   6,194,751 shares (cost $65,464,740)         84,000,819    

Appreciation Portfolio - Initial Shares (DCAP)

      
   882,512 shares (cost $31,113,875)         35,715,258    

Appreciation Portfolio - Service Shares (DCAPS)

      
   2,619,534 shares (cost $93,809,518)         105,436,254    

Opportunistic Small Cap Portfolio: Service Shares (DVDLS)

      
   38,187 shares (cost $929,754)         1,188,758    

Growth and Income Portfolio - Initial Shares (DGI)

      
   590,414 shares (cost $12,194,049)         13,030,435    

Managed Tail Risk Fund II: Service Shares (FCA2S)

      
   211,199 shares (cost $1,232,239)         1,322,109    

Quality Bond Fund II - Primary Shares (FQB)

      
   962,434 shares (cost $10,390,924)         11,356,717    

Quality Bond Fund II - Service Shares (FQBS)

      
   3,201,760 shares (cost $34,703,019)         37,620,678    

Equity-Income Portfolio - Initial Class (FEIP)

      
   16,532,245 shares (cost $377,083,479)         329,652,958    

VIP Value Strategies Portfolio - Service Class 2 (FVSS2)

      
   808,340 shares (cost $6,505,910)         9,037,240    

High Income Portfolio - Initial Class (FHIP)

      
   8,679,576 shares (cost $47,812,770)         50,428,335    

VIP Asset Manager Portfolio - Initial Class (FAMP)

      
   9,072,042 shares (cost $126,139,013)         137,622,875    

VIP Energy Portfolio - Service Class 2 (FNRS2)

      
   3,815,697 shares (cost $71,517,125)         74,215,310    

VIP Equity-Income Portfolio - Service Class 2 (FEI2)

      
   9,172,057 shares (cost $188,457,647)         179,955,757    

VIP Freedom Fund 2010 Portfolio - Service Class (FF10S)

      
   523,038 shares (cost $5,210,757)         5,826,643    

VIP Freedom Fund 2010 Portfolio - Service Class 2 (FF10S2)

      
   12,782,984 shares (cost $134,428,479)         141,891,117    

VIP Freedom Fund 2020 Portfolio - Service Class (FF20S)

      
   901,692 shares (cost $8,748,119)         10,089,930    

VIP Freedom Fund 2020 Portfolio - Service Class 2 (FF20S2)

      
   38,312,089 shares (cost $399,004,175)         427,562,913    

VIP Freedom Fund 2030 Portfolio - Service Class (FF30S)

      
   757,973 shares (cost $6,959,120)         8,239,172    

VIP Freedom Fund 2030 Portfolio - Service Class 2 (FF30S2)

      
   2,665,158 shares (cost $25,982,112)         28,863,662    

VIP Growth Portfolio - Initial Class (FGP)

      
   7,624,005 shares (cost $227,757,725)         320,589,398    

VIP Growth Portfolio - Service Class 2 (FG2)

      
   2,324,014 shares (cost $82,960,793)         96,771,924    

VIP High Income Portfolio - Initial Class R (FHIPR)

      
   4,404,309 shares (cost $25,295,392)         25,500,950    

VIP Investment Grade Bond Portfolio - Service Class (FIGBS)

      
   2,049,976 shares (cost $26,132,663)         26,526,686    

VIP Investment Grade Bond Portfolio - Service Class 2 (FIGBP2)

      
   31,086,516 shares (cost $384,129,115)         397,596,533    

VIP Mid Cap Portfolio - Service Class (FMCS)

      
   748,839 shares (cost $21,617,454)         22,757,217    

VIP Mid Cap Portfolio - Service Class 2 (FMC2)

      
   8,049,546 shares (cost $229,966,833)         241,325,385    

VIP Overseas Portfolio - Initial Class (FOP)

      
   3,164,424 shares (cost $55,321,781)         50,915,588    

VIP Overseas Portfolio - Initial Class R (FOPR)

      
   1,505,389 shares (cost $29,818,565)         24,161,498    

VIP Overseas Portfolio - Service Class 2 (FO2)

      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2012

 

   150,253 shares (cost $2,800,084)         2,396,533    

VIP Overseas Portfolio - Service Class 2 R (FO2R)

      
   3,906,088 shares (cost $56,511,946)         61,716,184    

VIP Value Strategies Portfolio - Service Class (FVSS)

      
   593,798 shares (cost $5,121,476)         6,579,287    

Franklin Income Securities Fund - Class 2 (FTVIS2)

      
   10,002,719 shares (cost $150,336,744)         150,740,973    

Franklin Rising Dividends Securities Fund - Class 2 (FTVRD2)

      
   2,458,238 shares (cost $44,846,521)         53,196,281    

Franklin Small Cap Value Securities Fund - Class 2 (FTVSV2)

      
   7,719,680 shares (cost $89,182,413)         140,729,763    

Templeton Developing Markets Securities Fund - Class 3 (FTVDM3)

      
   2,631,417 shares (cost $23,170,307)         27,445,677    

Templeton Foreign Securities Fund - Class 2 (TIF2)

      
   236,925 shares (cost $3,342,562)         3,404,608    

Templeton Foreign Securities Fund - Class 3 (TIF3)

      
   4,961,992 shares (cost $50,204,289)         71,055,730    

Templeton Global Bond Securities Fund - Class 3 (FTVGI3)

      
   6,250,006 shares (cost $111,752,725)         121,750,124    

VIP Founding Funds Allocation Fund - Class 2 (FTVFA2)

      
   3,304,424 shares (cost $25,147,841)         28,120,649    

Advisers Management Trust - Short Duration Bond Portfolio - I Class Shares (AMTB)

      
   14,358,667 shares (cost $163,585,872)         157,227,404    

Growth Portfolio - I Class Shares (AMTG)

      
   615 shares (cost $12,470)         12,860    

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

      
   1,067 shares (cost $11,227)         12,378    

Small-Cap Growth Portfolio - S Class Shares (AMFAS)

      
   257,707 shares (cost $3,315,571)         3,401,739    

Socially Responsive Portfolio - I Class Shares (AMSRS)

      
   1,510,885 shares (cost $20,793,333)         24,007,963    

Balanced Fund/VA - Non-Service Shares (OVMS)

      
   2,994,239 shares (cost $45,394,986)         37,487,875    

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

      
   4,014,520 shares (cost $39,673,455)         33,159,936    

Global Securities Fund/VA - Class 3 (OVGS3)

      
   1,591,696 shares (cost $48,248,063)         52,159,871    

Global Securities Fund/VA - Class 4 (OVGS4)

      
   2,102,197 shares (cost $64,327,156)         67,942,996    

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

      
   3,216,604 shares (cost $84,451,302)         104,700,453    

Global Securities Fund/VA - Service Class (OVGSS)

      
   229,652 shares (cost $6,429,886)         7,406,264    

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

      
   474,280 shares (cost $10,036,443)         11,368,481    

Main Street Fund(R)/VA - Service Class (OVGIS)

      
   8,616,924 shares (cost $150,684,379)         204,910,457    

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

      
   219,339 shares (cost $3,892,373)         4,417,481    

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

      
   2,671,405 shares (cost $35,070,653)         53,321,238    

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

      
   175,237 shares (cost $8,358,298)         9,603,003    

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

      
   121,994 shares (cost $680,522)         691,708    

Global Strategic Income Fund/VA: Service Shares (OVSBS)

      
   1,533,903 shares (cost $8,730,027)         8,881,298    

All Asset Portfolio - Advisor Class (PMVAAD)

      
   1,731,848 shares (cost $19,728,477)         19,881,619    

Foreign Bond Portfolio (Unhedged) - Advisor Class (PMVFAD)

      

 

(Continued) 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2012

 

   1,934,276 shares (cost $22,824,397)         22,843,796    

Low Duration Portfolio - Advisor Class (PMVLAD)

      
   31,266,127 shares (cost $326,242,971)         337,048,848    

Total Return Portfolio - Advisor Class (PMVTRD)

      
   16,772,906 shares (cost $190,836,525)         193,727,066    

Putnam VT Growth and Income Fund - Class IB (PVGIB)

      
   147,489 shares (cost $2,384,959)         2,644,484    

Putnam VT International Equity Fund - Class IB (PVTIGB)

      
   29,361 shares (cost $441,812)         332,663    

Putnam VT Voyager Fund - Class IB (PVTVB)

      
   52,525 shares (cost $1,966,474)         1,899,834    

Van Kampen V.I. American Franchise Fund: Series II Shares (ACEG2)

      
   148,444 shares (cost $5,418,395)         5,277,200    

Diversified Stock Fund Class A Shares (VYDS)

      
   37,452 shares (cost $282,967)         390,247    

Health Sciences Portfolio - II (TRHS2)

      
   2,718,967 shares (cost $48,913,758)         56,146,671    

Eck VIP Trust - Global Hard Assets Fund - Service Class (VWHAS)

      
   486,995 shares (cost $13,417,361)         13,820,927    

VIP Trust - Global Bond Fund: Initial Class (VWBF)

      
   1,278,125 shares (cost $14,536,970)         15,235,251    

VIP Trust - Emerging Markets Fund: Initial Class (VWEM)

      
   2,253,149 shares (cost $27,972,545)         30,417,513    

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

      
   2,233,335 shares (cost $67,716,067)         65,057,048    

Variable Insurance Portfolios - Asset Strategy (WRASP)

      
   11,386,738 shares (cost $109,973,367)         122,133,013    

Variable Insurance Portfolios - High Income (WRHIP)

      
   6,665,114 shares (cost $24,396,286)         25,294,775    

Variable Insurance Portfolios - Mid Cap Growth (WRMCG)

      
   873,111 shares (cost $7,094,457)         7,454,186    

Variable Insurance Portfolios - Pathfinder Conservative (WRPCP)

      
   433,703 shares (cost $2,275,031)         2,311,375    

Variable Insurance Portfolios - Pathfinder Moderate (WRPMP)

      
   3,172,060 shares (cost $16,471,227)         16,912,153    

Variable Insurance Portfolios - Pathfinder Moderately Aggressive (WRPMAP)

      
   5,006,390 shares (cost $26,736,349)         27,276,316    

Variable Insurance Portfolios - Pathfinder Moderately Conservative (WRPMCP)

      
   986,593 shares (cost $5,223,909)         5,337,961    

Advantage VT Discovery Fund (SVDF)

         
   1,498 shares (cost $26,378)         37,689    

Advantage VT Opportunity Fund - Class 2 (SVOF)

      
   12,812 shares (cost $183,022)         256,873    

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

      
   4,104,199 shares (cost $31,545,964)         32,341,087    

Advantage VT Small Cap Value Fund - Class 2 (WFVSMV)

      
   788 shares (cost $5,672)         7,409    

Advantage VT Core Bond Fund (WFVTRB)

      
   28,429 shares (cost $295,161)         307,597    

Advantage - VT Omega Growth Fund - Class 2 (WFVOG2)

      
   1,932 shares (cost $37,283)         48,544    
     

 

  

Total Investments

       $      33,973,541,816    

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

         663    

Accounts Receivable-Growth Portfolio - I Class Shares (AMTG)

         354    

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

         168    

Other Accounts Payable

         (75,227)   

Accounts Payable-Advantage VT Discovery Fund (SVDF)

         (53)   

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

         (203)   

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2012

 

Accounts Payable-VP Vista(SM) Fund - Class I (ACVVS1)

         (510)   

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

         (624)   

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

         (1,228)   

Accounts Payable-VA International Equity Fund (HVIE)

         (12,566)   

Accounts Payable-Eck VIP Trust - Global Hard Assets Fund - Service Class (VWHAS)

         (457,842)   
     

 

  
      $      33,972,994,748    
     

 

  

Contract Owners’ Equity:

         

Accumulation units

         33,964,713,592    

Contracts in payout (annuitization) period (note 1f)

         8,281,156    
     

 

  

Total Contract Owners’ Equity (note 5)

    $      33,972,994,748    
     

 

  

See accompanying notes to financial statements.

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       Total     ALMCS     ALVDAB     AFGF     AFHY     AVPAP2     AFGC     MLVGA3  

Reinvested dividends

   $     504,604,185         -            874         111,528         121,778         108,859         13,850         2,247,866    

Mortality and expense risk charges (note 2)

       (505,472,567)        (4,669)        (10,114)        (138,112)        (20,633)        (11,754)        (15,132)        (2,239,738)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (868,382)        (4,669)        (9,240)        (26,584)        101,145         97,105         (1,282)        8,128    

Realized gain (loss) on investments

       138,736,108         (51,583)        438         137,504         75,394         (1)        15,531         876,600    

Change in unrealized gain (loss) on investments

       2,715,330,029         113,711         61,461         1,485,565         3,862         8,806         (36,013)        9,286,107    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       2,854,066,137         62,128         61,899         1,623,069         79,256         8,805         (20,482)        10,162,707    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       391,317,868         -            404         -            -            -            32,139         505,553    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     3,244,515,623         57,459         53,063         1,596,485         180,401         105,910         10,375         10,676,388   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       CHSMM     DSIF     DSIFS     DSRG     GVGMNS     HVIE     HVSIT     IVMCC2  

Reinvested dividends

   $     1,327         4,356,704         2,249,868         328,901         -            121,399         -            -       

Mortality and expense risk charges (note 2)

       (122,963)        (2,899,096)        (1,857,729)        (536,213)        (1,312)        (122,039)        (275,887)        (7,713)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (121,636)        1,457,608         392,139         (207,312)        (1,312)        (640)        (275,887)        (7,713)   

Realized gain (loss) on investments

       -            8,840,652         (550,789)        2,295,367         46         (100,939)        282,761         (227)   

Change in unrealized gain (loss) on investments

       -            7,681,337         9,983,889         1,986,545         13,126         1,065,413         3,353,709         58,225    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       -            16,521,989         9,433,100         4,281,912         13,172         964,474         3,636,470         57,998    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            10,738,166         5,772,701         -            672         -            -            7,869    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     (121,636)        28,717,763         15,597,940         4,074,600         12,532         963,834         3,360,583         58,154    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)  

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       IVKMG2     JPMMV1     JABS     JACAS     JAGTS     JAIGS     MIGSC     MNDSC  

Reinvested dividends

   $     -            85,535         297,511         781,928         -            514,513         19,832         -       

Mortality and expense risk charges (note 2)

       (235,579)        (116,508)        (163,949)        (2,031,052)        (178,769)        (778,331)        (140,480)        (11,114)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (235,579)        (30,973)        133,562         (1,249,124)        (178,769)        (263,818)        (120,648)        (11,114)   

Realized gain (loss) on investments

       (159,601)        518,272         (143,799)        (162,263)        722,606         (2,758,370)        658,949         (2,784)   

Change in unrealized gain (loss) on investments

       (336,503)        934,965         446,216         25,949,401         (386,687)        (8,234,841)        312,080         46,713    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       (496,104)        1,453,237         302,417         25,787,138         335,919         (10,993,211)        971,029         43,929    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       6,819         -            817,709         -            -            9,366,961         437,026         72,688    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     (724,864)        1,422,264         1,253,688         24,538,014         157,150         (1,890,068)        1,287,407         105,503    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       MVFSC        MVIVSC        MSVFI        MSVF2        MSEM        MSEMB        VKVGR2        MSVRE   

Reinvested dividends

   $     4,492,965         978,394         66,723         865,246         100,094         28,079         143         322    

Mortality and expense risk charges (note 2)

       (5,243,105)        (1,032,433)        (19,399)        (317,012)        (47,094)        (14,608)        (348)        (503)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (750,140)        (54,039)        47,324         548,234         53,000         13,471         (205)        (181)   

Realized gain (loss) on investments

       21,454,078         826,506         55,941         353,338         83,327         13,137         15         1,327    

Change in unrealized gain (loss) on investments

       18,997,367         8,039,702         8,816         535,842         399,647         124,714         4,157         4,271    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       40,451,445         8,866,208         64,757         889,180         482,974         137,851         4,172         5,598    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       2,388,656         -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     42,089,961         8,812,169         112,081         1,437,414         535,974         151,322         3,967         5,417    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)  

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       MSVREB      NVAMV1      NVAMV2      GVAAA2      GVABD2      GVAGG2      GVAGR2      GVAGI2  

Reinvested dividends

   $     28          483,863          1,167,674          46,078,626          26,451,882          1,144,475          482,636          12,459,218    

Mortality and expense risk charges (note 2)

       (68)         (682,954)         (2,275,611)         (54,417,124)         (18,953,436)         (2,006,595)         (3,373,977)         (19,064,293)   
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net investment income (loss)

       (40)         (199,091)         (1,107,937)         (8,338,498)         7,498,446          (862,120)         (2,891,341)         (6,605,075)   

Realized gain (loss) on investments

       1,393          721,869          1,648,201          2,290,785          1,371,324          (2,448,582)         (6,153,775)         (861,974)   

Change in unrealized gain (loss) on investments

       (832)         3,809,786          11,016,530          447,347,736          27,197,053          27,321,376          40,496,020          166,394,063    
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net gain (loss) on investments

       561          4,531,655          12,664,731          449,638,521          28,568,377          24,872,794          34,342,245          165,532,089    
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Reinvested capital gains

       -             2,037,600          5,941,559          -             -             -             -             -       
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

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

   $     521          6,370,164          17,498,353          441,300,023          36,066,823          24,010,674          31,450,904          158,927,014    
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
Investment Activity:       HIBF      HIBF3      GEM      GEM2      GEM3      GEM6      GIG      GIG3  

Reinvested dividends

   $     485,420          7,920,663          1,026          2,439          107,758          131,204          320          204,817    

Mortality and expense risk charges (note 2)

       (93,297)         (1,462,444)         (2,943)         (17,139)         (312,633)         (792,288)         (480)         (336,209)   
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net investment income (loss)

       392,123          6,458,219          (1,917)         (14,700)         (204,875)         (661,084)         (160)         (131,392)   

Realized gain (loss) on investments

       (184,587)         854,689          (55,685)         (245,677)         (1,521,297)         (112,087)         1,059          796,615    

Change in unrealized gain (loss) on investments

       585,028          3,950,323          100,996          437,185          5,076,471          7,071,298          4,074          2,629,444    
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net gain (loss) on investments

       400,441          4,805,012          45,311          191,508          3,555,174          6,959,211          5,133          3,426,059    
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Reinvested capital gains

       -             -             -             -             -             -             -             -       
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

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

   $     792,564          11,263,231          43,394          176,808          3,350,299          6,298,127          4,973          3,294,667    
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       NVIE6     NVNMO1     NVNMO2     NVNSR1     NVNSR2     NVCRA2     NVCRB2     NVCCA2  

Reinvested dividends

   $     146,656         1,005,626         320,262         28,250         1,681,429         262,830         22,499,825         31,166,612    

Mortality and expense risk charges (note 2)

       (390,371)        (961,044)        (360,166)        (28,798)        (2,800,111)        (415,739)        (23,194,376)        (35,515,441)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (243,715)        44,582         (39,904)        (548)        (1,118,682)        (152,909)        (694,551)        (4,348,829)   

Realized gain (loss) on investments

       851,907         1,080,857         (455,722)        7,638         3,158,170         243,862         931,324         1,903,568    

Change in unrealized gain (loss) on investments

       2,479,899         4,089,975         2,125,262         199,359         13,354,018         2,194,034         104,996,734         217,317,898    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       3,331,806         5,170,832         1,669,540         206,997         16,512,188         2,437,896         105,928,058         219,221,466    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            5,060,113         1,691,067         -            -            1,042,883         18,208,571         33,278,540    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     3,088,091         10,275,527         3,320,703         206,449         15,393,506         3,327,870         123,442,078         248,151,177    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       NVCCN2     NVCMD2     NVCMA2     NVCMC2     NVCBD1     NVCBD2     NVLCP2     TRF  

Reinvested dividends

   $     12,731,648         30,441,090         4,353,368         11,246,583         103,109         3,333,347         1,006,877         1,698,294    

Mortality and expense risk charges (note 2)

       (10,286,590)        (31,975,215)        (5,984,276)        (9,993,367)        (41,201)        (2,212,006)        (726,880)        (1,642,188)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       2,445,058         (1,534,125)        (1,630,908)        1,253,216         61,908         1,121,341         279,997         56,106    

Realized gain (loss) on investments

       7,877,727         1,264,985         2,992,692         1,394,135         59,181         3,220,408         597,281         219,120    

Change in unrealized gain (loss) on investments

       16,786,044         174,246,357         32,114,038         35,932,206         44,851         1,968,847         712,067         14,628,968    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       24,663,771         175,511,342         35,106,730         37,326,341         104,032         5,189,255         1,309,348         14,848,088    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       9,671,320         33,776,138         9,486,110         12,080,603         20,878         791,448         883,698         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     36,780,149         207,753,355         42,961,932         50,660,160         186,818         7,102,044         2,473,043         14,904,194    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       TRF2     GBF     CAF     CAF2     GVIX8     GVIDA     NVDBL2     NVDCA2  

Reinvested dividends

   $     1,745,559         8,434,193         182,878         176,063         464,232         3,476,111         11,977,803         19,869,616    

Mortality and expense risk charges (note 2)

       (2,712,009)        (6,279,536)        (445,929)        (285,525)        (276,674)        (4,522,696)        (9,171,153)        (16,423,148)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (966,450)        2,154,657         (263,051)        (109,462)        187,558         (1,046,585)        2,806,650         3,446,468    

Realized gain (loss) on investments

       1,917,002         3,564,812         2,511,788         263,424         683,249         (20,460,551)        816,706         8,137,343    

Change in unrealized gain (loss) on investments

       17,355,660         (12,227,239)        1,680,857         1,293,160         2,110,133         54,304,973         32,818,918         79,591,523    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       19,272,662         (8,662,427)        4,192,645         1,556,584         2,793,382         33,844,422         33,635,624         87,728,866    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            12,510,903         -            -            -            -            6,606,231         13,157,136    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     18,306,212         6,003,133         3,929,594         1,447,122         2,980,940         32,797,837         43,048,505         104,332,470    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       GVIDC     GVIDM     GVDMA     GVDMC     MCIF     SAM     NVMIG3     NVMIG6  

Reinvested dividends

   $     11,527,682         40,139,001         19,167,687         13,544,888         1,113,027         -            195,342         535,744    

Mortality and expense risk charges (note 2)

       (9,115,834)        (39,107,621)        (20,714,501)        (12,893,382)        (1,513,665)        (9,685,921)        (453,356)        (2,819,786)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       2,411,848         1,031,380         (1,546,814)        651,506         (400,638)        (9,685,921)        (258,014)        (2,284,042)   

Realized gain (loss) on investments

       18,247         476,528         (26,211,464)        375,493         243,373         (318)        1,008,551         (665,733)   

Change in unrealized gain (loss) on investments

       9,664,365         210,082,299         167,505,085         43,380,593         8,126,493         -            3,750,451         24,196,475    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       9,682,612         210,558,827         141,293,621         43,756,086         8,369,866         (318)        4,759,002         23,530,742    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       8,323,406         -            -            3,269,186         6,960,670         -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     20,417,866         211,590,207         139,746,807         47,676,778         14,929,898         (9,686,239)        4,500,988         21,246,700    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       GVDIV2     GVDIV3     GVDIV6     NVMLG1     NVMLG2     NVMLV1     NVMLV2     NVMMG1  

Reinvested dividends

   $     612         19,192         91,015         45,341         246,333         40,616         546,758         -       

Mortality and expense risk charges (note 2)

       (8,007)        (70,061)        (894,690)        (133,366)        (1,893,664)        (42,865)        (729,817)        (2,413,910)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (7,395)        (50,869)        (803,675)        (88,025)        (1,647,331)        (2,249)        (183,059)        (2,413,910)   

Realized gain (loss) on investments

       (88,011)        (1,786,790)        (1,621,650)        478,611         10,212,445         8,918         1,297,709         9,404,126    

Change in unrealized gain (loss) on investments

       173,798         2,568,680         10,141,540         772,743         4,614,926         494,137         5,455,285         (722,039)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       85,787         781,890         8,519,890         1,251,354         14,827,371         503,055         6,752,994         8,682,087    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            -            -            241,936         2,775,096         -            -            16,720,810    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     78,392         731,021         7,716,215         1,405,265         15,955,136         500,806         6,569,935         22,988,987    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       NVMMG2     NVMMV2     SCGF     SCGF2     SCVF     SCVF2     SCF     SCF2  

Reinvested dividends

   $     -            2,865,277         -            -            267,172         118,772         108,880         -       

Mortality and expense risk charges (note 2)

       (2,131,153)        (3,921,741)        (82,739)        (324,660)        (432,776)        (336,655)        (973,799)        (619,855)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (2,131,153)        (1,056,464)        (82,739)        (324,660)        (165,604)        (217,883)        (864,919)        (619,855)   

Realized gain (loss) on investments

       13,105,734         10,553,001         652,842         802,811         (545,140)        2,227,739         (2,785,306)        (737,870)   

Change in unrealized gain (loss) on investments

       (6,661,320)        1,342,795         165,087         1,785,088         6,292,987         1,717,976         13,197,879         6,780,262    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       6,444,414         11,895,796         817,929         2,587,899         5,747,847         3,945,715         10,412,573         6,042,392    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       11,722,621         25,062,241         -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     16,035,882         35,901,573         735,190         2,263,239         5,582,243         3,727,832         9,547,654         5,422,537    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       MSBF     NVSTB2     NVOLG1     NVOLG2     NVTIV3     EIF2     NVRE1     NVRE2  

Reinvested dividends

   $     4,132,382         1,054,522         2,346,283         1,021,937         5,610,680         1,316,402         689,569         567,415    

Mortality and expense risk charges (note 2)

       (2,480,795)        (1,234,767)        (4,580,302)        (3,676,093)        (3,831,791)        (2,112,566)        (894,905)        (1,049,750)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       1,651,587         (180,245)        (2,234,019)        (2,654,156)        1,778,889         (796,164)        (205,336)        (482,335)   

Realized gain (loss) on investments

       344,774         275,802         5,426,399         4,448,290         316,105         6,274,561         4,460,378         6,052,878    

Change in unrealized gain (loss) on investments

       13,494,479         1,269,933         51,052,517         34,803,766         32,274,962         14,279,807         (1,475,127)        (3,499,416)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       13,839,253         1,545,735         56,478,916         39,252,056         32,591,067         20,554,368         2,985,251         2,553,462    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            -            -            -            3,970,267         -            6,061,151         6,699,271    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     15,490,840         1,365,490         54,244,897         36,597,900         38,340,223         19,758,204         8,841,066         8,770,398    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       NOTB4     NOTG4     NOTMG4     ALVBWB     ALVGIB     ALVSVB     ACVB     ACVCA  

Reinvested dividends

   $     -            -            -            1,979         86,711         163,507         719,646         -       

Mortality and expense risk charges (note 2)

       (145)        (69)        (37)        (361)        (95,526)        (894,036)        (466,658)        (1,149)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (145)        (69)        (37)        1,618         (8,815)        (730,529)        252,988         (1,149)   

Realized gain (loss) on investments

       2         1         1         67         (310,389)        3,472,786         128,344         11,931    

Change in unrealized gain (loss) on investments

       450         (401)        (93)        10,826         1,267,722         4,018,458         3,027,234         (3,694)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       452         (400)        (92)        10,893         957,333         7,491,244         3,155,578         8,237    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            -            -            -            -            1,808,592         -            5,294    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     307         (469)        (129)        12,511         948,518         8,569,307         3,408,566         12,382    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       ACVIG     ACVIG2     ACVIP2     ACVI     ACVI3     ACVMV1     ACVMV2     ACVVS1  

Reinvested dividends

   $     305,587         80,775         6,653,497         126         1         147,863         1,399,237         -       

Mortality and expense risk charges (note 2)

       (196,431)        (61,630)        (4,197,331)        (185)        (2)        (95,938)        (1,170,623)        (67)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       109,156         19,145         2,456,166         (59)        (1)        51,925         228,614         (67)   

Realized gain (loss) on investments

       (207,264)        (129,365)        2,599,188         (761)        16         346,443         2,379,004         557    

Change in unrealized gain (loss) on investments

       1,920,003         666,102         3,966,549         3,194         7         201,214         3,403,599         279    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       1,712,739         536,737         6,565,737         2,433         23         547,657         5,782,603         836    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            -            6,029,123         -            -            387,583         3,920,363         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     1,821,895         555,882         15,051,026         2,374         22         987,165         9,931,580         769    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       DVSCS     DCAP     DCAPS     DVDLS     DGI     FCA2S     FQB     FQBS  

Reinvested dividends

   $     376,034         1,354,103         3,178,667         -            188,392         3,999         453,689         1,591,086    

Mortality and expense risk charges (note 2)

       (1,277,868)        (492,326)        (1,550,475)        (20,991)        (176,585)        (22,527)        (150,095)        (624,674)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (901,834)        861,777         1,628,192         (20,991)        11,807         (18,528)        303,594         966,412    

Realized gain (loss) on investments

       7,509,240         785,181         2,132,194         125,010         272,642         (6,920)        115,862         322,937    

Change in unrealized gain (loss) on investments

       1,100,457         1,435,033         3,769,940         163,956         1,724,328         64,439         468,008         1,740,874    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       8,609,697         2,220,214         5,902,134         288,966         1,996,970         57,519         583,870         2,063,811    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       2,917,328         -            -            -            -            90,844         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     10,625,191         3,081,991         7,530,326         267,975         2,008,777         129,835         887,464         3,030,223    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       FEIP     FVSS2     FHIP     FAMP     FNRS2     FEI2     FF10S     FF10S2  

Reinvested dividends

   $     10,085,997         31,072         2,873,916         2,107,505         584,515         5,041,166         101,745         2,316,205    

Mortality and expense risk charges (note 2)

       (4,475,002)        (137,598)        (709,448)        (1,900,935)        (1,228,246)        (2,637,800)        (73,474)        (1,924,509)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       5,610,995         (106,526)        2,164,468         206,570         (643,731)        2,403,366         28,271         391,696    

Realized gain (loss) on investments

       5,118,528         (327,900)        (1,137,947)        2,630,650         (6,545,271)        (4,514,983)        159,227         (373,546)   

Change in unrealized gain (loss) on investments

       17,134,098         2,502,330         5,297,401         11,166,603         9,324,446         14,837,289         262,948         9,596,864    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       22,252,626         2,174,430         4,159,454         13,797,253         2,779,175         10,322,306         422,175         9,223,318    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       21,013,230         -            -            1,009,102         -            11,021,363         79,550         1,860,931    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     48,876,851         2,067,904         6,323,922         15,012,925         2,135,444         23,747,035         529,996         11,475,945    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       FF20S     FF20S2     FF30S     FF30S2     FGP     FG2     FHIPR     FIGBS  

Reinvested dividends

   $     191,212         7,557,801         161,647         537,085         1,949,233         350,582         1,451,898         596,742    

Mortality and expense risk charges (note 2)

       (130,805)        (6,005,328)        (103,121)        (454,268)        (4,519,008)        (1,548,711)        (317,517)        (361,667)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       60,407         1,552,473         58,526         82,817         (2,569,775)        (1,198,129)        1,134,381         235,075    

Realized gain (loss) on investments

       254,922         (468,336)        (70,257)        (945,122)        7,167,215         438,500         175,063         802,968    

Change in unrealized gain (loss) on investments

       664,072         35,608,515         931,094         3,890,185         37,988,759         12,187,378         1,457,588         (598,954)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       918,994         35,140,179         860,837         2,945,063         45,155,974         12,625,878        1,632,651         204,014    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       117,762         4,822,666         70,610         245,034         -            -            -            721,816    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     1,097,163         41,515,318         989,973         3,272,914         42,586,199         11,427,749         2,767,032         1,160,905    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       FIGBP2     FMCS     FMC2     FOP     FOPR     FO2     FO2R     FVSS  

Reinvested dividends

   $     8,539,139         117,434         931,997         959,956         456,482         39,409         1,026,093         31,533    

Mortality and expense risk charges (note 2)

       (6,796,201)        (320,096)        (3,832,848)        (676,306)        (314,721)        (33,035)        (913,246)        (83,486)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       1,742,938         (202,662)        (2,900,851)        283,650         141,761         6,374         112,847         (51,953)   

Realized gain (loss) on investments

       3,406,579         1,995,541         (802,650)        669,340         (1,511,158)        (40,773)        (4,777,350)        652,957    

Change in unrealized gain (loss) on investments

       (155,049)        (581,637)        13,877,082         7,772,708         5,438,720         444,109         14,314,528         790,190    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       3,251,530         1,413,904         13,074,432         8,442,048         3,927,562         403,336         9,537,178         1,443,147    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       10,995,269         1,797,861         19,110,143         165,187         78,550         7,823         201,418         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     15,989,737         3,009,103         29,283,724         8,890,885         4,147,873         417,533         9,851,443         1,391,194    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       FTVIS2     FTVRD2     FTVSV2     FTVDM3     TIF2     TIF3     FTVGI3     FTVFA2  

Reinvested dividends

   $     8,978,151         932,892         1,058,904         394,282         98,990         2,104,898         7,232,019         651,082    

Mortality and expense risk charges (note 2)

       (2,155,805)        (897,056)        (2,230,794)        (426,160)        (49,119)        (1,137,781)        (1,687,831)        (388,559)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       6,822,346         35,836         (1,171,890)        (31,878)        49,871         967,117         5,544,188         262,523    

Realized gain (loss) on investments

       (2,916,245)        2,477,217         16,268,277         (589,789)        22,237         2,496,917         648,807         540,184    

Change in unrealized gain (loss) on investments

       10,652,790         3,097,048         6,646,397         3,471,324         440,345         7,282,591         7,896,335         2,301,201    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       7,736,545         5,574,265         22,914,674         2,881,535         462,582         9,779,508         8,545,142         2,841,385    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            -            -            -            -            -            182,992         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     14,558,891         5,610,101         21,742,784         2,849,657         512,453         10,746,625         14,272,322         3,103,908    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       AMTB     AMTG     AMTP     AMFAS     AMSRS     OVMS     OVB     OVGS3  

Reinvested dividends

   $     4,924,127         -            71         -            56,875         530,976         1,701,235         1,071,665    

Mortality and expense risk charges (note 2)

       (2,786,020)        (183)        (199)        (58,692)        (386,719)        (528,146)        (468,473)        (667,359)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       2,138,107         (183)        (128)        (58,692)        (329,844)        2,830         1,232,762         404,306    

Realized gain (loss) on investments

       (6,292,415)        232         1,306         32,910         (643,106)        (2,325,747)        (2,827,125)        382,645    

Change in unrealized gain (loss) on investments

       9,166,168         1,299         1,381         346,122         3,383,957         6,415,498         4,541,965         8,352,205    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       2,873,753         1,531         2,687         379,032         2,740,851         4,089,751         1,714,840         8,734,850    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     5,011,860         1,348         2,559         320,340         2,411,007         4,092,581         2,947,602         9,139,156    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       OVGS4     OVGS     OVGSS     OVGI     OVGIS     OVSC     OVSCS     OVAG  

Reinvested dividends

   $     1,198,500         2,228,927         139,285         123,584         1,389,435         25,251         173,492         -       

Mortality and expense risk charges (note 2)

       (913,955)        (1,390,162)        (103,492)        (162,854)        (3,619,047)        (58,695)        (847,643)        (139,831)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       284,545         838,765         35,793         (39,270)        (2,229,612)        (33,444)        (674,151)        (139,831)   

Realized gain (loss) on investments

       (1,677,194)        7,742,844         151,570         240,657         (467,277)        346,914         5,013,335         154,044    

Change in unrealized gain (loss) on investments

       12,162,381         9,963,594         1,098,903         1,504,611         32,867,877         315,018         3,353,514         1,469,772    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       10,485,187         17,706,438         1,250,473         1,745,268         32,400,600         661,932         8,366,849         1,623,816    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     10,769,732         18,545,203         1,286,266         1,705,998         30,170,988         628,488         7,692,698         1,483,985    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       OVSB     OVSBS     PMVAAD     PMVFAD     PMVLAD     PMVTRD     PVGIB     PVTIGB  

Reinvested dividends

   $     -            -            492,893         1,149,467         5,509,289         3,121,829         48,232         8,144    

Mortality and expense risk charges (note 2)

       (1,479)        (23,537)        (69,353)        (335,991)        (4,858,609)        (1,971,045)        (41,093)        (5,406)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (1,479)        (23,537)        423,540         813,476         650,680         1,150,784         7,139         2,738    

Realized gain (loss) on investments

       285         2,879         9,812         535,080         924,447         57,378         (333,740)        (52,884)   

Change in unrealized gain (loss) on investments

       11,186         151,271         153,142         (1,086,348)        10,401,166         3,860,783         733,390         117,212    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       11,471         154,150         162,954         (551,268)        11,325,613         3,918,161         399,650         64,328    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            -            -            518,077         -            3,544,898         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     9,992         130,613         586,494         780,285         11,976,293         8,613,843         406,789         67,066    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       PVTVB     ACEG2     VYDS     TRHS2     VWHAS     VWBF     VWEM     VWHA  

Reinvested dividends

   $     9,711         -            3,723         -            65,867         251,712         -            427,502    

Mortality and expense risk charges (note 2)

       (36,985)        (57,829)        (4,800)        (686,038)        (75,901)        (192,501)        (324,663)        (782,238)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (27,274)        (57,829)        (1,077)        (686,038)        (10,034)        59,211         (324,663)        (354,736)   

Realized gain (loss) on investments

       79,673         (41,285)        (803)        1,426,849         (2,703)        (133,179)        (1,519,560)        1,552,201    

Change in unrealized gain (loss) on investments

       251,531         (141,196)        53,047         7,738,204         403,566         460,132         6,660,836         (5,574,871)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       331,204         (182,481)        52,244         9,165,053         400,863         326,953         5,141,276         (4,022,670)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            -            -            1,043,394         109,899         158,772         -            2,563,706    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     303,930         (240,310)        51,167         9,522,409         500,728         544,936         4,816,613         (1,813,700)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:       WRASP     WRHIP     WRMCG     WRPCP     WRPMP     WRPMAP     WRPMCP     SVDF  

Reinvested dividends

   $     1,212,200         5,974         -            11,326         68,462         134,476         21,505         -       

Mortality and expense risk charges (note 2)

       (1,696,888)        (113,227)        (30,622)        (5,631)        (36,766)        (75,962)        (12,303)        (524)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (484,688)        (107,253)        (30,622)        5,695         31,696         58,514         9,202         (524)   

Realized gain (loss) on investments

       898,488         107,527         (9,484)        (731)        (3,223)        (24,782)        (2,822)        1,166    

Change in unrealized gain (loss) on investments

       16,358,539         898,489         359,730         39,608         501,688         1,295,887         126,062         4,931    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       17,257,027         1,006,016         350,246         38,877         498,465         1,271,105         123,240         6,097    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       -            -            12,611         35,666         196,645         441,576         66,185         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     16,772,339         898,763         332,235         80,238         726,806         1,771,195         198,627         5,573    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Investment Activity:       SVOF     WFVSCG     WFVSMV     WFVTRB     WFVOG2     JAGTS2     JAIGS2     VFMG2  

Reinvested dividends

   $     248         -            71         4,359         -            -            -            12,916    

Mortality and expense risk charges (note 2)

       (3,439)        (539,310)        (90)        (3,770)        (857)        (64,891)        (442,260)        (29,437)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income (loss)

       (3,191)        (539,310)        (19)        589         (857)        (64,891)        (442,260)        (16,521)   

Realized gain (loss) on investments

       8,799         1,172,522         (581)        321         3,068         814,110         2,355,718         (289,770)   

Change in unrealized gain (loss) on investments

       27,797         (589,315)        1,613         7,550         3,305         1,264,910         8,375,770         349,749    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net gain (loss) on investments

       36,596         583,207         1,032         7,871         6,373         2,079,020         10,731,488         59,979    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Reinvested capital gains

       91         1,636,874         -            5,572         3,480         -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

   $     33,496         1,680,771         1,013         14,032         8,996         2,014,129         10,289,228         43,458    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENT OF OPERATIONS

Year Ended December 31, 2012

 

Investment Activity:        AVCA2      AVCD2      VWBFR      VWEMR      VWHAR      OVHI3      OVHI4      OVHI  

Reinvested dividends

    $     -             -             124,972          -             -             97,257          983,966          3,187    

Mortality and expense risk charges (note 2)

        (32,047)         (126,084)         (24,809)         (59,389)         (289,294)         (5,923)         (80,142)         (197)   
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net investment income (loss)

        (32,047)         (126,084)         100,163          (59,389)         (289,294)         91,334          903,824          2,990    

Realized gain (loss) on investments

        (342,665)         5,254,486          79,263          2,130,804          (5,416,237)         (71,063)         (593,671)         (47,209)   

Change in unrealized gain (loss) on investments

        1,202,582          (2,195,190)         (149,144)         90,670          4,221,023          39,989          364,056          46,555    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net gain (loss) on investments

        859,917          3,059,296          (69,881)         2,221,474          (1,195,214)         (31,074)         (229,615)         (654)   
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Reinvested capital gains

        -             -             78,829          -             4,042,343          -             -             -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

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

    $     827,870          2,933,212          109,111          2,162,085          2,557,835          60,260          674,209          2,336    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
Investment Activity:        OVHIS      ACVU2      AVBV2         

Reinvested dividends

    $     393,915          -             -          

Mortality and expense risk charges (note 2)

        (29,394)         (29)         (23)      
    

 

 

     

 

 

     

 

 

     

Net investment income (loss)

        364,521          (29)         (23)      

Realized gain (loss) on investments

        (6,266,756)         1,983          652       

Change in unrealized gain (loss) on investments

        6,166,243          (1,235)         (133)      
    

 

 

     

 

 

     

 

 

     

Net gain (loss) on investments

        (100,513)         748          519       
    

 

 

     

 

 

     

 

 

     

Reinvested capital gains

        -             -             -          
    

 

 

     

 

 

     

 

 

     

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

    $     264,008          719          496       
    

 

 

     

 

 

     

 

 

     

See accompanying notes to financial statements.

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        Total     ALMCS     ALVDAB     AFGF  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (868,382)        69,045,778         (4,669)        (5,149)        (9,240)                    -            (26,584)        (47,382)   

Realized gain (loss) on investments

       138,736,108         (726,415)        (51,583)        (109,103)        438         -            137,504         107,972    

Change in unrealized gain (loss) on investments

       2,715,330,029         (953,196,565)        113,711         66,458         61,461         -            1,485,565         (602,435)   

Reinvested capital gains

       391,317,868         85,173,364         -            -            404         -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       3,244,515,623         (799,703,838)        57,459         (47,794)        53,063         -            1,596,485         (541,845)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       4,330,208,480         6,928,864,729         -            -            1,883,778         -            17,280         23,378    

Transfers between funds

       -            -            (21,165)        390         62,903         -            (65,976)        (68,084)   

Redemptions

       (3,178,018,419)        (2,865,907,300)        (27,091)        (11,918)        (8,605)        -            (590,226)        (627,123)   

Annuity benefits

       (1,609,188)        (1,665,603)        -            -            -            -            (641)        (641)   

Contract maintenance charges (note 2)

       (195,320,379)        (112,337,217)        (5)        (5)        -            -            (3,313)        (3,784)   

Contingent deferred sales charges
(note 2)

       (20,085,587)        (20,837,633)        -            -            -            -            (147)        (493)   

Adjustments to maintain reserves

       (599,214)        (36,260)        4         (10)        10         -            542         403    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       934,575,693         3,928,080,716         (48,257)        (11,543)        1,938,086         -            (642,481)        (676,344)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       4,179,091,316         3,128,376,878         9,202         (59,337)        1,991,149         -            954,004         (1,218,189)   

Contract owners’ equity beginning of period

       29,793,903,432         26,665,526,554         393,138         452,475         -            -            9,763,807         10,981,996    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     33,972,994,748         29,793,903,432         402,340         393,138         1,991,149         -            10,717,811         9,763,807    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       2,517,758,479         2,109,588,057         32,647         34,119         -            -            133,488         142,179    

Units purchased

       707,765,795         978,929,071         7,017         11,920         197,949         -            213         323    

Units redeemed

       (585,251,583)        (570,758,649)        (10,562)        (13,392)        (1,248)        -            (8,085)        (9,014)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       2,640,272,691         2,517,758,479         29,102         32,647         196,701         -            125,616         133,488    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        AFHY     AVPAP2     AFGC     MLVGA3  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     101,145         115,165         97,105                     -            (1,282)        8,422         8,128         1,179,795    

Realized gain (loss) on investments

       75,394         (14,852)        (1)        -            15,531         5,208         876,600         749,851    

Change in unrealized gain (loss) on investments

       3,862         (38,230)        8,806         -            (36,013)        34,133         9,286,107         (11,963,314)   

Reinvested capital gains

       -            -            -            -            32,139         28,110         505,553         3,122,639    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       180,401         62,083         105,910         -            10,375         75,873         10,676,388         (6,911,029)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       1,418         5,320         12,416,356         -            243         295         32,521,177         36,668,257    

Transfers between funds

       (960)        34,491         638,055         -            (67,812)        -            (1,839,954)        18,403,568    

Redemptions

       (34,272)        (75,948)        (54)        -            (69,830)        (71,880)        (10,954,494)        (9,998,731)   

Annuity benefits

       (1,401)        (1,378)        -            -            (241)        (239)        -            -       

Contract maintenance charges (note 2)

       (528)        (626)        -            -            (648)        (759)        (10,704)        (7,709)   

Contingent deferred sales charges (note 2)

       -            -            -            -            -            -            (46,330)        (41,574)   

Adjustments to maintain reserves

       820         1,582         (30)        -            160         143         (604)        (388)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (34,923)        (36,559)        13,054,327         -            (138,128)        (72,440)        19,669,091         45,023,423    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       145,478         25,524         13,160,237         -            (127,753)        3,433         30,345,479         38,112,394    

Contract owners’ equity beginning of period

       1,811,691         1,786,167         -            -            1,223,501         1,220,068         123,669,985         85,557,591    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     1,957,169         1,811,691         13,160,237         -            1,095,748         1,223,501         154,015,464         123,669,985    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       37,304         37,078         -            -            34,457         36,578         10,016,317         6,572,107    

Units purchased

       104,321         90,954         1,300,946         -            7         9         3,778,528         5,150,285    

Units redeemed

       (105,771)        (90,728)        (5)        -            (3,876)        (2,130)        (2,264,223)        (1,706,075)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       35,854         37,304         1,300,941         -            30,588         34,457         11,530,622         10,016,317    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        CHSMM     DSIF     DSIFS     DSRG  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (121,636)        (120,529)        1,457,608         1,082,230         392,139         129,878         (207,312)        (176,425)   

Realized gain (loss) on investments

       -            -            8,840,652         9,814,474         (550,789)        (515,046)        2,295,367         1,091,291    

Change in unrealized gain (loss) on investments

       -            1         7,681,337         (10,918,941)        9,983,889         (50,354)        1,986,545         (981,875)   

Reinvested capital gains

       -            -            10,738,166         1,562,507         5,772,701         731,611         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       (121,636)        (120,528)        28,717,763         1,540,270         15,597,940         296,089         4,074,600         (67,009)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       4,508,129         5,899,031         3,065,443         3,396,610         19,021,454         19,668,645         688,977         744,087    

Transfers between funds

       (3,233,511)        (2,113,449)        (1,571,346)        (6,861,391)        (3,519,032)        (1,130,490)        (191,678)        (416,395)   

Redemptions

       (4,770,359)        (3,082,925)        (31,854,859)        (31,422,859)        (13,537,724)        (13,755,888)        (5,313,891)        (6,194,893)   

Annuity benefits

       -            (18,553)        (61,740)        (66,675)        (35,545)        (37,700)        (2,701)        (2,620)   

Contract maintenance charges (note 2)

       (523)        (601)        (127,839)        (140,380)        (345,677)        (174,722)        (33,795)        (38,053)   

Contingent deferred sales charges (note 2)

       -            -            (22,120)        (38,071)        (68,980)        (94,351)        (7,779)        (5,122)   

Adjustments to maintain reserves

       37         17         136         1,853         (1,308)        (1,832)        154         (22)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (3,496,227)        683,520         (30,572,325)        (35,130,913)        1,513,188         4,473,662         (4,860,713)        (5,913,018)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (3,617,863)        562,992         (1,854,562)        (33,590,643)        17,111,128         4,769,751         (786,113)        (5,980,027)   

Contract owners’ equity beginning of period

       14,443,732         13,880,740         210,978,801         244,569,444         114,015,519         109,245,768         39,114,157         45,094,184    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     10,825,869         14,443,732         209,124,239         210,978,801         131,126,647         114,015,519         38,328,044         39,114,157    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       1,391,226         1,300,472         7,343,204         8,556,559         7,723,730         7,353,016         1,619,263         1,858,295    

Units purchased

       915,325         1,237,541         352,615         389,033         2,628,249         2,908,956         52,434         71,852    

Units redeemed

       (1,258,603)        (1,146,787)        (1,322,098)        (1,602,388)        (2,467,327)        (2,538,242)        (236,142)        (310,884)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       1,047,948         1,391,226         6,373,721         7,343,204         7,884,652         7,723,730         1,435,555         1,619,263    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        GVGMNS     HVIE     HVSIT     IVMCC2  
        2012         2011         2012     2011     2012     2011     2012         2011      

Investment activity:

                  

Net investment income (loss)

   $     (1,312)        -            (640)        33,356         (275,887)        (89,513)        (7,713)        -       

Realized gain (loss) on investments

       46         -            (100,939)        2,752         282,761         (8,647)        (227)        -       

Change in unrealized gain (loss) on investments

       13,126         -            1,065,413         (532,366)        3,353,709         (86,148)        58,225         -       

Reinvested capital gains

       672         -            -            -            -            -            7,869         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       12,532         -            963,834         (496,258)        3,360,583         (184,308)        58,154         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       525,929         -            2,964,602         3,677,562         5,933,771         6,391,741         1,015,995         -       

Transfers between funds

       38,549         -            (77,278)        2,682,926         (87,207)        7,402,818         467,222         -       

Redemptions

       (5,842)        -            (559,480)        (78,605)        (660,379)        (231,292)        (14,181)        -       

Annuity benefits

       -            -            -            -            -            -            -            -       

Contract maintenance charges (note 2)

       -            -            (53,651)        (5,005)        (113,462)        (12,964)        (1,207)        -       

Contingent deferred sales charges (note 2)

       (213)        -            (8,428)        (88)        (8,601)        (4,839)        (43)        -       

Adjustments to maintain reserves

       (19)        -            (12,722)        (102)        (308)        (98)        (45)        -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       558,404         -            2,253,043         6,276,688         5,063,814         13,545,366         1,467,741         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       570,936         -            3,216,877         5,780,430         8,424,397         13,361,058         1,525,895         -       

Contract owners’ equity beginning of period

       -            -            6,042,943         262,513         13,876,653         515,595         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     570,936         -            9,259,820         6,042,943         22,301,050         13,876,653         1,525,895         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       -            -            672,762         25,460         1,261,261         45,685         -            -       

Units purchased

       57,507         -            486,457         674,086         1,124,800         1,424,829         157,701         -       

Units redeemed

       (1,539)        -            (242,204)        (26,784)        (707,856)        (209,253)        (4,169)        -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       55,968         -            917,015         672,762         1,678,205         1,261,261         153,532         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        IVKMG2     JPMMV1     JABS     JACAS  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (235,579)        -            (30,973)        1,488         133,562         109,249         (1,249,124)        (1,490,840)   

Realized gain (loss) on investments

       (159,601)        -            518,272         821,086         (143,799)        191,639         (162,263)        (2,104,706)   

Change in unrealized gain (loss) on investments

       (336,503)        -            934,965         (774,058)        446,216         (843,088)        25,949,401         (5,636,839)   

Reinvested capital gains

       6,819         -            -            -            817,709         566,308         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       (724,864)        -            1,422,264         48,516         1,253,688         24,108         24,538,014         (9,232,385)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       412,549         -            228,612         43,629         36,509         101,300         14,847,992         19,549,331    

Transfers between funds

       23,476,825         -            3,530,039         573,079         860,490         26,667         2,891,518         (15,615,474)   

Redemptions

       (1,677,803)        -            (752,613)        (1,457,349)        (1,231,066)        (2,267,313)        (11,597,332)        (10,902,517)   

Annuity benefits

       -            -            -            -            -            -            -            -       

Contract maintenance charges (note 2)

       (73,943)        -            (3,007)        (2,558)        (912)        (990)        (560,583)        (342,751)   

Contingent deferred sales charges (note 2)

       (13,754)        -            (839)        (1,168)        (793)        (3,097)        (87,428)        (79,193)   

Adjustments to maintain reserves

       (778)        -            (106)        (52)        (108)        (251)        (1,361)        (1,561)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       22,123,096         -            3,002,086         (844,419)        (335,880)        (2,143,684)        5,492,806         (7,392,165)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       21,398,232         -            4,424,350         (795,903)        917,808         (2,119,576)        30,030,820         (16,624,550)   

Contract owners’ equity beginning of period

       -            -            5,854,364         6,650,267        10,841,461         12,961,037         111,237,782         127,862,332    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     21,398,232         -            10,278,714         5,854,364         11,759,269         10,841,461         141,268,602         111,237,782    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       -            -            404,489         463,358         655,718         781,885         8,157,179         8,528,417    

Units purchased

       2,554,821         -            318,277         108,536         101,324         144,938         2,927,685         2,494,702    

Units redeemed

       (353,468)        -            (125,130)        (167,405)        (119,775)        (271,105)        (2,553,083)        (2,865,940)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       2,201,353         -            597,636         404,489         637,267         655,718         8,531,781         8,157,179    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

         JAGTS      JAIGS      MIGSC      MNDSC  
         2012      2011      2012      2011      2012      2011      2012          2011      

Investment activity:

                          

Net investment income (loss)

   $      (178,769)         (26,666)         (263,818)         (72,339)         (120,648)         (145,396)         (11,114)         -       

Realized gain (loss) on investments

        722,606          108,743          (2,758,370)         697,687          658,949          520,546          (2,784)         -       

Change in unrealized gain (loss) on investments

        (386,687)         (275,263)         (8,234,841)         (3,494,518)         312,080          (460,050)         46,713          -       

Reinvested capital gains

        -             -             9,366,961          73,862          437,026          -             72,688          -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

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

        157,150          (193,186)         (1,890,068)         (2,795,308)         1,287,407          (84,900)         105,503          -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Equity transactions:

                          

Purchase payments received from contract owners (note 3)

        1,683,387          -             1,841,470          -             118,124          84,705          1,086,920          -       

Transfers between funds

        14,842,401          (47,704)         82,450,932          (332,117)         (434,498)         (386,434)         1,392,940          -       

Redemptions

        (1,110,909)         (211,711)         (6,933,784)         (1,015,321)         (2,206,573)         (2,227,412)         (31,399)         -       

Annuity benefits

        (449)         (461)         (11,180)         -             -             -             -             -       

Contract maintenance charges (note 2)

        (3,414)         (1,735)         (13,829)         (3,907)         (1,078)         (1,166)         (2,197)         -       

Contingent deferred sales charges (note 2)

        (1,980)         (121)         (30,108)         (724)         (3,605)         (10,543)         (73)         -       

Adjustments to maintain reserves

        (3,526)         (695)         (102,897)         (121)         (3,887)         (442)         (55)         -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net equity transactions

        15,405,510         (262,427)         77,200,604         (1,352,190)         (2,531,517)         (2,541,292)         2,446,136         -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net change in contract owners’ equity

        15,562,660          (455,613)         75,310,536          (4,147,498)         (1,244,110)         (2,626,192)         2,551,639          -       

Contract owners’ equity beginning of period

        1,755,826          2,211,439          5,139,442          9,286,940          9,464,140          12,090,332          -             -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Contract owners’ equity end of period

   $      17,318,486          1,755,826          80,449,978          5,139,442          8,220,030          9,464,140          2,551,639          -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

CHANGES IN UNITS:

                          

Beginning units

        378,492          429,603          391,151          470,786          638,301          809,425          -             -       

Units purchased

        2,703,521          -             5,034,442          4,058          85,002          112,082          293,271          -       

Units redeemed

        (679,788)         (51,111)         (1,186,406)         (83,693)         (242,886)         (283,206)         (43,172)         -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Ending units

        2,402,225          378,492          4,239,187          391,151          480,417          638,301          250,099          -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

         MVFSC      MVIVSC      MSVFI      MSVF2  
         2012      2011      2012      2011      2012      2011      2012      2011  

Investment activity:

                          

Net investment income (loss)

   $      (750,140)         (1,453,951)         (54,039)         (118,611)         47,324          37,813          548,234          403,201    

Realized gain (loss) on investments

        21,454,078          12,847,215          826,506          346,428          55,941          (403)         353,338          (12,527)   

Change in unrealized gain (loss) on investments

        18,997,367          (17,119,075)         8,039,702          (1,804,417)         8,816          30,757          535,842          422,448    

Reinvested capital gains

        2,388,656          1,274,247          -             -             -             -             -             -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

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

        42,089,961          (4,451,564)          8,812,169          (1,576,600)         112,081          68,167          1,437,414          813,122    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Equity transactions:

                          

Purchase payments received from contract owners (note 3)

        20,769,221          33,239,620          18,099,412          24,913,927          15,352          24,813          110,504          224,748    

Transfers between funds

        (29,136,073)         (13,983,358)         4,486,866          12,845,954          30,512          17,119          (83,468)         (1,258,799)   

Redemptions

        (40,523,464)         (36,189,614)         (3,003,388)         (1,063,394)         (329,097)         (497,769)         (2,756,267)         (2,787,979)   

Annuity benefits

        (6,559)         (6,096)         -             -             -             -             (7,711)         (7,537)   

Contract maintenance charges (note 2)

        (1,467,206)         (1,136,632)         (502,127)         (133,248)         (484)         (542)         (23,111)         (22,307)   

Contingent deferred sales charges (note 2)

        (213,614)         (283,580)         (32,725)         (9,665)         (63)         (881)         (10,791)         (10,959)   

Adjustments to maintain reserves

        (1,221)         (695)         (659)         (703)         (10)         (59)         (352)         (448)   
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net equity transactions

        (50,578,916)         (18,360,355)         19,047,379          36,552,871          (283,790)         (457,319)         (2,771,196)         (3,863,281)   
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net change in contract owners’ equity

        (8,488,955)         (22,811,919)         27,859,548          34,976,271          (171,709)         (389,152)         (1,333,782)         (3,050,159)   

Contract owners’ equity beginning of period

        317,203,619          340,015,538          50,011,075          15,034,804          1,592,352          1,981,504          19,892,492          22,942,651    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Contract owners’ equity end of period

   $      308,714,664          317,203,619          77,870,623          50,011,075          1,420,643          1,592,352          18,558,710          19,892,492    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

CHANGES IN UNITS:

                          

Beginning units

        19,464,081          20,429,012          4,818,705          1,400,680          139,216          180,620          1,719,934          2,060,566    

Units purchased

        3,204,311          4,814,723          3,218,364          4,208,756          36,116          44,314          169,763          177,271    

Units redeemed

        (6,069,568)         (5,779,654)         (1,469,018)         (790,731)         (60,345)         (85,718)         (400,726)         (517,903)   
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Ending units

        16,598,824          19,464,081          6,568,051          4,818,705          114,987          139,216          1,488,971          1,719,934    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

         MSEM      MSEMB      VKVGR2      MSVRE  
         2012      2011      2012      2011      2012      2011      2012      2011  

Investment activity:

                          

Net investment income (loss)

   $      53,000          81,900          13,471          21,703          (205)         120          (181)         (246)   

Realized gain (loss) on investments

        83,327          (17,129)         13,137          (5,537)         15          (932)         1,327          16,620    

Change in unrealized gain (loss) on investments

        399,647          100,551          124,714          26,669          4,157          -             4,271          (13,932)   

Reinvested capital gains

        -             41,069          -             11,623          -             -             -             -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

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

        535,974          206,391          151,322          54,458          3,967          (812)         5,417          2,442    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Equity transactions:

                          

Purchase payments received from contract owners (note 3)

        -             -             -             -             -             -             (290)         (5,026)   

Transfers between funds

        (55,969)         (103,024)         (36,747)         (22,519)         55,729          923          116          (9,705)   

Redemptions

        (663,484)         (524,425)         (123,745)         (145,671)         -             (111)         -             122    

Annuity benefits

        -             -             -             -             -             -             (2,964)         (10,076)   

Contract maintenance charges (note 2)

        (1,974)         (2,167)         (194)         (202)         -             -             174          -       

Contingent deferred sales charges (note 2)

        (191)         (425)         (69)         (31)         -             -             -             -       

Adjustments to maintain reserves

        (128)         (78)         (67)         (115)         (2)         -             (3,173)         (349)   
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net equity transactions

        (721,746)         (630,119)         (160,822)         (168,538)         55,727          812          (6,137)         (25,034)   
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net change in contract owners’ equity

        (185,772)         (423,728)         (9,500)         (114,080)         59,694          -             (720)         (22,592)   

Contract owners’ equity beginning of period

        3,579,650          4,003,378          1,015,627          1,129,707          -             -             35,079          57,671    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Contract owners’ equity end of period

   $      3,393,878          3,579,650          1,006,127          1,015,627          59,694          -             34,359          35,079    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

CHANGES IN UNITS:

                          

Beginning units

        146,190          172,642          47,925          56,191          -             -             -             312    

Units purchased

        -             -             652          3,278          6,184          592          9          -       

Units redeemed

        (27,053)         (26,452)         (7,693)         (11,544)         -             (592)         (9)         (312)   
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Ending units

        119,137          146,190          40,884          47,925          6,184          -             -             -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

         MSVREB      NVAMV1      NVAMV2      GVAAA2  
         2012      2011      2012      2011      2012      2011      2012      2011  

Investment activity:

                          

Net investment income (loss)

   $      (40)         (52)         (199,091)         146,762          (1,107,937)         (95,811)         (8,338,498)         (8,748,128)   

Realized gain (loss) on investments

        1,393          1,852          721,869          263,334          1,648,201          1,161,400          2,290,785          179,686    

Change in unrealized gain (loss) on investments

        (832)         (1,461)         3,809,786          (891,778)         11,016,530          (3,017,896)         447,347,736          (16,676,602)   

Reinvested capital gains

        -             -             2,037,600          137,253          5,941,559          380,763          -             -       
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

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

        521          339          6,370,164          (344,429)         17,498,353          (1,571,544)         441,300,023          (25,245,044)   
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Equity transactions:

                          

Purchase payments received from contract owners (note 3)

        (39,125)         39,388          707,015          1,083,684          7,568,117          14,533,385          555,891,246          1,022,701,603    

Transfers between funds

        39,208          (39,388)         (2,237,375)         (4,593,749)         (13,306,562)         (8,210,128)         (794,538)         (19,901,350)   

Redemptions

        -             -             (8,009,308)         (8,757,056)         (15,656,987)         (16,344,346)         (162,680,418)         (89,968,002)   

Annuity benefits

        (772)         (4,488)         (3,039)         (6,521)         (17,994)         (10,473)         (3,539)         (2,813)   

Contract maintenance charges (note 2)

        (2)         -             (23,606)         (26,400)         (519,924)         (373,450)         (31,014,092)         (17,081,920)   

Contingent deferred sales charges (note 2)

        -             -             (12,827)         (20,419)         (102,646)         (169,835)         (1,925,134)         (1,586,944)   

Adjustments to maintain reserves

        39          297          305          10,944          (2,308)         7,749          (3,790)         11,723    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net equity transactions

        (652)         (4,191)         (9,578,835)         (12,309,517)         (22,038,304)         (10,567,098)         359,469,735          894,172,297    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Net change in contract owners’ equity

        (131)         (3,852)         (3,208,671)         (12,653,946)         (4,539,951)         (12,138,642)         800,769,758          868,927,253    

Contract owners’ equity beginning of period

        4,945          8,797          52,140,929          64,794,875          147,342,084          159,480,726          3,003,377,639          2,134,450,386    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Contract owners’ equity end of period

   $      4,814          4,945          48,932,258          52,140,929          142,802,133          147,342,084          3,804,147,397          3,003,377,639    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

CHANGES IN UNITS:

                          

Beginning units

        27          27          3,763,621          4,645,835          10,757,342          11,529,269          298,878,335          211,427,824    

Units purchased

        3,308          3,393          90,321          190,825          1,096,504          2,206,410          64,730,700          108,345,137    

Units redeemed

        (3,308)         (3,393)         (732,333)         (1,073,039)         (2,609,098)         (2,978,337)         (31,751,402)         (20,894,626)   
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Ending units

        27          27          3,121,609          3,763,621          9,244,748          10,757,342          331,857,633          298,878,335    
    

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        GVABD2     GVAGG2     GVAGR2     GVAGI2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     7,498,446         3,908,167         (862,120)        (722,081)        (2,891,341)        (2,618,040)        (6,605,075)        (6,805,173)   

Realized gain (loss) on investments

       1,371,324         (1,256,608)        (2,448,582)        (1,933,212)        (6,153,775)        (4,169,992)        (861,974)        (3,749,693)   

Change in unrealized gain (loss) on investments

       27,197,053         33,880,415         27,321,376         (9,782,123)        40,496,020         (5,714,866)        166,394,063         (23,884,988)   

Reinvested capital gains

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       36,066,823         36,531,974         24,010,674         (12,437,416)        31,450,904         (12,502,898)        158,927,014         (34,439,854)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       218,970,652         285,562,009         16,473,773         26,636,675         25,867,731         39,921,287         229,516,424         294,865,946    

Transfers between funds

       52,628,071         (16,771,794)        (3,349,337)        1,437,876         (15,951,353)        2,035,175         (42,981,040)        (2,762,862)   

Redemptions

       (86,431,007)        (45,389,095)        (10,357,687)        (10,836,924)        (16,607,631)        (17,512,597)        (83,952,247)        (36,401,236)   

Annuity benefits

       (34,683)        (8,783)        (7,605)        (6,220)        (4,750)        (4,604)        (2,114)        (1,723)   

Contract maintenance charges (note 2)

       (8,552,540)        (5,087,949)        (623,287)        (343,966)        (887,303)        (546,272)        (8,657,851)        (4,760,859)   

Contingent deferred sales charges (note 2)

       (702,188)        (834,019)        (92,408)        (100,775)        (134,622)        (146,169)        (701,559)        (758,413)   

Adjustments to maintain reserves

       (2,749)        8,251         (919)        246         (956)        (1,575)        (3,843)        (8,140)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       175,875,556         217,478,620         2,042,530         16,786,912         (7,718,884)        23,745,245         93,217,770         250,172,713    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       211,942,379         254,010,594         26,053,204         4,349,496         23,732,020         11,242,347         252,144,784         215,732,859    

Contract owners’ equity beginning of period

       1,024,636,255         770,625,661         116,531,942         112,182,446         203,065,667         191,823,320         1,005,300,580         789,567,721    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     1,236,578,634         1,024,636,255         142,585,146         116,531,942         226,797,687         203,065,667         1,257,445,364         1,005,300,580    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       91,572,178         71,841,137         11,697,772         10,053,778         21,925,386         19,445,092         125,082,554         94,709,952    

Units purchased

       30,111,228         34,301,944         2,742,837         4,450,308         4,106,547         7,194,972         32,142,445         43,246,817    

Units redeemed

       (15,034,268)        (14,570,903)        (2,537,602)        (2,806,314)        (4,853,312)        (4,714,678)        (21,788,014)        (12,874,215)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       106,649,138         91,572,178         11,903,007         11,697,772         21,178,621         21,925,386         135,436,985         125,082,554    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

          HIBF     HIBF3     GEM     GEM2  
          2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

     $        392,123         535,443         6,458,219         5,630,792         (1,917)        (2,787)        (14,700)        (17,020)   

Realized gain (loss) on investments

       (184,587)        (418,585)        854,689         3,775,393         (55,685)        (39,549)        (245,677)        (27,864)   

Change in unrealized gain (loss) on investments

       585,028         72,641         3,950,323         (7,065,820)        100,996         (57,044)        437,185         (377,713)   

Reinvested capital gains

       -             -             -             -             -             -             -             -        
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       792,564         189,499         11,263,231         2,340,365         43,394         (99,380)        176,808         (422,597)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       29         88         9,123,520         8,068,539         -             -             (49)        -        

Transfers between funds

       (302,180)        (405,304)        (5,804,309)        1,732,584         (20,766)        (38,817)        (82,436)        (24,169)   

Redemptions

       (1,280,655)        (1,796,036)        (10,697,689)        (10,518,180)        (109,494)        (45,592)        (278,702)        (268,987)   

Annuity benefits

       (305)        (277)        (10,309)        (9,871)        (552)        (641)        -             -        

Contract maintenance charges
(note 2)

       (979)        (1,095)        (6,897)        (6,233)        (112)        (135)        (325)        (424)   

Contingent deferred sales charges (note 2)

       (468)        (6,939)        (56,633)        (55,427)        (1)        (3)        (163)        (206)   

Adjustments to maintain reserves

       (264)        (254)        (788)        (469)        (311)        (378)        (47)        (97)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (1,584,822)        (2,209,817)        (7,453,105)        (789,057)        (131,236)        (85,566)        (361,722)        (293,883)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (792,258)        (2,020,318)        3,810,126         1,551,308         (87,842)        (184,946)        (184,914)        (716,480)   

Contract owners’ equity beginning of period

       6,839,009         8,859,327         97,202,206         95,650,898         297,368         482,314         1,272,348         1,988,828    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

     $        6,046,751         6,839,009         101,012,332         97,202,206         209,526         297,368         1,087,434         1,272,348    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       405,899         540,532         7,233,930         7,280,016         14,503         18,106         44,117         52,785    

Units purchased

       25,324         98,053         4,079,407         5,368,529         -             -             284         6,775    

Units redeemed

       (113,815)        (232,686)        (4,651,621)        (5,414,615)        (5,886)        (3,603)        (11,742)        (15,443)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       317,408         405,899         6,661,716         7,233,930         8,617         14,503         32,659         44,117    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        GEM3     GEM6     GIG     GIG3  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (204,875)        (203,521)        (661,084)        (588,128)        (160)        12         (131,392)        (27,196)   

Realized gain (loss) on investments

       (1,521,297)        (7,675,076)        (112,087)        (9,626,946)                1,059                 1,071         796,615         (367,298)   

Change in unrealized gain (loss) on investments

       5,076,471         (1,496)        7,071,298         (3,988,277)        4,074         (5,750)        2,629,444         (2,872,659)   

Reinvested capital gains

       -             -             -             -             -             -             -             -        
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       3,350,299         (7,880,093)        6,298,127         (14,203,351)        4,973         (4,667)        3,294,667         (3,267,153)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       526,430         1,215,053         8,201,646         8,115,744         (1)        -             338,218         374,330    

Transfers between funds

       (1,443,011)        (4,735,882)        (303,727)        (6,626,973)        3         -             (822,168)        68,727    

Redemptions

       (3,680,267)        (5,376,932)        (5,713,863)        (6,914,453)        (2,680)        (3,192)        (3,685,324)        (4,855,542)   

Annuity benefits

       (2,519)        (5,571)        (1,942)        -             -             -             (6,662)        (7,239)   

Contract maintenance charges (note 2)

       (11,372)        (14,203)        (6,353)        (6,825)        (28)        (36)        (11,280)        (12,937)   

Contingent deferred sales charges (note 2)

       (4,444)        (13,866)        (46,339)        (54,086)        -             -             (2,895)        (5,979)   

Adjustments to maintain reserves

       (2,146)        442         (1,320)        (754)        2         (31)        (669)        13,825    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (4,617,329)        (8,930,959)        2,128,102         (5,487,347)        (2,704)        (3,259)        (4,190,780)        (4,424,815)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (1,267,030)        (16,811,052)        8,426,229         (19,690,698)        2,269         (7,926)        (896,113)        (7,691,968)   

Contract owners’ equity beginning of period

       23,472,677         40,283,729         43,888,708         63,579,406         35,746         43,672         25,375,025         33,066,993    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     22,205,647         23,472,677         52,314,937         43,888,708         38,015         35,746         24,478,912         25,375,025    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       1,075,051         1,413,626         2,598,477         2,890,791         3,386         3,675         1,510,544         1,753,932    

Units purchased

       146,794         164,028         1,061,571         832,414         -             -             39,976         163,083    

Units redeemed

       (342,885)        (502,603)        (954,916)        (1,124,728)        (218)        (289)        (272,782)        (406,471)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       878,960         1,075,051         2,705,132         2,598,477         3,168         3,386         1,277,738         1,510,544    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        NVIE6     NVNMO1     NVNMO2     NVNSR1  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (243,715)        (92,134)        44,582         (679,303)        (39,904)        (259,705)        (548)        (13,457)   

Realized gain (loss) on investments

       851,907         940,738         1,080,857         1,984,473         (455,722)        (94,216)        7,638         371,873    

Change in unrealized gain (loss) on investments

       2,479,899         (3,620,754)        4,089,975         (13,163,847)        2,125,262         (3,503,958)        199,359         (540,513)   

Reinvested capital gains

       -             -             5,060,113         677,844         1,691,067         204,746         -             -        
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       3,088,091         (2,772,150)        10,275,527         (11,180,833)        3,320,703         (3,653,133)        206,449         (182,097)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       2,125,460         3,317,466         891,891         1,158,627         4,044,040         8,997,765         271,583         158,705    

Transfers between funds

       (2,473,355)        4,116,297         (3,073,354)        (2,704,805)        (5,594,507)        1,402,105         171,156         422,185    

Redemptions

       (2,193,911)        (1,711,231)        (10,231,572)        (11,882,578)        (1,089,967)        (1,499,636)        (367,735)        (253,130)   

Annuity benefits

       -             -             (26,271)        (14,716)        -             -             -             -        

Contract maintenance charges (note 2)

       (114,906)        (72,967)        (37,938)        (45,683)        (169,882)        (85,748)        (1,150)        (1,063)   

Contingent deferred sales charges (note 2)

       (27,879)        (9,039)        (6,764)        (23,422)        (11,239)        (20,043)        (1,692)        (748)   

Adjustments to maintain reserves

       (500)        254         (241)        (1,792)        (426)        (501)        (65)        (62)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (2,685,091)        5,640,780         (12,484,249)        (13,514,369)        (2,821,981)        8,793,942         72,097         325,887    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       403,000         2,868,630         (2,208,722)        (24,695,202)        498,722         5,140,809         278,546         143,790    

Contract owners’ equity beginning of period

       24,130,603         21,261,973         72,695,987         97,391,189         23,656,246         18,515,437         2,108,691         1,964,901    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     24,533,603         24,130,603         70,487,265         72,695,987         24,154,968         23,656,246         2,387,237         2,108,691    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       3,528,777         2,754,847         9,418,341         11,003,045         3,122,319         2,127,346         227,602         202,690    

Units purchased

       637,277         1,682,280         177,927         426,205         750,979         2,297,649         67,491         222,042    

Units redeemed

       (1,008,477)        (908,350)        (1,680,167)        (2,010,909)        (1,104,847)        (1,302,676)        (60,956)        (197,130)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       3,157,577         3,528,777         7,916,101         9,418,341         2,768,451         3,122,319         234,137         227,602    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        NVNSR2     NVCRA2     NVCRB2     NVCCA2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (1,118,682)        (2,110,130)        (152,909)        72,768         (694,551)        8,682,845         (4,348,829)        11,584,199    

Realized gain (loss) on investments

       3,158,170         2,257,917         243,862         1,378,893         931,324         11,907         1,903,568         (157,807)   

Change in unrealized gain (loss) on investments

       13,354,018         (6,887,748)        2,194,034         (3,956,192)        104,996,734         (52,411,470)        217,317,898         (121,757,876)   

Reinvested capital gains

       -            -            1,042,883         355,769         18,208,571         7,339,091         33,278,540         10,895,379    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       15,393,506         (6,739,961)        3,327,870         (2,148,762)        123,442,078         (36,377,627)        248,151,177         (99,436,105)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       4,920,646         10,710,831         4,663,127         4,788,842         305,604,539         404,792,668         284,605,039         835,255,553    

Transfers between funds

       (18,555,862)        (8,201,985)        (821,390)        706,694         (10,096,718)        12,410,216         (27,496,657)        5,991,743    

Redemptions

       (23,426,724)        (22,992,218)        (1,493,504)        (2,807,771)        (105,099,933)        (36,141,060)        (56,642,630)        (39,667,171)   

Annuity benefits

       (2,866)        (2,781)        -            -            -            -            -            -       

Contract maintenance charges (note 2)

       (748,295)        (693,349)        (4,180)        (4,030)        (11,329,322)        (6,029,010)        (22,726,905)        (11,209,805)   

Contingent deferred sales charges (note 2)

       (133,120)        (204,935)        (17,022)        (35,767)        (896,257)        (648,042)        (1,074,108)        (839,931)   

Adjustments to maintain reserves

       (1,047)        (1,300)        (264)        162         (1,146)        (4,664)        151         (11,290)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (37,947,268)        (21,385,737)        2,326,767         2,648,130         178,181,163         374,380,108         176,664,890         789,519,099    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (22,553,762)        (28,125,698)        5,654,637         499,368         301,623,241         338,002,481         424,816,067         690,082,994    

Contract owners’ equity beginning of period

       174,956,881         203,082,579         22,508,074         22,008,706         1,259,936,055         921,933,574         1,993,782,374         1,303,699,380    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     152,403,119         174,956,881         28,162,711         22,508,074         1,561,559,296         1,259,936,055         2,418,598,441         1,993,782,374    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       19,248,367         21,270,528         2,675,730         2,416,119         128,328,881         91,327,946         215,720,584         134,184,859    

Units purchased

       2,627,837         5,214,783         660,100         1,042,514         38,695,997         46,164,222         35,891,174         96,316,816    

Units redeemed

       (6,609,748)        (7,236,944)        (404,096)        (782,903)        (21,896,292)        (9,163,287)        (17,843,167)        (14,781,091)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       15,266,456         19,248,367         2,931,734         2,675,730         145,128,586         128,328,881         233,768,591         215,720,584    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        NVCCN2     NVCMD2     NVCMA2     NVCMC2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     2,445,058         4,696,475         (1,534,125)        12,982,809         (1,630,908)        2,735,374         1,253,216         4,907,986    

Realized gain (loss) on investments

       7,877,727         4,943,425         1,264,985         (334,802)        2,992,692         (339,662)        1,394,135         567,042    

Change in unrealized gain (loss) on investments

       16,786,044         (14,006,408)        174,246,357         (95,093,111)        32,114,038         (29,035,553)        35,932,206         (17,845,617)   

Reinvested capital gains

       9,671,320         2,688,951         33,776,138         11,062,859         9,486,110         3,343,151         12,080,603         2,968,535    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       36,780,149         (1,677,557)        207,753,355         (71,382,245)        42,961,932         (23,296,690)        50,660,160         (9,402,054)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       128,728,941         158,098,491         295,118,909         700,007,455         13,248,220         12,840,436         141,556,880         186,647,527    

Transfers between funds

       60,099,790         81,061,529         (17,371,631)        10,111,955         (5,418,477)        1,115,152         12,539,130         2,560,929    

Redemptions

       (39,168,728)        (29,740,793)        (81,479,867)        (85,249,293)        (22,393,673)        (25,119,040)        (32,077,247)        (22,226,014)   

Annuity benefits

       -            -            -            -            -            -            -            -       

Contract maintenance charges (note 2)

       (6,015,007)        (3,509,652)        (19,769,111)        (10,593,475)        (2,094,689)        (2,099,688)        (5,691,151)        (3,143,421)   

Contingent deferred sales charges (note 2)

       (789,576)        (447,860)        (1,429,635)        (1,125,118)        (150,041)        (247,980)        (490,489)        (348,014)   

Adjustments to maintain reserves

       (680)        (817)        (1,086)        (5,148)        (558)        (350)        (838)        (1,740)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       142,854,740         205,460,898         175,067,579         613,146,376         (16,809,218)        (13,511,470)        115,836,285         163,489,267    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       179,634,889         203,783,341         382,820,934         541,764,131         26,152,714         (36,808,160)        166,496,445         154,087,213    

Contract owners’ equity beginning of period

       581,434,652         377,651,311         1,863,452,955         1,321,688,824         343,084,881         379,893,041         556,682,830         402,595,617    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     761,069,541         581,434,652         2,246,273,889         1,863,452,955         369,237,595         343,084,881         723,179,275         556,682,830    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       54,984,947         35,658,142         194,824,445         133,082,298         38,634,829         40,125,331         54,955,819         39,080,002    

Units purchased

       27,849,330         30,573,061         36,303,091         86,188,702         2,607,358         3,393,666         17,896,066         22,612,236    

Units redeemed

       (14,865,778)        (11,246,256)        (18,961,252)        (24,446,555)        (4,351,799)        (4,884,168)        (6,985,084)        (6,736,419)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       67,968,499         54,984,947         212,166,284         194,824,445         36,890,388         38,634,829         65,866,801         54,955,819    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        NVCBD1     NVCBD2     NVLCP2     TRF  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     61,908         44,297         1,121,341         1,256,413         279,997         319,966         56,106         (238,124)   

Realized gain (loss) on investments

       59,181         22,771         3,220,408         2,344,806         597,281         351,008         219,120         (5,175,956)   

Change in unrealized gain (loss) on investments

       44,851         40,974         1,968,847         2,615,526         712,067         752,471         14,628,968         4,619,978    

Reinvested capital gains

       20,878         -            791,448         -            883,698         36,533         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       186,818         108,042         7,102,044         6,216,745         2,473,043         1,459,978         14,904,194         (794,102)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       141,307         165,016         7,013,416         7,763,878         7,150,138         11,563,400         1,365,258         1,954,192    

Transfers between funds

       819,191         542,575         2,743,856         (10,323,196)        2,126,964         3,499,028         (2,409,616)        (3,607,632)   

Redemptions

       (619,450)        (396,735)        (24,390,445)        (20,295,386)        (3,573,589)        (2,756,305)        (17,861,217)        (18,364,044)   

Annuity benefits

       -            -            (2,224)        (1,920)        -            -            (52,117)        (67,453)   

Contract maintenance charges (note 2)

       (1,043)        (865)        (505,107)        (466,440)        (261,967)        (128,141)        (91,462)        (103,337)   

Contingent deferred sales charges (note 2)

       (578)        (697)        (113,843)        (151,259)        (31,128)        (16,056)        (9,038)        (18,270)   

Adjustments to maintain reserves

       (52)        (70)        (922)        (1,004)        (490)        (508)        (38,864)        13,528    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       339,375         309,224         (15,255,269)        (23,475,327)        5,409,928         12,161,418         (19,097,056)        (20,193,016)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       526,193         417,266         (8,153,225)        (17,258,582)        7,882,971         13,621,396         (4,192,862)        (20,987,118)   

Contract owners’ equity beginning of period

       2,763,344         2,346,078         127,561,730         144,820,312         40,774,802         27,153,406         123,961,912         144,949,030    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     3,289,537         2,763,344         119,408,505         127,561,730         48,657,773         40,774,802         119,769,050         123,961,912    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       235,110         209,916         11,130,478         13,216,889         3,256,827         2,269,048         2,459,013         2,827,396    

Units purchased

       166,150         135,519         3,784,767         3,574,509         1,464,689         2,299,623         30,884         51,660    

Units redeemed

       (138,020)        (110,325)        (5,099,034)        (5,660,920)        (1,037,763)        (1,311,844)        (393,274)        (420,043)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       263,240         235,110         9,816,211         11,130,478         3,683,753         3,256,827         2,096,623         2,459,013    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        TRF2     GBF     CAF     CAF2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (966,450)        (1,559,402)        2,154,657         5,741,612         (263,051)        (259,785)        (109,462)        19,474    

Realized gain (loss) on investments

       1,917,002         (11,738,465)        3,564,812         2,212,745         2,511,788         2,398,610         263,424         (16,121)   

Change in unrealized gain (loss) on investments

       17,355,660         12,680,009         (12,227,239)        14,767,389         1,680,857         (2,806,152)        1,293,160         139,364    

Reinvested capital gains

       -            -            12,510,903         1,336,507         -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       18,306,212         (617,858)        6,003,133         24,058,253         3,929,594         (667,327)        1,447,122         142,717    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       3,074,134         3,279,098         15,209,610         18,346,424         832,102         642,476         8,400,120         6,515,616    

Transfers between funds

       (15,514,929)        (10,072,890)        3,539,091         (23,095,419)        224,888         686,393         3,799,569         3,652,806    

Redemptions

       (23,698,491)        (23,548,338)        (62,025,466)        (60,738,031)        (4,552,509)        (4,991,713)        (442,822)        (39,194)   

Annuity benefits

       (1,991)        (1,811)        (20,244)        (25,894)        (21,484)        (8,554)        -            -       

Contract maintenance charges (note 2)

       (623,028)        (631,351)        (1,113,852)        (1,046,615)        (29,426)        (32,525)        (113,766)        (4,421)   

Contingent deferred sales charges (note 2)

       (137,206)        (196,285)        (262,521)        (346,713)        (4,134)        (7,399)        (6,191)        (552)   

Adjustments to maintain reserves

       (1,020)        (904)        (70)        1,121         1,640         448         (286)        (44)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (36,902,531)        (31,172,481)        (44,673,452)        (66,905,127)        (3,548,923)        (3,710,874)        11,636,624         10,124,211    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (18,596,319)        (31,790,339)        (38,670,319)        (42,846,874)        380,671         (4,378,201)        13,083,746         10,266,928    

Contract owners’ equity beginning of period

       167,516,909         199,307,248         407,181,059         450,027,933         31,815,129         36,193,330         10,266,928         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     148,920,590         167,516,909         368,510,740         407,181,059         32,195,800         31,815,129         23,350,674         10,266,928    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       12,416,055         14,608,151         25,298,375         30,230,403         1,730,666         1,929,649         1,133,015         -       

Units purchased

       1,340,895         1,942,302         7,765,453         7,933,130         116,583         164,317         1,601,830         1,219,798    

Units redeemed

       (3,945,706)        (4,134,398)        (10,442,113)        (12,865,158)        (290,760)        (363,300)        (434,331)        (86,783)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       9,811,244         12,416,055         22,621,715         25,298,375         1,556,489         1,730,666         2,300,514         1,133,015    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        GVIX8     GVIDA     NVDBL2     NVDCA2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     187,558         210,737         (1,046,585)        (109,857)        2,806,650         2,354,465         3,446,468         3,825,946    

Realized gain (loss) on investments

       683,249         (495,803)        (20,460,551)        (16,491,307)        816,706         227,017         8,137,343         1,661,708    

Change in unrealized gain (loss) on investments

       2,110,133         (2,856,612)        54,304,973         310,490         32,818,918         (6,890,276)        79,591,523         (29,486,529)   

Reinvested capital gains

       -            -            -            -            6,606,231         513,222         13,157,136         677,210    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       2,980,940         (3,141,678)        32,797,837         (16,290,674)        43,048,505         (3,795,572)        104,332,470         (23,321,665)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       1,800,028         3,526,416         7,299,542         4,610,804         212,722,775         218,095,273         211,290,678         501,218,133    

Transfers between funds

       (2,399,959)        3,941,371         (12,755,664)        (10,678,043)        16,484,249         17,074,496         (5,341,671)        14,170,521    

Redemptions

       (1,064,430)        (1,199,126)        (62,022,844)        (54,500,702)        (30,211,093)        (13,470,230)        (21,714,871)        (10,719,464)   

Annuity benefits

       -            -            (20,626)        (14,469)        -            -            -            -       

Contract maintenance charges (note 2)

       (78,279)        (41,652)        (47,813)        (56,770)        (5,108,071)        (2,285,245)        (11,354,282)        (4,370,123)   

Contingent deferred sales charges (note 2)

       (5,105)        (11,669)        (154,314)        (298,822)        (481,129)        (244,911)        (566,068)        (233,739)   

Adjustments to maintain reserves

       (421)        (432)        514        4,963        (713)        (3,091)        (723)        (6,684)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (1,748,166)        6,214,908        (67,701,205)        (60,933,039)        193,406,018        219,166,292        172,313,063        500,058,644   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       1,232,774         3,073,230         (34,903,368)        (77,223,713)        236,454,523         215,370,720         276,645,533         476,736,979    

Contract owners’ equity beginning of period

       19,050,533         15,977,303         264,292,741         341,516,454         489,089,921         273,719,201         906,298,809         429,561,830    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     20,283,307         19,050,533         229,389,373         264,292,741         725,544,444         489,089,921         1,182,944,342         906,298,809    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       2,533,356         1,822,983         16,836,607         20,614,506         39,506,703         21,980,236         69,667,022         32,219,088    

Units purchased

       598,836         1,217,445         2,816,095         2,345,472         21,729,282         20,322,615         19,767,966         42,034,142    

Units redeemed

       (815,253)        (507,072)        (6,859,007)        (6,123,371)        (6,876,448)        (2,796,148)        (7,219,505)        (4,586,208)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       2,316,939         2,533,356         12,793,695         16,836,607         54,359,537         39,506,703         82,215,483         69,667,022    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        GVIDC     GVIDM     GVDMA     GVDMC  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     2,411,848         3,720,985         1,031,380         11,476,690         (1,546,814)        4,752,843         651,506         4,466,943    

Realized gain (loss) on investments

       18,247         (261,080)        476,528         280,095         (26,211,464)        (20,510,261)        375,493         (461,714)   

Change in unrealized gain (loss) on investments

       9,664,365         1,117,885         210,082,299         (51,379,389)        167,505,085         (33,685,157)        43,380,593         (1,357,344)   

Reinvested capital gains

       8,323,406         1,557,894         -            -            -            -            3,269,186         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       20,417,866         6,135,684         211,590,207         (39,622,604)        139,746,807         (49,442,575)        47,676,778         2,647,885    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners
(note 3)

       134,085,096         138,254,369         215,033,838         397,119,283         16,822,585         18,909,283         110,990,931         127,648,171    

Transfers between funds

       58,791,548         43,980,204         (28,611,651)        (73,223,684)        (36,487,977)        (31,103,442)        2,410,839         11,037,413    

Redemptions

       (54,250,761)        (44,261,619)        (301,137,174)        (366,727,754)        (188,240,199)        (163,811,995)        (117,582,496)        (80,845,288)   

Annuity benefits

       (11,627)        (11,690)        (113,054)        (109,135)        -            (29,982)        (113,564)        (117,861)   

Contract maintenance charges (note 2)

       (4,745,432)        (2,449,428)        (13,869,457)        (8,911,084)        (4,411,971)        (4,458,196)        (4,287,001)        (2,644,876)   

Contingent deferred sales charges (note 2)

       (682,683)        (546,307)        (1,684,233)        (2,201,178)        (927,560)        (1,414,009)        (485,575)        (664,390)   

Adjustments to maintain reserves

       (853)        (1,060)        (1,034)        1,928         (1,238)        3,437         (200)        (1,664)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       133,185,288         134,964,469         (130,382,765)        (54,051,624)        (213,246,360)        (181,904,904)        (9,067,066)        54,411,505    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       153,603,154         141,100,153         81,207,442         (93,674,228)        (73,499,553)        (231,347,479)        38,609,712         57,059,390    

Contract owners’ equity beginning of period

       518,575,478         377,475,325         2,362,793,548         2,456,467,776         1,253,194,315         1,484,541,794         756,335,353         699,275,963    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     672,178,632         518,575,478         2,444,000,990         2,362,793,548         1,179,694,762         1,253,194,315         794,945,065         756,335,353    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       40,657,415         29,968,371         163,597,374         166,698,445         80,738,644         92,239,100         55,287,171         51,232,905    

Units purchased

       20,937,992         20,869,615         29,003,377         53,288,743         6,643,515         6,082,366         16,927,413         15,008,587    

Units redeemed

       (10,691,559)        (10,180,571)        (37,092,613)        (56,389,814)        (19,649,933)        (17,582,822)        (17,706,382)        (10,954,321)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       50,903,848         40,657,415         155,508,138         163,597,374         67,732,226         80,738,644         54,508,202         55,287,171    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        MCIF     SAM     NVMIG3     NVMIG6  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (400,638)        (694,772)        (9,685,921)        (9,036,524)        (258,014)        (23,349)        (2,284,042)        (1,212,918)   

Realized gain (loss) on investments

       243,373         560,765         (318)        -            1,008,551         1,571,686         (665,733)        100,072    

Change in unrealized gain (loss) on investments

       8,126,493         (5,226,560)        -            -            3,750,451         (5,658,845)        24,196,475         (17,722,290)   

Reinvested capital gains

       6,960,670         1,548,165         -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       14,929,898         (3,812,402)        (9,686,239)        (9,036,524)        4,500,988         (4,110,508)        21,246,700         (18,835,136)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       7,980,266         13,183,693         247,207,814         302,275,346         420,785         484,026         3,926,052         8,048,393    

Transfers between funds

       (3,968,613)        2,506,583         143,621,124         118,974,495         (643,468)        (1,020,058)        (7,824,811)        2,731,351    

Redemptions

       (11,285,361)        (12,824,031)        (363,582,711)        (321,996,751)        (4,474,976)        (6,234,279)        (22,111,170)        (21,895,425)   

Annuity benefits

       (12,234)        (9,068)        (80,486)        (88,129)        (1,447)        (1,503)        (533)        (444)   

Contract maintenance charges (note 2)

       (279,370)        (142,371)        (1,353,438)        (795,150)        (16,835)        (19,852)        (750,029)        (695,399)   

Contingent deferred sales charges (note 2)

       (45,828)        (46,177)        (724,115)        (1,241,313)        (7,701)        (10,122)        (139,744)        (203,425)   

Adjustments to maintain reserves

       (1,286)        (4,624)        (4,731)        28,281         (124)        (66)        (1,210)        (865)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (7,612,426)        2,664,005         25,083,457         97,156,779         (4,723,766)        (6,801,854)        (26,901,445)        (12,015,814)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       7,317,472         (1,148,397)        15,397,218         88,120,255         (222,778)        (10,912,362)        (5,654,745)        (30,850,950)   

Contract owners’ equity beginning of period

       98,415,415         99,563,812         654,554,435         566,434,180         33,825,091         44,737,453         166,931,769         197,782,719    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     105,732,887         98,415,415         669,951,653         654,554,435         33,602,313         33,825,091         161,277,024         166,931,769    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       5,247,331         5,115,318         52,755,926         45,261,889         4,100,818         4,850,543         20,747,296         21,858,795    

Units purchased

       982,475         1,945,436         88,452,722         95,037,845         88,356         132,200         2,422,511         4,324,627    

Units redeemed

       (1,343,538)        (1,813,423)        (85,369,097)        (87,543,808)        (623,128)        (881,925)        (5,558,410)        (5,436,126)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       4,886,268         5,247,331         55,839,551         52,755,926         3,566,046         4,100,818         17,611,397         20,747,296    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        GVDIV2     GVDIV3     GVDIV6     NVMLG1  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (7,395)        (615)        (50,869)        30,818         (803,675)        133,442         (88,025)        (145,688)   

Realized gain (loss) on investments

       (88,011)        (94,325)        (1,786,790)        (1,392,741)        (1,621,650)        (674,146)        478,611         207,305    

Change in unrealized gain (loss) on investments

       173,798         (31,310)        2,568,680         204,658         10,141,540         (9,471,630)        772,743         (483,600)   

Reinvested capital gains

       -            -            -            -            -            -            241,936         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       78,392         (126,250)        731,021         (1,157,265)        7,716,215         (10,012,334)        1,405,265         (421,983)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       -            -            105,052         159,661         4,269,453         9,578,611         229,409         290,704    

Transfers between funds

       (9,598)        (35,064)        (343,400)        (72,374)        327,690         388,437         37,223         (485,705)   

Redemptions

       (110,913)        (163,041)        (863,101)        (1,157,691)        (4,090,384)        (3,860,146)        (2,233,461)        (1,565,329)   

Annuity benefits

       -            -            -            -            (1,050)        (1,223)        (1,684)        (1,679)   

Contract maintenance charges (note 2)

       (67)        (88)        (2,249)        (2,681)        (364,470)        (251,491)        (5,699)        (6,278)   

Contingent deferred sales charges (note 2)

       (53)        (132)        (1,527)        (2,134)        (43,242)        (52,855)        (5,128)        (4,942)   

Adjustments to maintain reserves

       (70)        (57)        (96)        (84)        (649)        (786)        115         (2,397)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (120,701)        (198,382)        (1,105,321)        (1,075,303)        97,348         5,800,547        (1,979,225)        (1,775,626)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (42,309)        (324,632)        (374,300)        (2,232,568)        7,813,563         (4,211,787)        (573,960)        (2,197,609)   

Contract owners’ equity beginning of period

       559,837         884,469         5,441,335         7,673,903         52,397,141         56,608,928         9,767,057         11,964,666    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     517,528         559,837         5,067,035         5,441,335         60,210,704         52,397,141         9,193,097         9,767,057    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       44,925         58,167         415,870         485,438         5,935,093         5,274,892         1,104,279         1,296,267    

Units purchased

       425         4,852         53,493         63,166         1,399,547         1,918,445         226,740         192,874    

Units redeemed

       (9,374)        (18,094)        (134,561)        (132,734)        (1,408,041)        (1,258,244)        (426,146)        (384,862)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       35,976         44,925         334,802         415,870         5,926,599         5,935,093         904,873         1,104,279    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        NVMLG2     NVMLV1     NVMLV2     NVMMG1  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (1,647,331)        (2,067,406)        (2,249)        (8,208)        (183,059)        (302,589)        (2,413,910)        (2,612,586)   

Realized gain (loss) on investments

       10,212,445         6,719,593         8,918         (14,831)        1,297,709         878,622         9,404,126         9,549,350    

Change in unrealized gain (loss) on investments

       4,614,926         (9,689,783)        494,137         (368,941)        5,455,285         (5,366,484)        (722,039)        (17,266,389)   

Reinvested capital gains

       2,775,096         -            -            118,443         -            1,486,602         16,720,810         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       15,955,136         (5,037,596)        500,806         (273,537)        6,569,935         (3,303,849)        22,988,987         (10,329,625)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners
(note 3)

       5,869,224         8,972,927         139,821         128,362         6,125,770         8,371,802         1,721,916         2,183,677    

Transfers between funds

       (12,733,860)        (4,759,740)        (51,211)        299,680         (774,225)        (690,247)        (3,461,781)        (5,246,061)   

Redemptions

       (15,764,758)        (15,559,904)        (684,859)        (680,349)        (4,841,114)        (4,874,170)        (24,082,215)        (25,622,702)   

Annuity benefits

       (9,851)        (3,113)        -            -            -            -            (18,919)        (18,674)   

Contract maintenance charges (note 2)

       (382,863)        (324,632)        (1,490)        (1,661)        (192,343)        (101,654)        (113,893)        (124,961)   

Contingent deferred sales charges (note 2)

       (93,358)        (114,839)        (2,261)        (601)        (30,502)        (30,167)        (13,338)        (19,095)   

Adjustments to maintain reserves

       (1,693)        (268)        (92)        (36)        (736)        (702)        2,621         1,387    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (23,117,159)        (11,789,569)        (600,092)        (254,605)        286,850         2,674,862         (25,965,609)        (28,846,429)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (7,162,023)        (16,827,165)        (99,286)        (528,142)        6,856,785         (628,987)        (2,976,622)        (39,176,054)   

Contract owners’ equity beginning of period

       113,541,164         130,368,329         3,307,487         3,835,629         41,597,008         42,225,995         175,618,967         214,795,021    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     106,379,141         113,541,164         3,208,201         3,307,487         48,453,793         41,597,008         172,642,345         175,618,967    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       13,148,749         14,383,005         341,497         368,018         5,145,247         4,831,835         18,999,885         21,964,214    

Units purchased

       2,148,673         3,430,101         60,859         103,491         1,679,692         1,995,582         283,823         399,587    

Units redeemed

       (4,543,629)        (4,664,357)        (117,433)        (130,012)        (1,649,086)        (1,682,170)        (2,812,233)        (3,363,916)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       10,753,793         13,148,749         284,923         341,497         5,175,853         5,145,247         16,471,475         18,999,885    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
                    (Continued)   

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        NVMMG2     NVMMV2     SCGF     SCGF2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (2,131,153)        (2,292,662)        (1,056,464)        (1,973,658)        (82,739)        (99,998)        (324,660)        (316,989)   

Realized gain (loss) on investments

       13,105,734         11,160,853         10,553,001         10,282,591         652,842         (270,602)        802,811         443,448    

Change in unrealized gain (loss) on investments

       (6,661,320)        (15,004,422)        1,342,795         (18,252,957)        165,087         (77,181)        1,785,088         (1,902,744)   

Reinvested capital gains

       11,722,621         -            25,062,241         1,158,382         -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       16,035,882         (6,136,231)        35,901,573         (8,785,642)        735,190         (447,781)        2,263,239         (1,776,285)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners
(note 3)

       4,282,164         7,801,314         4,234,157         6,422,922         181,600         162,553         1,911,308         3,940,777    

Transfers between funds

       (12,045,990)        (9,834,724)        (13,770,357)        (9,351,828)        396,118         722,364         (5,403,078)        5,168,688    

Redemptions

       (16,695,985)        (16,624,168)        (33,865,349)        (34,246,478)        (981,136)        (1,238,804)        (2,387,846)        (2,128,444)   

Annuity benefits

       (1,887)        (1,797)        (505)        (402)        (2,070)        (2,054)        (1,109)        -       

Contract maintenance charges (note 2)

       (526,136)        (445,178)        (558,458)        (540,177)        (2,867)        (3,416)        (46,867)        (25,590)   

Contingent deferred sales charges (note 2)

       (110,421)        (150,043)        (103,260)        (150,529)        (2,751)        (5,569)        (42,866)        (13,615)   

Adjustments to maintain reserves

       (1,168)        731         (1,233)        (2,686)        (128)        (120)        (941)        (378)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (25,099,423)        (19,253,865)        (44,065,005)        (37,869,178)        (411,234)        (365,046)        (5,971,399)        6,941,438    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (9,063,541)        (25,390,096)        (8,163,432)        (46,654,820)        323,956         (812,827)        (3,708,160)        5,165,153    

Contract owners’ equity beginning of period

       128,019,368         153,409,464         265,166,289         311,821,109         6,284,822         7,097,649         21,201,023         16,035,870    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     118,955,827         128,019,368         257,002,857         265,166,289         6,608,778         6,284,822         17,492,863         21,201,023    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       14,187,931         15,990,746         27,202,766         30,788,320         954,853         1,058,529         1,534,116         1,120,559    

Units purchased

       2,021,104         3,129,029         1,519,420         2,415,325         338,711         705,792         473,384         1,573,297    

Units redeemed

       (4,540,627)        (4,931,844)        (5,751,477)        (6,000,879)        (396,678)        (809,468)        (874,128)        (1,159,740)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       11,668,408         14,187,931         22,970,709         27,202,766         896,886         954,853         1,133,372         1,534,116    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
                    (Continued)   

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        SCVF     SCVF2     SCF     SCF2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (165,604)        (317,006)        (217,883)        (283,301)        (864,919)        (649,770)        (619,855)        (445,082)   

Realized gain (loss) on investments

       (545,140)        (1,262,311)        2,227,739         118,953         (2,785,306)        (4,175,167)        (737,870)        (2,066,677)   

Change in unrealized gain (loss) on investments

       6,292,987         (636,292)        1,717,976         (1,454,048)        13,197,879         (666,964)        6,780,262         (480,843)   

Reinvested capital gains

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       5,582,243         (2,215,609)        3,727,832         (1,618,396)        9,547,654         (5,491,901)        5,422,537         (2,992,602)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners
(note 3)

       527,312         533,137         1,686,343         2,919,712         909,614         1,074,712         1,804,025         4,277,597    

Transfers between funds

       (380,914)        (3,004,799)        (1,339,193)        (891,295)        (1,981,428)        (2,416,619)        (484,709)        (2,199,794)   

Redemptions

       (4,530,168)        (4,750,801)        (2,487,009)        (3,247,498)        (9,413,807)        (11,341,728)        (4,909,752)        (5,969,396)   

Annuity benefits

       (8,268)        (8,106)        (256)        (226)        (11,887)        (13,106)        (10,092)        (10,001)   

Contract maintenance charges (note 2)

       (15,238)        (17,358)        (46,544)        (26,549)        (36,762)        (41,636)        (87,353)        (59,473)   

Contingent deferred sales charges (note 2)

       (3,889)        (8,375)        (12,997)        (20,301)        (8,118)        (21,360)        (21,685)        (37,251)   

Adjustments to maintain reserves

       1,001         (1,557)        (689)        (11,358)        (8,814)        3,933         (660)        (4,094)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (4,410,164)        (7,257,859)        (2,200,345)        (1,277,515)        (10,551,202)        (12,755,804)        (3,710,226)        (4,002,412)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       1,172,079         (9,473,468)        1,527,487         (2,895,911)        (1,003,548)        (18,247,705)        1,712,311         (6,995,014)   

Contract owners’ equity beginning of period

       31,138,365         40,611,833         22,008,886         24,904,797         71,658,581         89,906,286         41,518,940         48,513,954    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     32,310,444         31,138,365         23,536,373         22,008,886         70,655,033         71,658,581         43,231,251         41,518,940    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       1,530,375         1,869,906         1,135,796         1,184,181         2,073,053         2,424,228         2,180,295         2,354,378    

Units purchased

       128,432         77,187         283,004         359,725         34,528         79,266         307,616         513,055    

Units redeemed

       (322,887)        (416,718)        (387,329)        (408,110)        (314,197)        (430,441)        (484,799)        (687,138)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       1,335,920         1,530,375         1,031,471         1,135,796         1,793,384         2,073,053         2,003,112         2,180,295    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        MSBF     NVSTB2     NVOLG1     NVOLG2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     1,651,587         3,684,517         (180,245)        (37,139)        (2,234,019)        (2,503,145)        (2,654,156)        (3,043,752)   

Realized gain (loss) on investments

       344,774         (2,191,747)        275,802         391,112         5,426,399         1,149,225         4,448,290         847,802    

Change in unrealized gain (loss) on investments

       13,494,479         3,235,626         1,269,933         (603,266)        51,052,517         (11,481,323)        34,803,766         (7,963,767)   

Reinvested capital gains

       -            -            -            -            -            1,308,144         -            913,646    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       15,490,840         4,728,396         1,365,490         (249,293)        54,244,897         (11,527,099)        36,597,900         (9,246,071)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners
(note 3)

       17,588,431         37,706,570         12,162,082         8,640,236         4,303,351         5,468,229         5,738,421         9,587,439    

Transfers between funds

       11,047,855         (2,971,089)        3,420,041         (5,527,365)        (11,129,356)        (26,271,087)        (12,673,243)        (30,678,992)   

Redemptions

       (11,808,683)        (9,959,347)        (7,875,069)        (8,860,304)        (48,009,010)        (60,228,487)        (34,449,963)        (39,218,867)   

Annuity benefits

       (1,825)        (1,751)        (18,755)        (15,448)        (96,074)        (88,542)        (50,508)        (37,406)   

Contract maintenance charges (note 2)

       (933,007)        (483,169)        (349,012)        (271,716)        (174,969)        (197,408)        (232,256)        (166,416)   

Contingent deferred sales charges
(note 2)

       (93,043)        (61,458)        (46,924)        (69,038)        (58,412)        (89,561)        (160,072)        (246,279)   

Adjustments to maintain reserves

       (809)        (950)        (775)        (842)        4,687         (18,148)        (3,692)        (7,139)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       15,798,919         24,228,806         7,291,588         (6,104,477)        (55,159,783)        (81,425,004)        (41,831,313)        (60,767,660)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       31,289,759         28,957,202         8,657,078         (6,353,770)        (914,886)        (92,952,103)        (5,233,413)        (70,013,731)   

Contract owners’ equity beginning of period

       138,362,303         109,405,101         69,545,479         75,899,249         329,836,348         422,788,451         229,733,564         299,747,295    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     169,652,062         138,362,303         78,202,557         69,545,479         328,921,462         329,836,348         224,500,151         229,733,564    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       9,793,974         8,055,038         6,676,235         7,264,937         24,571,339         30,384,486         17,340,176         21,739,959    

Units purchased

       4,039,425         4,777,007         3,062,881         2,412,673         578,567         614,853         1,738,695         2,210,015    

Units redeemed

       (2,998,890)        (3,038,071)        (2,375,687)        (3,001,375)        (4,226,177)        (6,428,000)        (4,557,346)        (6,609,798)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       10,834,509         9,793,974         7,363,429         6,676,235         20,923,729         24,571,339         14,521,525         17,340,176    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
                    (Continued)   

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        NVTIV3     EIF2     NVRE1     NVRE2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     1,778,889         2,637,067         (796,164)        (627,002)        (205,336)        (318,823)        (482,335)        (606,858)   

Realized gain (loss) on investments

       316,105         1,372,048         6,274,561         (416,831)        4,460,378         3,918,498         6,052,878         5,332,786    

Change in unrealized gain (loss) on investments

       32,274,962         (34,380,208)        14,279,807         (3,344,505)        (1,475,127)        (734,046)        (3,499,416)        (2,016,752)   

Reinvested capital gains

       3,970,267         241,593         -            -            6,061,151         278,438         6,699,271         277,097    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       38,340,223         (30,129,500)        19,758,204         (4,388,338)        8,841,066         3,144,067         8,770,398         2,986,273    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners
(note 3)

       14,620,907         35,551,377         9,130,537         21,782,969         1,187,157         1,047,416         7,583,595         5,861,092    

Transfers between funds

       (6,132,659)        13,687,670         (11,425,457)        (640,096)        262,303         (1,527,120)        (1,381,989)        (3,164,279)   

Redemptions

       (23,434,554)        (23,873,382)        (11,767,011)        (13,313,942)        (9,805,662)        (8,999,781)        (8,993,774)        (9,660,517)   

Annuity benefits

       (2,091)        (1,904)        (8,052)        (8,191)        (1,456)        (1,354)        (3,729)        -       

Contract maintenance charges (note 2)

       (1,454,744)        (1,066,892)        (689,678)        (452,981)        (27,533)        (29,237)        (8,771)        (8,343)   

Contingent deferred sales charges (note 2)

       (175,032)        (223,721)        (89,755)        (106,478)        (10,757)        (17,908)        (43,949)        (66,992)   

Adjustments to maintain reserves

       (1,243)        6,080         (1,461)        (1,566)        (112)        (198)        (750)        (740)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (16,579,416)        24,079,228         (14,850,877)        7,259,715         (8,396,060)        (9,528,182)        (2,849,367)        (7,039,779)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       21,760,807         (6,050,272)        4,907,327         2,871,377         445,006         (6,384,115)        5,921,031         (4,053,506)   

Contract owners’ equity beginning of period

       222,458,599         228,508,871         128,293,126         125,421,749         64,241,909         70,626,024         63,716,493         67,769,999    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     244,219,406         222,458,599         133,200,453         128,293,126         64,686,915         64,241,909         69,637,524         63,716,493    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       19,166,748         16,971,191         8,681,768         8,163,585         6,584,064         7,607,257         6,645,388         7,395,551    

Units purchased

       3,513,317         6,775,590         1,131,390         2,855,357         731,661         766,455         2,648,867         2,380,446    

Units redeemed

       (4,813,861)        (4,580,033)        (2,073,942)        (2,337,174)        (1,513,132)        (1,789,648)        (2,919,784)        (3,130,609)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       17,866,204         19,166,748         7,739,216         8,681,768         5,802,593         6,584,064         6,374,471         6,645,388    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
                    (Continued)   

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

            NOTB4     NOTG4     NOTMG4     ALVBWB  
              2012           2011             2012             2011           2012           2011           2012         2011    

Investment activity:

                    

Net investment income (loss)

   $       (145)        -            (69)        -            (37)        -            1,618         (91)   

Realized gain (loss) on investments

         2         -            1         -            1         -            67         (41)   

Change in unrealized gain (loss) on investments

         450         -            (401)        -            (93)        -            10,826         (2,004)   

Reinvested capital gains

         -            -            -            -            -            -            -            -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         307         -            (469)        -            (129)        -            12,511         (2,136)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         283,740         -            151,863         -            77,187         -            134,459         -       

Transfers between funds

         -            -            -            -            -            -            (133)        46,884    

Redemptions

         -            -            -            -            -            -            (2,803)        (583)   

Annuity benefits

         -            -            -            -            -            -            -            -       

Contract maintenance charges (note 2)

         -            -            -            -            -            -            (327)        -       

Contingent deferred sales charges (note 2)

         -            -            -            -            -            -            -            -       

Adjustments to maintain reserves

         2         -            (3)        -            1         -            (9)        2    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         283,742         -            151,860         -            77,188         -            131,187         46,303    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         284,049         -            151,391         -            77,059         -            143,698         44,167    

Contract owners’ equity beginning of period

         -            -            -            -            -            -            44,167         -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       284,049         -            151,391         -            77,059         -            187,865         44,167    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         -            -            -            -            -            -            4,833         -       

Units purchased

         28,003         -            14,748         -            7,494         -            13,706         4,898    

Units redeemed

         -            -            -            -            -            -            (334)        (65)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         28,003         -            14,748         -            7,494         -            18,205         4,833    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

            ALVGIB     ALVSVB     ACVB     ACVCA  
            2012     2011     2012     2011     2012     2011         2012             2011      

Investment activity:

                    

Net investment income (loss)

   $       (8,815)        (27,128)        (730,529)        (651,705)        252,988         195,160         (1,149)        (1,388)   

Realized gain (loss) on investments

         (310,389)        (715,629)        3,472,786         2,932,486         128,344         389,961         11,931         11,646    

Change in unrealized gain (loss) on investments

         1,267,722         1,112,476         4,018,458         (6,741,553)        3,027,234         807,535         (3,694)        (17,607)   

Reinvested capital gains

         -            -            1,808,592         -            -            -            5,294         -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         948,518         369,719         8,569,307         (4,460,772)        3,408,566         1,392,656         12,382         (7,349)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         63,680         119,778         8,658,428         16,969,188         442,668         319,108         (167)        (763)   

Transfers between funds

         (238,510)        (340,550)        (3,206,421)        (782,142)        2,356,265         (168,384)        (89)        951    

Redemptions

         (1,132,303)        (1,724,429)        (4,534,107)        (3,881,999)        (5,155,224)        (5,590,784)        (16,691)        (10,070)   

Annuity benefits

         -            -            -            -            (26,147)        (24,910)        (14,894)        (21,268)   

Contract maintenance charges (note 2)

         (606)        (711)        (344,787)        (185,625)        (19,120)        (20,388)        284         (59)   

Contingent deferred sales charges (note 2)

         (667)        (1,929)        (50,738)        (37,045)        (2,129)        (6,608)        -            -       

Adjustments to maintain reserves

         (212)        (176)        (672)        (1,725)        700         753         874         2,838    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (1,308,618)        (1,948,017)        521,703         12,080,652         (2,402,987)        (5,491,213)        (30,683)        (28,371)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         (360,100)        (1,578,298)        9,091,010         7,619,880         1,005,579         (4,098,557)        (18,301)        (35,720)   

Contract owners’ equity beginning of period

         6,554,605         8,132,903         53,434,948         45,815,068         33,575,388         37,673,945         90,130         125,850    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       6,194,505         6,554,605         62,525,958         53,434,948         34,580,967         33,575,388         71,829         90,130    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         449,878         585,653         2,665,187         2,060,999         1,363,531         1,591,690         -            197    

Units purchased

         17,455         99,342         845,808         1,462,866         158,379         83,062         9         -       

Units redeemed

         (100,022)        (235,117)        (828,722)        (858,678)        (251,099)        (311,221)        (9)        (197)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         367,311         449,878         2,682,273         2,665,187         1,270,811         1,363,531         -            -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

            ACVIG     ACVIG2     ACVIP2     ACVI  
            2012     2011       2012       2011     2012     2011         2012             2011      

Investment activity:

                    

Net investment income (loss)

   $       109,156         33,042         19,145         (6,948)        2,456,166         5,646,357         (59)        28    

Realized gain (loss) on investments

         (207,264)        (167,564)        (129,365)        (304,559)        2,599,188         3,142,131         (761)        5,683    

Change in unrealized gain (loss) on investments

         1,920,003         426,452         666,102         442,142         3,966,549         10,086,527         3,194         (8,320)   

Reinvested capital gains

         -            -            -            -            6,029,123         2,459,240         -            -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         1,821,895         291,930         555,882         130,635         15,051,026         21,334,255         2,374         (2,609)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         215,317         256,700         34,265         71,184         34,390,441         52,967,680         (37)        6    

Transfers between funds

         (441,930)        677,860         (47,247)        (229,389)        8,560,480         13,901,530         46         22    

Redemptions

         (1,779,451)        (2,083,384)        (705,230)        (1,364,717)        (25,327,881)        (22,526,761)        -            28    

Annuity benefits

         (4,392)        (6,089)        -            -            (20,317)        (20,175)        (7,154)        (10,199)   

Contract maintenance charges (note 2)

         (8,185)        (8,911)        (744)        (851)        (1,302,626)        (680,505)        (10)        (28)   

Contingent deferred sales charges (note 2)

         (1,587)        (3,075)        (344)        (2,793)        (139,466)        (149,562)        1         -       

Adjustments to maintain reserves

         (115)        (151)        (179)        (100)        (2,637)        (864)        702         718    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (2,020,343)        (1,167,050)        (719,479)        (1,526,666)        16,157,994         43,491,343         (6,452)        (9,453)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         (198,448)        (875,120)        (163,597)        (1,396,031)        31,209,020         64,825,598         (4,078)        (12,062)   

Contract owners’ equity beginning of period

         14,239,521         15,114,641         4,486,341         5,882,372         248,948,599         184,123,001         15,864         27,926    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       14,041,073         14,239,521         4,322,744         4,486,341         280,157,619         248,948,599         11,786         15,864    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         1,231,796         1,330,183         311,018         413,946         17,822,531         14,505,426         -            -       

Units purchased

         90,005         128,730         26,461         86,291         6,220,656         9,665,810         1         -       

Units redeemed

         (248,938)        (227,117)        (70,505)        (189,219)        (5,084,411)        (6,348,705)        (1)        -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         1,072,863         1,231,796         266,974         311,018         18,958,776         17,822,531         -            -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

            ACVI3     ACVMV1     ACVMV2     ACVVS1  
                2012             2011         2012     2011     2012     2011         2012             2011      

Investment activity:

                    

Net investment income (loss)

   $       (1)        -            51,925         2,357         228,614         (227,327)        (67)        (91)   

Realized gain (loss) on investments

         16         22         346,443         694,698         2,379,004         1,018,745         557         598    

Change in unrealized gain (loss) on investments

         7         (52)        201,214         (1,063,646)        3,403,599         (3,155,494)        279         (1,119)   

Reinvested capital gains

         -            -            387,583         185,964         3,920,363         1,585,878         -            -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         22         (30)        987,165         (180,627)        9,931,580         (778,198)        769         (612)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         -            45         228,135         189,729         10,447,724         17,636,715         126         2    

Transfers between funds

         2         -            (43,046)        925,685         (2,918,193)        (2,679,815)        (129)        5    

Redemptions

         -            (45)        (726,541)        (862,824)        (5,092,553)        (4,793,574)        -            -       

Annuity benefits

         (94)        (103)        (656)        (640)        (37)        (84)        (478)        (1,823)   

Contract maintenance charges (note 2)

         (3)        -            (2,647)        (2,536)        (411,922)        (207,832)        3         (7)   

Contingent deferred sales charges (note 2)

         -            -            (1,162)        (2,708)        (48,980)        (44,011)        -            -       

Adjustments to maintain reserves

         1         5         (63)        (93)        (810)        (1,093)        (1,588)        (154)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (94)        (98)        (545,980)        246,613         1,975,229         9,910,306         (2,066)        (1,977)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         (72)        (128)        441,185         65,986         11,906,809         9,132,108         (1,297)        (2,589)   

Contract owners’ equity beginning of period

         164         292         6,839,115         6,773,129         68,625,858         59,493,750         5,367         7,956    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       92         164         7,280,300         6,839,115         80,532,667         68,625,858         4,070         5,367    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         -            -            580,082         563,062         4,998,981         4,240,631         -            -       

Units purchased

         -            3         149,808         261,720         1,305,989         2,268,662         25         -       

Units redeemed

         -            (3)        (191,944)        (244,700)        (1,182,993)        (1,510,312)        (25)        -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         -            -            537,946         580,082         5,121,977         4,998,981         -            -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

            DVSCS     DCAP     DCAPS     DVDLS  
            2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                    

Net investment income (loss)

   $       (901,834)        (715,108)        861,777         88,867         1,628,192         (183,645)        (20,991)        (15,993)   

Realized gain (loss) on investments

         7,509,240         (276,231)        785,181         288,259         2,132,194         (110,160)        125,010         (90,792)   

Change in unrealized gain (loss) on investments

         1,100,457         774,737         1,435,033         1,830,568         3,769,940         4,605,397         163,956         24,240    

Reinvested capital gains

         2,917,328         180,331         -            -            -            -            -            -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         10,625,191         (36,271)        3,081,991         2,207,694         7,530,326         4,311,592         267,975         (82,545)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         7,923,579         9,800,455         643,284         618,614         19,707,743         25,092,202         5,477         37,029    

Transfers between funds

         (6,258,432)        2,114,625         3,741,571         7,034,816         2,687,388         18,920,480         (417,783)        187,005    

Redemptions

         (8,107,080)        (8,229,857)        (4,799,723)        (4,529,712)        (7,013,643)        (3,999,330)        (359,585)        (401,589)   

Annuity benefits

         (313)        (2,324)        (7,749)        (6,910)        -            -            (112)        (101)   

Contract maintenance charges (note 2)

         (256,742)        (169,159)        (15,502)        (14,563)        (530,592)        (181,858)        (300)        (294)   

Contingent deferred sales charges (note 2)

         (50,049)        (58,026)        (5,738)        (5,904)        (66,541)        (27,191)        (1,271)        (1,271)   

Adjustments to maintain reserves

         (1,382)        (1,196)        2,107         12,054         (751)        (770)        (79)        (69)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (6,750,419)        3,454,518         (441,750)        3,108,395         14,783,604         39,803,533         (773,653)        (179,290)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         3,874,772         3,418,247         2,640,241         5,316,089         22,313,930         44,115,125         (505,678)        (261,835)   

Contract owners’ equity beginning of period

         80,125,567         76,707,320         33,075,439         27,759,350         83,122,167         39,007,042         1,694,412         1,956,247    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       84,000,339         80,125,567         35,715,680         33,075,439         105,436,097         83,122,167         1,188,734         1,694,412    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         4,193,254         3,955,893         1,991,035         1,798,776         5,240,577         2,607,789         146,781         146,633    

Units purchased

         987,109         1,511,539         519,877         749,144         3,005,542         3,784,026         48,602         114,410    

Units redeemed

         (1,273,032)        (1,274,178)        (537,520)        (556,885)        (2,101,186)        (1,151,238)        (109,150)        (114,262)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         3,907,331         4,193,254         1,973,392         1,991,035         6,144,933         5,240,577         86,233         146,781    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

 

            DGI     FCA2S     FQB     FQBS  
            2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                    

Net investment income (loss)

   $       11,807         (12,613)        (18,528)        (18,918)        303,594         470,850         966,412         1,680,237    

Realized gain (loss) on investments

         272,642         559,642         (6,920)        24,275         115,862         19,409         322,937         294,248    

Change in unrealized gain (loss) on investments

         1,724,328         (1,079,186)        64,439         (145,242)        468,008         (366,671)        1,740,874         (1,729,168)   

Reinvested capital gains

         -            -            90,844         -            -            -            -            -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         2,008,777         (532,157)        129,835         (139,885)        887,464         123,588         3,030,223         245,317    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         171,784         288,573         19,902         50,248         178,719         274,242         360,517         821,277    

Transfers between funds

         (114,815)        (138,603)        (27,208)        (123,123)        726,570         134,938         (18,568)        (1,854,262)   

Redemptions

         (1,766,161)        (2,228,669)        (415,740)        (460,661)        (1,480,896)        (2,350,781)        (7,404,108)        (8,450,391)   

Annuity benefits

         (1,039)        (1,035)        -            -            -            -            -            -       

Contract maintenance charges (note 2)

         (8,740)        (9,826)        (249)        (308)        (4,222)        (4,784)        (14,704)        (14,937)   

Contingent deferred sales charges (note 2)

         (1,758)        (2,331)        (34)        (445)        (1,607)        (5,670)        (18,512)        (23,742)   

Adjustments to maintain reserves

         (41)        (24)        (73)        (109)        (100)        (80)        (425)        (609)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (1,720,770)        (2,091,915)        (423,402)        (534,398)        (581,536)        (1,952,135)        (7,095,800)        (9,522,664)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         288,007         (2,624,072)        (293,567)        (674,283)        305,928         (1,828,547)        (4,065,577)        (9,277,347)   

Contract owners’ equity beginning of period

         12,742,413         15,366,485         1,615,658         2,289,941         11,050,770         12,879,317         41,686,179         50,963,526    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       13,030,420         12,742,413         1,322,091         1,615,658         11,356,698         11,050,770         37,620,602         41,686,179    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         981,613         1,135,487         119,610         159,179         780,758         917,867         3,296,763         4,051,047    

Units purchased

         43,860         96,776         2,324         19,274         113,166         145,409         423,311         695,282    

Units redeemed

         (164,136)        (250,650)        (31,491)        (58,843)        (152,636)        (282,518)        (964,515)        (1,449,566)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         861,337         981,613         90,443         119,610         741,288         780,758         2,755,559         3,296,763    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

            FEIP     FVSS2     FHIP     FAMP  
            2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                    

Net investment income (loss)

   $       5,610,995         3,752,131         (106,526)        (105,501)        2,164,468         2,936,013         206,570         838,178    

Realized gain (loss) on investments

         5,118,528         (6,158,939)        (327,900)        (1,200,981)        (1,137,947)        (1,128,421)        2,630,650         565,756    

Change in unrealized gain (loss) on investments

         17,134,098         1,793,459         2,502,330         183,667         5,297,401         (236,192)        11,166,603         (7,785,316)   

Reinvested capital gains

         21,013,230         -            -            -            -            -            1,009,102         726,738    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         48,876,851         (613,349)        2,067,904         (1,122,815)        6,323,922         1,571,400         15,012,925         (5,654,644)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         4,115,420         4,700,575         105,320         145,427         (342)        (1)        1,286,309         1,485,500    

Transfers between funds

         (3,541,812)        (6,858,114)        (202,142)        (932,918)        (1,312,313)        (1,656,934)        (1,719,710)        (1,072,877)   

Redemptions

         (47,017,486)        (50,391,145)        (1,994,978)        (2,537,816)        (7,726,239)        (7,409,703)        (19,696,655)        (23,577,395)   

Annuity benefits

         (147,869)        (119,757)        (2,459)        -            (7,606)        (8,073)        (18,316)        (21,817)   

Contract maintenance charges (note 2)

         (175,351)        (194,347)        (1,654)        (1,942)        (27,731)        (31,022)        (84,834)        (95,037)   

Contingent deferred sales charges (note 2)

         (22,494)        (39,836)        (4,208)        (9,243)        (1,560)        (2,178)        (9,924)        (15,999)   

Adjustments to maintain reserves

         6,557         5,121         (1,119)        (1,143)        (4,690)        2,303         4,928         2,132    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (46,783,035)        (52,897,503)        (2,101,240)        (3,337,635)        (9,080,481)        (9,105,608)        (20,238,202)        (23,295,493)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         2,093,816         (53,510,852)        (33,336)        (4,460,450)        (2,756,559)        (7,534,208)        (5,225,277)        (28,950,137)   

Contract owners’ equity beginning of period

         327,558,733         381,069,585         9,070,473         13,530,923         53,185,035         60,719,243         142,849,462         171,799,599    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       329,652,549         327,558,733         9,037,137         9,070,473         50,428,476         53,185,035         137,624,185         142,849,462    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         8,145,845         9,449,660         490,823         670,043         1,920,320         2,252,355         4,443,665         5,144,923    

Units purchased

         175,949         216,335         87,259         122,585         -            -            55,208         104,302    

Units redeemed

         (1,266,012)        (1,520,150)        (190,218)        (301,805)        (309,086)        (332,035)        (649,862)        (805,560)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         7,055,782         8,145,845         387,864         490,823         1,611,234         1,920,320         3,849,011         4,443,665    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

            FNRS2     FEI2     FF10S     FF10S2  
            2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                    

Net investment income (loss)

   $       (643,731)        (668,151)        2,403,366         1,343,344         28,271         34,711         391,696         493,255    

Realized gain (loss) on investments

         (6,545,271)        (4,616,316)        (4,514,983)        (3,815,369)        159,227         (47,935)        (373,546)        (473,981)   

Change in unrealized gain (loss) on investments

         9,324,446         (2,120,730)        14,837,289         1,567,029         262,948         (112,430)        9,596,864         (2,752,125)   

Reinvested capital gains

         -            -            11,021,363         -            79,550         27,771         1,860,931         562,206    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         2,135,444         (7,405,197)        23,747,035         (904,996)        529,996         (97,883)        11,475,945         (2,170,645)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         8,409,524         9,238,333         22,748,996         32,702,178         53,652         474,351         25,539,421         33,209,999    

Transfers between funds

         (9,051,966)        9,987,356         (8,602,069)        (849,716)        614,060         542,711         6,235,816         (177,232)   

Redemptions

         (9,374,671)        (10,539,922)        (17,566,070)        (17,920,413)        (674,338)        (1,082,149)        (9,363,769)        (11,639,216)   

Annuity benefits

         (6,029)        (1,657)        (1,421)        (1,605)        (9,177)        (9,172)        -            -       

Contract maintenance charges (note 2)

         (14,262)        (15,977)        (696,198)        (377,245)        (2,050)        (2,493)        (932,769)        (495,735)   

Contingent deferred sales charges (note 2)

         (92,532)        (90,177)        (107,608)        11,854         (1,211)        (1,108)        (102,210)        (69,650)   

Adjustments to maintain reserves

         (884)        (1,488)        (1,818)        (6,108)        1,769         1,364         (508)        (654)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (10,130,820)        8,576,468         (4,226,188)        13,558,945         (17,295)        (76,496)        21,375,981         20,827,512    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         (7,995,376)        1,171,271         19,520,847         12,653,949         512,701         (174,379)        32,851,926         18,656,867    

Contract owners’ equity beginning of period

         82,210,476         81,039,205         160,434,147         147,780,198         5,314,349         5,488,728         109,039,045         90,382,178    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       74,215,100         82,210,476         179,954,994         160,434,147         5,827,050         5,314,349         141,890,971         109,039,045    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         5,296,112         4,869,955         10,951,320         9,964,580         470,396         477,386         9,073,579         7,420,624    

Units purchased

         1,366,148         2,693,772         2,710,891         4,246,051         101,705         117,958         3,079,121         4,219,745    

Units redeemed

         (1,995,289)        (2,267,615)        (2,969,390)        (3,259,311)        (103,564)        (124,948)        (1,430,836)        (2,566,790)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         4,666,971         5,296,112         10,692,821         10,951,320         468,537         470,396         10,721,864         9,073,579    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

 

            FF20S     FF20S2     FF30S     FF30S2  
            2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                    

Net investment income (loss)

   $       60,407         74,792         1,552,473         2,507,911         58,526         51,952         82,817         49,303    

Realized gain (loss) on investments

         254,922         (132,434)        (468,336)        (249,131)        (70,257)        (223,095)        (945,122)        (818,657)   

Change in unrealized gain (loss) on investments

         664,072         (219,877)        35,608,515         (13,474,393)        931,094         (144,597)        3,890,185         (526,674)   

Reinvested capital gains

         117,762         36,905         4,822,666         1,318,347         70,610         21,006         245,034         72,546    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         1,097,163         (240,614)        41,515,318         (9,897,266)        989,973         (294,734)        3,272,914         (1,223,482)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         280,293         527,904         58,023,162         136,211,288         590,216         639,682         3,455,517         2,424,041    

Transfers between funds

         388,740         1,119,499         5,076,979         7,602,875         519,884         470,807         161,991         1,850,153    

Redemptions

         (1,282,036)        (1,384,874)        (18,237,501)        (13,551,377)        (800,984)        (592,693)        (1,920,354)        (2,068,048)   

Annuity benefits

         -            -            -            -            -            -            -            -       

Contract maintenance charges (note 2)

         (4,458)        (4,652)        (3,504,859)        (1,732,675)        (4,854)        (4,666)        (5,308)        (5,120)   

Contingent deferred sales charges (note 2)

         (5,454)        (4,527)        (203,373)        (287,904)        (8,367)        (2,874)        (20,349)        (26,114)   

Adjustments to maintain reserves

         (68)        (60)        (551)        (1,547)        (80)        (71)        (306)        (257)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (622,983)        253,290         41,153,857         128,240,660         295,815         510,185         1,671,191         2,174,655    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         474,180         12,676         82,669,175         118,343,394         1,285,788         215,451         4,944,105         951,173    

Contract owners’ equity beginning of period

         9,615,738         9,603,062         344,893,609         226,550,215         6,953,362         6,737,911         23,919,498         22,968,325    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       10,089,918         9,615,738         427,562,784         344,893,609         8,239,150         6,953,362         28,863,603         23,919,498    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         901,996         879,170         28,669,879         18,343,828         688,670         640,936         2,066,391         1,895,831    

Units purchased

         106,851         218,988         6,261,474         12,611,995         133,563         182,726         550,349         521,774    

Units redeemed

         (161,530)        (196,162)        (3,057,674)        (2,285,944)        (106,188)        (134,992)        (420,497)        (351,214)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         847,317         901,996         31,873,679         28,669,879         716,045         688,670         2,196,243         2,066,391    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

            FGP     FG2     FHIPR     FIGBS  
            2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                    

Net investment income (loss)

   $       (2,569,775)        (3,535,127)        (1,198,129)        (1,128,511)        1,134,381         1,226,818         235,075         510,999    

Realized gain (loss) on investments

         7,167,215         (1,173,028)        438,500         (2,380,823)        175,063         2,517,280         802,968         336,073    

Change in unrealized gain (loss) on investments

         37,988,759         971,173         12,187,378         499,281         1,457,588         (3,050,392)        (598,954)        (68,689)   

Reinvested capital gains

         -            1,253,598         -            269,866         -            -            721,816         748,306    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         42,586,199         (2,483,384)        11,427,749         (2,740,187)        2,767,032         693,706         1,160,905         1,526,689    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         4,835,706         5,119,757         19,163,172         22,667,171         1,137,197         1,093,545         588,391         742,600    

Transfers between funds

         (6,962,662)        (2,105,085)        (12,811,696)        15,426,580         2,743,914         (805,093)        787,620         1,154,537    

Redemptions

         (47,928,988)        (48,833,620)        (9,642,019)        (8,808,539)        (3,177,947)        (4,028,947)        (3,784,877)        (5,238,408)   

Annuity benefits

         (79,318)        (101,221)        (1,896)        (2,541)        -            -            (4,806)        (4,711)   

Contract maintenance charges (note 2)

         (228,807)        (252,064)        (410,948)        (168,201)        (6,475)        (6,930)        (7,467)        (7,915)   

Contingent deferred sales charges (note 2)

         (34,652)        (48,400)        (120,765)        (57,518)        (3,290)        (5,867)        (4,675)        (9,296)   

Adjustments to maintain reserves

         6,006         6,997         (1,134)        (1,012)        (116)        (118)        (123)        (161)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (50,392,715)        (46,213,636)        (3,825,286)        29,055,940         693,283         (3,753,410)        (2,425,937)        (3,363,354)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         (7,806,516)        (48,697,020)        7,602,463         26,315,753         3,460,315         (3,059,704)        (1,265,032)        (1,836,665)   

Contract owners’ equity beginning of period

         328,397,293         377,094,313         89,168,898         62,853,145         22,040,608         25,100,312         27,791,661         29,628,326    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       320,590,777         328,397,293         96,771,361         89,168,898         25,500,923         22,040,608         26,526,629         27,791,661    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         6,680,291         7,616,804         6,092,294         4,203,897         1,853,305         2,166,797         2,042,324         2,303,690    

Units purchased

         142,612         295,614         2,397,744         4,471,418         1,183,024         1,500,256         379,339         567,398    

Units redeemed

         (1,081,866)        (1,232,127)        (2,566,496)        (2,583,021)        (1,135,107)        (1,813,748)        (553,786)        (828,764)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         5,741,037         6,680,291         5,923,542         6,092,294         1,901,222         1,853,305         1,867,877         2,042,324    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        FIGBP2     FMCS     FMC2     FOP  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     1,742,938         4,820,399         (202,662)        (376,801)        (2,900,851)        (3,911,084)        283,650         (1,666)   

Realized gain (loss) on investments

       3,406,579         4,890,312         1,995,541         107,758         (802,650)        (746,414)        669,340         1,333,032    

Change in unrealized gain (loss) on investments

       (155,049)        1,164,428         (581,637)        (3,524,647)        13,877,082         (26,848,523)        7,772,708         (12,839,256)   

Reinvested capital gains

       10,995,269         11,376,584         1,797,861         47,717         19,110,143         446,500         165,187         123,690    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       15,989,737         22,251,723         3,009,103         (3,745,973)        29,283,724         (31,059,521)        8,890,885         (11,384,200)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       26,586,213         39,438,365         784,078         903,305         21,703,598         42,458,799         (26)        (1,426)   

Transfers between funds

       18,573,845         (37,805,528)        (2,197,048)        (3,036,006)        (16,454,217)        (14,591,118)        (1,014,830)        (1,420,251)   

Redemptions

       (56,140,506)        (52,077,080)        (3,744,054)        (4,359,851)        (25,223,259)        (27,644,953)        (6,571,168)        (7,892,930)   

Annuity benefits

       (13,475)        (12,927)        (5,473)        (3,447)        (16,644)        (15,970)        (6,027)        (10,007)   

Contract maintenance charges (note 2)

       (1,893,358)        (1,458,800)        (9,158)        (11,338)        (1,008,948)        (604,425)        (32,959)        (40,284)   

Contingent deferred sales charges (note 2)

       (288,524)        (394,334)        (5,018)        (11,075)        (193,281)        (251,942)        (640)        (2,030)   

Adjustments to maintain reserves

       (1,329)        (1,601)        (735)        1,196         (1,711)        1,959         510         358    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (13,177,134)        (52,311,905)        (5,177,408)        (6,517,216)        (21,194,462)        (647,650)        (7,625,140)        (9,366,570)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       2,812,603         (30,060,182)        (2,168,305)        (10,263,189)        8,089,262         (31,707,171)        1,265,745         (20,750,770)   

Contract owners’ equity beginning of period

       394,783,413         424,843,595         24,925,334         35,188,523         233,235,701         264,942,872         49,649,942         70,400,712    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     397,596,016         394,783,413         22,757,029         24,925,334         241,324,963         233,235,701         50,915,687         49,649,942    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       29,688,055         33,793,486         2,401,588         2,988,963         10,141,828         10,137,469         2,365,334         2,742,146    

Units purchased

       8,873,731         8,867,895         233,335         742,257         1,932,893         3,372,714         3         (67)   

Units redeemed

       (9,943,992)        (12,973,326)        (699,301)        (1,329,632)        (2,749,999)        (3,368,355)        (329,009)        (376,745)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       28,617,794         29,688,055         1,935,622         2,401,588         9,324,722         10,141,828         2,036,328         2,365,334    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
                    (Continued)   

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        FOPR     FO2     FO2R     FVSS  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     141,761         (3,918)        6,374         (11,392)        112,847         (150,229)        (51,953)        (35,629)   

Realized gain (loss) on investments

       (1,511,158)        (626,677)        (40,773)        36,814         (4,777,350)        (4,155,340)        652,957         687,635    

Change in unrealized gain (loss) on investments

       5,438,720         (4,791,201)        444,109         (573,548)        14,314,528         (6,494,327)        790,190         (1,295,073)   

Reinvested capital gains

       78,550         58,558         7,823         7,011         201,418         108,894         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       4,147,873         (5,363,238)        417,533         (541,115)        9,851,443         (10,691,002)        1,391,194         (643,067)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners
(note 3)

       1,240,222         1,184,907         -            -            6,482,300         11,247,420         124,196         124,631    

Transfers between funds

       (743,248)        (1,170,848)        (16,780)        (78,252)        (2,727,268)        (1,957,303)        337,643         (674,304)   

Redemptions

       (3,421,426)        (5,184,489)        (427,734)        (867,520)        (4,653,331)        (5,549,915)        (991,793)        (1,045,709)   

Annuity benefits

       (1,566)        (1,713)        -            -            (1,059)        (1,092)        -            -       

Contract maintenance charges (note 2)

       (9,303)        (11,661)        (306)        (426)        (259,103)        (144,003)        (2,642)        (3,083)   

Contingent deferred sales charges (note 2)

       (3,927)        (12,640)        (50)        (805)        (31,779)        (51,729)        (610)        (2,028)   

Adjustments to maintain reserves

       66         194         15         (138)        (914)        (1,170)        (101)        22    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (2,939,182)        (5,196,250)        (444,855)        (947,141)        (1,191,154)        3,542,208         (533,307)        (1,600,471)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       1,208,691         (10,559,488)        (27,322)        (1,488,256)        8,660,289         (7,148,794)        857,887         (2,243,538)   

Contract owners’ equity beginning of period

       22,952,788         33,512,276         2,423,876         3,912,132         53,055,648         60,204,442         5,721,382         7,964,920    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     24,161,479         22,952,788         2,396,554         2,423,876         61,715,937         53,055,648         6,579,269         5,721,382    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       1,866,140         2,228,091         149,602         198,160         4,998,098         4,618,811         432,099         540,940    

Units purchased

       130,201         170,497         966         20,459         1,324,721         1,798,978         84,367         71,862    

Units redeemed

       (347,393)        (532,448)        (26,261)        (69,017)        (1,404,853)        (1,419,691)        (120,338)        (180,703)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       1,648,948         1,866,140         124,307         149,602         4,917,966         4,998,098         396,128         432,099    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
                    (Continued)   

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        FTVIS2     FTVRD2     FTVSV2     FTVDM3  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     6,822,346         5,635,603         35,836         (32,734)        (1,171,890)        (1,443,578)        (31,878)        (170,829)   

Realized gain (loss) on investments

       (2,916,245)        (2,972,293)        2,477,217         1,514,217         16,268,277         12,258,988         (589,789)        (2,498,885)   

Change in unrealized gain (loss) on investments

       10,652,790         (1,686,046)        3,097,048         1,090,945         6,646,397         (16,606,531)        3,471,324         (3,115,486)   

Reinvested capital gains

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       14,558,891         977,264         5,610,101         2,572,428         21,742,784         (5,791,121)        2,849,657         (5,785,200)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       18,528,968         14,661,470         307,661         696,473         6,990,978         12,952,878         232,798         489,824    

Transfers between funds

       3,954,298         4,227,422         (2,052,014)        (1,644,548)        (19,216,758)        (3,952,355)        1,096,378         (522,461)   

Redemptions

       (17,263,941)        (16,432,264)        (10,974,687)        (13,391,190)        (18,117,281)        (18,480,749)        (3,062,546)        (3,472,143)   

Annuity benefits

       (26,978)        (25,365)        (10,740)        (10,552)        (2,580)        (7,838)        -            -       

Contract maintenance charges (note 2)

       (14,836)        (13,935)        (6,701)        (7,611)        (487,715)        (394,940)        (4,083)        (4,255)   

Contingent deferred sales charges (note 2)

       (118,004)        (85,474)        (21,378)        (51,403)        (117,332)        (123,239)        (12,185)        (21,146)   

Adjustments to maintain reserves

       (780)        2,313         (774)        (908)        (1,942)        (847)        (462)        (784)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       5,058,727         2,334,167         (12,758,633)        (14,409,739)        (30,952,630)        (10,007,090)        (1,750,100)        (3,530,965)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       19,617,618         3,311,431         (7,148,532)        (11,837,311)        (9,209,846)        (15,798,211)        1,099,557         (9,316,165)   

Contract owners’ equity beginning of period

       131,123,063         127,811,632         60,344,570         72,181,881         149,938,988         165,737,199         26,345,988         35,662,153    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     150,740,681         131,123,063         53,196,038         60,344,570         140,729,142         149,938,988         27,445,545         26,345,988    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       11,167,150         10,974,594         3,637,623         4,554,255         7,354,175         7,692,944         1,718,984         1,928,435    

Units purchased

       2,954,988         2,876,195         477,417         705,267         1,151,477         2,550,062         293,512         311,944    

Units redeemed

       (2,541,383)        (2,683,639)        (1,217,000)        (1,621,899)        (2,596,483)        (2,888,831)        (407,103)        (521,395)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       11,580,755         11,167,150         2,898,040         3,637,623         5,909,169         7,354,175         1,605,393         1,718,984    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
                    (Continued)   

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

            TIF2     TIF3     FTVGI3     FTVFA2  
            2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                    

Net investment income (loss)

   $       49,871         10,061         967,117         76,766         5,544,188         4,551,783         262,523         (310,427)   

Realized gain (loss) on investments

         22,237         163,587         2,496,917         509,671         648,807         1,453,221         540,184         790,311    

Change in unrealized gain (loss) on investments

         440,345         (639,255)        7,282,591         (9,760,218)        7,896,335         (9,649,489)        2,301,201         (1,269,714)   

Reinvested capital gains

         -            -            -            -            182,992         717,904         -            -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         512,453         (465,607)        10,746,625         (9,173,781)        14,272,322         (2,926,581)        3,103,908         (789,830)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         15         -            779,899         1,055,095         12,232,898         16,249,940         5,404,403         5,571,187    

Transfers between funds

         (97,066)        (161,355)        (2,677,303)        (1,453,018)        1,915,216         2,805,760         (580,343)        1,022,679    

Redemptions

         (484,716)        (1,209,944)        (7,997,509)        (7,582,065)        (13,298,766)        (12,747,147)        (1,453,754)        (1,010,480)   

Annuity benefits

         (341)        (311)        (2,336)        (2,410)        (32,588)        (20,543)        -            -       

Contract maintenance charges (note 2)

         (263)        (360)        (199,584)        (210,458)        (12,024)        (12,403)        (1,855)        (1,652)   

Contingent deferred sales charges (note 2)

         (156)        (2,035)        (41,950)        (52,615)        (63,484)        (48,687)        (13,762)        (4,108)   

Adjustments to maintain reserves

         (153)        (88)        (789)        (593)        (1,785)        (526)        (303)        (328)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (582,680)        (1,374,093)        (10,139,572)        (8,246,064)        739,467         6,226,394         3,354,386         5,577,298    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         (70,227)        (1,839,700)        607,053         (17,419,845)        15,011,789         3,299,813         6,458,294         4,787,468    

Contract owners’ equity beginning of period

         3,474,765         5,314,465         70,448,463         87,868,308         106,737,652         103,437,839         21,662,279         16,874,811    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       3,404,538         3,474,765         71,055,516         70,448,463         121,749,441         106,737,652         28,120,573         21,662,279    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         196,259         264,742         5,613,198         6,154,147         6,648,136         6,305,385         2,438,014         1,840,165    

Units purchased

         408         20,816         510,931         657,527         1,606,250         2,441,844         782,997         1,066,363    

Units redeemed

         (31,530)        (89,299)        (1,266,742)        (1,198,476)        (1,551,884)        (2,099,093)        (430,387)        (468,514)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         165,137         196,259         4,857,387         5,613,198         6,702,502         6,648,136         2,790,624         2,438,014    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

            AMTB     AMTG     AMTP     AMFAS  
            2012     2011           2012                 2011                 2012                 2011           2012     2011  

Investment activity:

                    

Net investment income (loss)

   $       2,138,107         3,714,429         (183)        (193)        (128)        (310)        (58,692)        (82,712)   

Realized gain (loss) on investments

         (6,292,415)        (6,287,137)        232         6,699         1,306         5,416         32,910         728,680    

Change in unrealized gain (loss) on investments

         9,166,168         (30,885)        1,299         (6,526)        1,381         (6,876)        346,122         (869,758)   

Reinvested capital gains

         -            -            -            -            -            -            -            -       
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

         5,011,860         (2,603,593)        1,348         (20)        2,559         (1,770)        320,340         (223,790)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                    

Purchase payments received from contract owners (note 3)

         6,420,090         12,662,100         (94)        (719)        (113)        (7,448)        20,770         103,795    

Transfers between funds

         6,399,749         (9,337,382)        (45)        841         (233)        (24,671)        (614,494)        (919,169)   

Redemptions

         (31,235,201)        (29,093,636)        1         (8,398)        1         (6)        (543,418)        (957,732)   

Annuity benefits

         (19,797)        (56,488)        (2,519)        (5,421)        (1,898)        (2,893)        -            -       

Contract maintenance charges (note 2)

         (634,481)        (547,113)        137         (49)        234         (12)        (1,362)        (1,466)   

Contingent deferred sales charges (note 2)

         (109,462)        (171,683)        -            -            -            -            (2,399)        (2,207)   

Adjustments to maintain reserves

         (1,872)        (2,277)        1,456         1,376         (5,581)        951         (212)        (307)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

         (19,180,974)        (26,546,479)        (1,064)        (12,370)        (7,590)        (34,079)        (1,141,115)        (1,777,086)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

         (14,169,114)        (29,150,072)        284         (12,390)        (5,031)        (35,849)        (820,775)        (2,000,876)   

Contract owners’ equity beginning of period

         171,395,888         200,545,960         12,930         25,320         17,206         53,055         4,222,440         6,223,316    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $       157,226,774         171,395,888         13,214         12,930         12,175         17,206         3,401,665         4,222,440    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                    

Beginning units

         15,352,684         18,038,619         5         153         -            999         335,319         480,243    

Units purchased

         4,150,707         4,081,983         17         -            3         1         73,848         450,321    

Units redeemed

         (5,960,527)        (6,767,918)        (17)        (148)        (3)        (1,000)        (156,707)        (595,245)   
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

         13,542,864         15,352,684         5         5         -            -            252,460         335,319    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

(Continued)

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        AMSRS     OVMS     OVB     OVGS3  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (329,844)        (363,459)        2,830         468,616         1,232,762         1,791,960         404,306         (5,284)   

Realized gain (loss) on investments

       (643,106)        (832,132)        (2,325,747)        (1,167,336)        (2,827,125)        (3,308,468)        382,645         1,249,806    

Change in unrealized gain (loss) on investments

       3,383,957         (354,006)        6,415,498         540,337         4,541,965         4,069,721         8,352,205         (6,641,561)   

Reinvested capital gains

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       2,411,007         (1,549,597)        4,092,581         (158,383)        2,947,602         2,553,213         9,139,156         (5,397,039)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       279,030         718,330         438,062         398,729         606,005         559,852         1,870,495         2,422,146    

Transfers between funds

       (2,851,772)        158,409         (928,698)        (939,428)        (885,888)        (546,661)        (527,435)        (1,254,206)   

Redemptions

       (3,380,948)        (4,052,911)        (6,959,169)        (6,426,728)        (5,610,540)        (6,650,841)        (8,226,767)        (10,907,147)   

Annuity benefits

       (15,651)        (7,046)        (5,859)        (12,018)        (7,036)        (8,726)        (9,665)        (10,229)   

Contract maintenance charges (note 2)

       (9,599)        (10,322)        (23,036)        (25,683)        (17,132)        (19,464)        (20,188)        (24,172)   

Contingent deferred sales charges (note 2)

       (11,655)        (24,315)        (3,505)        (7,243)        (4,012)        (10,633)        (17,662)        (34,522)   

Adjustments to maintain reserves

       (226)        6,944         (345)        (271)        2,572         3,028         (183)        7    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (5,990,821)        (3,210,911)        (7,482,550)        (7,012,642)        (5,916,031)        (6,673,445)        (6,931,405)        (9,808,123)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (3,579,814)        (4,760,508)        (3,389,969)        (7,171,025)        (2,968,429)        (4,120,232)        2,207,751         (15,205,162)   

Contract owners’ equity beginning of period

       27,587,567         32,348,075         40,877,855         48,048,880         36,128,352         40,248,584         49,952,032         65,157,194    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     24,007,753         27,587,567         37,487,886         40,877,855         33,159,923         36,128,352         52,159,783         49,952,032    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       1,804,517         2,033,231         1,737,854         2,027,729         2,055,734         2,443,496         2,572,768         3,037,983    

Units purchased

       106,239         415,960         29,750         27,873         89,669         106,922         202,630         243,705    

Units redeemed

       (477,977)        (644,674)        (333,489)        (317,748)        (409,073)        (494,684)        (529,487)        (708,920)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       1,432,779         1,804,517         1,434,115         1,737,854         1,736,330         2,055,734         2,245,911         2,572,768    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

          OVGS4     OVGS     OVGSS     OVGI  
          2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $          284,545         (289,026)        838,765         (28,433)        35,793         (28,966)        (39,270)        (53,651)   

Realized gain (loss) on investments

       (1,677,194)        (593,653)        7,742,844         9,155,029         151,570         277,223         240,657         140,383    

Change in unrealized gain (loss) on investments

       12,162,381         (6,028,612)        9,963,594         (19,988,626)        1,098,903         (1,062,068)        1,504,611         (263,162)   

Reinvested capital gains

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       10,769,732         (6,911,291)        18,545,203         (10,862,030)        1,286,266         (813,811)        1,705,998         (176,430)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       4,702,765         5,312,978         9,330         3,819         (9,656)        44         485,575         330,574    

Transfers between funds

       516,047         (1,193,244)        (3,162,900)        (3,571,171)        (145,912)        (341,334)        168,301         (155,476)   

Redemptions

       (8,629,965)        (8,007,480)        (13,011,205)        (14,592,300)        (1,083,894)        (1,749,994)        (2,199,460)        (1,710,986)   

Annuity benefits

       (13,550)        (4,217)        (19,383)        (31,173)        -            -            (3,985)        (10,101)   

Contract maintenance charges (note 2)

       (7,483)        (8,438)        (47,414)        (55,550)        (702)        (982)        (7,428)        (8,047)   

Contingent deferred sales charges (note 2)

       (66,157)        (62,164)        (2,263)        (5,031)        (833)        (983)        (4,356)        (4,289)   

Adjustments to maintain reserves

       (1,100)        4,842         4,417         644         (98)        (233)        (482)        198    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (3,499,443)        (3,957,723)        (16,229,418)        (18,250,762)        (1,241,095)        (2,093,482)        (1,561,835)        (1,558,127)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       7,270,289         (10,869,014)        2,315,785         (29,112,792)        45,171         (2,907,293)        144,163         (1,734,557)   

Contract owners’ equity beginning of period

       60,672,239         71,541,253         102,385,540         131,498,332         7,361,088         10,268,381         11,224,428         12,958,985    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $          67,942,528         60,672,239         104,701,325         102,385,540         7,406,259         7,361,088         11,368,591         11,224,428    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       4,665,467         4,965,773         2,816,110         3,271,262         368,092         466,144         1,223,602         1,392,924    

Units purchased

       1,031,896         880,059         21         77         4,511         45,732         244,973         128,555    

Units redeemed

       (1,306,887)        (1,180,365)        (410,332)        (455,229)        (62,212)        (143,784)        (393,952)        (297,877)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       4,390,476         4,665,467         2,405,799         2,816,110         310,391         368,092         1,074,623         1,223,602    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

 

          OVGIS     OVSC     OVSCS     OVAG  
          2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $          (2,229,612)        (2,581,367)        (33,444)        (30,238)        (674,151)        (551,854)        (139,831)        (148,752)   

Realized gain (loss) on investments

       (467,277)        (10,516,619)        346,914         582,351         5,013,335         2,622,797         154,044         (121,631)   

Change in unrealized gain (loss) on investments

       32,867,877         9,101,558         315,018         (782,465)        3,353,514         (3,413,977)        1,469,772         (102,654)   

Reinvested capital gains

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       30,170,988         (3,996,428)        628,488         (230,352)        7,692,698         (1,343,034)        1,483,985         (373,037)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       10,012,198         12,706,693         147,811         212,703         6,126,148         8,540,960         359,190         346,842    

Transfers between funds

       (21,944,982)        (11,850,584)        116,320         515,063         (5,702,213)        940,489         (625,607)        1,955,345    

Redemptions

       (28,592,025)        (28,437,308)        (478,181)        (553,693)        (4,609,469)        (4,122,193)        (1,787,726)        (1,579,753)   

Annuity benefits

       (1,747)        (1,497)        (478)        (468)        (6,806)        (1,649)        -            -       

Contract maintenance charges (note 2)

       (900,005)        (785,314)        (1,459)        (1,401)        (175,300)        (99,384)        (7,212)        (7,690)   

Contingent deferred sales charges (note 2)

       (175,848)        (223,529)        (2,985)        (1,503)        (48,828)        (30,136)        (3,556)        (4,498)   

Adjustments to maintain reserves

       (1,276)        (1,037)        (59)        (106)        (738)        2,128         (85)        187    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (41,603,685)        (28,592,576)        (219,031)        170,595         (4,417,206)        5,230,215         (2,064,996)        710,433    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (11,432,697)        (32,589,004)        409,457         (59,757)        3,275,492         3,887,181         (581,011)        337,396    

Contract owners’ equity beginning of period

       216,342,816         248,931,820         4,008,007         4,067,764         50,045,477         46,158,296         10,183,980         9,846,584    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $          204,910,119         216,342,816         4,417,464         4,008,007         53,320,969         50,045,477         9,602,969         10,183,980    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       15,287,929         17,274,630         420,119         411,283         2,533,954         2,225,257         1,900,617         1,833,474    

Units purchased

       2,364,421         2,902,651         141,004         259,814         658,285         968,998         248,115         1,209,307    

Units redeemed

       (5,068,500)        (4,889,352)        (163,498)        (250,978)        (857,474)        (660,301)        (589,321)        (1,142,164)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       12,583,850         15,287,929         397,625         420,119         2,334,765         2,533,954         1,559,411         1,900,617    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        OVSB     OVSBS     PMVAAD     PMVFAD  
        2012         2011         2012         2011         2012         2011         2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (1,479)        -            (23,537)        -            423,540         -            813,476         88,420    

Realized gain (loss) on investments

       285         -            2,879         -            9,812         -            535,080         610,773    

Change in unrealized gain (loss) on investments

       11,186         -            151,271         -            153,142         -            (1,086,348)        425,383    

Reinvested capital gains

       -            -            -            -            -            -            518,077         73,207    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       9,992        -            130,613         -            586,494         -            780,285         1,197,783    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       1,434         -            86,858         -            8,200,329         -            3,077,251         4,148,576    

Transfers between funds

       723,779         -            9,056,879         -            11,678,994         -            (1,730,044)        2,732,798    

Redemptions

       (44,585)        -            (394,761)        -            (582,275)        -            (2,237,273)        (2,655,456)   

Annuity benefits

       -            -            (22)        -            -            -            -            -       

Contract maintenance charges (note 2)

       (26)        -            (216)        -            (234)        -            (1,799)        (1,604)   

Contingent deferred sales charges (note 2)

       (91)        -            (213)        -            (1,651)        -            (16,841)        (7,003)   

Adjustments to maintain reserves

       (23)        -            1,121         -            (116)        -            509         (1,339)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       680,488         -            8,749,646         -            19,295,047         -            (908,197)        4,215,972    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       690,480         -            8,880,259         -            19,881,541         -            (127,912)        5,413,755    

Contract owners’ equity beginning of period

       -            -            -            -            -            -            22,970,486         17,556,731    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     690,480         -            8,880,259         -            19,881,541         -            22,842,574         22,970,486    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       -            -            -            -            -            -            1,837,753         1,500,572    

Units purchased

       74,231         -            942,718         -            2,001,065         -            542,041         1,265,349    

Units redeemed

       (6,244)        -            (67,807)        -            (126,395)        -            (616,270)        (928,168)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       67,987         -            874,911         -            1,874,670         -            1,763,524         1,837,753    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        PMVLAD     PMVTRD     PVGIB     PVTIGB  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     650,680         (129,068)        1,150,784         245,053         7,139         (7,543)        2,738         10,953    

Realized gain (loss) on investments

       924,447         485,376         57,378         (2,822)        (333,740)        (606,386)        (52,884)        (32,882)   

Change in unrealized gain (loss) on investments

       10,401,166         (2,419,505)        3,860,783         (970,242)        733,390         437,749         117,212         (67,628)   

Reinvested capital gains

       -            -            3,544,898         835,917         -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       11,976,293         (2,063,197)        8,613,843         107,906         406,789         (176,180)        67,066         (89,557)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       57,926,661         71,828,103         77,913,355         43,402,248         9,751         25,101         -            -       

Transfers between funds

       37,544,311         14,125,276         51,435,830         22,982,635         194,965         (84,556)        -            (31,881)   

Redemptions

       (28,981,984)        (26,147,617)        (8,870,608)        (1,119,580)        (525,768)        (709,127)        (100,889)        (137,736)   

Annuity benefits

       (637)        (572)        -            -            -            -            -            -       

Contract maintenance charges (note 2)

       (1,784,357)        (913,678)        (646,959)        (27,481)        (537)        (554)        (80)        (82)   

Contingent deferred sales charges (note 2)

       (238,752)        (199,377)        (53,861)        (8,887)        (427)        (2,302)        (117)        (16)   

Adjustments to maintain reserves

       5,603         (5,964)        (2,687)        (9,593)        (112)        (259)        3         (67)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       64,470,845         58,686,171         119,775,070         65,219,342         (322,128)        (771,697)        (101,083)        (169,782)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       76,447,138         56,622,974         128,388,913         65,327,248         84,661         (947,877)        (34,017)        (259,339)   

Contract owners’ equity beginning of period

       260,585,570         203,962,596         65,327,248         -            2,559,811         3,507,688         366,694         626,033    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     337,032,708         260,585,570         193,716,161         65,327,248         2,644,472         2,559,811         332,677         366,694    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       23,171,669         18,042,359         6,540,321         -            212,998         275,411         28,337         39,549    

Units purchased

       12,794,621         13,186,257         14,394,072         7,565,330         53,761         52,419         -            1,067    

Units redeemed

       (7,193,529)        (8,056,947)        (2,947,189)        (1,025,009)        (79,139)        (114,832)        (6,862)        (12,279)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       28,772,761         23,171,669         17,987,204         6,540,321         187,620         212,998         21,475         28,337    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        PVTVB     ACEG2     VYDS     TRHS2  
        2012     2011     2012         2011         2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (27,274)        (59,022)        (57,829)        -            (1,077)        (3,072)        (686,038)        (205,865)   

Realized gain (loss) on investments

       79,673         379,283         (41,285)        -            (803)        (57,508)        1,426,849         191,366    

Change in unrealized gain (loss) on investments

       251,531         (1,159,581)        (141,196)        -            53,047         16,550         7,738,204         (811,736)   

Reinvested capital gains

       -            -            -            -            -            -            1,043,394         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       303,930         (839,320)        (240,310)        -            51,167         (44,030)        9,522,409         (826,235)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       17,484         1,816         34,233         -            -            26,609         6,864,457         3,367,389    

Transfers between funds

       (484,432)        277,956         6,023,242         -            -            (102,794)        17,709,653         22,636,118    

Redemptions

       (850,541)        (521,357)        (533,933)        -            (8,675)        (58,353)        (5,022,033)        (1,226,618)   

Annuity benefits

       -            -            (230)        -            -            -            -            -       

Contract maintenance charges (note 2)

       (417)        (470)        (1,113)        -            (114)        (135)        (6,266)        (1,538)   

Contingent deferred sales charges (note 2)

       (515)        (1,159)        (3,066)        -            (110)        (27)        (37,225)        (8,818)   

Adjustments to maintain reserves

       (104)        (110)        (225)        -            (44)        (7)        (492)        (752)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (1,318,525)        (243,324)        5,518,908         -            (8,943)        (134,707)        19,508,094         24,765,781    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (1,014,595)        (1,082,644)        5,278,598         -            42,224         (178,737)        29,030,503         23,939,546    

Contract owners’ equity beginning of period

       2,914,393         3,997,037         -            -            348,002         526,739         27,116,053         3,176,507    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     1,899,798         2,914,393         5,278,598         -            390,226         348,002         56,146,556         27,116,053    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       221,728         248,463         -            -            27,442         38,329         2,368,928         301,680    

Units purchased

       41,612         137,865         644,750         -            504         2,805         3,369,395         3,364,199    

Units redeemed

       (135,355)        (164,600)        (96,695)        -            (1,165)        (13,692)        (1,939,336)        (1,296,951)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       127,985         221,728         548,055         -            26,781         27,442         3,798,987         2,368,928    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        VWHAS     VWBF     VWEM     VWHA  
        2012         2011         2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (10,034)        -            59,211         799,031         (324,663)        (45,550)        (354,736)        (32,427)   

Realized gain (loss) on investments

       (2,703)        -            (133,179)        (112,445)        (1,519,560)        (2,137,349)        1,552,201         2,234,334    

Change in unrealized gain (loss) on investments

       403,566         -            460,132         (151,075)        6,660,836         (3,557,569)        (5,574,871)        (8,124,985)   

Reinvested capital gains

       109,899         -            158,772         243,995         -            -            2,563,706         407,783    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       500,728         -            544,936         779,506         4,816,613         (5,740,468)        (1,813,700)        (5,515,295)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       4,829,063         -            241,875         13,537         251,121         -            (4,763)        1,406    

Transfers between funds

       8,816,346         -            5,194,049         (302,294)        13,236,597         (1,046,520)        48,728,869         (819,801)   

Redemptions

       (323,417)        -            (2,154,877)        (1,346,118)        (2,658,659)        (2,366,960)        (6,903,459)        (2,636,150)   

Annuity benefits

       -            -            (4,111)        (3,534)        (5,816)        (6,448)        (2,526)        (3,053)   

Contract maintenance charges (note 2)

       (330)        -            (6,423)        (6,255)        (10,527)        (10,017)        (17,229)        (13,419)   

Contingent deferred sales charges (note 2)

       (1,373)        -            (648)        (215)        (601)        (1,176)        (20,225)        (422)   

Adjustments to maintain reserves

       (457,932)        -            (77)        934         (24,273)        1,004         (7,662)        427    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       12,862,357         -            3,269,788         (1,643,945)        10,787,842         (3,430,117)        41,773,005         (3,471,012)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       13,363,085         -            3,814,724         (864,439)        15,604,455         (9,170,585)        39,959,305         (8,986,307)   

Contract owners’ equity beginning of period

       -            -            11,420,517         12,284,956         14,809,682         23,980,267         25,097,845         34,084,152    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     13,363,085         -            15,235,241         11,420,517         30,414,137         14,809,682         65,057,150         25,097,845    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       -            -            445,923         511,066         797,445         946,130         552,304         619,064    

Units purchased

       1,652,401         -            225,585         -            684,367         -            3,361,341         1    

Units redeemed

       (264,318)        -            (95,420)        (65,143)        (203,948)        (148,685)        (939,633)        (66,761)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       1,388,083         -            576,088         445,923         1,277,864         797,445         2,974,012         552,304    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

        WRASP     WRHIP     WRMCG     WRPCP  
        2012     2011     2012         2011         2012         2011         2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (484,688)        (500,298)        (107,253)        -            (30,622)        -            5,695         (1,047)   

Realized gain (loss) on investments

       898,488         1,577,566         107,527         -            (9,484)        -            (731)        (10,031)   

Change in unrealized gain (loss) on investments

       16,358,539         (10,208,797)        898,489         -            359,730         -            39,608         (3,265)   

Reinvested capital gains

       -            -            -            -            12,611         -            35,666         652    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       16,772,339         (9,131,529)        898,763         -            332,235         -            80,238         (13,691)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       27,771,220         27,069,234         7,623,244         -            3,733,672         -            1,425,542         933,390    

Transfers between funds

       (5,500,167)        8,920,842         17,830,308         -            3,451,334         -            (95,454)        87,869    

Redemptions

       (10,518,864)        (10,852,045)        (1,056,839)        -            (55,444)        -            (99,096)        (877)   

Annuity benefits

       (636)        -            -            -            -            -            -            -       

Contract maintenance charges (note 2)

       (9,215)        (8,908)        (458)        -            (7,565)        -            (6,543)        -       

Contingent deferred sales charges (note 2)

       (109,596)        (66,987)        (195)        -            (6)        -            -            -       

Adjustments to maintain reserves

       (913)        606         (141)        -            (131)        -            (6)        1    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       11,631,829         25,062,742         24,395,919         -            7,121,860         -            1,224,443         1,020,383    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       28,404,168         15,931,213         25,294,682         -            7,454,095         -            1,304,681         1,006,692    

Contract owners’ equity beginning of period

       93,728,667         77,797,454         -            -            -            -            1,006,692         -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     122,132,835         93,728,667         25,294,682         -            7,454,095         -            2,311,373         1,006,692    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       8,101,468         6,143,715         -            -            -            -            92,333         -       

Units purchased

       3,371,154         4,827,421         2,872,915         -            777,372         -            124,130         103,588    

Units redeemed

       (2,469,020)        (2,869,668)        (528,836)        -            (35,696)        -            (17,444)        (11,255)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       9,003,602         8,101,468         2,344,079         -            741,676         -            199,019         92,333    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

          WRPMP     WRPMAP     WRPMCP     SVDF  
          2012     2011     2012     2011     2012     2011         2012             2011      

Investment activity:

                  

Net investment income (loss)

   $          31,696         4,002         58,514         29,602         9,202         (202)        (524)        (468)   

Realized gain (loss) on investments

       (3,223)        (2,911)        (24,782)        (26,852)        (2,822)        (9,500)        1,166         2,076    

Change in unrealized gain (loss) on investments

       501,688         (63,776)        1,295,887         (755,920)        126,062         (12,010)        4,931         (1,575)   

Reinvested capital gains

       196,645         15,295         441,576         107,545         66,185         3,950         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       726,806         (47,390)        1,771,195         (645,625)        198,627         (17,762)        5,573         33    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       11,312,462         4,782,149         12,612,480         14,337,201         3,673,867         1,661,641         (33)        2,363    

Transfers between funds

       376,320         (24,265)        (88,336)        (16,720)        16,660         15,628         (23)        1,016    

Redemptions

       (145,808)        (61,827)        (533,802)        (68,113)        (172,146)        (28,126)        -            -       

Annuity benefits

       -            -            -            -            -            -            (3,564)        (7,427)   

Contract maintenance charges (note 2)

       (34,013)        (255)        (91,814)        (123)        (10,326)        (93)        52         (279)   

Contingent deferred sales charges (note 2)

       -            -            -            -            -            -            -            -       

Adjustments to maintain reserves

       (14)        1         (27)        (5)        (15)        (2)        41         3    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       11,508,947         4,695,803         11,898,501         14,252,240         3,508,040         1,649,048         (3,527)        (4,324)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       12,235,753         4,648,413         13,669,696         13,606,615         3,706,667         1,631,286         2,046         (4,291)   

Contract owners’ equity beginning of period

       4,676,395         27,982         13,606,615         -            1,631,286         -            35,590         39,881    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $          16,912,148         4,676,395         27,276,311         13,606,615         5,337,953         1,631,286         37,636         35,590    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       424,157         2,491         1,230,558         -            148,360         -            74         -       

Units purchased

       997,291         428,766         1,064,633         1,255,458         319,088         150,962         1         15    

Units redeemed

       (15,327)        (7,100)        (60,162)        (24,900)        (17,841)        (2,602)        (1)        59    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       1,406,121         424,157         2,235,029         1,230,558         449,607         148,360         74         74    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

          SVOF     WFVSCG     WFVSMV     WFVTRB  
          2012     2011     2012     2011         2012             2011         2012     2011  

Investment activity:

                  

Net investment income (loss)

   $          (3,191)        (3,414)        (539,310)        (423,134)        (19)        (38)        589         4,038    

Realized gain (loss) on investments

       8,799         26,894         1,172,522         1,060,262         (581)        (493)        321         224    

Change in unrealized gain (loss) on investments

       27,797         (42,438)        (589,315)        (2,072,670)        1,613         (273)        7,550         3,548    

Reinvested capital gains

       91         -            1,636,874         -            -            -            5,572         11,330    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       33,496         (18,958)        1,680,771         (1,435,542)        1,013         (804)        14,032         19,140    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       (163)        (14,154)        5,844,284         8,919,613         -            -            -            -       

Transfers between funds

       (232)        (35,273)        (3,083,002)        (1,588,741)        (810)        521         -            -       

Redemptions

       (25)        -            (2,750,446)        (1,984,912)        (1,096)        (1,178)        -            -       

Annuity benefits

       (22,836)        (32,222)        -            -            -            -            -            -       

Contract maintenance charges (note 2)

       419         (44)        (151,750)        (72,105)        -            -            -            -       

Contingent deferred sales charges (note 2)

       1         -            (42,508)        (9,935)        -            -            -            -       

Adjustments to maintain reserves

       (1,035)        (3,052)        (544)        (792)        2         (2)        (3)        (3)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (23,871)        (84,745)        (183,966)        5,263,128         (1,904)        (659)        (3)        (3)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       9,625         (103,703)        1,496,805         3,827,586         (891)        (1,463)        14,029         19,137    

Contract owners’ equity beginning of period

       246,624         350,327         30,844,147         27,016,561         8,299         9,762         293,570         274,433    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $          256,249         246,624         32,340,952         30,844,147         7,408         8,299         307,599         293,570    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       -            836         2,029,850         1,674,122         951         1,026         21,348         21,348    

Units purchased

       9         -            992,569         1,334,492         57         106         -            -       

Units redeemed

       (9)        (836)        (1,015,850)        (978,764)        (255)        (181)        -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       -            -            2,006,569         2,029,850         753         951         21,348         21,348    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        WFVOG2     JAGTS2     JAIGS2     VFMG2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (857)        (966)        (64,891)        (173,645)        (442,260)        (1,348,124)        (16,521)        6,690    

Realized gain (loss) on investments

       3,068         1,091         814,110         2,046,500         2,355,718         (4,635,315)        (289,770)        (70,855)   

Change in unrealized gain (loss) on investments

       3,305         (5,183)        1,264,910         (3,189,059)        8,375,770         (42,385,904)        349,749         (196,359)   

Reinvested capital gains

       3,480         541         -            -            -            1,249,495         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       8,996         (4,517)        2,014,129         (1,316,204)        10,289,228         (47,119,848)        43,458         (260,524)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       -            -            733,950         2,624,036         1,407,453         9,127,376         6,578         76,042    

Transfers between funds

       -            (5,242)        (12,984,772)        926,695         (90,931,903)        (28,839,426)        (2,952,809)        (61,810)   

Redemptions

           (11,463)        (1,225)        (694,552)        (1,766,216)        (4,009,784)        (15,391,266)        (407,306)        (513,298)   

Annuity benefits

       -            -            -            -            (7,132)        (13,264)        -            -       

Contract maintenance charges (note 2)

       (10)        (18)        (968)        (2,855)        (6,854)        (25,707)        (1,246)        (1,595)   

Contingent deferred sales charges (note 2)

       -            -            (706)        (4,444)        (22,974)        (69,170)        (3)        (924)   

Adjustments to maintain reserves

       (18)        10         25         (509)        101,705         5,919         (26)        (27)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (11,491)        (6,475)        (12,947,023)        1,776,707         (93,469,489)        (35,205,538)        (3,354,812)        (501,612)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (2,495)            (10,992)        (10,932,894)        460,503         (83,180,261)        (82,325,386)        (3,311,354)        (762,136)   

Contract owners’ equity beginning of period

       51,038         62,030         10,932,894         10,472,391         83,180,261         165,505,647         3,311,354         4,073,490    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     48,543         51,038         -            10,932,894         -            83,180,261         -            3,311,354    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       4,361         4,925         921,943         765,556         4,453,401         5,924,822         293,739         334,971    

Units purchased

       851         -            489,186         1,121,150         327,316         1,029,521         59,437         57,319    

Units redeemed

       (1,719)        (564)        (1,411,129)        (964,763)        (4,780,717)        (2,500,942)        (353,176)        (98,551)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       3,493         4,361         -            921,943         -            4,453,401         -            293,739    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        AVCA2     AVCD2     VWBFR     VWEMR  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (32,047)        (112,786)        (126,084)        (425,704)        100,163         398,577         (59,389)        (11,913)   

Realized gain (loss) on investments

       (342,665)        (114,742)        5,254,486         (4,005,304)        79,263         (16,148)        2,130,804         1,458,164    

Change in unrealized gain (loss) on investments

       1,202,582         (401,054)        (2,195,190)        2,139,793         (149,144)        (133,246)        90,670         (6,253,902)   

Reinvested capital gains

       -            -            -            -            78,829         121,547         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       827,870         (628,582)        2,933,212         (2,291,215)        109,111         370,730         2,162,085         (4,807,651)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       16,827         81,949         855,153         4,465,249         38,040         167,392         53,174         617,855    

Transfers between funds

       (6,145,979)        (106,757)        (25,619,835)        220,884         (5,709,062)        344,874         (13,180,281)        (5,284,411)   

Redemptions

       (408,004)        (1,058,709)        (923,202)        (2,512,531)        (267,811)        (1,032,678)        (445,831)        (2,461,309)   

Annuity benefits

       (371)        (1,230)        -            -            -            -            (726)        (4,040)   

Contract maintenance charges (note 2)

       (729)        (2,531)        (30,995)        (73,499)        (549)        (1,582)        (1,688)        (5,154)   

Contingent deferred sales charges (note 2)

       (289)        (5,308)        (5,566)        (28,125)        (225)        (547)        (867)        (1,943)   

Adjustments to maintain reserves

       1,187         (384)        124         (734)        167         (1,034)        20,876         146    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (6,537,358)        (1,092,970)        (25,724,321)        2,071,244         (5,939,440)        (523,575)        (13,555,343)        (7,138,856)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (5,709,488)        (1,721,552)        (22,791,109)        (219,971)        (5,830,329)        (152,845)        (11,393,258)        (11,946,507)   

Contract owners’ equity beginning of period

       5,709,488         7,431,040         22,791,109         23,011,080         5,830,329         5,983,174         11,393,258         23,339,765    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     -            5,709,488         -            22,791,109         -            5,830,329         -            11,393,258    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       490,830         579,187         1,414,528         1,298,000         399,375         437,415         551,256         827,950    

Units purchased

       49,715         92,123         97,446         846,862         15,686         89,462         51,001         119,749    

Units redeemed

       (540,545)        (180,480)        (1,511,974)        (730,334)        (415,061)        (127,502)        (602,257)        (396,443)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       -            490,830         -            1,414,528         -            399,375         -            551,256    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        VWHAR     NVAGF3     OVHI3     OVHI4  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     (289,294)        (242,307)                    -            112,024         91,334         47,513         903,824         586,860    

Realized gain (loss) on investments

       (5,416,237)        (358,911)        -            (313,065)        (71,063)        10,667         (593,671)        596,792    

Change in unrealized gain (loss) on investments

       4,221,023         (12,271,602)        -            100,870         39,989         (79,705)        364,056         (1,488,525)   

Reinvested capital gains

       4,042,343         674,581         -            173,773         -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       2,557,835         (12,198,239)        -            73,602         60,260         (21,525)        674,209         (304,873)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       4,290,359         11,142,816         -            24,573         57,621         37,379         147,542         314,199    

Transfers between funds

       (58,649,211)        8,050,481         -            (3,469,556)        (481,685)        35,216         (6,994,776)        863,308    

Redemptions

       (2,686,605)        (6,217,849)        -            (109,678)        (118,059)        (125,397)        (982,492)        (1,269,909)   

Annuity benefits

       (941)        (6,032)        -            -            -            -            -            -       

Contract maintenance charges (note 2)

       (4,761)        (13,198)        -            (91)        (215)        (273)        (493)        (747)   

Contingent deferred sales charges (note 2)

       (15,779)        (20,399)        -            (108)        (110)        (166)        (626)        (7,676)   

Adjustments to maintain reserves

       7,816         (6,975)        -            (73)        (29)        (45)        (208)        (250)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (57,059,122)        12,928,844         -            (3,554,933)        (542,477)        (53,286)        (7,831,053)        (101,075)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (54,501,287)        730,605         -            (3,481,331)        (482,217)        (74,811)        (7,156,844)        (405,948)   

Contract owners’ equity beginning of period

       54,501,287         53,770,682         -            3,481,331         482,217         557,028         7,156,844         7,562,792    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     -            54,501,287         -            -            -            482,217         -            7,156,844    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       3,469,671         2,350,975         -            288,563         175,763         196,791         2,632,631         2,685,043    

Units purchased

       610,995         2,531,203         -            27,666         114,563         124,033         763,683         1,826,898    

Units redeemed

       (4,080,666)        (1,412,507)        -            (316,229)        (290,326)        (145,061)        (3,396,314)        (1,879,310)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       -            3,469,671         -            -            -            175,763         -            2,632,631    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        OVHI     OVHIS     ACVU2     AVBV2  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $     2,990         4,049         364,521         248,271         (29)        (108)        (23)        (63)   

Realized gain (loss) on investments

       (47,209)        (81,366)        (6,266,756)        (2,885,033)        1,983         1,824         652         672    

Change in unrealized gain (loss) on investments

       46,555         77,454         6,166,243         2,539,282         (1,235)        (1,393)        (133)        (531)   

Reinvested capital gains

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       2,336         137         264,008         (97,480)        719         323         496         78    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       -            -            2         75         -            -            2,163         39    

Transfers between funds

       (20,951)        (514)        (2,476,910)        (323,301)        -            -            (13,427)        (39)   

Redemptions

       (4,664)        (25,838)        (280,219)        (537,967)        -            -            11,264         -       

Annuity benefits

       -            -            (107)        (132)        (5,712)        (5,636)        (4,608)        (4,779)   

Contract maintenance charges (note 2)

       (7)        (13)        (368)        (513)        -            -            -            -       

Contingent deferred sales charges (note 2)

       -            (9)        (710)        (1,211)        -            -            -            -       

Adjustments to maintain reserves

       (10)        (13)        (2,193)        (298)        (12)        62         4         15    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       (25,632)        (26,387)        (2,760,505)        (863,347)        (5,724)        (5,574)        (4,604)        (4,764)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       (23,296)        (26,250)        (2,496,497)        (960,827)        (5,005)        (5,251)        (4,108)        (4,686)   

Contract owners’ equity beginning of period

       23,296         49,546         2,496,497         3,457,324         5,005         10,256         4,108         8,794    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     -            23,296         -            2,496,497         -            5,005         -            4,108    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       7,881         16,199         642,234         856,240         -            -            -            -       

Units purchased

       -            -            20,641         107,168         -            -            2         (159)   

Units redeemed

       (7,881)        (8,318)        (662,875)        (321,174)        -            -            (2)        159    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       -            7,881         -            642,234         -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

        CSIEF3     AMINS     WSCP     GEF3  
        2012     2011     2012     2011     2012     2011     2012     2011  

Investment activity:

                  

Net investment income (loss)

   $                 -            28,624                     -            (7)                    -            (180,035)                    -            (1,059)   

Realized gain (loss) on investments

       -            (41,389)        -            (522)        -            2,404,597         -            (425,178)   

Change in unrealized gain (loss) on investments

       -            (210,286)        -            -            -            (4,313,690)        -            385,062    

Reinvested capital gains

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

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

       -            (223,051)        -            (529)        -            (2,089,128)        -            (41,175)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

                  

Purchase payments received from contract owners (note 3)

       -            20,341         -            1,921         -            321,366         -            92,036    

Transfers between funds

       -            (1,882,814)        -            (1,175)        -            (28,116,105)        -            (1,883,961)   

Redemptions

       -            (115,708)        -            (112)        -            (3,691,090)        -            (360,558)   

Annuity benefits

       -            (3,110)        -            -            -            (2,221)        -            -       

Contract maintenance charges (note 2)

       -            (973)        -            (105)        -            (16,307)        -            (418)   

Contingent deferred sales charges (note 2)

       -            (8)        -            -            -            (6,145)        -            (335)   

Adjustments to maintain reserves

       -            (33,705)        -            -            -            (10,000)        -            (23)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       -            (2,015,977)        -            529         -            (31,520,502)        -            (2,153,259)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       -            (2,239,028)        -            -            -            (33,609,630)        -            (2,194,434)   

Contract owners’ equity beginning of period

       -            2,239,028         -            -            -            33,609,630         -            2,194,434    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

   $     -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

                  

Beginning units

       -            196,205         -            -            -            2,155,736         -            147,046    

Units purchased

       -            31,812         -            2,240         -            33,589         -            42,559    

Units redeemed

       -            (228,017)        -            (2,240)        -            (2,189,325)        -            (189,605)   
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       -            -            -            -            -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2012 and 2011

 

 

          NVGWL6     ACVI4  
          2012     2011     2012     2011  

Investment activity:

          

Net investment income (loss)

     $                    -            (2,662)                    -            7    

Realized gain (loss) on investments

       -            154,220         -            32    

Change in unrealized gain (loss) on investments

       -            (229,888)        -            -       

Reinvested capital gains

       -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

  

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

       -            (78,330)        -            39    
   

 

 

    

 

 

    

 

 

    

 

 

  

Equity transactions:

          

Purchase payments received from contract owners (note 3)

       -            394,116         -                    (37)   

Transfers between funds

       -            (2,511,022)        -            58    

Redemptions

       -            (17,563)        -            -       

Annuity benefits

       -            -            -            -       

Contract maintenance charges (note 2)

       -            (4,380)        -            (60)   

Contingent deferred sales charges (note 2)

       -            (177)        -            -       

Adjustments to maintain reserves

       -            (182)        -            -       
   

 

 

    

 

 

    

 

 

    

 

 

  

Net equity transactions

       -            (2,139,208)        -            (39)   
   

 

 

    

 

 

    

 

 

    

 

 

  

Net change in contract owners’ equity

       -            (2,217,538)        -            -       

Contract owners’ equity beginning of period

       -            2,217,538         -            -       
   

 

 

    

 

 

    

 

 

    

 

 

  

Contract owners’ equity end of period

     $        -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

  

CHANGES IN UNITS:

          

Beginning units

       -            152,509         -            -       

Units purchased

       -            41,976        -             45    

Units redeemed

       -            (194,485)        -            (45)   
   

 

 

    

 

 

    

 

 

    

 

 

  

Ending units

       -            -            -            -       
   

 

 

    

 

 

    

 

 

    

 

 

  

See accompanying notes to financial statements.

  

  

 

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

(1) Background and Summary of Significant Accounting Policies

(a) Organization and Nature of Operations

The Nationwide Variable Account-II (the Account) was established pursuant to a resolution of the Board of Directors of Nationwide Life Insurance Company (the Company) on October 7, 1981. The Account is registered as a unit investment trust under the Investment Company Act of 1940.

The Company offers tax qualified and non-tax qualified Individual Deferred Variable Annuity Contracts, and Individual Modified Single Premium Deferred Variable Annuity Contracts through the Account. The primary distribution for the contracts is through the brokerage community; however, other distributors are utilized.

(b) The Contracts

Only contracts without a front-end sales charge, but with a contingent deferred sales charge and certain other fees are offered for purchase. See note 2 for a discussion of contract expenses.

With certain exceptions, contract owners in either the accumulation or the payout phase may invest in the following:

ALGER AMERICAN FUNDS

Mid Cap Growth Portfolio - Class S Shares (ALMCS)

ALLIANCE BERNSTEIN FUNDS

VPS Dynamic Asset Allocation Portfolio - Class B (ALVDAB)

AMERICAN FUNDS GROUP (THE)

Growth Fund - Class 1 (AFGF)

High-Income Bond Fund - Class 1 (AFHY)

Protected Asset Allocation Fund - Class P2 (AVPAP2)

U.S. Government/AAA-Rated Securities Fund - Class 1 (AFGC)

BB&T FUNDS

Sterling Capital Strategic Allocation Equity VIF (BBCMAG)*

Sterling Capital Select Equity VIF (BBGI)*

BLACKROCK FUNDS

Global Allocation V.I. Fund - Class III (MLVGA3)

CHARLES SCHWAB FUNDS

Money Market Portfolio(TM) (CHSMM)

DREYFUS CORPORATION FUNDS

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

Stock Index Fund, Inc. - Service Shares (DSIFS)

The Dreyfus Socially Responsible Growth Fund, Inc. - Initial Shares (DSRG)

GOLDMAN SACHS ASSET MANAGEMENT GROUP

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

HUNTINGTON TRUST COMPANY

VA International Equity Fund (HVIE)

VA Situs Fund (HVSIT)

INVESCO AIM INVESTMENTS

V.I. Mid Cap Core Equity - Series II Shares (IVMCC2)

Van Kampen V.I. Mid Cap Growth Fund - Series II Shares (IVKMG2)

J.P. MORGAN INVESTMENT MANAGEMENT INC.

Mid Cap Growth Portfolio- Class 1 (OGGO)*

Mid Cap Value Portfolio: Class 1 (JPMMV1)

JPMorgan Insurance Trust Core Bond Portfolio 1 (OGBDP)*

JPMorgan Insurance Trust Equity Index Portfolio 1 (OGEI)*

JPMorgan Insurance Trust Intrepid Growth Portfolio - Class 1 (OGLG)*

JPMorgan Insurance Trust Intrepid Mid Cap Portfolio 1 (OGDMP)*

JPMorgan Insurance Trust U.S. Equity Portfolio 1 (OGDEP)*

JANUS FUNDS

Janus Aspen Series - Balanced Portfolio - Service Shares (JABS)

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

Janus Aspen Series - Global Technology Portfolio - Service Shares (JAGTS)

Janus Aspen Series - Overseas Portfolio - Service Shares (JAIGS)

MASSACHUSETTS FINANCIAL SERVICES CO.

Investors Growth Stock Series - Service Class (MIGSC)

New Discovery Series - Service Class (MNDSC)

Value Series - Service Class (MVFSC)

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

MORGAN STANLEY

Core Plus Fixed Income Portfolio - Class I (MSVFI)

Core Plus Fixed Income Portfolio - Class II (MSVF2)

Emerging Markets Debt Portfolio - Class I (MSEM)

Emerging Markets Debt Portfolio - Class II (MSEMB)

Global Real Estate Portfolio - Class II (VKVGR2)

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

U.S. Real Estate Portfolio - Class II (MSVREB)

NATIONWIDE FUNDS GROUP

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

American Century NVIT Multi Cap Value Fund - Class II (NVAMV2)

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 I (GEM)

NVIT Emerging Markets Fund - Class II (GEM2)

NVIT Emerging Markets Fund - Class III (GEM3)

NVIT Emerging Markets Fund - Class VI (GEM6)

NVIT International Equity Fund - Class I (GIG)

NVIT International Equity Fund - Class III (GIG3)

Variable Insurance Trust: NVIT International Equity Fund - Class VI (NVIE6)

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

Neuberger Berman NVIT Multi Cap Opportunities Fund - Class II (NVNMO2)

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

Neuberger Berman NVIT Socially Responsible Fund - Class II (NVNSR2)

NVIT Cardinal Aggressive Fund - Class II (NVCRA2)

NVIT Cardinal Balanced Fund - Class II (NVCRB2)

NVIT Cardinal Capital Appreciation Fund - Class II (NVCCA2)

NVIT Cardinal Conservative Fund - Class II (NVCCN2)

NVIT Cardinal Moderate Fund - Class II (NVCMD2)

NVIT Cardinal Moderately Aggressive Fund - Class II (NVCMA2)

NVIT Cardinal Moderately Conservative Fund - Class II (NVCMC2)

 

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NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

NVIT Core Bond Fund - Class I (NVCBD1)

NVIT Core Bond Fund - Class II (NVCBD2)

NVIT Core Plus Bond Fund - Class II (NVLCP2)

NVIT Nationwide Fund - Class I (TRF)

NVIT Nationwide Fund - Class II (TRF2)

NVIT Government Bond Fund - Class I (GBF)

American Century NVIT Growth Fund - Class I (CAF)

American Century NVIT Growth Fund -Class II (CAF2)

NVIT International Index Fund - Class VIII (GVIX8)

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)

NVIT Money Market Fund - Class I (SAM)

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

NVIT Multi-Manager International Growth Fund - Class VI (NVMIG6)

NVIT Multi-Manager International Value Fund - Class II (GVDIV2)

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

NVIT Multi-Manager International Value Fund - Class VI (GVDIV6)

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

NVIT Multi-Manager Large Cap Growth Fund - Class II (NVMLG2)

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

NVIT Multi-Manager Large Cap Value Fund - Class II (NVMLV2)

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

NVIT Multi-Manager Mid Cap Growth Fund - Class II (NVMMG2)

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 Growth Fund - Class II (SCGF2)

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

NVIT Multi-Manager Small Cap Value Fund - Class II (SCVF2)

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

NVIT Multi-Manager Small Company Fund - Class II (SCF2)

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

NVIT Short Term Bond Fund - Class II (NVSTB2)

NVIT Large Cap Growth Fund - Class I (NVOLG1)

NVIT Large Cap Growth Fund - Class II (NVOLG2)

Templeton NVIT International Value Fund - Class III (NVTIV3)

Van Kampen NVIT Comstock Value Fund - Class II (EIF2)

NVIT Real Estate Fund - Class I (NVRE1)

NVIT Real Estate Fund - Class II (NVRE2)

Northern Lights Variable Trust

TOPS Protected Balanced ETF Portfolio - Class 4 (NOTB4)

TOPS Protected Growth ETF Portfolio - Class 4 (NOTG4)

TOPS Protected Moderate Growth ETF Portfolio - Class 4 (NOTMG4)

PORTFOLIOS OF THE ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC

VPS Balanced Wealth Strategy Portfolio - Class B (ALVBWB)

VPS Growth and Income Portfolio - Class B (ALVGIB)

VPS Small/Mid Cap Value Portfolio: Class B (ALVSVB)

PORTFOLIOS OF THE AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

VP Balanced Fund - Class I (ACVB)

VP Capital Appreciation Fund - Class I (ACVCA)*

VP Income & Growth Fund - Class I (ACVIG)

VP Income & Growth Fund - Class II (ACVIG2)

American Century VP Inflation Protection Fund - Class II (ACVIP2)

VP International Fund - Class I (ACVI)*

VP International Fund - Class II (ACVI2)*

VP International Fund - Class III (ACVI3)*

VP International Fund - Class IV (ACVI4)*

VP Mid Cap Value Fund - Class I (ACVMV1)

VP Mid Cap Value Fund - Class II (ACVMV2)

VP Ultra(R) Fund - Class I (ACVU1)*

VP Ultra(R) Fund - Class II (ACVU2)*

VP Vista(SM) Fund - Class I (ACVVS1)*

VP Vista(SM) Fund - Class II (ACVVS2)*

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)

Appreciation Portfolio - Service Shares (DCAPS)

Opportunistic Small Cap Portfolio: Service Shares (DVDLS)

Growth and Income Portfolio - Initial Shares (DGI)

PORTFOLIOS OF THE FEDERATED INSURANCE SERIES

Capital Appreciation Fund II - Service Shares (FCA2S)

Quality Bond Fund II - Primary Shares (FQB)

Quality Bond Fund II - Service Shares (FQBS)

PORTFOLIOS OF THE FIDELITY(R) VARIABLE INSURANCE PRODUCTS

Contrafund Portfolio - Service Class 2 (FC2)*

Equity-Income Portfolio - Initial Class (FEIP)

VIP Value Strategies Portfolio - Service Class 2 (FVSS2)

High Income Portfolio - Initial Class (FHIP)

VIP Asset Manager Portfolio - Initial Class (FAMP)

VIP Contrafund Portfolio - Initial Class (FCP)*

VIP Energy Portfolio - Service Class 2 (FNRS2)

VIP Equity-Income Portfolio - Service Class 2 (FEI2)

VIP Freedom Fund 2010 Portfolio - Service Class (FF10S)

VIP Freedom Fund 2010 Portfolio - Service Class 2 (FF10S2)

VIP Freedom Fund 2020 Portfolio - Service Class (FF20S)

VIP Freedom Fund 2020 Portfolio - Service Class 2 (FF20S2)

VIP Freedom Fund 2030 Portfolio - Service Class (FF30S)

VIP Freedom Fund 2030 Portfolio - Service Class 2 (FF30S2)

VIP Growth Opportunities Portfolio - Initial Class (FGOP)*

VIP Growth Portfolio - Initial Class (FGP)

VIP Growth Portfolio - Service Class 2 (FG2)

VIP High Income Portfolio - Initial Class R (FHIPR)

VIP Investment Grade Bond Portfolio - Service Class (FIGBS)

VIP Investment Grade Bond Portfolio - Service Class 2 (FIGBP2)

 

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NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

VIP Mid Cap Portfolio - Service Class (FMCS)

VIP Mid Cap Portfolio - Service Class 2 (FMC2)

VIP Overseas Portfolio - Initial Class (FOP)

VIP Overseas Portfolio - Initial Class R (FOPR)

VIP Overseas Portfolio - Service Class 2 (FO2)

VIP Overseas Portfolio - Service Class 2 R (FO2R)

VIP Value Strategies Portfolio - Service Class (FVSS)

PORTFOLIOS OF THE FRANKLIN TEMPLETON VARIABLE

    INSURANCE PRODUCTS TRU

Franklin Income Securities Fund - Class 2 (FTVIS2)

Franklin Rising Dividends Securities Fund - Class 2 (FTVRD2)

Franklin Small Cap Value Securities Fund - Class 2 (FTVSV2)

Templeton Developing Markets Securities Fund - Class 3 (FTVDM3)

Templeton Foreign Securities Fund - Class 2 (TIF2)

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)

Growth Portfolio - I Class Shares (AMTG)

Guardian Portfolio - I Class Shares (AMGP)*

International Portfolio - S Class Shares (AMINS)*

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

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

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

Small-Cap Growth Portfolio - S Class Shares (AMFAS)

Socially Responsive Portfolio - I Class Shares (AMSRS)

PORTFOLIOS OF THE OPPENHEIMER VARIABLE ACCOUNT FUNDS

Balanced Fund/VA - Non-Service Shares (OVMS)

Oppenheimer Capital Appreciation Fund/VA - Service Class (OVCAFS)*

Capital Appreciation Fund/VA - Non-Service Shares (OVGR)*

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

Global Securities Fund/VA - Class 3 (OVGS3)

Global Securities Fund/VA - Class 4 (OVGS4)

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

Global Securities Fund/VA - Service Class (OVGSS)

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

Main Street Fund(R)/VA - Service Class (OVGIS)

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

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

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

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

Global Strategic Income Fund/VA: Service Shares (OVSBS)

PORTFOLIOS OF THE PIMCO VARIABLE INSURANCE TRUST

All Asset Portfolio - Advisor Class (PMVAAD)

Foreign Bond Portfolio (Unhedged) - Advisor Class (PMVFAD)

Low Duration Portfolio - Advisor Class (PMVLAD)

Total Return Portfolio - Advisor Class (PMVTRD)

PORTFOLIOS OF THE PUTNAM VARIABLE TRUST

Putnam VT Growth and Income Fund - Class IB (PVGIB)

Putnam VT International Equity Fund - Class IB (PVTIGB)

Putnam VT Voyager Fund - Class IB (PVTVB)

PORTFOLIOS OF THE VAN KAMPEN LIFE INVESTMENT TRUST

Van Kampen V.I. American Franchise Fund: Series II Shares (ACEG2)

Van Kampen V.I. Value Opportunities Fund: Series II Shares (AVBV2)*

PORTFOLIOS OF THE VICTORY VARIABLE INSURANCE FUNDS

Diversified Stock Fund Class A Shares (VYDS)

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

Eck VIP Trust - Global Hard Assets Fund - Service Class (VWHAS)

VIP Trust - Global Bond Fund: Initial Class (VWBF)

VIP Trust - Emerging Markets Fund: Initial Class (VWEM)

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

WADDELL & REED, INC.

Variable Insurance Portfolios - Asset Strategy (WRASP)

Variable Insurance Portfolios - High Income (WRHIP)

Variable Insurance Portfolios - Mid Cap Growth (WRMCG)

Variable Insurance Portfolios - Pathfinder Conservative (WRPCP)

Variable Insurance Portfolios - Pathfinder Moderate (WRPMP)

Variable Insurance Portfolios - Pathfinder Moderately Aggressive (WRPMAP)

Variable Insurance Portfolios - Pathfinder Moderately Conservative (WRPMCP)

WELLS FARGO FUNDS

Advantage VT Index Asset Allocation Fund - Class 2 (WFVAA)*

Advantage VT Discovery Fund (SVDF)

Advantage VT Opportunity Fund - Class 2 (SVOF)*

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

Advantage VT Small Cap Value Fund - Class 2 (WFVSMV)

Advantage VT Core Bond Fund (WFVTRB)

Advantage - VT Omega Growth Fund - Class 2 (WFVOG2)

*At December 31, 2012, contract owners were not invested in the fund.

 

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NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

The contract owners’ equity is affected by the investment results of each fund, equity transactions by contract owners and certain contract expenses (see note 2). 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, 2012 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 Internal Revenue Code. The Company does not provide for income taxes within the Account. Taxes are generally the responsibility of the contract owner upon termination or withdrawal.

(e) Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with U.S. generally accepted accounting principles may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, if any, at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

(f) Calculation of Annuity Reserves

At each financial reporting date, the separate account financial statement includes an aggregate amount of net assets allocated to future contract benefits for the contracts in the payout (annuitization) period. The payout (annuitization) period begins when amounts accumulated under the contract (the contract value) are applied according to payment method selected by the contract owner.

Annuity reserves are computed for contracts in the variable payout stage according to industry standard mortality tables. The assumed investment return is 3.5% unless the annuitant elects otherwise, in which case the rate may vary from 3.5% to 7%, as regulated by the laws of the respective states. The mortality risk is fully borne by the Company and may result in additional amounts being transferred into the Account by the Company to cover greater longevity of annuitants than expected. Conversely, if reserves exceed amounts required, transfers may be made to the Company.

(g) Recently Issued Accounting Standards

There are no recently issued accounting standards applicable to the Account.

(h) Subsequent Events

The Company evaluated subsequent events through the date the financial statements were issued with the SEC.

(2) Expenses

The Company does not deduct a sales charge from purchase payments received from the contract owners. However, if any part of the contract value of such contracts is redeemed, the Company will, with certain exceptions, deduct from a contract owners’ contract value a contingent deferred sales charge. For BOA IV contracts issued prior to December 15, 1988, the contingent deferred sales charge will be equal to 5% of the lesser of purchase payments or the amount redeemed. For America’s Vision, America’s Future II, All American Gold, Future Venue, Choice Venue II and for BOA IV contracts issued on or after December 15, 1988, the contingent deferred sales charge will not exceed 7% of purchase payments redeemed, such charge declining a specified percentage each year. After the purchase payment has been held in the contract for 7 years this charge is 0%. For Achiever contracts, this charge will not exceed 8% of purchase payments redeemed, such charge declining a specified percentage each year. After the purchase payment has been held in the contract for 8 years this charge is 0%. For Elite Venue and Nationwide Destination L contracts, the contingent deferred sales charge will not exceed 7% of purchase payments redeemed, such charge declining a specified percentage each year. After the purchase payment has been held in the contract for 4 years this charge is 0%. No contingent deferred sales charge is deducted on NEBA, Nationwide Destination C (formerly Exclusive Venue), Income Architect or Schwab contracts. No sales charges are deducted on redemptions used to purchase units in the fixed investment options of the Company.

The Company may deduct a contract maintenance charge of up to $30, dependent upon contract type and issue date, which is satisfied by redeeming units. The Company deducts a mortality and expense risk charge assessed through a reduction of the unit value. The Option tables on the following two pages illustrate the annual rate for all contract level charges by product, as well as the maximum variable account charge per product. The table also summarizes the contract level options available to contract owners. The options and related charges are described in more detail in the applicable product prospectus.

 

Nationwide Variable Account - II Options

    BOA IV      BOA Vision      Schwab Income Choice  

Variable Account Charges - Recurring

    1.30%      1.40%      0.65%  

Death Benefit Options - Allows enhanced provisions in place of the standard death benefit.

               

One-Year Enhanced

    -      -      0.20%

Combination Enhanced

    -      -      -  

Return of Premium

              0.10%

Beneficiary Protector II Option

    -      -      -  

Upon death of the annuitant, in addition to any death benefit payable, the contract will be credited an additional amount.

               

Spousal Continuation Benefit Option

    -      -      0.30%(2)

Capital Preservation and Income Options:

               

Capital Preservation Plus Option

    -      -      -  

Lifetime Income Option

              

5% Lifetime Income Option (New York)

    -      -      -  

7% Lifetime Income Option

    -      -      1.00%(1)
        

Maximum Variable Account Charges*

   1.30%    1.40%    2.15%

 

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NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

 

Nationwide Variable Account - II
Options		    BOA
Future II		  

All

American
Gold

    All American
Gold 2.0		    All American Gold
NY 2.0		   

BOA

Achiever

   

Income

Architect

Variable Account Charges - Recurring

    1.15%   1.15%    1.15%    1.15%    1.55%    0.40%

CDSC Options:

                             

Four Year CDSC

    0.30% (3)   0.50%(3)               0.20%(3)    -    

No CDSC

    0.35% (7)   0.55%(7)              0.25%(7)    -    

Death Benefit Options - Allows enhanced provisions in
place of the standard death benefit.

                             

One-Year Enhanced II

    0.20%   0.20%(8)    -        -        -        -    

One-Year Enhanced

    0.10%   0.10%    0.20%(47)    0.20%(47)    -        -    

One-Month Enhanced

    -       0.35%(9)    0.35%(9)    -        0.20%    -    

Combination Enhanced II

    -       -        -        -        0.45%    -    

Combination Enhanced

    -       0.40%(10)    0.45%(59)    -        0.30%    -    

Beneficiary Protector II Option

    -       0.35%(11)    0.35%(48)         0.35%    -    

Upon death of the annuitant, in addition to any death benefit payable, the contract will be credited an additional amount.

                             

Capital Preservation and Income Options:

                             

Capital Preservation Plus Lifetime Income Option

    1.00%(17)   1.00%(17)    -        -        1.00%(17)    -    

Capital Preservation Plus Option

    0.50%   0.50%    -        -        0.50%    -    

Lifetime Income Option

                            

5% Lifetime Income Option (New York)

    1.00%(18)   1.00%(18)(19)    -        -        1.00%(18)    -    

7% Lifetime Income Option (New York)

    -       1.00%    -        1.50%(49)(51)(53)    -        -    

7% Lifetime Income Option (Non-New York)

    1.00%(1)   -        1.50%(49)(51)(53)    -        1.00%(1)    -    

10% Lifetime Income Option

    1.20%(20)   1.20%    -        -        1.20%(20)    -    

Spousal Continuation Benefit Option

                             

5% Spousal Continuation Benefit (New York)

    0.15%   0.15%(19)    -        -        0.15%    -    

7% Spousal Continuation Benefit (New York)

    -       0.30%(32)    -        0.40%(50)(51)(53)    -        -    

7% Spousal Continuation Benefit (Non-New York)

    0.15%   -        0.40%(50)(51)(53)    -        0.15%    -    

10% Spousal Continuation Benefit (Non-New York)

    0.30%(21)   0.30%(33)    -        -        0.30%(21)    -    

Guaranteed Lifetime Withdrawal Fee

    -       -        -        -        -        0.60%

Spousal Continuation Benefit Option

    -       -        -        -        -        0.10%

Extra Value Options (EV):

                             

Fee assessed to assets of the variable account and to allocations made to the fixed account or guaranteed term options in exchange for application of Extra Value Credit of purchase payments made during the first 12 months contract is in force.

                             

3% Extra Value Credit Option

    0.30%(5)   0.45%(5)    -        -        0.10%(13)    -    

4% Extra Value Credit Option

    0.40%(6)   -        -        -        0.25%(14)    -    

5% Extra Value Credit Option (New York)

    -       0.70%(12)    -        -        0.55%(16)    -    

5% Extra Value Credit Option (Non-New York)

    -       -        -        -        0.45%(15)    -    
                

Maximum Variable Account Charges*

   3.55%(58)   4.60%(46)    3.85%(52)    3.25%(52)    4.50%(22)    1.10%

 

Nationwide Variable Account - II Options   BOA
Future
Venue		      Destination C     Destination L     Destination L 2.0     Destination L NY
2.0		     BOA Elite
Venue		     BOA
Choice
Venue II		  

Variable Account Charges - Recurring

     1.10%         1.60%        1.75%        1.75%        1.75%        1.75%        1.50%   

Death Benefit Options - Allows enhanced provisions in place of the standard death benefit.

                             

One-Year Enhanced II

     0.15%(8)         -            -            -            -            -            -       

One-Year Enhanced

     0.10%         -            0.20%        0.20%        0.20%        -            -       

One-Month Enhanced II

     0.35%(24)         0.20%(24)        -            -            -            0.20%(24)        0.20%(24)   

One-Month Enhanced

     0.30%         0.20%        0.35%        0.35%        -            0.20%        0.20%   

Combination Enhanced II

     0.45%(25)         0.35%(25)        -            -            -            0.35%(25)        0.35%(25)   

Combination Enhanced

     0.40%(10)         0.30%(10)        0.45%        0.45%        -            0.30%(10)        0.30%(10)   

Return of Premium

                                                         

Spousal Protection Annuity Option - Allows a surviving spouse to continue the contract while receiving the economic benefit of the death benefit upon the death of the other spouse

                     

Spousal Protection Annuity Option II

     0.20%         -            -            -            -            -            -       

Spousal Protection Annuity Option

     0.10%         0.20%(29)        -            -            -            0.20%(34)        0.20%(34)   

Beneficiary Protector II Option

     0.35%(11)         0.35%(11)        0.35%(31)        0.35%(31)        -            0.35%(11)        0.35%(11)   

Upon death of the annuitant, in addition to any death benefit payable, the contract will be credited an additional amount.

                                                         

Capital Preservation and Income Options:

                     

Capital Preservation Plus Lifetime Income Option

     1.00%(17)         -            -            -            -            1.00%(17)        1.00%(17)   

Capital Preservation Plus Option

     0.50%         0.50%(30)        -            -            -            0.50%        0.50%(19)   

Lifetime Income Option

                    

5% Lifetime Income Option (New York)

     1.00%(18)         -            1.00%(18)(42)        -            -            1.00%(18)        1.00%(18)   

7% Lifetime Income Option (New York)

          1.00%        -            1.50%(49)(51)(53)           

7% Lifetime Income Option (Non-New York)

     1.00%(1)         -            -            1.50%(49)(51)(53)        -            1.00%(1)        1.00%(1)   

10% Lifetime Income Option

     1.20%(20)         -            1.20%        -            -            1.20%(20)        1.20%(20)   

Spousal Continuation Benefit Option

                     

5% Spousal Continuation Benefit (New York)

     0.15%         -            0.15%(42)        -            -            0.15%        0.15%   

7% Spousal Continuation Benefit (New York)

     -             -            0.30%(32)        -            0.40%(50)(51)(53)           

7% Spousal Continuation Benefit (Non-New York)

     0.15%         -            -            0.40%(50)(51)(53)        -            0.15%        0.15%   

10% Spousal Continuation Benefit (Non-New York)

     0.30%(21)         -            0.30%(33)        -            -            0.30%(21)        0.30%(21)   

Extra Value Options (EV):

                     

Fee assessed to assets of the variable account and to allocations made to the fixed account or guaranteed term options in exchange for application of Extra Value Credit of purchase payments made during the first 12 months contract is in force.

                     

3% Extra Value Credit Option

     0.45%(26)         -            -            -            -            -            -       
                      

Maximum Variable Account Charges*

    4.05%(28)         3.00%        4.05%(28)        4.45%(52)        3.85%(52)        4.15%(23)        3.90%(27)   

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

Nationwide Variable Account -
II Options		    Destination B    Destination B 2.0    Destination B NY 2.0    Destinnation EV    Destinnation EV 2.0    Destinnation EV NY 2.0

Variable Account Charges - Recurring

    1.30%    1.30%    1.30%    1.85%(39)    1.85%(39)    1.85%(39)

Death Benefit Options - Allows enhanced provisions in place of the standard death benefit.

                              

One-Year Enhanced II

    -        -        -        -        -        -    

One-Year Enhanced

    0.20%    0.20%    0.20%    0.20%    0.20%    0.20%

One-Month Enhanced II

    -        -        -        -        -        -    

One-Month Enhanced

    0.35%    0.35%    -        0.35%    0.35%    -    

Combination Enhanced II

    -        -        -        -        -        -    

Combination Enhanced

    0.45%    0.45%    -        0.45%    0.45%    -    

Return of Premium

    -        -        -        -        -        -    

Beneficiary Protector II Option

    0.35%(35)    0.35%(35)    -        0.35%(35)    0.35%(35)    -    

Upon death of the annuitant, in addition to any death benefit payable, the contract will be credited an additional amount.

                              

Lifetime Income Option

                             

5% Lifetime Income Option (New York)

    -        -        -        -        -        -    

5% Lifetime Income Option (Non-New York)

    1.00%(18)(42)    -        -        -        -        -    

7% Lifetime Income Option (New York)

    -        -        1.50%(49)(51)(53)    1.00%    -        1.50%(49)(51)(53)

7% Lifetime Income Option (Non-New York)

    1.00%    1.50%(49)(51)(53)    -        -        1.50%(49)(51)(53)    -    

10% Lifetime Income Option (New York)

    -        -        -        -        -        -    

10% Lifetime Income Option (Non-New York)

    1.20%    -        -        1.20%    -        -    

Spousal Continuation Benefit Option

                              

5% Spousal Continuation Benefit (New York)

    0.15%(42)    -        -        -        -        -    

5% Spousal Continuation Benefit (Non-New York)

    -        -        -        -        -        -    

7% Spousal Continuation Benefit (New York)

    0.30%(36)    -        0.40%(50)(51)(53)    0.30%(36)    -        0.40%(50)(51)(53)

7% Spousal Continuation Benefit (Non-New York)

    -        0.40%(50)(51)(53)    -        -        0.40%(50)(51)(53)    -    

10% Spousal Continuation Benefit (New York)

    -        -        -        -        -        -    

10% Spousal Continuation Benefit (Non-New York)

    0.30%(37)    -        -        0.30%(37)    -        -    

Reduced CDSC Option (“Liquidity Option”)

                              
                               

Maximum Variable Account Charges*

   3.60%(38)    4.00%(52)    3.40%(52)    4.15%(23)    4.55%(52)    3.95%(52)

 

Nationwide Variable Account - II
Options		   Destination
Navigator		   Destination
Navigator 2.0		   Destination
Navigator-NY		   Destination
Navigator-NY 2.0

Variable Account Charges - Recurring

   1.30%   1.30%   1.30%   1.30%

Death Benefit Options - Allows enhanced provisions in place of the standard death benefit.

                

One-Year Enhanced II

   -       -       -       -    

One-Year Enhanced

   0.20%   0.20%   0.20%   0.20%

One-Month Enhanced II

   -       -       -       -    

One-Month Enhanced

   0.35%   0.35%   -       -    

Combination Enhanced II

   -       -       -       -    

Combination Enhanced

   0.45%   0.45%   -       -    

Return of Premium

   -       -       -       -    

Beneficiary Protector II Option

   0.35%(35)   0.35%(35)   -       -    

Upon death of the annuitant, in addition to any death benefit payable, the contract will be credited an additional amount.

                

Lifetime Income Option

               

5% Lifetime Income Option (New York)

   -       -       1.00%(40)   1.00%(51)(53)(55)

5% Lifetime Income Option (Non-New York)

   1.00%(40)   1.00%(51)(53)(55)   -       -    

7% Lifetime Income Option (New York)

   -       -       1.00%   1.50%(51)(53)(49)

7% Lifetime Income Option (Non-New York)

   -       1.50%(49)(51)(53)   -       -    

10% Lifetime Income Option (New York)

   -       -       1.20%   -    

10% Lifetime Income Option (Non-New York)

   1.20%   -       -       -    

Spousal Continuation Benefit Option

                

5% Spousal Continuation Benefit (New York)

   -       -       0.15%(45)   0.15%(51)(53)(57)

5% Spousal Continuation Benefit (Non-New York)

   0.15%(41)   0.15%(51)(53)(56)   -       -    

7% Spousal Continuation Benefit (New York)

   -       -       0.30%(36)   0.40%(50)(51)(53)

7% Spousal Continuation Benefit (Non-New York)

   -       0.40%(50)(51)(53)   -       -    

10% Spousal Continuation Benefit (New York)

   -       -       -       -    

10% Spousal Continuation Benefit (Non-New York)

   0.30%(33)   -           -    

Reduced CDSC Option (“Liquidity Option”)

   0.50%(54)   0.50%(54)   0.50%(54)   0.50%(54)
                 

Maximum Variable Account Charges*

  4.10%(44)   4.00%(52)   3.30%(43)   3.40%(52)

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

(1) Currently, the charge associated with the 7% Lifetime Income Option is equal to 0.95% of the Current Income Benefit Base.

(2) Currently, the charge associated with the Spousal Continuation Benefit is equal to 0.15% of the Current Income Benefit Base.

(3) Range of L Schedule Option CDSC over time:

 

Number of Completed Years from Date of Purchase Payment                0                1                    2                    3                     4

CDSC Percentage

    7%    6%    5%    4%    0%
The charge associated with this option will be assessed for the life of the contract

(4) The Contract Maintenance Charge is deducted annually from all contracts containing less than $50,000 on each contract anniversary. This charge is permanently waived for any contract valued at $50,000 or more on any contract anniversary.

(5) Nationwide will discontinue deducting the charge associated with the 3% Extra Value Option 7 years from the date the contract was issued.

(6) Nationwide will discontinue deducting the charge associated with the 4% Extra Value Option 7 years from the date the contract was issued.

(7) Election of the C Schedule Option eliminates the B Schedule CDSC schedule; no CDSC will be assessed upon surrenders from the contract.

(8) The One-Year Enhanced Death Benefit II Option is only available for contracts with annuitants age 80 or younger at the time of application.

(9) The One-Month Enhanced Death Benefit Option is only available for contracts with annuitants age 75 or younger at the time of application.

(10) The Combination Enhanced Death Benefit Option is only available for contracts with annuitants age 80 or younger at the time of application.

(11) The Beneficiary Protector II Option is only available for contracts with annuitants age 75 or younger at the time of application.

(12) Nationwide will discontinue deducting the charge associated with the 5% Extra Value Option 7 years from the date the contract was issued.

(13) Nationwide will discontinue deducting the charge associated with the 3% Extra Value Option 8 years from the date the contract was issued.

(14) Nationwide will discontinue deducting the charge associated with the 4% Extra Value Option 8 years from the date the contract was issued.

(15) Nationwide will discontinue deducting the charge associated with the 5% Extra Value Option 8 years from the date the contract was issued.

(16) Nationwide will discontinue deducting the charge associated with the 5% Extra Value Option (New York) 7 years from the date the contract was issued.

(17) For contracts issued on or after September 15, 2008 or the date of state approval (whichever is later): the current Variable Account charge associated with the Capital Preservation Plus Lifetime Income Option is equal to an annualized rate of 0.75% of the Daily Net Assets of the Variable Account, and the Guaranteed Term Option/Target Term Option charge is equal to a reduction in crediting rates of 0.75%. For contracts issued before September 15, 2008 or the date of state approval (whichever is later): the current Variable Account charge associated with the Capital Preservation Plus Lifetime Income Option is equal to an annualized rate of 0.60% of the Daily Net Assets of the Variable Account. Additionally, the Guaranteed Term Option/Target Term Option charge is equal to a reduction in crediting rates of 0.60%.

(18) Currently, the charge associated with the 5% Lifetime Income Option is equal to 0.85% of the Current Income Benefit Base.

(19) No longer available for purchase

(20) Currently, the charge associated with the 10% Lifetime Income Option is equal to 1.00% of the Current Income Benefit Base.

(21) Currently, the charge associated with the 10% Spousal Continuation Benefit is 0.20% of the Current Income Benefit Base.

(22) The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower than 4.50% depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.

(23) The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower than 4.15% depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.

(24) The One-Month Enhanced Death Benefit II Option is only available for contracts with Annuitants age 80 or younger at the time of application.

(25) The Combination Enhanced Death Benefit II Option is only available for contracts with Annuitants age 75 or younger at the time of application.

(26) Nationwide will discontinue deducting the charge associated with the 3% Extra Value Option 7 years from the date the contract was issued. Under certain circumstances, Nationwide may restrict the allocation of purchase payments to the Fixed Account when the Contract Owner elects or has elected the 3% Extra Value Option.

(27) The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower than 3.90 % depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.

(28) The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower than 4.05% depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.

(29) For contracts that elected the Spousal Protection Annuity Option before state approval of the price increase, the charge for the option is 0.10% of the Daily Net Assets of the Variable Account for the duration of the contract.

(30) Nationwide will discontinue deducting the charges associated with the Capital Preservation Plus Option at the end of the Guaranteed Term Option/Target Term Option that corresponds to the end of the program period elected by the Contract Owner.

(31) In addition to the 0.35% charge assessed to Variable Account allocations, allocations made to the Fixed Account will be assessed a fee of 0.35% by decreasing the interest we credit to amounts allocated to the Fixed Account.

(32) The 7% Spousal Continuation Benefit is only available for election if the 7% Lifetime Income Option is elected. For contracts issued on or after December 5, 2011 or the date of state approval (whichever is later), there currently is no charge associated with the 7% Spousal Continuation Benefit. For contracts issued before December 5, 2011 or the date of state approval (whichever is later), the charge for the 7% Spousal Continuation Benefit is 0.15% of the Current Income Benefit Base.

(33) The 10% Spousal Continuation Benefit is only available for election if the 10% Lifetime Income Option is elected. For contracts issued on or after December 5, 2011 or the date of state approval (whichever is later), there currently is no charge associated with the 10% Spousal Continuation Benefit. For contracts issued before December 5, 2011 or the date of state approval (whichever is later), the charge for the 10% Spousal Continuation Benefit is 0.20% of the Current Income Benefit Base.

(34) For contracts issued before state approval of the price increase, the charge for the Spousal Protection Annuity Option is 0.10% of the Daily Net Assets of the Variable Account.

(35) In addition to the 0.35% charge assessed to Variable Account allocations, allocations made to the Fixed Account will be assessed a fee of 0.35% by decreasing the interest credited to amounts allocated to the Fixed Account.

(36) For contracts issued on or after December 5, 2011 or the date of state approval (whichever is later), there is currently no charge associated with the 7% Spousal Continuation Benefit. For contracts issued before December 5, 2011 or the date of state approval (whichever is later), the charge associated with the 7% Spousal Continuation Benefit is 0.15% of the Current Income Benefit Base.

(37) For contracts issued on or after December 5, 2011 or the date of state approval (whichever is later), there is currently no charge associated with the 10% Spousal Continuation Benefit. For contracts issued before December 5, 2011 or the date of state approval (whichever is later), the charge associated with the 10% Spousal Continuation Benefit is 0.20% of the Current Income Benefit Base.

(38) The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower than 3.60% depending onwhether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.

(39) Beginning in the 9th Contract Year, the Mortality and Expense Charge will be equal to an annualized rate of 1.30% of the Daily Net Assets of the Variable Account.

(40) Currently, the charge associated with the 5% Lifetime Income Option is equal to 0.75% of the Current Income Benefit Base.

(41) The 5% Spousal Continuation Benefit is only available for election if the 5% Lifetime Income Option is elected. For contracts issued on or after December 5, 2011 or the date of state approval (whichever is later), there currently is no charge associated with the 5% Spousal Continuation Benefit. For contracts issued before December 5, 2011 or the date of state approval (whichever is later), the charge for the 5% Spousal Continuation Benefit is 0.15% of the Current Income Benefit Base.

(42) No longer available

(43) The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower than 3.30% depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.

(44) The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower than 4.10% depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.

(45) For contracts issued on or after December 5, 2011 or the date of state approval (whichever is later), there is currently no charge associated with the 5% Spousal Continuation Benefit. For contracts issued before December 5, 2011 or the date of state approval (whichever is later), the charge associated with the 5% Spousal Continuation Benefit is 0.15% of the Current Income Benefit Base.

(46) The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower than 4.60% depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.

(47) The One-Year Enhanced Death Benefit Option is only available for contracts with Annuitants age 80 or younger at the time of application.

(48) The Beneficiary Protector II Option is only available for contracts with Annuitants age 75 or younger at the time of application. In addition to the 0.35% charge assessed to Variable Account allocations, allocations made to the Fixed Account will be assessed a fee of 0.35% by decreasing the interest credited to amounts allocated to the Fixed Account.

(49) Currently, the charge for the 7% Lifetime Income Option is 1.20% of the Current Income Benefit Base.

(50) The 7% Spousal Continuation Benefit may only be elected if and when the 7% Lifetime Income Option is elected. Currently, there is no charge associated with the 7% Spousal Continuation Benefit.

(51) This charge is a percentage of the Current Income Benefit Base. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.

(52) The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.

(53) For information about how the Current Income Benefit Base is calculated, see “Determination of the Income Benefit Base Prior to the First Withdrawal.”

(54) Election of the Liquidity Option replaces the standard 7 year CDSC schedule with the following reduced CDSC schedule:

 

Range of Liquidity Option CDSC over time:

    Number of Completed Years from Date of Contract Issuance              0                 1                 2                 3                 4   
   CDSC Percentage      7%         7%         6%         5%         0%   
   Nationwide will discontinue deducting the charge associated with the Liquidity Option 4 years from the date the contract was issued.    

(55) Currently, the charge for the 5% Lifetime Income Option is 0.75% of the Current Income Benefit Base.

(56) The 5% Spousal Continuation Benefit may only be elected if and when the 5% Lifetime Income Option is elected.

(57) The 5% Spousal Continuation Benefit may only be elected if and when the 5% Lifetime Income Option is elected. Currently, there is no charge associated with the 5% Spousal Continuation Benefit.

(58) The Maximum Possible Total Variable Account Charges associated with a particular contract may be higher or lower than 3.55% depending on whether the Current Income Benefit Base is higher or lower than the Daily Net Assets. For purposes of this table, Nationwide assumes the Current Income Benefit Base is equal to the Daily Net Assets.”

(59) The One-Month Enhanced Death Benefit Option and the Combination Enhanced Death Benefit Option are only available for contracts with Annuitants age 75 or younger at the time of application.

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

The following table provides mortality and expense risk charges by asset fee rates for the period ended December 31, 2012.

 

    Total     ALMCS     ALVDAB     AFGF     AFHY     AVPAP2     AFGC     MLVGA3  
0.40%   $ 158,919      $ -          $ -          $ -          $ -          $ -          $ -          $ -       
0.65%     134,790        -            -            -            -            -            -            70   
0.75%     561,314        -            -            -            -            -            -            3,054   
0.80%     185,712        -            -            -            -            -            -            337   
0.85%     686,357        -            -            -            -            -            -            2,292   
0.95%     308,424        1,428        -            -            -            -            -            1,114   
1.05%     279,953        2,924        -            -            -            -            -            1,652   
1.10%     10,358,403        -            -            -            -            -            -            20,982   
1.15%     48,671,560        -            64        -            -            495        -            98,117   
1.20%     339,624        -            -            -            -            -            -            1,060   
1.25%     4,830,613        -            -            -            -            -            -            40,532   
1.30%     102,951,093        -            34        138,112        20,633        3,469        15,132        241,321   
1.35%     11,941,930        -            139        -            -            173        -            82,022   
1.40%     16,746,219        -            -            -            -            -            -            67,542   
1.45%     5,625,509        317        -            -            -            -            -            35,065   
1.50%     21,143,291        -            1,548        -            -            1,859        -            277,392   
1.55%     36,049,532        -            13        -            -            -            -            187,464   
1.60%     3,927,030        -            419        -            -            196        -            136,993   
1.65%     9,807,794        -            -            -            -            5        -            57,221   
1.70%     3,272,323        -            -            -            -            -            -            13,941   
1.75%     102,105,025        -            3,289        -            -            3,200        -            418,288   
1.80%     8,263,150        -            2,887        -            -            31        -            107,495   
1.85%     11,194,061        -            -            -            -            1,616        -            43,424   
1.90%     3,090,054        -            -            -            -            -            -            12,472   
1.95%     19,069,704        -            247        -            -            427        -            173,948   
2.00%     12,279,825        -            226        -            -            -            -            54,746   
2.05%     4,655,607        -            -            -            -            19        -            19,254   
2.10%     6,870,366        -            366        -            -            -            -            40,882   
2.15%     9,522,470        -            -            -            -            -            -            13,728   
2.20%     7,478,358        -            540        -            -            250        -            44,603   
2.25%     4,991,471        -            -            -            -            -            -            7,023   
2.30%     4,107,381        -            -            -            -            14        -            11,466   
2.35%     15,723,072        -            -            -            -            -            -            15,594   
2.40%     3,057,324        -            -            -            -            -            -            579   
2.45%     1,774,082        -            -            -            -            -            -            2,474   
2.50%     8,685,605        -            -            -            -            -            -            1,302   
2.55%     1,667,702        -            342        -            -            -            -            1,926   
2.60%     727,774        -            -            -            -            -            -            1,020   
2.65%     288,003        -            -            -            -            -            -            1,343   
2.70%     850,508        -            -            -            -            -            -            -       
2.75%     218,365        -            -            -            -            -            -            -       
2.80%     264,403        -            -            -            -            -            -            -       
2.85%     199,486        -            -            -            -            -            -            -       
2.90%     109,277        -            -            -            -            -            -            -       
2.95%     151,184        -            -            -            -            -            -            -       
3.00%     73,081        -            -            -            -            -            -            -       
3.05%     61,049        -            -            -            -            -            -            -       
3.10%     3,198        -            -            -            -            -            -            -       
3.15%     864        -            -            -            -            -            -            -       
3.20%     772        -            -            -            -            -            -            -       
3.25%     3,875        -            -            -            -            -            -            -       
3.30%     3,583        -            -            -            -            -            -            -       
3.40%     1,498        -            -            -            -            -            -            -       
 

 

 

  
Totals   $     505,472,567      $     4,669      $     10,114      $     138,112      $     20,633      $     11,754      $     15,132      $     2,239,738   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     CHSMM      DSIF      DSIFS      DSRG      GVGMNS      HVIE      HVSIT      IVMCC2  

0.40%

    $ -           $ -           $ 308       $ -           $ -           $ 54       $ 28       $ 28   

0.65%

      138         -             170         -             -             32         19         24   

0.75%

      22,482         -             4,336         -             -             1,154         393         22   

0.80%

      -             8,993         -             2,201         -             -             -             -       

0.85%

      19,943         -             11,719         -             -             533         385         1   

0.95%

      39,421         -             18,749         -             -             -             -             -       

1.05%

      37,047         -             15,382         -             -             -             -             -       

1.10%

      -             -             32,276         -             -             29         2,396         -       

1.15%

      -             -             305,348         -             2         6,431         14,492         403   

1.20%

      -             -             7,768         -             -             -             -             -       

1.25%

      -             -             35,584         -             -             433         661         -       

1.30%

      -             1,935,372         166,902         415,995         73         42,356         76,008         1,479   

1.35%

      3,397         -             71,234         -             -             2,142         4,394         516   

1.40%

      -             954,731         17,112         118,017         -             6         6         53   

1.45%

      450         -             63,114         -             -             218         1,007         -       

1.50%

      -             -             130,692         -             671         11,035         24,092         313   

1.55%

      85         -             193,354         -             108         12,481         14,212         33   

1.60%

      -             -             48,166         -             80         1,937         4,516         214   

1.65%

      -             -             52,364         -             5         2,244         8,025         434   

1.70%

      -             -             15,725         -             -             160         184         -       

1.75%

      -             -             234,001         -             253         14,352         37,154         1,064   

1.80%

      -             -             64,231         -             10         7,011         3,125         478   

1.85%

      -             -             76,745         -             2         4,961         20,883         169   

1.90%

      -             -             12,674         -             -             16         15,805         -       

1.95%

      -             -             53,886         -             -             3,792         7,127         311   

2.00%

      -             -             59,731         -             -             516         15,011         -       

2.05%

      -             -             22,500         -             -             1,798         5,450         11   

2.10%

      -             -             31,114         -             -             983         3,918         585   

2.15%

      -             -             16,774         -             -             257         232         458   

2.20%

      -             -             31,334         -             108         5,377         2,925         185   

2.25%

      -             -             8,296         -             -             105         60         -       

2.30%

      -             -             20,038         -             -             959         2,897         689   

2.35%

      -             -             16,594         -             -             581         3,333         -       

2.40%

      -             -             5,485         -             -             -             283         -       

2.45%

      -             -             3,651         -             -             -             54         -       

2.50%

      -             -             6,171         -             -             86         677         155   

2.55%

      -             -             652         -             -             -             5,713         61   

2.60%

      -             -             829         -             -             -             271         -       

2.65%

      -             -             663         -             -             -             28         27   

2.70%

      -             -             981         -             -             -             123         -       

2.75%

      -             -             408         -             -             -             -             -       

2.80%

      -             -             -             -             -             -             -             -       

2.85%

      -             -             668         -             -             -             -             -       

2.90%

      -             -             -             -             -             -             -             -       

2.95%

      -             -             -             -             -             -             -             -       

3.00%

      -             -             -             -             -             -             -             -       

3.05%

      -             -             -             -             -             -             -             -       

3.10%

      -             -             -             -             -             -             -             -       

3.15%

      -             -             -             -             -             -             -             -       

3.20%

      -             -             -             -             -             -             -             -       

3.25%

      -             -             -             -             -             -             -             -       

3.30%

      -             -             -             -             -             -             -             -       

3.40%

      -             -             -             -             -             -             -             -       
  

 

 

  
     $    122,963         $    2,899,096       $     1,857,729         $    536,213         $    1,312       $     122,039       $     275,887         $    7,713   
  

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    IVKMG1     IVKMG2     JPMMV1     JABS     JACAS     JAGTS     JAIGS     MIGSC  
0.40%   $ -          $ -          $ -          $ -          $ 388      $ -          $ -          $ -       
0.65%     -            -            -            -            326        -            -            -       
0.75%     -            368        -            -            1,232        87        991        -       
0.80%     -            66        285        -            3,223        267        2,138        -       
0.85%     -            254        -            -            4,338        233        2,188        -       
0.95%     -            450        -            13,634        9,607        18        9,095        381   
1.05%     -            -            -            20,708        9,203        58        7,053        -       
1.10%     -            2,364        -            196        20,951        531        4,968        798   
1.15%     -            22,279        -            16,826        216,260        6,588        91,430        18,801   
1.20%     -            271        -            87        195        -            17        1,131   
1.25%     -            5,286        -            12,230        19,293        822        14,549        12,171   
1.30%     -            27,643        93,329        83        395,538        63,791        240,176        344   
1.35%     -            8,346        -            145        72,799        6,322        29,417        3,386   
1.40%     -            2,604        22,894        1,078        62,350        16,471        58,077        1,834   
1.45%     -            4,161        -            5,538        29,129        1,845        12,837        3,306   
1.50%     -            10,058        -            9,072        73,558        11,950        20,019        13,389   
1.55%     -            21,183        -            33,501        170,321        7,592        85,721        19,841   
1.60%     -            3,623        -            1,887        32,112        3,876        16,665        4,379   
1.65%     -            4,687        -            394        40,232        25,218        17,907        4,601   
1.70%     -            1,986        -            6,604        16,637        623        7,677        5,266   
1.75%     -            39,695        -            14,687        356,262        8,475        68,068        15,004   
1.80%     -            5,458        -            6,293        30,900        1,653        20,091        5,678   
1.85%     -            4,628        -            1,844        50,868        1,993        7,507        7,625   
1.90%     -            1,380        -            137        9,164        157        4,282        2,859   
1.95%     -            12,991        -            3,571        67,736        3,438        14,811        1,815   
2.00%     -            5,434        -            150        68,389        1,746        15,757        1,229   
2.05%     -            1,866        -            8,078        16,983        1,779        3,909        4,482   
2.10%     -            15,165        -            869        33,524        3,937        8,531        2,739   
2.15%     -            6,964        -            1,507        28,385        1,568        4,957        2,018   
2.20%     -            3,772        -            4,405        43,474        6,441        4,317        2,601   
2.25%     -            1,247        -            401        7,748        48        280        796   
2.30%     -            6,321        -            24        30,584        154        1,743        2,809   
2.35%     -            6,205        -            -            44,131        -            781        684   
2.40%     -            1,331        -            -            12,679        -            188        -       
2.45%     -            1,439        -            -            13,524        502        1,063        262   
2.50%     -            4,193        -            -            26,350        -            65        220   
2.55%     -            859        -            -            3,044        586        391        -       
2.60%     -            137        -            -            4,067        -            -            -       
2.65%     -            -            -            -            3,555        -            451        -       
2.70%     -            29        -            -            1,196        -            -            -       
2.75%     -            391        -            -            419        -            -            -       
2.80%     -            -            -            -            226        -            214        31   
2.85%     -            388        -            -            78        -            -            -       
2.90%     -            -            -            -            -            -            -            -       
2.95%     -            57        -            -            74        -            -            -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $      -          $     235,579      $     116,508      $     163,949      $     2,031,052      $     178,769      $     778,331      $     140,480   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     MNDSC      MVFSC      MVIVSC      MSVFI      MSVF2      MSEM      MSEMB      VKVGR2  

0.40%

    $ 6       $ 1,033       $ 638       $ -           $ -           $ -           $ -           $ -       

0.65%

      -             1,763         133         -             -             -             -             -       

0.75%

      -             8,119         4,538         -             -             -             -             -       

0.80%

      -             349         -             2         -             22         -             -       

0.85%

      84         11,925         1,898         -             -             -             -             -       

0.95%

      -             1,702         485         -             4,534         -             -             -       

1.05%

      -             570         844         -             1,386         -             -             -       

1.10%

      44         67,959         3,153         -             3,567         -             242         -       

1.15%

      594         523,796         78,306         -             34,204         -             2,414         -       

1.20%

      -             5,151         -             -             62         -             -             -       

1.25%

      74         45,567         4,397         -             7,660         -             1,556         -       

1.30%

      1,780         399,217         258,808         13,696         -             32,561         -             -       

1.35%

      410         128,292         23,082         -             10,509         -             -             -       

1.40%

      448         91,764         17,703         5,701         3,089         14,511         658         -       

1.45%

      262         72,403         7,631         -             11,569         -             738         -       

1.50%

      495         146,440         62,215         -             22,247         -             4,784         -       

1.55%

      235         466,955         44,091         -             52,316         -             1,774         -       

1.60%

      233         46,059         19,271         -             4,073         -             -             -       

1.65%

      410         130,180         16,865         -             7,592         -             42         -       

1.70%

      42         68,509         2,039         -             13,885         -             444         -       

1.75%

      1,983         1,313,273         225,865         -             56,407         -             624         219   

1.80%

      11         124,197         10,398         -             8,952         -             333         -       

1.85%

      459         86,872         54,993         -             6,120         -             187         -       

1.90%

      25         29,267         6,808         -             1,990         -             -             -       

1.95%

      708         183,141         47,822         -             11,166         -             180         103   

2.00%

      34         204,987         28,799         -             10,385         -             -             -       

2.05%

      399         44,775         18,402         -             2,954         -             632         -       

2.10%

      1,358         89,293         13,761         -             4,114         -             -             -       

2.15%

      115         201,121         5,383         -             3,811         -             -             -       

2.20%

      38         60,105         26,521         -             2,728         -             -             -       

2.25%

      18         91,031         1,489         -             2,201         -             -             -       

2.30%

      427         35,264         17,979         -             1,779         -             -             -       

2.35%

      1         372,646         7,940         -             12,699         -             -             -       

2.40%

      -             63,258         2,550         -             1,649         -             -             -       

2.45%

      152         29,310         7,607         -             133         -             -             -       

2.50%

      -             36,451         2,880         -             10,798         -             -             -       

2.55%

      269         30,534         3,613         -             668         -             -             26   

2.60%

      -             13,630         987         -             972         -             -             -       

2.65%

      -             1,174         2,061         -             87         -             -             -       

2.70%

      -             7,594         72         -             126         -             -             -       

2.75%

      -             2,052         -             -             -             -             -             -       

2.80%

      -             1,463         406         -             -             -             -             -       

2.85%

      -             480         -             -             -             -             -             -       

2.90%

      -             2,061         -             -             -             -             -             -       

2.95%

      -             603         -             -             33         -             -             -       

3.00%

      -             -             -             -             -             -             -             -       

3.05%

      -             727         -             -             547         -             -             -       

3.10%

      -             -             -             -             -             -             -             -       

3.15%

      -             -             -             -             -             -             -             -       

3.20%

      -             43         -             -             -             -             -             -       

3.25%

      -             -             -             -             -             -             -             -       

3.30%

      -             -             -             -             -             -             -             -       

3.40%

      -             -             -             -             -             -             -             -       
  

 

 

  
   $     11,114       $     5,243,105       $     1,032,433         $    19,399       $     317,012         $    47,094         $    14,608         $    348   
  

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     MSVRE      MSVREB      NVAMV1    NVAMV2    GVAAA2    GVABD2    GVAGG2      GVAGR2  

0.40%

    $ -           $  -           $         -        $        182    $        1,581    $            74    $ 341       $ 202   

0.65%

      -             -           -        593    9,461    2,147      234         160   

0.75%

      -             -           -        2,199    18,761    5,925      1,717         1,750   

0.80%

      -             -           1,456    -        633    443      725         1,508   

0.85%

      -             -           -        2,223    15,041    3,463      1,438         3,796   

0.95%

      -             -           -        6,171    495    4,844      1,678         2,204   

1.05%

      -             -           -        6,463    2,149    2,661      1,563         2,501   

1.10%

      -             -           -        38,198    1,640,114    383,846      27,585         57,345   

1.15%

      -             31       -        329,968    5,816,353    1,856,148      214,898         373,312   

1.20%

      -             -           -        1,918    9,754    5,928      1,136         1,619   

1.25%

      -             -           -        51,329    473,402    106,577      27,148         34,052   

1.30%

      186         -           501,036    116,335    10,994,709    3,239,627      320,170         487,382   

1.35%

      -             8       -        124,352    1,335,972    418,327      89,730         130,398   

1.40%

      317         -           180,462    24,367    272,798    75,011      34,575         60,503   

1.45%

      -             -           -        67,553    462,156    167,376      32,539         56,791   

1.50%

      -             29       -        78,701    2,865,608    826,250      116,957         190,469   

1.55%

      -             -           -        303,173    3,907,846    1,386,195      194,125         360,877   

1.60%

      -             -           -        15,686    184,844    46,016      33,777         77,172   

1.65%

      -             -           -        69,964    918,092    232,291      49,540         83,661   

1.70%

      -             -           -        37,801    287,151    134,737      22,714         34,249   

1.75%

      -             -           -        429,335    12,699,518    3,348,304      414,933         690,717   

1.80%

      -             -           -        65,182    601,466    201,205      40,133         83,805   

1.85%

      -             -           -        56,795    1,496,688    493,361      42,146         72,544   

1.90%

      -             -           -        24,164    212,466    168,205      9,969         19,088   

1.95%

      -             -           -        60,311    2,378,487    671,445      82,687         130,708   

2.00%

      -             -           -        47,514    1,154,617    358,600      45,586         91,778   

2.05%

      -             -           -        23,330    449,256    275,979      18,623         30,804   

2.10%

      -             -           -        38,805    703,887    199,720      46,407         51,084   

2.15%

      -             -           -        46,749    357,567    250,110      14,322         31,605   

2.20%

      -             -           -        33,597    860,800    282,064      26,631         49,926   

2.25%

      -             -           -        21,510    567,198    495,643      7,114         18,190   

2.30%

      -             -           -        26,988    357,324    208,334      18,847         22,619   

2.35%

      -             -           -        53,913    1,250,533    1,179,726      23,793         54,967   

2.40%

      -             -           -        13,401    283,190    251,416      5,490         4,816   

2.45%

      -             -           -        8,869    172,806    103,495      6,609         8,497   

2.50%

      -             -           -        33,550    1,197,671    1,189,049      21,976         33,502   

2.55%

      -             -           -        2,894    158,739    115,168      1,486         3,457   

2.60%

      -             -           -        4,237    44,208    47,119      2,972         3,188   

2.65%

      -             -           -        660    34,172    28,034      2,472         6,966   

2.70%

      -             -           -        2,010    94,014    87,963      701         3,002   

2.75%

      -             -           -        56    18,405    17,128      159         398   

2.80%

      -             -           -        1,646    40,015    16,825      305         522   

2.85%

      -             -           -        1,416    25,723    26,556      -             709   

2.90%

      -             -           -        925    8,188    7,165      279         646   

2.95%

      -             -           -        460    24,129    23,838      198         129   

3.00%

      -             -           -        -        2,121    2,092      -             -       

3.05%

      -             -           -        -        5,055    4,987      108         300   

3.10%

      -             -           -        -        727    717      -             -       

3.15%

      -             -           -        -        -        -          -             -       

3.20%

      -             -           -        -        -        -          -             -       

3.25%

      -             -           -        -        1,234    1,218      -             -       

3.30%

      -             -           -        118    -        84      59         59   

3.40%

      -             -           -        -        -        -          -             -       
  

 

 

  
     $    503       $     68       $    682,954    $    2,275,611    $    54,417,124    $    18,953,436    $     2,006,595       $     3,373,977   
  

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    GVAGI2     HIBF     HIBF3     GEM     GEM2     GEM3     GEM6     GIG  
0.40%   $ 196      $ -          $ -          $ -          $ -          $ -          $ -          $ -       
0.65%     2,243        -            -            -            -            -            -            -       
0.75%     8,208        -            255        -            -            -            714        -       
0.80%     278        -            137        48        -            1,089        -            41   
0.85%     4,670        -            1,014        -            -            -            1,260        -       
0.95%     1,837        677        6,985        -            -            -            852        -       
1.05%     519        103        2,676        -            -            -            1,736        -       
1.10%     367,899        433        5,313        -            75        -            5,185        -       
1.15%     1,828,947        17,900        207,480        -            3,919        -            125,736        -       
1.20%     4,555        966        144        -            438        -            230        -       
1.25%     93,658        9,266        19,977        -            1,972        -            12,779        -       
1.30%     3,308,768        32        185,858        1,221        -            259,278        33,420        104   
1.35%     436,053        4,383        46,570        -            -            -            38,254        -       
1.40%     29,550        1,251        57,748        1,674        1,029        52,266        4,124        335   
1.45%     148,920        4,407        53,813        -            349        -            28,034        -       
1.50%     869,604        3,002        96,064        -            495        -            49,257        -       
1.55%     1,368,379        27,622        199,224        -            3,916        -            101,302        -       
1.60%     61,588        2,225        72,082        -            -            -            34,833        -       
1.65%     209,223        819        50,924        -            -            -            46,396        -       
1.70%     117,475        4,712        11,730        -            699        -            5,581        -       
1.75%     3,341,960        5,595        144,678        -            246        -            93,309        -       
1.80%     173,793        3,338        82,037        -            559        -            20,585        -       
1.85%     506,594        3,692        42,614        -            1,380        -            18,673        -       
1.90%     171,484        597        16,111        -            732        -            3,747        -       
1.95%     690,922        200        17,044        -            551        -            42,707        -       
2.00%     377,963        836        50,156        -            -            -            24,185        -       
2.05%     278,637        284        5,897        -            79        -            6,286        -       
2.10%     187,015        339        10,484        -            26        -            37,444        -       
2.15%     259,302        618        7,051        -            250        -            7,387        -       
2.20%     297,284        -            30,391        -            410        -            24,151        -       
2.25%     511,653        -            5,406        -            14        -            2,959        -       
2.30%     227,891        -            7,603        -            -            -            5,987        -       
2.35%     1,211,767        -            5,061        -            -            -            4,432        -       
2.40%     255,924        -            280        -            -            -            392        -       
2.45%     103,233        -            3,306        -            -            -            5,185        -       
2.50%     1,220,361        -            13        -            -            -            462        -       
2.55%     117,435        -            13,633        -            -            -            3,166        -       
2.60%     45,702        -            -            -            -            -            68        -       
2.65%     30,431        -            71        -            -            -            420        -       
2.70%     89,500        -            -            -            -            -            -            -       
2.75%     16,013        -            89        -            -            -            -            -       
2.80%     18,275        -            2,525        -            -            -            1,050        -       
2.85%     26,641        -            -            -            -            -            -            -       
2.90%     7,420        -            -            -            -            -            -            -       
2.95%     25,002        -            -            -            -            -            -            -       
3.00%     2,196        -            -            -            -            -            -            -       
3.05%     5,235        -            -            -            -            -            -            -       
3.10%     753        -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            -            -       
3.25%     1,278        -            -            -            -            -            -            -       
3.30%     59        -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     19,064,293      $     93,297      $     1,462,444      $     2,943      $     17,139      $     312,633      $     792,288      $     480   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    GIG3     NVIE6     NVNMO1     NVNMO2     NVNSR1     NVNSR2     NVCRA2     NVCRB2  
0.40%   $ -          $ 98      $ -          $ 165      $ -          $ 52      $ -          $ 124   
0.65%     -            23        -            170        -            1,296        -            5,736   
0.75%     -            133        -            777        -            4,390        571        17,661   
0.80%     1,094        -            2,365        -            78        -            112        36   
0.85%     -            933        -            133        -            8,841        743        39,849   
0.95%     -            200        -            124        -            157        -            -       
1.05%     -            454        -            22        -            311        -            -       
1.10%     -            7,694        -            7,320        -            31,568        1,669        978,188   
1.15%     -            42,630        -            28,120        -            259,107        65,586        1,674,800   
1.20%     -            -            -            121        -            3,590        -            21,436   
1.25%     -            4,069        -            7,706        -            18,074        5,754        212,434   
1.30%     210,446        31,590        611,656        59,854        25,129        61,725        28,367        4,991,739   
1.35%     -            12,641        -            9,664        -            53,428        10,822        317,072   
1.40%     124,669        1,728        347,023        2,974        3,591        33,503        2,375        51,947   
1.45%     -            17,563        -            1,130        -            29,752        3,656        152,672   
1.50%     -            25,038        -            18,585        -            52,925        19,281        1,266,700   
1.55%     -            39,385        -            30,092        -            255,567        33,512        1,064,010   
1.60%     -            9,697        -            3,154        -            15,122        14,850        99,617   
1.65%     -            9,904        -            12,304        -            74,355        10,187        284,633   
1.70%     -            2,947        -            321        -            40,356        3,017        62,070   
1.75%     -            81,101        -            75,099        -            750,682        54,329        3,971,945   
1.80%     -            7,268        -            6,377        -            66,187        11,229        176,264   
1.85%     -            9,814        -            6,354        -            40,151        1,248        586,026   
1.90%     -            7,892        -            1,254        -            13,885        71        175,839   
1.95%     -            11,864        -            28,472        -            96,336        22,500        832,533   
2.00%     -            18,251        -            10,797        -            141,225        17,569        423,365   
2.05%     -            3,326        -            4,248        -            27,591        1,318        159,656   
2.10%     -            8,783        -            6,810        -            54,629        38,282        192,048   
2.15%     -            1,936        -            3,547        -            158,875        590        262,233   
2.20%     -            4,737        -            13,027        -            32,568        13,739        399,010   
2.25%     -            1,742        -            446        -            64,801        65        341,746   
2.30%     -            7,855        -            7,619        -            14,971        652        207,686   
2.35%     -            9,862        -            3,606        -            275,531        1,860        1,365,545   
2.40%     -            1,543        -            2,485        -            47,788        -            158,167   
2.45%     -            81        -            1,863        -            18,856        203        173,696   
2.50%     -            2,620        -            1,356        -            5,276        -            2,093,326   
2.55%     -            3,991        -            2,091        -            25,466        3,187        89,835   
2.60%     -            439        -            -            -            8,165        48,254        82,757   
2.65%     -            95        -            1,514        -            577        141        4,130   
2.70%     -            -            -            -            -            6,361        -            198,540   
2.75%     -            444        -            30        -            1,704        -            11,920   
2.80%     -            -            -            435        -            1,291        -            -       
2.85%     -            -            -            -            -            349        -            32,543   
2.90%     -            -            -            -            -            1,859        -            -       
2.95%     -            -            -            -            -            577        -            4,626   
3.00%     -            -            -            -            -            -            -            571   
3.05%     -            -            -            -            -            248        -            8,567   
3.10%     -            -            -            -            -            -            -            1,001   
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            43        -            -       
3.25%     -            -            -            -            -            -            -            77   
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     336,209      $     390,371      $     961,044      $     360,166      $     28,798      $     2,800,111      $     415,739      $     23,194,376   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    NVCCA2   NVCCN2   NVCMD2   NVCMA2     NVCMC2   NVCBD1   NVCBD2     NVLCP2
0.40%   $            1,503   $             -       $              2,896   $                 -          $              477   $         -       $               119      $            25
0.65%   14,462   3,317   7,328     -          2,964   -         1,488      11
0.75%   23,787   14,938   53,636     14,340      13,386   -         5,343      920
0.80%   85   20   11     104      -       101     -          841
0.85%   73,679   9,638   41,330     2,536      28,662   -         8,922      564
0.95%   -       -       -         -          -       -         1,692      227
1.05%   -       -       -         -          -       -         2,555      682
1.10%   963,162   383,626   1,333,656     107,384      425,619   -         36,903      11,457
1.15%   3,508,105   848,973   3,338,080     804,338      1,014,379   -         187,933      52,965
1.20%   9,890   13,326   25,885     -          2,639   -         3,037      -    
1.25%   275,394   113,114   269,276     37,512      97,146   -         21,514      9,811
1.30%   7,006,195   1,887,206   6,670,928     110,311      1,981,443   26,751     45,986      128,990
1.35%   908,228   165,090   876,849     195,205      234,821   -         36,171      15,079
1.40%   14,698   64,961   103,583     32,266      37,074   14,349     29,903      18,869
1.45%   211,718   153,265   267,328     80,915      105,698   -         33,157      13,963
1.50%   1,983,890   474,598   1,805,537     127,896      502,174   -         43,575      47,488
1.55%   1,812,757   824,544   1,964,723     692,136      815,180   -         178,306      67,599
1.60%   44,300   54,200   98,518     35,373      53,791   -         22,863      13,245
1.65%   429,729   234,138   559,395     199,785      190,263   -         56,632      26,393
1.70%   157,522   11,864   114,222     36,911      38,376   -         37,452      3,835
1.75%   10,242,440   2,483,119   8,421,742     1,546,104      2,108,815   -         542,428      155,501
1.80%   275,760   256,709   395,060     138,689      257,208   -         61,201      15,661
1.85%   958,908   349,773   792,830     80,054      361,629   -         28,391      32,264
1.90%   354,549   42,964   158,476     38,430      81,631   -         3,895      2,214
1.95%   2,240,879   416,862   1,489,967     247,033      369,471   -         65,014      34,160
2.00%   554,983   435,617   746,207     321,970      261,066   -         108,028      12,625
2.05%   317,342   53,931   219,592     103,610      49,414   -         22,374      4,643
2.10%   554,010   292,374   417,466     95,692      124,678   -         33,421      7,666
2.15%   425,218   61,726   265,196     327,661      82,844   -         101,074      5,592
2.20%   602,923   210,592   641,720     84,464      165,763   -         22,086      15,043
2.25%   56,825   26,672   54,902     41,972      60,145   -         81,261      1,810
2.30%   361,869   107,244   275,451     107,934      118,855   -         6,129      12,145
2.35%   459,247   91,802   167,922     236,217      72,540   -         288,834      7,748
2.40%   114,782   18,918   57,054     52,062      30,381   -         30,869      473
2.45%   135,955   32,121   56,586     19,313      32,859   -         21,320      202
2.50%   226,025   72,279   130,787     38,111      143,629   -         5,374      3,496
2.55%   154,168   19,368   54,308     2,140      4,813   -         17,480      99
2.60%   734   11,719   11,634     6,022      23,710   -         8,009      540
2.65%   11,570   5,053   13,081     8,170      12,350   -         405      193
2.70%   14,324   5,027   26,074     3,777      40,346   -         5,119      1,841
2.75%   -       21,485   20,416     -          6,382   -         2,028      -    
2.80%   173   6,049   169     1,802      791   -         1,422      -    
2.85%   8,420   5,100   12,841     -          9,915   -         285      -    
2.90%   -       -       -         2,788      4,489   -         1,405      -    
2.95%   3,970   -       5,425     -          25,551   -         317      -    
3.00%   1,263   -       -         -          -       -         -          -    
3.05%   -       3,268   5,630     3,181      -       -         286      -    
3.10%   -       -       -         -          -       -         -          -    
3.15%   -       -       -         -          -       -         -          -    
3.20%   -       -       -         -          -       -         -          -    
3.25%   -       -       -         68      -       -         -          -    
3.30%   -       -       -         -          -       -         -          -    
3.40%   -       -       1,498     -          -       -         -          -    
 

 

  $    35,515,441   $    10,286,590   $    31,975,215   $     5,984,276      $    9,993,367   $    41,201   $     2,212,006      $    726,880
 

 

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    TRF     TRF2     GBF   CAF     CAF2   GVIX8     GVIDA     NVDBL2
0.40%   $ -          $ -          $            136   $ -          $            83   $ -          $ -          $            1,330
0.65%     -            1,169      2,191     -          393     30        -          2,934
0.75%     -            2,194      8,920     -          671     368        1,107      12,229
0.80%     23,781        -          3,722     5,138      -         202        4,562      101
0.85%     -            7,090      12,634     -          122     1,968        1,872      32,402
0.95%     -            1,996      13,483     -          -         551        940      -    
1.05%     -            3,124      12,104     -          4     1,230        1,841      771
1.10%     -            29,915      52,423     -          1,056     26,984        9,603      244,364
1.15%     -            269,194      635,074     -          18,023     39,450        265,992      689,079
1.20%     -            3,691      5,337     -          18     106        8,717      344
1.25%     -            18,942      62,697     -          1,139     1,673        46,883      68,954
1.30%     1,196,157        18,712      1,066,509     331,150      63,894     41,381        107,565      3,117,179
1.35%     -            60,458      158,686     -          3,868     6,633        76,473      132,504
1.40%     422,250        33,433      485,200     109,641      8,742     5,963        75,819      20,954
1.45%     -            28,383      97,126     -          2,129     7,129        36,543      17,242
1.50%     -            38,955      108,961     -          15,247     9,817        155,888      700,673
1.55%     -            287,318      535,763     -          11,752     25,777        210,417      304,432
1.60%     -            7,526      66,190     -          3,694     2,155        52,527      31,373
1.65%     -            75,697      141,274     -          5,682     7,172        207,992      108,175
1.70%     -            44,404      67,481     -          1,026     1,318        61,148      11,479
1.75%     -            749,667      1,080,168     -          79,917     38,467        905,666      1,603,750
1.80%     -            67,330      132,915     -          1,236     5,736        66,459      71,768
1.85%     -            26,826      67,430     -          15,545     6,715        75,937      181,835
1.90%     -            7,759      18,396     -          1,661     870        63,269      79,479
1.95%     -            82,769      170,234     -          12,376     9,026        254,082      340,713
2.00%     -            128,737      209,210     -          5,981     12,441        164,679      137,890
2.05%     -            25,793      36,970     -          3,031     2,495        185,609      81,657
2.10%     -            43,708      58,826     -          4,887     1,819        161,813      78,231
2.15%     -            163,023      185,954     -          2,319     994        382,587      123,922
2.20%     -            27,288      70,200     -          2,632     4,969        38,234      193,010
2.25%     -            61,702      97,795     -          1,555     1,335        179,090      73,348
2.30%     -            9,101      25,535     -          6,108     2,030        110,931      87,776
2.35%     -            270,529      408,998     -          3,390     7,142        341,527      300,377
2.40%     -            49,223      60,686     -          -         90        54,397      20,215
2.45%     -            18,046      25,534     -          22     1,335        28,738      14,342
2.50%     -            4,911      24,475     -          333     993        45,981      183,570
2.55%     -            19,200      27,168     -          6,374     74        70,328      12,344
2.60%     -            9,397      14,582     -          -         87        14,984      29,214
2.65%     -            581      6,479     -          23     -            6,234      6,740
2.70%     -            7,743      9,580     -          -         -            7,532      20,797
2.75%     -            2,092      6,830     -          -         149        624      2,200
2.80%     -            1,284      2,070     -          592     -            16,829      2,529
2.85%     -            385      386     -          -         -            2,670      5,120
2.90%     -            1,845      2,136     -          -         -            3,282      10,654
2.95%     -            584      708     -          -         -            38      4,523
3.00%     -            -          -         -          -         -            8,964      -    
3.05%     -            242      318     -          -         -            6,323      8,391
3.10%     -            -          -         -          -         -            -          -    
3.15%     -            -          -         -          -         -            -          -    
3.20%     -            43      42     -          -         -            -          239
3.25%     -            -          -         -          -         -            -          -    
3.30%     -            -          -         -          -         -            -          -    
3.40%     -            -          -         -          -         -            -          -    
 

 

 

  $     1,642,188      $     2,712,009      $    6,279,536   $     445,929      $    285,525   $     276,674      $     4,522,696      $    9,171,153
 

 

 

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    NVDCA2   GVIDC   GVIDM   GVDMA   GVDMC   MCIF     SAM   NVMIG3
0.40%   $            1,108   $             -       $          2,622   $             -       $        2,844   $ 260      $        1,024   $           -    
0.65%   18,035   3,943   20,376   2,637   8,909     103      1,363   -    
0.75%   42,755   22,129   43,460   7,036   13,331     1,634      22,083   -    
0.80%   144   250   5,045   9,315   2,310     2,182      11,289   1,354
0.85%   52,844   12,704   38,841   6,449   21,840     4,566      11,024   -    
0.95%   -       705   7,186   7,499   3,959     1,424      7,122   -    
1.05%   -       1,639   6,436   11,082   877     2,093      3,339   -    
1.10%   307,690   206,750   853,319   199,142   228,315     6,393      64,535   -    
1.15%   1,507,751   940,610   4,734,587   2,618,337   1,376,669     152,192      1,068,647   -    
1.20%   1,594   10,944   24,909   44,624   4,875     1,567      9,336   -    
1.25%   56,611   68,229   405,159   219,742   142,184     22,832      121,769   -    
1.30%   4,604,411   1,853,304   4,701,066   310,761   1,663,618     417,019      2,083,733   307,554
1.35%   318,015   164,383   933,214   554,208   305,754     46,141      239,922   -    
1.40%   8,349   151,265   845,012   343,885   206,581     110,953      910,444   144,448
1.45%   131,543   116,046   376,496   243,539   190,025     47,301      143,113   -    
1.50%   985,245   482,711   1,310,020   327,755   411,756     41,689      341,523   -    
1.55%   691,247   676,385   3,035,161   2,146,960   874,938     125,438      899,142   -    
1.60%   26,884   77,461   314,104   107,196   103,682     28,154      179,853   -    
1.65%   245,906   184,452   964,182   723,719   309,237     24,579      202,312   -    
1.70%   32,292   22,045   287,571   226,274   67,953     13,326      60,753   -    
1.75%   4,670,174   2,001,252   9,319,325   5,641,377   2,360,154     186,427      1,388,339   -    
1.80%   93,196   288,022   673,755   374,299   233,906     34,549      263,600   -    
1.85%   537,184   301,770   682,667   259,778   211,031     32,474      217,587   -    
1.90%   11,866   47,561   355,274   280,083   153,580     5,841      39,883   -    
1.95%   991,423   214,932   1,380,988   976,135   335,707     44,997      238,707   -    
2.00%   173,862   417,791   1,074,450   649,054   409,285     24,667      252,198   -    
2.05%   75,633   53,013   431,555   359,437   98,689     15,691      93,405   -    
2.10%   228,109   107,662   521,472   401,596   119,038     24,835      107,941   -    
2.15%   107,780   90,311   1,417,483   1,478,802   300,820     13,095      88,790   -    
2.20%   249,884   232,708   366,474   181,994   177,412     25,853      171,752   -    
2.25%   13,131   26,228   530,524   193,827   441,632     8,244      59,126   -    
2.30%   84,792   90,780   282,413   236,522   98,157     8,796      62,246   -    
2.35%   64,798   83,220   1,736,713   884,062   1,121,954     16,222      161,325   -    
2.40%   12,008   19,041   323,766   232,486   207,003     4,785      27,984   -    
2.45%   26,719   14,775   102,946   62,814   56,641     3,642      37,218   -    
2.50%   21,593   55,487   684,537   131,994   446,047     6,910      51,834   -    
2.55%   24,531   28,163   126,555   94,446   83,720     3,834      18,794   -    
2.60%   -       16,446   55,448   37,840   15,751     116      9,086   -    
2.65%   420   8,797   11,216   11,582   4,468     866      2,820   -    
2.70%   -       3,155   63,590   34,446   30,852     54      3,520   -    
2.75%   -       10,267   14,408   6,882   3,804     380      4,287   -    
2.80%   -       8,498   6,636   9,920   4,179     1,244      986   -    
2.85%   -       -       13,082   8,264   6,382     -          938   -    
2.90%   -       -       12,202   16,374   6,756     -          684   -    
2.95%   -       -       6,485   2,627   9,157     23      225   -    
3.00%   3,621   -       3,099   32,634   16,520     -          -       -    
3.05%   -       -       928   2,320   1,080     274      296   -    
3.10%   -       -       -       -       -         -          -       -    
3.15%   -       -       864   -       -         -          -       -    
3.20%   -       -       -       -       -         -          -       -    
3.25%   -       -       -       -       -         -          -       -    
3.30%   -       -       -       2,746   -         -          24   -    
3.40%   -       -       -       -       -         -          -       -    
 

 

  $  16,423,148   $  9,115,834   $  39,107,621   $  20,714,501   $  12,893,382   $   1,513,665      $  9,685,921   $  453,356
 

 

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    NVMIG6     GVDIV2     GVDIV3     GVDIV6     NVMLG1     NVMLG2     NVMLV1     NVMLV2  
0.40%   $ 21      $ -          $ -          $ 121      $ -          $ 76      $ -          $ 49   
0.65%     1,208        -            -            171        -            742        -            244   
0.75%     3,307        -            -            2,419        -            4,084        -            3,687   
0.80%     -            -            148        -            1,207        -            338        32   
0.85%     6,272        -            -            642        -            3,005        -            292   
0.95%     598        185        -            2,314        -            2,766        -            912   
1.05%     1,697        -            -            1,277        -            2,368        -            28   
1.10%     31,285        -            -            20,786        -            17,102        -            9,442   
1.15%     269,351        1,326        -            125,334        -            200,734        -            75,010   
1.20%     3,892        -            -            1,165        -            3,502        -            1,420   
1.25%     20,310        298        -            7,845        -            30,790        -            18,131   
1.30%     53,640        -            47,664        75,006        105,241        46,328        31,057        69,537   
1.35%     64,673        -            -            24,347        -            50,268        -            18,218   
1.40%     32,089        182        22,249        5,326        26,918        19,324        11,470        7,443   
1.45%     39,365        143        -            12,447        -            31,164        -            10,960   
1.50%     51,957        782        -            34,721        -            64,058        -            50,594   
1.55%     283,598        1,837        -            94,830        -            232,273        -            90,451   
1.60%     9,045        202        -            6,440        -            21,077        -            13,143   
1.65%     75,702        -            -            20,305        -            56,014        -            15,645   
1.70%     42,369        66        -            13,251        -            31,099        -            17,819   
1.75%     781,494        80        -            211,275        -            406,678        -            105,645   
1.80%     66,544        496        -            15,865        -            57,944        -            32,364   
1.85%     38,522        431        -            20,018        -            34,552        -            18,759   
1.90%     6,808        -            -            9,942        -            8,849        -            1,746   
1.95%     96,736        182        -            44,830        -            63,137        -            28,769   
2.00%     134,888        -            -            24,101        -            91,016        -            24,433   
2.05%     25,690        1,538        -            11,622        -            22,119        -            18,137   
2.10%     47,314        259        -            14,808        -            35,372        -            16,222   
2.15%     170,792        -            -            9,389        -            85,918        -            7,626   
2.20%     31,407        -            -            15,312        -            35,243        -            7,660   
2.25%     53,489        -            -            5,098        -            32,588        -            3,704   
2.30%     10,081        -            -            14,819        -            12,492        -            20,408   
2.35%     247,782        -            -            21,151        -            123,701        -            5,077   
2.40%     51,475        -            -            2,604        -            28,644        -            3,270   
2.45%     19,235        -            -            4,563        -            10,986        -            15,915   
2.50%     4,896        -            -            13,268        -            5,557        -            10,699   
2.55%     20,639        -            -            1,465        -            9,262        -            493   
2.60%     6,579        -            -            1,619        -            3,665        -            644   
2.65%     1,056        -            -            1,523        -            375        -            4,902   
2.70%     7,434        -            -            433        -            2,955        -            202   
2.75%     1,921        -            -            538        -            873        -            28   
2.80%     1,460        -            -            1,254        -            3,600        -            37   
2.85%     361        -            -            -            -            130        -            -       
2.90%     1,900        -            -            405        -            841        -            -       
2.95%     625        -            -            -            -            272        -            20   
3.00%     -            -            -            -            -            -            -            -       
3.05%     220        -            -            -            -            100        -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     59        -            -            -            -            21        -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            41        -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     2,819,786      $     8,007      $     70,061      $     894,690      $     133,366      $     1,893,664      $     42,865      $     729,817   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    NVMMG1     NVMMG2     NVMMV2     SCGF     SCGF2     SCVF     SCVF2     SCF  
0.40%   $ -          $ 22      $ 23      $ -          $ 4      $ -          $ 42      $ -       
0.65%     -            613        1,002        -            12        -            72        -       
0.75%     -            1,743        3,653        -            87        -            1,650        -       
0.80%     6,219        -            1,366        725        -            1,947        -            5,512   
0.85%     -            3,696        4,147        -            115        -            431        -       
0.95%     -            4,103        43        -            192        -            1,477        -       
1.05%     -            1,371        16        -            -            -            211        -       
1.10%     -            26,467        26,524        -            1,806        -            1,818        -       
1.15%     -            225,965        178,639        -            34,961        -            55,105        -       
1.20%     -            2,730        2,274        -            -            -            183        -       
1.25%     -            26,580        14,858        -            6,656        -            18,582        -       
1.30%     1,999,052        59,220        1,576,183        66,138        16,527        311,492        17,988        661,112   
1.35%     -            60,967        45,419        -            6,825        -            16,194        -       
1.40%     408,639        21,552        484,132        15,876        2,678        119,337        3,556        307,175   
1.45%     -            32,651        22,160        -            9,425        -            19,929        -       
1.50%     -            52,239        33,966        -            14,344        -            16,109        -       
1.55%     -            228,899        192,530        -            40,673        -            44,937        -       
1.60%     -            13,661        9,748        -            9,153        -            11,110        -       
1.65%     -            70,065        52,479        -            7,674        -            11,891        -       
1.70%     -            35,518        27,848        -            5,755        -            5,198        -       
1.75%     -            504,705        513,999        -            43,584        -            40,138        -       
1.80%     -            53,997        44,649        -            8,923        -            12,132        -       
1.85%     -            34,891        19,195        -            15,447        -            9,622        -       
1.90%     -            11,644        4,859        -            2,176        -            1,802        -       
1.95%     -            73,063        64,520        -            12,594        -            9,798        -       
2.00%     -            89,328        90,590        -            18,309        -            10,468        -       
2.05%     -            26,688        18,752        -            9,797        -            3,142        -       
2.10%     -            35,263        34,334        -            12,038        -            6,248        -       
2.15%     -            103,222        115,556        -            3,830        -            2,497        -       
2.20%     -            24,768        22,250        -            16,275        -            3,978        -       
2.25%     -            34,050        40,973        -            1,348        -            1,127        -       
2.30%     -            18,445        8,227        -            2,343        -            3,213        -       
2.35%     -            157,098        182,768        -            5,474        -            2,700        -       
2.40%     -            33,273        34,169        -            659        -            512        -       
2.45%     -            23,187        12,351        -            945        -            802        -       
2.50%     -            8,814        7,929        -            2,618        -            1,229        -       
2.55%     -            10,643        14,832        -            342        -            129        -       
2.60%     -            8,149        5,176        -            219        -            211        -       
2.65%     -            3,333        319        -            299        -            10        -       
2.70%     -            4,047        5,124        -            -            -            304        -       
2.75%     -            1,750        1,174        -            -            -            -            -       
2.80%     -            1,073        785        -            10,553        -            84        -       
2.85%     -            175        232        -            -            -            -            -       
2.90%     -            1,015        1,329        -            -            -            26        -       
2.95%     -            330        440        -            -            -            -            -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            113        161        -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            27        38        -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     2,413,910      $     2,131,153      $     3,921,741      $     82,739      $     324,660      $     432,776      $     336,655      $     973,799   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    SCF2     MSBF   NVSTB2     NVOLG1     NVOLG2   NVTIV3   EIF2   NVRE1  
0.40%   $ 11      $            409   $ 171      $ -          $                1   $            302   $            -       $ -       
0.65%     4      357     129        -          302   1,519   332     -       
0.75%     417      5,573     4,147        -          965   4,360   2,681     -       
0.80%     -          300     109        10,386      -       -       51     5,468   
0.85%     1,288      2,928     1,588        -          1,027   7,529   1,998     -       
0.95%     4,310      5,322     1,125        -          3,434   -       43     -       
1.05%     2,423      3,545     654        -          4,697   10   622     -       
1.10%     7,558      26,508     26,854        -          28,599   53,861   29,079     -       
1.15%     120,147      224,132     137,130        -          578,331   363,827   197,934     -       
1.20%     479      601     747        -          6,580   3,724   1,845     -       
1.25%     28,427      30,237     5,917        -          146,450   22,184   27,801     -       
1.30%     26,950      416,384     99,708        3,214,338      61,995   303,383   217,719     614,051   
1.35%     56,070      67,419     25,478        -          247,688   78,635   43,270     -       
1.40%     7,710      62,587     22,385        1,355,578      46,870   36,031   28,536     275,386   
1.45%     28,368      58,007     22,212        -          122,586   35,390   22,993     -       
1.50%     33,498      127,976     58,749        -          146,348   113,337   114,971     -       
1.55%     79,898      210,840     109,261        -          577,574   334,322   210,888     -       
1.60%     9,790      28,239     29,606        -          57,433   12,571   27,490     -       
1.65%     19,209      49,552     20,738        -          135,029   96,483   46,294     -       
1.70%     19,330      12,691     16,362        -          63,857   44,359   43,140     -       
1.75%     77,185      459,575     252,772        -          479,937   1,037,554   497,775     -       
1.80%     14,410      50,814     29,286        -          171,709   79,109   55,242     -       
1.85%     9,348      81,146     29,578        -          116,991   68,166   54,402     -       
1.90%     8,742      19,085     12,830        -          24,270   8,017   7,680     -       
1.95%     13,224      112,458     39,650        -          100,145   170,377   78,843     -       
2.00%     13,433      62,795     30,729        -          110,396   155,039   78,299     -       
2.05%     2,364      35,439     12,900        -          42,503   31,636   17,279     -       
2.10%     6,270      36,270     28,383        -          67,936   71,119   27,590     -       
2.15%     6,782      18,526     17,956        -          102,991   179,301   69,121     -       
2.20%     5,887      42,377     21,219        -          52,780   57,030   45,333     -       
2.25%     1,561      19,704     17,337        -          24,725   55,069   12,992     -       
2.30%     7,019      34,505     12,905        -          32,569   20,554   17,272     -       
2.35%     3,203      79,953     44,861        -          53,318   260,125   73,316     -       
2.40%     730      5,899     11,736        -          30,319   53,371   20,018     -       
2.45%     212      21,203     9,250        -          7,947   24,150   8,818     -       
2.50%     1,112      46,443     55,786        -          14,739   6,439   14,692     -       
2.55%     1,246      7,354     5,638        -          3,452   20,667   7,225     -       
2.60%     160      5,861     8,133        -          5,458   6,730   2,042     -       
2.65%     31      2,119     3,262        -          1,759   1,225   1,447     -       
2.70%     93      744     2,542        -          836   7,967   3,080     -       
2.75%     -          592     2,642        -          146   1,845   786     -       
2.80%     243      2,249     684        -          1,037   1,217   601     -       
2.85%     353      1,787     707        -          161   373   120     -       
2.90%     178      -         598        -          -       1,943   532     -       
2.95%     182      290     255        -          203   662   314     -       
3.00%     -          -         -            -          -       -       -         -       
3.05%     -          -         -            -          -       220   39     -       
3.10%     -          -         -            -          -       -       -         -       
3.15%     -          -         -            -          -       -       -         -       
3.20%     -          -         -            -          -       59   21     -       
3.25%     -          -         -            -          -       -       -         -       
3.30%     -          -         58        -          -       -       -         -       
3.40%     -          -         -            -          -       -       -         -       
 

 

 

  
  $     619,855      $    2,480,795   $     1,234,767      $     4,580,302      $    3,676,093   $    3,831,791   $    2,112,566   $     894,905   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    NVRE2     NOTB4     NOTG4     NOTMG4     ALVBWB     ALVGIB     ALVSVB     ACVB  
0.40%   $ -          $ -          $ -          $ -          $ 361      $ -          $ 100      $ -       
0.65%     66        -            -            -            -            -            451        -       
0.75%     1,493        -            -            -            -            -            1,252        -       
0.80%     -            -            -            -            -            -            207        1,473   
0.85%     4,264        -            -            -            -            -            755        -       
0.95%     6,361        -            -            -            -            2,201        1,265        -       
1.05%     1,821        -            -            -            -            1,846        1,262        -       
1.10%     6,151        -            -            -            -            504        13,146        -       
1.15%     219,543        -            -            -            -            11,818        68,022        -       
1.20%     513        -            -            -            -            652        609        -       
1.25%     31,432        -            -            -            -            12,927        13,407        -       
1.30%     29,344        -            -            -            -            1,916        155,777        330,703   
1.35%     50,497        -            -            -            -            93        22,857        -       
1.40%     10,270        -            -            -            -            254        16,991        134,482   
1.45%     39,776        -            -            -            -            6,492        9,934        -       
1.50%     64,851        34        67        34        -            9,872        57,217        -       
1.55%     184,686        -            -            -            -            13,274        70,995        -       
1.60%     34,052        -            -            -            -            2,520        12,842        -       
1.65%     27,159        5        -            -            -            356        32,301        -       
1.70%     14,617        -            -            -            -            2,962        14,328        -       
1.75%     103,208        106        2        3        -            7,057        150,823        -       
1.80%     46,609        -            -            -            -            9,855        27,079        -       
1.85%     21,337        -            -            -            -            1,037        31,365        -       
1.90%     8,340        -            -            -            -            1,960        2,840        -       
1.95%     29,438        -            -            -            -            1,081        48,138        -       
2.00%     28,037        -            -            -            -            -            28,018        -       
2.05%     7,758        -            -            -            -            3,187        6,271        -       
2.10%     25,144        -            -            -            -            853        19,455        -       
2.15%     7,082        -            -            -            -            1,734        10,096        -       
2.20%     24,303        -            -            -            -            333        21,128        -       
2.25%     3,185        -            -            -            -            414        4,247        -       
2.30%     8,614        -            -            -            -            328        14,511        -       
2.35%     2,930        -            -            -            -            -            14,545        -       
2.40%     1,262        -            -            -            -            -            1,981        -       
2.45%     1,419        -            -            -            -            -            5,543        -       
2.50%     3        -            -            -            -            -            10,344        -       
2.55%     1,938        -            -            -            -            -            2,174        -       
2.60%     -            -            -            -            -            -            619        -       
2.65%     247        -            -            -            -            -            -            -       
2.70%     -            -            -            -            -            -            459        -       
2.75%     71        -            -            -            -            -            610        -       
2.80%     1,929        -            -            -            -            -            72        -       
2.85%     -            -            -            -            -            -            -            -       
2.90%     -            -            -            -            -            -            -            -       
2.95%     -            -            -            -            -            -            -            -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     1,049,750      $       145      $     69      $     37      $     361      $     95,526      $     894,036      $     466,658   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    ACVCA     ACVIG     ACVIG2     ACVIP2     ACVI     ACVI3     ACVMV1     ACVMV2  
0.40%   $ -          $ -          $ -          $ 653      $ -          $ -          $ -          $ 344   
0.65%     -            -            -            1,319        -            -            -            203   
0.75%     -            -            -            10,147        -            -            -            3,501   
0.80%     -            491        -            1,466        -            -            1,183        -       
0.85%     -            -            -            13,820        -            -            -            2,387   
0.95%     -            -            3,227        15,056        -            -            -            1,287   
1.05%     -            -            3,911        7,807        -            -            -            1,487   
1.10%     -            -            -            41,786        -            -            -            21,949   
1.15%     -            -            11,367        417,001        -            -            -            120,230   
1.20%     -            -            -            2,208        -            -            -            393   
1.25%     -            -            6,376        90,001        -            -            -            17,384   
1.30%     1,066        145,020        -            724,400        85        2        74,169        141,913   
1.35%     -            -            381        104,005        -            -            -            39,477   
1.40%     83        50,920        2,570        140,025        100        -            20,586        10,262   
1.45%     -            -            2,175        67,987        -            -            -            18,642   
1.50%     -            -            2,340        168,996        -            -            -            50,068   
1.55%     -            -            15,787        407,389        -            -            -            121,781   
1.60%     -            -            430        74,650        -            -            -            18,011   
1.65%     -            -            133        138,585        -            -            -            29,401   
1.70%     -            -            75        28,990        -            -            -            8,193   
1.75%     -            -            2,759        734,946        -            -            -            253,991   
1.80%     -            -            2,394        136,095        -            -            -            31,111   
1.85%     -            -            3,722        118,288        -            -            -            37,725   
1.90%     -            -            1,750        12,766        -            -            -            6,058   
1.95%     -            -            91        204,525        -            -            -            67,980   
2.00%     -            -            -            77,413        -            -            -            24,072   
2.05%     -            -            1,526        42,826        -            -            -            8,124   
2.10%     -            -            139        80,138        -            -            -            21,825   
2.15%     -            -            53        30,330        -            -            -            19,433   
2.20%     -            -            340        90,965        -            -            -            21,365   
2.25%     -            -            -            23,053        -            -            -            3,646   
2.30%     -            -            -            41,860        -            -            -            11,244   
2.35%     -            -            -            51,930        -            -            -            17,495   
2.40%     -            -            84        14,266        -            -            -            4,939   
2.45%     -            -            -            21,014        -            -            -            4,089   
2.50%     -            -            -            41,295        -            -            -            22,018   
2.55%     -            -            -            6,657        -            -            -            1,757   
2.60%     -            -            -            7,123        -            -            -            1,873   
2.65%     -            -            -            110        -            -            -            1,419   
2.70%     -            -            -            1,679        -            -            -            2,371   
2.75%     -            -            -            1,906        -            -            -            -       
2.80%     -            -            -            330        -            -            -            303   
2.85%     -            -            -            593        -            -            -            592   
2.90%     -            -            -            71        -            -            -            -       
2.95%     -            -            -            503        -            -            -            230   
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            273        -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            85        -            -            -            50   
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     1,149      $     196,431      $     61,630      $     4,197,331      $     185      $     2      $     95,938      $     1,170,623   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    ACVU2     ACVVS1     DVSCS     DCAP     DCAPS     DVDLS     DGI     FCA2S  
0.40%   $ -          $ -          $ 232      $ -          $ 304      $ -          $ -          $ -       
0.65%     -            -            161        -            344        -            -            -       
0.75%     -            -            2,984        -            3,911        -            -            -       
0.80%     -            -            569        2,992        -            -            407        -       
0.85%     -            -            5,217        -            4,765        -            -            -       
0.95%     -            -            2,728        -            4,794        308        -            141   
1.05%     -            -            5,557        -            6,638        24        -            -       
1.10%     -            -            8,615        -            11,391        -            -            -       
1.15%     -            -            137,910        -            162,881        6,822        -            3,792   
1.20%     -            -            1,092        -            -            -            -            10   
1.25%     -            -            15,748        -            18,623        1,244        -            2,551   
1.30%     -            67        188,133        366,453        226,752        -            125,576        -       
1.35%     -            -            38,591        -            49,306        -            -            -       
1.40%     -            -            40,798        122,881        9,598        173        50,602        180   
1.45%     -            -            35,427        -            41,742        12        -            595   
1.50%     -            -            64,955        -            96,408        339        -            1,105   
1.55%     29        -            121,773        -            118,675        6,949        -            6,707   
1.60%     -            -            17,175        -            27,846        -            -            1,396   
1.65%     -            -            20,907        -            45,087        -            -            154   
1.70%     -            -            9,988        -            19,108        540        -            463   
1.75%     -            -            224,876        -            273,592        2,280        -            348   
1.80%     -            -            56,514        -            33,590        1,288        -            604   
1.85%     -            -            25,262        -            62,447        113        -            1,564   
1.90%     -            -            6,269        -            14,932        -            -            579   
1.95%     -            -            43,644        -            82,064        556        -            308   
2.00%     -            -            43,302        -            43,793        5        -            -       
2.05%     -            -            11,340        -            24,589        39        -            1,709   
2.10%     -            -            18,848        -            40,111        202        -            -       
2.15%     -            -            32,803        -            13,658        -            -            -       
2.20%     -            -            19,590        -            25,850        -            -            -       
2.25%     -            -            4,610        -            3,518        97        -            283   
2.30%     -            -            6,666        -            25,287        -            -            -       
2.35%     -            -            34,861        -            19,144        -            -            -       
2.40%     -            -            9,119        -            1,969        -            -            38   
2.45%     -            -            3,749        -            6,810        -            -            -       
2.50%     -            -            4,351        -            11,313        -            -            -       
2.55%     -            -            7,782        -            10,512        -            -            -       
2.60%     -            -            2,038        -            3,423        -            -            -       
2.65%     -            -            861        -            1,310        -            -            -       
2.70%     -            -            1,124        -            632        -            -            -       
2.75%     -            -            278        -            1,152        -            -            -       
2.80%     -            -            990        -            2,606        -            -            -       
2.85%     -            -            66        -            -            -            -            -       
2.90%     -            -            251        -            -            -            -            -       
2.95%     -            -            79        -            -            -            -            -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            25        -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            10        -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     29      $     67      $     1,277,868      $     492,326      $     1,550,475      $     20,991      $     176,585      $     22,527   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    FQB     FQBS   FEIP     FVSS2     FHIP     FAMP     FNRS2   FEI2
0.40%   $ -          $            -       $ -          $ -          $ -          $ -          $             -       $            376
0.65%     -          -         -            -            -            -          66   353
0.75%     -          -         -            -            -            -          2,373   1,307
0.80%     151      -         5,248        -            1,516        1,039      1,633   -    
0.85%     -          -         -            -            -            -          6,663   1,779
0.95%     -          2,736     -            -            -            -          1,530   545
1.05%     -          1,665     -            -            -            -          3,134   808
1.10%     -          2,081     -            283        -            -          8,176   33,811
1.15%     -          93,097     -            23,902        -            -          151,451   369,908
1.20%     -          6,610     -            5,404        -            -          709   3,475
1.25%     -          36,814     -            11,303        -            -          13,602   65,710
1.30%     102,434      294     3,148,170        -            447,940        1,558,296      210,003   265,471
1.35%     -          33,559     -            8,843        -            -          46,613   94,849
1.40%     47,510      8,140     1,321,584        3,839        259,992        341,600      51,727   15,653
1.45%     -          21,708     -            2,401        -            -          26,158   60,852
1.50%     -          26,206     -            5,090        -            -          32,915   130,687
1.55%     -          92,515     -            23,771        -            -          157,392   284,409
1.60%     -          7,752     -            2,616        -            -          17,516   55,220
1.65%     -          28,397     -            6,265        -            -          30,901   62,758
1.70%     -          23,539     -            886        -            -          8,032   26,350
1.75%     -          79,794     -            13,513        -            -          124,271   486,967
1.80%     -          56,090     -            5,527        -            -          31,534   85,397
1.85%     -          8,977     -            3,180        -            -          22,413   79,425
1.90%     -          3,993     -            2,053        -            -          2,318   16,454
1.95%     -          8,509     -            4,970        -            -          35,663   115,622
2.00%     -          18,457     -            2,197        -            -          30,404   86,194
2.05%     -          5,830     -            2,038        -            -          9,769   36,750
2.10%     -          8,143     -            879        -            -          112,732   38,611
2.15%     -          13,560     -            4,138        -            -          13,407   48,016
2.20%     -          8,407     -            790        -            -          56,686   47,824
2.25%     -          3,872     -            1,150        -            -          914   14,316
2.30%     -          7,284     -            365        -            -          8,582   25,161
2.35%     -          7,036     -            687        -            -          1,516   47,285
2.40%     -          3,386     -            504        -            -          2,018   4,965
2.45%     -          723     -            109        -            -          3,226   9,860
2.50%     -          131     -            116        -            -          410   13,826
2.55%     -          3     -            43        -            -          1   1,677
2.60%     -          5,366     -            515        -            -          -       808
2.65%     -          -         -            221        -            -          568   182
2.70%     -          -         -            -            -            -          -       2,603
2.75%     -          -         -            -            -            -          15   317
2.80%     -          -         -            -            -            -          1,205   616
2.85%     -          -         -            -            -            -          -       -    
2.90%     -          -         -            -            -            -          -       70
2.95%     -          -         -            -            -            -          -       474
3.00%     -          -         -            -            -            -          -       -    
3.05%     -          -         -            -            -            -          -       -    
3.10%     -          -         -            -            -            -          -       -    
3.15%     -          -         -            -            -            -          -       -    
3.20%     -          -         -            -            -            -          -       -    
3.25%     -          -         -            -            -            -          -       -    
3.30%     -          -         -            -            -            -          -       59
3.40%     -          -         -            -            -            -          -       -    
 

 

 

  $     150,095      $    624,674   $     4,475,002      $     137,598      $     709,448      $     1,900,935      $    1,228,246   $    2,637,800
 

 

 

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    FF10S     FF10S2     FF20S     FF20S2     FF30S     FF30S2     FGP     FG2  
0.40%   $ -          $ -          $ -          $ -          $ -          $ -          $ -          $ 502   
0.65%     -            -            -            -            -            -            -            203   
0.75%     -            -            -            -            -            -            -            1,784   
0.80%     508        -            313        -            1,240        -            8,035        -       
0.85%     -            -            -            -            -            -            -            4,094   
0.95%     -            -            -            -            -            -            -            288   
1.05%     -            -            -            -            -            -            -            2,467   
1.10%     -            66,888        -            182,370        -            1,215        -            15,853   
1.15%     -            226,122        -            799,201        -            30,139        -            166,570   
1.20%     -            1,047        -            2,701        -            79        -            5,497   
1.25%     -            14,369        -            41,619        -            16,198        -            27,588   
1.30%     51,639        331,937        120,923        1,347,488        92,264        9,419        3,618,967        180,919   
1.35%     -            57,183        -            169,260        -            31,109        -            46,603   
1.40%     21,327        18,869        9,569        19,658        9,617        41        892,006        8,844   
1.45%     -            52,086        -            92,278        -            9,908        -            32,907   
1.50%     -            86,040        -            280,945        -            27,220        -            86,507   
1.55%     -            142,452        -            476,694        -            44,627        -            165,759   
1.60%     -            20,559        -            24,337        -            3,270        -            22,228   
1.65%     -            39,594        -            95,925        -            9,025        -            43,216   
1.70%     -            13,847        -            12,779        -            12,352        -            22,229   
1.75%     -            431,157        -            1,397,603        -            105,819        -            251,046   
1.80%     -            25,183        -            43,220        -            8,698        -            49,229   
1.85%     -            40,178        -            159,999        -            7,831        -            81,415   
1.90%     -            5,569        -            10,515        -            4,346        -            9,760   
1.95%     -            63,042        -            242,936        -            19,576        -            68,772   
2.00%     -            70,305        -            155,413        -            7,384        -            52,394   
2.05%     -            12,163        -            36,356        -            9,446        -            22,657   
2.10%     -            50,246        -            52,805        -            5,507        -            30,642   
2.15%     -            51,769        -            110,909        -            41,357        -            20,536   
2.20%     -            37,487        -            105,131        -            3,705        -            61,960   
2.25%     -            14,105        -            4,504        -            915        -            5,636   
2.30%     -            9,259        -            37,039        -            20,575        -            15,082   
2.35%     -            13,690        -            51,461        -            13,785        -            10,722   
2.40%     -            4,811        -            17,862        -            6,112        -            6,368   
2.45%     -            4,787        -            10,199        -            3,223        -            10,122   
2.50%     -            6,349        -            10,145        -            771        -            6,683   
2.55%     -            7,903        -            10,694        -            203        -            6,205   
2.60%     -            5,508        -            110        -            413        -            932   
2.65%     -            5        -            -            -            -            -            1,558   
2.70%     -            -            -            -            -            -            -            1,194   
2.75%     -            -            -            31        -            -            -            236   
2.80%     -            -            -            -            -            -            -            785   
2.85%     -            -            -            83        -            -            -            590   
2.90%     -            -            -            -            -            -            -            -       
2.95%     -            -            -            3,058        -            -            -            129   
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     73,474      $     1,924,509      $     130,805      $     6,005,328      $     103,121      $     454,268      $     4,519,008      $     1,548,711   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    FHIPR     FIGBS     FIGBP2     FMCS     FMC2     FOP     FOPR     FO2  
0.40%   $ -          $ -          $ 478      $ -          $ 578      $ -          $ -          $ -       
0.65%     -            -            2,331        -            265        -            -            -       
0.75%     -            -            16,058        -            2,330        -            -            -       
0.80%     686        3,052        -            2,877        -            419        1,020        -       
0.85%     -            -            22,130        -            6,190        -            -            -       
0.95%     -            -            3,400        -            2,214        -            -            -       
1.05%     -            -            4,602        -            5,538        -            -            -       
1.10%     -            -            88,117        -            44,790        -            -            84   
1.15%     -            -            793,803        -            542,801        -            -            9,508   
1.20%     -            -            6,110        -            2,882        -            -            -       
1.25%     -            -            75,277        -            68,854        -            -            7,082   
1.30%     214,673        242,829        383,252        253,495        303,581        544,114        260,437        238   
1.35%     -            -            181,733        -            185,316        -            -            -       
1.40%     102,158        115,786        75,778        63,724        25,293        131,773        53,264        1,439   
1.45%     -            -            125,616        -            77,751        -            -            911   
1.50%     -            -            194,343        -            168,529        -            -            2,380   
1.55%     -            -            639,558        -            421,378        -            -            3,765   
1.60%     -            -            67,922        -            62,254        -            -            559   
1.65%     -            -            191,716        -            134,069        -            -            -       
1.70%     -            -            93,607        -            43,791        -            -            3,683   
1.75%     -            -            1,606,786        -            693,635        -            -            480   
1.80%     -            -            164,405        -            120,735        -            -            937   
1.85%     -            -            151,772        -            104,596        -            -            561   
1.90%     -            -            28,664        -            23,492        -            -            422   
1.95%     -            -            235,387        -            150,315        -            -            593   
2.00%     -            -            263,394        -            113,332        -            -            18   
2.05%     -            -            73,441        -            64,247        -            -            176   
2.10%     -            -            88,271        -            68,585        -            -            5   
2.15%     -            -            231,209        -            78,159        -            -            -       
2.20%     -            -            87,806        -            59,426        -            -            162   
2.25%     -            -            130,917        -            24,447        -            -            32   
2.30%     -            -            40,789        -            46,600        -            -            -       
2.35%     -            -            481,298        -            81,163        -            -            -       
2.40%     -            -            79,403        -            25,170        -            -            -       
2.45%     -            -            39,773        -            10,609        -            -            -       
2.50%     -            -            44,289        -            29,897        -            -            -       
2.55%     -            -            36,342        -            7,806        -            -            -       
2.60%     -            -            16,638        -            13,015        -            -            -       
2.65%     -            -            4,560        -            2,692        -            -            -       
2.70%     -            -            10,538        -            1,481        -            -            -       
2.75%     -            -            5,378        -            38        -            -            -       
2.80%     -            -            3,642        -            13,694        -            -            -       
2.85%     -            -            461        -            364        -            -            -       
2.90%     -            -            3,979        -            537        -            -            -       
2.95%     -            -            784        -            351        -            -            -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            401        -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            43        -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            58        -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     317,517      $     361,667      $     6,796,201      $     320,096      $     3,832,848      $     676,306      $     314,721      $     33,035   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    FO2R     FVSS     FTVIS2     FTVRD2     FTVSV2     FTVDM3     TIF2     TIF3  
0.40%   $ 188      $ -          $ -          $ -          $ 140      $ -          $ -          $ -       
0.65%     78        -            110        -            625        -            -            -       
0.75%     1,030        -            2,884        -            2,091        -            -            -       
0.80%     -            300        897        -            398        399        -            243   
0.85%     1,657        -            2,323        -            4,132        -            -            -       
0.95%     300        -            1,246        3,325        5,225        350        339        1,632   
1.05%     779        -            796        2,039        3,010        1,381        36        1,394   
1.10%     12,524        -            22,437        2,142        26,245        3,231        221        16,854   
1.15%     130,771        -            241,519        133,761        238,522        49,221        8,120        152,327   
1.20%     987        -            1,676        3,491        10,664        294        199        1,235   
1.25%     11,750        -            41,999        49,469        33,078        5,514        5,374        17,823   
1.30%     84,727        63,492        204,075        2,063        173,342        48,808        -            37,996   
1.35%     29,790        -            130,177        47,348        79,360        18,095        -            44,990   
1.40%     3,587        19,694        123,754        16,668        45,564        17,078        2,628        13,470   
1.45%     25,880        -            52,224        28,856        45,579        19,511        2,597        32,540   
1.50%     40,715        -            126,191        35,113        67,059        14,791        3,593        39,761   
1.55%     96,358        -            253,285        163,671        235,469        72,845        7,701        162,837   
1.60%     8,950        -            97,341        17,811        26,678        3,893        6,172        14,064   
1.65%     22,650        -            83,213        36,625        59,840        32,150        19        24,531   
1.70%     20,540        -            22,775        14,408        30,965        2,935        1,939        24,820   
1.75%     165,027        -            348,789        81,996        457,469        46,888        885        206,687   
1.80%     33,286        -            96,066        65,065        59,660        17,331        3,498        35,601   
1.85%     36,212        -            38,101        17,150        39,228        5,863        1,180        20,648   
1.90%     7,343        -            3,451        11,017        7,267        2,439        1,591        12,315   
1.95%     39,152        -            63,822        21,975        75,079        13,273        799        32,792   
2.00%     21,251        -            77,126        37,309        94,303        9,052        14        35,202   
2.05%     4,825        -            17,745        20,389        22,397        1,436        732        6,601   
2.10%     16,343        -            24,980        15,025        41,079        22,918        705        20,126   
2.15%     9,975        -            18,753        20,847        73,868        5,053        305        16,697   
2.20%     18,194        -            11,309        19,259        25,100        1,636        -            13,217   
2.25%     5,800        -            19,295        3,192        30,068        1,079        472        11,644   
2.30%     11,382        -            9,082        13,346        14,202        4,948        -            17,394   
2.35%     28,287        -            4,036        6,303        133,464        61        -            58,551   
2.40%     1,785        -            3,070        2,517        20,504        918        -            6,109   
2.45%     4,588        -            3,214        2,089        12,505        1,367        -            4,649   
2.50%     9,918        -            849        1,045        12,385        487        -            36,654   
2.55%     1,298        -            5,381        520        9,132        635        -            3,461   
2.60%     2,262        -            425        567        5,050        -            -            6,703   
2.65%     886        -            20        640        358        280        -            116   
2.70%     1,350        -            -            -            3,580        -            -            2,387   
2.75%     124        -            -            -            678        -            -            932   
2.80%     153        -            724        15        4,109        -            -            1,484   
2.85%     471        -            -            -            142        -            -            705   
2.90%     -            -            -            -            766        -            -            -       
2.95%     73        -            645        -            219        -            -            387   
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            -            181        -            -            161   
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            15        -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            41   
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     913,246      $     83,486      $     2,155,805      $     897,056      $     2,230,794      $     426,160      $     49,119      $     1,137,781   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    FTVGI3     FTVFA2     AMTB     AMTG     AMTP     AMFAS     AMSRS     OVMS  
0.40%   $ -          $ -          $ 43      $ -          $ -          $ -          $ -          $ -       
0.65%     152        -            1,306        -            -            -            -            -       
0.75%     1,741        154        7,499        -            -            -            -            -       
0.80%     677        21        354        -            -            243        130        389   
0.85%     2,073        -            6,800        -            -            -            -            -       
0.95%     2,026        -            6,337        -            -            290        7,438        -       
1.05%     3,760        289        992        -            -            45        2,123        -       
1.10%     10,344        2,507        32,717        -            -            276        5,963        -       
1.15%     231,343        21,296        262,968        -            -            4,652        57,757        -       
1.20%     484        -            3,413        -            -            51        -            -       
1.25%     29,752        5,647        23,806        -            -            2,475        7,075        -       
1.30%     297,028        35,170        305,136        100        2        4,983        68,050        362,428   
1.35%     79,998        16,148        54,665        -            -            1,173        26,106        -       
1.40%     84,985        5,539        145,495        83        197        5,838        11,938        165,329   
1.45%     77,496        21,040        55,914        -            -            2,288        10,804        -       
1.50%     92,083        39,182        57,455        -            -            1,808        8,575        -       
1.55%     145,655        67,622        235,118        -            -            10,160        32,313        -       
1.60%     101,551        23,810        32,913        -            -            1,238        4,095        -       
1.65%     59,942        6,095        79,889        -            -            301        12,402        -       
1.70%     11,485        3,170        40,862        -            -            593        7,130        -       
1.75%     176,185        73,349        516,522        -            -            7,964        58,617        -       
1.80%     100,555        10,946        78,167        -            -            1,521        9,945        -       
1.85%     41,372        7,269        44,845        -            -            765        8,105        -       
1.90%     1,700        78        14,437        -            -            62        7,019        -       
1.95%     39,654        15,787        80,535        -            -            1,133        4,072        -       
2.00%     35,790        7,097        96,641        -            -            161        5,171        -       
2.05%     8,696        2,482        21,116        -            -            2,476        4,698        -       
2.10%     9,307        205        26,953        -            -            676        6,672        -       
2.15%     4,393        2,171        76,579        -            -            1,398        6,274        -       
2.20%     18,661        11,502        33,326        -            -            1,795        1,331        -       
2.25%     4,399        320        82,519        -            -            306        735        -       
2.30%     4,615        965        19,102        -            -            764        2,702        -       
2.35%     667        2,909        249,196        -            -            1,851        3,749        -       
2.40%     1,421        1,042        24,315        -            -            1,245        5,208        -       
2.45%     1,857        -            16,905        -            -            -            -            -       
2.50%     1,395        603        17,751        -            -            105        64        -       
2.55%     723        2,534        11,005        -            -            25        -            -       
2.60%     442        -            8,040        -            -            -            224        -       
2.65%     3,424        1,610        2,523        -            -            -            234        -       
2.70%     -            -            3,630        -            -            -            -            -       
2.75%     -            -            4,518        -            -            -            -            -       
2.80%     -            -            1,184        -            -            31        -            -       
2.85%     -            -            780        -            -            -            -            -       
2.90%     -            -            901        -            -            -            -            -       
2.95%     -            -            359        -            -            -            -            -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            489        -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     1,687,831      $     388,559      $     2,786,020      $     183      $     199      $     58,692      $     386,719      $     528,146   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    OVB     OVGS3     OVGS4     OVGS     OVGSS     OVGI     OVGIS     OVSC  
0.40%   $ -          $ -          $ -          $ -          $ -          $ -          $ 98      $ -       
0.65%     -            -            -            -            -            -            1,194        -       
0.75%     -            -            495        -            -            -            3,687        -       
0.80%     524        1,305        -            919        -            120        -            343   
0.85%     -            -            1,210        -            -            -            7,492        -       
0.95%     -            -            8,470        -            8        -            1,604        -       
1.05%     -            -            5,798        -            252        -            1,455        -       
1.10%     -            -            6,416        -            303        -            41,947        -       
1.15%     -            -            183,090        -            18,601        -            355,751        -       
1.20%     -            -            1,376        -            763        -            3,924        -       
1.25%     -            -            37,979        -            25,784        -            37,471        -       
1.30%     286,277        557,217        29,922        880,188        2,227        131,675        109,978        45,958   
1.35%     -            -            89,854        -            -            -            88,572        -       
1.40%     181,672        108,837        12,743        509,055        1,671        31,059        40,379        12,394   
1.45%     -            -            45,573        -            4,838        -            45,543        -       
1.50%     -            -            44,637        -            6,081        -            89,296        -       
1.55%     -            -            130,121        -            17,643        -            383,865        -       
1.60%     -            -            19,536        -            300        -            20,945        -       
1.65%     -            -            52,739        -            46        -            95,408        -       
1.70%     -            -            8,381        -            2,093        -            58,853        -       
1.75%     -            -            78,712        -            2,125        -            930,756        -       
1.80%     -            -            30,405        -            9,670        -            90,565        -       
1.85%     -            -            14,238        -            4,237        -            59,136        -       
1.90%     -            -            3,569        -            540        -            11,363        -       
1.95%     -            -            23,333        -            744        -            127,637        -       
2.00%     -            -            21,586        -            930        -            157,033        -       
2.05%     -            -            6,369        -            1,376        -            39,853        -       
2.10%     -            -            20,406        -            1,835        -            65,991        -       
2.15%     -            -            2,793        -            1,261        -            192,791        -       
2.20%     -            -            19,200        -            -            -            42,757        -       
2.25%     -            -            2,393        -            164        -            61,716        -       
2.30%     -            -            2,353        -            -            -            16,371        -       
2.35%     -            -            3,076        -            -            -            289,735        -       
2.40%     -            -            2,020        -            -            -            55,318        -       
2.45%     -            -            701        -            -            -            22,363        -       
2.50%     -            -            109        -            -            -            17,136        -       
2.55%     -            -            1,016        -            -            -            23,272        -       
2.60%     -            -            68        -            -            -            10,813        -       
2.65%     -            -            38        -            -            -            2,434        -       
2.70%     -            -            -            -            -            -            6,742        -       
2.75%     -            -            -            -            -            -            2,959        -       
2.80%     -            -            3,230        -            -            -            1,485        -       
2.85%     -            -            -            -            -            -            540        -       
2.90%     -            -            -            -            -            -            1,922        -       
2.95%     -            -            -            -            -            -            607        -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            -            -            -            242        -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            48        -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     468,473      $     667,359      $     913,955      $     1,390,162      $     103,492      $     162,854      $     3,619,047      $     58,695   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    OVSCS     OVAG     OVSB     OVSBS     PMVAAD     PMVFAD     PMVLAD     PMVTRD  
0.40%   $ 54      $ -          $ -          $ -          $ -          $ -          $ 1,104      $ 1,419   
0.65%     43        -            -            -            21        -            1,351        779   
0.75%     450        -            -            -            32        2,335        19,877        5,953   
0.80%     -            486        97        -            -            111        532        -       
0.85%     1,752        -            -            -            130        1,230        21,325        8,103   
0.95%     1,837        -            -            218        -            41        5,588        1,013   
1.05%     2,891        -            -            90        -            213        6,088        1,524   
1.10%     9,718        -            -            66        684        7,924        58,625        5,659   
1.15%     95,711        -            -            4,620        6,460        35,886        406,779        129,076   
1.20%     116        -            -            74        -            79        1,900        45   
1.25%     15,253        -            -            918        47        7,070        36,749        6,248   
1.30%     58,868        117,104        1,046        -            8,218        49,906        743,970        499,233   
1.35%     43,918        -            -            1,343        2,783        14,835        108,466        41,683   
1.40%     4,289        22,241        336        350        1,537        12,522        80,624        41,336   
1.45%     21,928        -            -            1,475        734        7,403        65,213        20,247   
1.50%     33,068        -            -            677        4,752        21,783        238,771        136,328   
1.55%     123,556        -            -            5,304        4,269        34,477        379,528        71,830   
1.60%     15,304        -            -            182        8,603        36,558        123,769        108,839   
1.65%     40,459        -            -            747        1,909        8,526        116,070        32,043   
1.70%     7,102        -            -            281        1        628        28,761        3,229   
1.75%     127,597        -            -            3,200        9,565        35,293        1,009,907        399,861   
1.80%     29,631        -            -            1,108        2,763        9,880        118,079        34,488   
1.85%     20,933        -            -            354        2,405        3,288        167,244        88,619   
1.90%     3,629        -            -            225        -            1,265        15,793        2,899   
1.95%     35,107        -            -            353        1,414        12,612        274,701        100,294   
2.00%     32,456        -            -            753        2,634        9,413        154,200        26,134   
2.05%     17,354        -            -            115        322        2,800        64,894        31,076   
2.10%     30,435        -            -            200        4,493        8,746        65,677        25,026   
2.15%     6,904        -            -            140        80        1,851        89,746        20,036   
2.20%     11,043        -            -            470        1,476        5,320        118,417        71,728   
2.25%     2,666        -            -            179        428        378        35,271        3,883   
2.30%     9,751        -            -            -            23        1,277        38,171        28,013   
2.35%     8,492        -            -            -            1,018        -            148,468        6,420   
2.40%     1,198        -            -            14        447        122        26,607        859   
2.45%     4,281        -            -            76        -            642        24,034        7,950   
2.50%     6,235        -            -            -            -            -            9,773        2,932   
2.55%     4,886        -            -            -            2,105        1,577        18,648        2,177   
2.60%     676        -            -            -            -            -            3,974        1,019   
2.65%     1,263        -            -            -            -            -            3,378        2,302   
2.70%     50        -            -            -            -            -            4,034        467   
2.75%     336        -            -            5        -            -            994        -       
2.80%     16,361        -            -            -            -            -            20,089        275   
2.85%     -            -            -            -            -            -            164        -       
2.90%     -            -            -            -            -            -            855        -       
2.95%     -            -            -            -            -            -            267        -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            -            -            -            113        -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            21        -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     42        -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     847,643      $     139,831      $     1,479      $     23,537      $     69,353      $     335,991      $     4,858,609      $     1,971,045   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    PVGIB     PVTIGB     PVTVB     ACEG2     AVBV2     VYDS     TRHS2     VWHAS  
0.40%   $ -          $ -          $ -          $ -          $ -          $ -          $ -          $ -       
0.65%     -            -            -            -            -            -            51        -       
0.75%     -            -            -            -            -            -            2,351        3,328   
0.80%     -            -            -            19        -            -            784        1   
0.85%     -            -            -            -            -            -            4,354        929   
0.95%     -            -            759        482        -            -            1,936        239   
1.05%     112        -            10        1,043        -            -            1,217        -       
1.10%     514        -            205        503        -            -            4,514        52   
1.15%     7,340        1,166        8,190        7,860        -            418        75,751        2,228   
1.20%     110        -            -            -            -            -            570        -       
1.25%     1,778        446        5,515        1,604        -            3,023        5,290        222   
1.30%     -            -            -            1,679        -            -            160,022        18,349   
1.35%     1,026        -            695        1,590        -            1,250        16,391        2,131   
1.40%     264        339        513        1,677        -            -            49,465        471   
1.45%     1,005        254        842        1,332        -            -            7,533        187   
1.50%     920        620        838        3,053        -            -            27,386        7,877   
1.55%     9,562        231        6,444        8,973        23        51        55,122        4,419   
1.60%     43        29        3,489        460        -            -            15,447        4,753   
1.65%     1,808        -            972        522        -            58        14,157        1,251   
1.70%     380        -            735        2,769        -            -            3,349        207   
1.75%     7,011        499        845        5,988        -            -            72,730        8,738   
1.80%     1,851        940        2,009        1,530        -            -            12,074        857   
1.85%     933        304        684        1,633        -            -            16,179        2,306   
1.90%     1,127        -            1,783        1,615        -            -            1,362        -       
1.95%     1,080        -            -            1,539        -            -            28,721        1,811   
2.00%     724        -            292        2,107        -            -            22,148        584   
2.05%     681        519        203        1,181        -            -            10,081        1,615   
2.10%     1,589        59        87        1,903        -            -            16,802        8,716   
2.15%     239        -            -            2,639        -            -            2,558        212   
2.20%     167        -            24        248        -            -            38,968        3,633   
2.25%     470        -            483        210        -            -            66        46   
2.30%     148        -            174        144        -            -            3,864        683   
2.35%     211        -            863        2,048        -            -            1,203        -       
2.40%     -            -            -            606        -            -            281        -       
2.45%     -            -            331        390        -            -            1,278        -       
2.50%     -            -            -            259        -            -            -            -       
2.55%     -            -            -            212        -            -            1,661        56   
2.60%     -            -            -            -            -            -            -            -       
2.65%     -            -            -            -            -            -            103        -       
2.70%     -            -            -            -            -            -            -            -       
2.75%     -            -            -            -            -            -            74        -       
2.80%     -            -            -            -            -            -            10,195        -       
2.85%     -            -            -            -            -            -            -            -       
2.90%     -            -            -            -            -            -            -            -       
2.95%     -            -            -            11        -            -            -            -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     41,093      $     5,406      $     36,985      $     57,829      $     23      $     4,800      $     686,038      $     75,901   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    VWBF     VWEM     VWHA     WRASP     WRHIP     WRMCG     WRPCP     WRPMP  
0.40%   $ -          $ -          $ -          $ -          $ -          $ 69      $ 5,631      $ 36,766   
0.65%     -            -            -            52        -            -            -            -       
0.75%     -            -            1,369        3,755        40        162        -            -       
0.80%     131        1,674        1,841        1,007        -            -            -            -       
0.85%     -            -            1,282        984        109        1        -            -       
0.95%     -            -            51        527        -            -            -            -       
1.05%     -            -            541        1,864        -            -            -            -       
1.10%     -            -            2,614        6,401        122        146        -            -       
1.15%     -            -            19,200        107,388        6,784        1,389        -            -       
1.20%     -            -            5        106        16        -            -            -       
1.25%     -            -            2,973        37,984        619        21        -            -       
1.30%     127,426        236,392        416,472        225,479        13,491        6,201        -            -       
1.35%     -            -            7,876        62,815        1,927        1,010        -            -       
1.40%     64,944        86,597        124,337        37,836        3,059        156        -            -       
1.45%     -            -            4,113        20,061        896        180        -            -       
1.50%     -            -            32,161        193,139        13,668        4,493        -            -       
1.55%     -            -            19,242        124,094        6,046        878        -            -       
1.60%     -            -            13,278        123,908        6,631        1,460        -            -       
1.65%     -            -            9,028        33,563        2,969        1,025        -            -       
1.70%     -            -            1,760        5,322        368        14        -            -       
1.75%     -            -            17,972        240,358        16,126        6,498        -            -       
1.80%     -            -            11,507        78,195        4,055        662        -            -       
1.85%     -            -            5,993        24,902        2,260        931        -            -       
1.90%     -            -            456        1,858        2,037        53        -            -       
1.95%     -            -            7,836        114,724        2,255        1,817        -            -       
2.00%     -            -            3,350        78,462        3,133        441        -            -       
2.05%     -            -            5,239        12,749        1,300        1,207        -            -       
2.10%     -            -            21,648        45,243        1,995        510        -            -       
2.15%     -            -            2,125        12,569        336        11        -            -       
2.20%     -            -            27,499        72,123        8,458        236        -            -       
2.25%     -            -            379        515        724        13        -            -       
2.30%     -            -            751        14,277        4,932        724        -            -       
2.35%     -            -            206        3,471        1,688        -            -            -       
2.40%     -            -            5,267        1,330        -            4        -            -       
2.45%     -            -            3,377        1,637        20        -            -            -       
2.50%     -            -            -            1,306        -            220        -            -       
2.55%     -            -            1,213        4,495        6,088        20        -            -       
2.60%     -            -            -            -            -            -            -            -       
2.65%     -            -            33        2,235        29        -            -            -       
2.70%     -            -            -            -            -            -            -            -       
2.75%     -            -            8,011        -            -            -            -            -       
2.80%     -            -            1,233        154        1,046        70        -            -       
2.85%     -            -            -            -            -            -            -            -       
2.90%     -            -            -            -            -            -            -            -       
2.95%     -            -            -            -            -            -            -            -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     192,501      $     324,663      $     782,238      $     1,696,888      $     113,227      $     30,622      $     5,631      $     36,766   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    WRPMAP     WRPMCP     SVDF     SVOF     WFVSCG     WFVSMV     WFVTRB     WFVOG2  
0.40%   $ 75,962      $ 12,303      $ -          $ -          $ 37      $ -          $ -          $ -       
0.65%     -            -            -            -            27        -            -            -       
0.75%     -            -            -            -            221        -            -            -       
0.80%     -            -            -            -            91        -            -            -       
0.85%     -            -            -            -            2,329        -            -            -       
0.95%     -            -            -            -            663        -            -            -       
1.05%     -            -            -            -            421        -            -            -       
1.10%     -            -            -            -            9,544        90        -            -       
1.15%     -            -            -            -            40,383        -            348        13   
1.20%     -            -            -            -            17        -            -            -       
1.25%     -            -            -            -            4,333        -            3,422        -       
1.30%     -            -            91        3,180        95,644        -            -            -       
1.35%     -            -            -            -            14,537        -            -            -       
1.40%     -            -            433        259        11,818        -            -            152   
1.45%     -            -            -            -            8,224        -            -            -       
1.50%     -            -            -            -            27,329        -            -            -       
1.55%     -            -            -            -            56,005        -            -            -       
1.60%     -            -            -            -            10,815        -            -            454   
1.65%     -            -            -            -            13,701        -            -            -       
1.70%     -            -            -            -            2,583        -            -            -       
1.75%     -            -            -            -            100,801        -            -            82   
1.80%     -            -            -            -            7,542        -            -            -       
1.85%     -            -            -            -            17,780        -            -            -       
1.90%     -            -            -            -            3,241        -            -            -       
1.95%     -            -            -            -            21,009        -            -            -       
2.00%     -            -            -            -            13,652        -            -            -       
2.05%     -            -            -            -            2,760        -            -            -       
2.10%     -            -            -            -            19,031        -            -            -       
2.15%     -            -            -            -            2,370        -            -            -       
2.20%     -            -            -            -            34,259        -            -            156   
2.25%     -            -            -            -            1,664        -            -            -       
2.30%     -            -            -            -            5,978        -            -            -       
2.35%     -            -            -            -            5,188        -            -            -       
2.40%     -            -            -            -            797        -            -            -       
2.45%     -            -            -            -            1,986        -            -            -       
2.50%     -            -            -            -            938        -            -            -       
2.55%     -            -            -            -            854        -            -            -       
2.60%     -            -            -            -            74        -            -            -       
2.65%     -            -            -            -            242        -            -            -       
2.70%     -            -            -            -            422        -            -            -       
2.75%     -            -            -            -            -            -            -            -       
2.80%     -            -            -            -            -            -            -            -       
2.85%     -            -            -            -            -            -            -            -       
2.90%     -            -            -            -            -            -            -            -       
2.95%     -            -            -            -            -            -            -            -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     75,962      $     12,303      $     524      $     3,439      $     539,310      $     90      $     3,770      $     857   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II

NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    JAGTS2     JAIGS2     VFMG2     AVCA2     AVCD2     VWBFR     VWEMR     VWHAR  
0.40%   $ -          $ -          $ -          $ -          $ -          $ -          $ -          $ -       
0.65%     -            141        -            -            -            -            -            -       
0.75%     45        822        -            -            67        -            -            909   
0.80%     80        1,533        -            9        43        68        346        335   
0.85%     70        1,380        -            -            63        -            -            723   
0.95%     -            6,260        -            237        261        -            -            98   
1.05%     50        5,128        -            504        17        -            -            386   
1.10%     239        3,286        -            300        1,207        -            -            1,490   
1.15%     3,337        54,599        11,497        3,863        11,873        -            -            12,685   
1.20%     -            10        -            -            134        -            -            3   
1.25%     404        7,787        10,919        1,006        2,884        -            -            1,792   
1.30%     23,244        129,809        -            771        13,339        15,491        46,533        118,546   
1.35%     1,704        18,193        1,862        764        4,562        -            -            5,642   
1.40%     4,957        27,243        213        1,220        1,620        9,250        12,510        28,996   
1.45%     1,375        7,412        95        619        2,412        -            -            3,239   
1.50%     4,948        10,594        -            1,553        4,797        -            -            17,895   
1.55%     2,694        50,830        29        4,848        11,450        -            -            11,767   
1.60%     1,494        8,985        263        226        1,842        -            -            9,831   
1.65%     6,525        13,300        351        450        2,896        -            -            5,296   
1.70%     516        2,938        -            1,384        1,124        -            -            1,128   
1.75%     3,308        37,881        2,968        3,213        20,284        -            -            11,255   
1.80%     915        12,174        -            769        3,188        -            -            6,874   
1.85%     818        4,713        436        1,406        2,694        -            -            3,269   
1.90%     190        3,193        223        820        676        -            -            589   
1.95%     1,285        8,058        336        703        6,823        -            -            4,864   
2.00%     861        10,199        -            1,394        3,369        -            -            2,481   
2.05%     488        1,911        -            863        1,353        -            -            2,868   
2.10%     1,392        5,566        -            988        7,789        -            -            13,299   
2.15%     717        2,621        -            1,404        4,534        -            -            1,231   
2.20%     2,680        2,880        245        152        1,791        -            -            8,168   
2.25%     -            158        -            125        721        -            -            230   
2.30%     70        629        -            109        3,553        -            -            444   
2.35%     -            520        -            1,386        3,403        -            -            114   
2.40%     -            101        -            309        667        -            -            3,132   
2.45%     201        589        -            408        1,068        -            -            2,414   
2.50%     -            46        -            128        2,229        -            -            -       
2.55%     284        320        -            107        590        -            -            1,184   
2.60%     -            -            -            -            69        -            -            -       
2.65%     -            253        -            -            -            -            -            89   
2.70%     -            -            -            -            15        -            -            -       
2.75%     -            -            -            -            200        -            -            5,345   
2.80%     -            198        -            -            233        -            -            683   
2.85%     -            -            -            -            197        -            -            -       
2.90%     -            -            -            -            -            -            -            -       
2.95%     -            -            -            9        47        -            -            -       
3.00%     -            -            -            -            -            -            -            -       
3.05%     -            -            -            -            -            -            -            -       
3.10%     -            -            -            -            -            -            -            -       
3.15%     -            -            -            -            -            -            -            -       
3.20%     -            -            -            -            -            -            -            -       
3.25%     -            -            -            -            -            -            -            -       
3.30%     -            -            -            -            -            -            -            -       
3.40%     -            -            -            -            -            -            -            -       
 

 

 

  
  $     64,891      $     442,260      $     29,437      $     32,047      $     126,084      $     24,809      $     59,389      $     289,294   
 

 

 

  

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    OVHI3     OVHI4     OVHI     OVHIS                  
0.40%   $ -          $ -          $ -          $ -               
0.65%     -            -            -            -               
0.75%     -            -            -            -               
0.80%     431        -            15        -               
0.85%     -            -            -            -               
0.95%     -            687        -            406           
1.05%     -            194        -            263           
1.10%     -            92        -            198           
1.15%     -            15,508        -            5,532           
1.20%     -            106        -            227           
1.25%     -            2,235        -            2,307           
1.30%     4,399        -            169        -               
1.35%     -            5,152        -            1,652           
1.40%     1,093        662        13        1,124           
1.45%     -            4,917        -            1,012           
1.50%     -            2,451        -            861           
1.55%     -            17,586        -            5,955           
1.60%     -            437        -            319           
1.65%     -            2,975        -            876           
1.70%     -            529        -            711           
1.75%     -            12,550        -            2,320           
1.80%     -            2,087        -            2,394           
1.85%     -            1,036        -            713           
1.90%     -            823        -            255           
1.95%     -            1,399        -            178           
2.00%     -            3,363        -            730           
2.05%     -            45        -            455           
2.10%     -            941        -            297           
2.15%     -            441        -            181           
2.20%     -            2,876        -            217           
2.25%     -            635        -            145           
2.30%     -            -            -            5           
2.35%     -            -            -            61           
2.40%     -            58        -            -               
2.45%     -            345        -            -               
2.50%     -            -            -            -               
2.55%     -            -            -            -               
2.60%     -            -            -            -               
2.65%     -            -            -            -               
2.70%     -            -            -            -               
2.75%     -            12        -            -               
2.80%     -            -            -            -               
2.85%     -            -            -            -               
2.90%     -            -            -            -               
2.95%     -            -            -            -               
3.00%     -            -            -            -               
3.05%     -            -            -            -               
3.10%     -            -            -            -               
3.15%     -            -            -            -               
3.20%     -            -            -            -               
3.25%     -            -            -            -               
3.30%     -            -            -            -               
3.40%     -            -            -            -               
 

 

 

    

 

  

 

  

 

  

 

  $     5,923      $     80,142      $     197      $     29,394           
 

 

 

    

 

  

 

  

 

  

 

(3) 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. The fixed account assets are not reflected in the accompanying financial statements. In addition, the Account portion of contract owner loans is transferred to the accounts of the Company for administration and collection. Loan repayments are transferred to the Account at the direction of the contract owner. For the years ended December 31, 2012 and 2011, total transfers to the Account from the fixed account were $992,712,778 and $1,259,932,807, respectively, and total transfers from the Account to the fixed account were $301,251,657 and $267,916,742, respectively. Transfers from the Account to the fixed account are included in redemptions, and transfers to the Account from the fixed account are included in purchase payments received from contract owners, as applicable, on the accompanying Statements of Changes in Contract Owners’ Equity.

For contracts with the Extra Value option, the Company contributed $10,008,558 and $15,728,316 to the Account in the form of bonus credits to the contract owner accounts for the years ended December 31, 2012 and 2011, respectively. These amounts are included in purchase payments received from contract owners and are credited at the time the related purchase payment from the contract owner is received.

For guaranteed minimum death benefits, the Company contributed $13,377,510 and $23,803,282 to the Account in the form of additional premium to contract owner accounts for the years ended December 31, 2012 and 2011, respectively. These amounts are included in purchase payments received from contract owners and are credited at time of annuitant death.

For Purchase Payment Credits, the Company contributed $3,333,007 and $5,392,901 to the Account in the form of additional credit to the contract owner accounts for the years ended December 31, 2012 and 2011, respectively. These amounts are included in purchase payments received from contract owners and, as applicable, are applied to a contract when cumulative purchase payments reach certain aggregate levels.

 

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

(4) Fair Value Measurement

FASB ASC 820, Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the Account generally uses the market approach as the valuation technique due to the nature of the mutual fund investments offered in the Account. This technique maximizes the use of observable inputs and minimizes the use of unobservable inputs.

In accordance with FASB ASC 820, the Account categorized its financial instruments into a three level hierarchy based on the priority of the inputs to the valuation technique. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument in its entirety.

The Account categorizes financial assets recorded at fair value as follows:

• Level 1 - Unadjusted quoted prices accessible in active markets and mutual funds where the value per share (unit) is determined and published and is the basis for current transactions for identical assets or liabilities at the measurement date.

• Level 2 - Unadjusted quoted prices for similar assets or liabilities in active markets or inputs (other than quoted prices) that are observable or that are derived principally from or corroborated by observable market data through correlation or other means.

• Level 3 - Prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management’s best estimate about the assumptions market participants would use at the measurement date in pricing the asset or liability. Consideration is given to the risk inherent in both the method of valuation and the valuation inputs.

The Account recognizes transfers between fair value hierarchy levels at the reporting period end. There were no transfers between Level 1 and 2 as of December 31, 2012.

The following table summarizes assets measured at fair value on a recurring basis as of December 31, 2012:

 

     Level 1    Level 2    Level 3    Total

Separate Account Investments

    $33,973,541,816    $0    $0    $33,973,541,816

The cost of purchases and proceeds from sales of investments for the year ended December 31, 2012 were as follows:

 

     Purchases of
Investments		      Sales of Investments  

Mid Cap Growth Portfolio - Class S Shares ( ALMCS )

    $             90,834       $             143,771   

VPS Dynamic Asset Allocation Portfolio - Class B ( ALVDAB )

      1,941,698         12,463   

Growth Fund - Class 1 ( AFGF )

      113,001         782,187   

High-Income Bond Fund - Class 1 ( AFHY )

      5,554,556         5,488,414   

Protected Asset Allocation Fund - Class P2 ( AVPAP2 )

      13,151,517         56   

U.S. Government/AAA-Rated Securities Fund - Class 1 ( AFGC )

      46,041         153,323   

Global Allocation V.I. Fund - Class III ( MLVGA3 )

      30,429,998         10,247,168   

Money Market Portfolio(TM) ( CHSMM )

      8,160,040         11,777,911   

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

      16,595,091         34,970,368   

Stock Index Fund, Inc. - Service Shares ( DSIFS )

      28,290,060         20,611,792   

The Dreyfus Socially Responsible Growth Fund, Inc. - Initial Shares ( DSRG )

      706,502         5,774,636   

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

      569,752         11,972   

VA International Equity Fund ( HVIE )

      3,915,386         1,650,420   

VA Situs Fund ( HVSIT )

      10,494,030         5,706,022   

V.I. Mid Cap Core Equity - Series II Shares ( IVMCC2 )

      1,484,725         16,807   

Van Kampen V.I. Mid Cap Growth Fund - Series II Shares ( IVKMG2 )

      24,827,495         2,932,382   

Mid Cap Value Portfolio: Class 1 ( JPMMV1 )

      4,118,340         1,147,213   

Janus Aspen Series - Balanced Portfolio - Service Shares ( JABS )

      2,542,866         1,927,486   

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

      25,624,529         21,380,693   

Janus Aspen Series - Global Technology Portfolio - Service Shares ( JAGTS )

      18,945,264         3,714,995   

Janus Aspen Series - Overseas Portfolio - Service Shares ( JAIGS )

      102,517,058         16,211,044   

Investors Growth Stock Series - Service Class ( MIGSC )

      655,522         2,870,690   

New Discovery Series - Service Class ( MNDSC )

      2,675,845         168,106   

Value Series - Service Class ( MVFSC )

      14,526,019         63,465,761   

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

      24,570,204         5,576,740   

Core Plus Fixed Income Portfolio - Class I ( MSVFI )

      483,285         719,783   

Core Plus Fixed Income Portfolio - Class II ( MSVF2 )

      1,811,462         4,033,841   

Emerging Markets Debt Portfolio - Class I ( MSEM )

      100,371         769,065   

Emerging Markets Debt Portfolio - Class II ( MSEMB )

      28,079         175,426   

Global Real Estate Portfolio - Class II ( VKVGR2 )

      55,861         338   

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

      322         11,312   

U.S. Real Estate Portfolio - Class II ( MSVREB )

      32,259         32,647   

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

      2,703,143         10,443,619   

American Century NVIT Multi Cap Value Fund - Class II ( NVAMV2 )

      9,214,469         26,418,089   

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

      396,661,820         45,529,030   

American Funds NVIT Bond Fund - Class II ( GVABD2 )

      210,343,286         26,964,393   

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

      14,933,577         13,752,465   

American Funds NVIT Growth Fund - Class II ( GVAGR2 )

      15,401,138         26,010,660   

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

      132,911,755         46,297,313   

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

      490,653         1,683,266   

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

      53,468,078         54,462,799   

NVIT Emerging Markets Fund - Class I ( GEM )

      1,026         134,126   

NVIT Emerging Markets Fund - Class II ( GEM2 )

      2,489         378,935   

NVIT Emerging Markets Fund - Class III ( GEM3 )

      2,163,701         6,985,461   

NVIT Emerging Markets Fund - Class VI ( GEM6 )

      10,338,529         8,871,425   

NVIT International Equity Fund - Class I ( GIG )

      320         3,199   

NVIT International Equity Fund - Class III ( GIG3 )

      329,543         4,651,314   

Variable Insurance Trust: NVIT International Equity Fund - Class VI ( NVIE6 )

      2,108,362         5,036,852   

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

      6,326,745         13,709,915   

Neuberger Berman NVIT Multi Cap Opportunities Fund - Class II ( NVNMO2 )

      5,614,486         6,785,257   

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

      554,524         482,977   

Neuberger Berman NVIT Socially Responsible Fund - Class II ( NVNSR2 )

      7,018,936         46,084,821   

NVIT Cardinal Aggressive Fund - Class II ( NVCRA2 )

      6,119,360         2,902,571   

NVIT Cardinal Balanced Fund - Class II ( NVCRB2 )

      221,525,633         25,830,270   

NVIT Cardinal Capital Appreciation Fund - Class II ( NVCCA2 )

      265,727,595         60,133,014   

NVIT Cardinal Conservative Fund - Class II ( NVCCN2 )

      222,208,059         67,236,959   

NVIT Cardinal Moderate Fund - Class II ( NVCMD2 )

      245,418,553         38,108,863   

NVIT Cardinal Moderately Aggressive Fund - Class II ( NVCMA2 )

      22,412,185         31,366,169   

NVIT Cardinal Moderately Conservative Fund - Class II ( NVCMC2 )

      141,280,098         12,109,868   

NVIT Core Bond Fund - Class I ( NVCBD1 )

      1,888,368         1,466,211   

NVIT Core Bond Fund - Class II ( NVCBD2 )

      20,819,816         34,162,224   

NVIT Core Plus Bond Fund - Class II ( NVLCP2 )

      14,067,601         7,493,934   

NVIT Nationwide Fund - Class I ( TRF )

      2,058,410         21,104,745   

NVIT Nationwide Fund - Class II ( TRF2 )

      4,323,611         42,192,577   

NVIT Government Bond Fund - Class I ( GBF )

      82,400,243         112,407,981   

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

American Century NVIT Growth Fund - Class I ( CAF )

      1,202,056         5,014,115   

American Century NVIT Growth Fund -Class II ( CAF2 )

      13,969,385         2,442,144   

NVIT International Index Fund - Class VIII ( GVIX8 )

      3,589,169         5,149,721   

NVIT Investor Destinations Aggressive Fund - Class II ( GVIDA )

      5,807,940         74,555,354   

NVIT Investor Destinations Balanced Fund - Class II ( NVDBL2 )

      207,174,144         4,355,236   

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

      229,059,362         40,142,600   

NVIT Investor Destinations Conservative Fund - Class II ( GVIDC )

      177,536,262         33,615,624   

NVIT Investor Destinations Moderate Fund - Class II ( GVIDM )

      70,938,935         200,290,234   

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

      19,167,687         233,960,717   

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

      60,783,557         65,929,955   

NVIT Mid Cap Index Fund - Class I ( MCIF )

      14,716,837         15,769,197   

NVIT Money Market Fund - Class I ( SAM )

      229,128,924         213,744,174   

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

      259,981         5,241,755   

NVIT Multi-Manager International Growth Fund - Class VI ( NVMIG6 )

      3,978,321         33,163,620   

NVIT Multi-Manager International Value Fund - Class II ( GVDIV2 )

      612         128,684   

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

      616,839         1,773,013   

NVIT Multi-Manager International Value Fund - Class VI ( GVDIV6 )

      7,248,720         7,954,491   

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

      1,818,771         3,644,032   

NVIT Multi-Manager Large Cap Growth Fund - Class II ( NVMLG2 )

      7,958,233         29,947,216   

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

      564,264         1,166,591   

NVIT Multi-Manager Large Cap Value Fund - Class II ( NVMLV2 )

      8,622,133         8,518,271   

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

      17,099,096         28,758,051   

NVIT Multi-Manager Mid Cap Growth Fund - Class II ( NVMMG2 )

      16,405,329         31,913,231   

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

      28,524,791         48,583,995   

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

      2,037,267         2,531,207   

NVIT Multi-Manager Small Cap Growth Fund - Class II ( SCGF2 )

      4,390,217         10,686,129   

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

      1,986,167         6,562,049   

NVIT Multi-Manager Small Cap Value Fund - Class II ( SCVF2 )

      3,434,720         5,852,757   

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

      217,344         11,633,273   

NVIT Multi-Manager Small Company Fund - Class II ( SCF2 )

      2,959,732         7,289,074   

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

      38,501,718         21,050,476   

NVIT Short Term Bond Fund - Class II ( NVSTB2 )

      20,740,739         13,628,912   

NVIT Large Cap Growth Fund - Class I ( NVOLG1 )

      2,959,151         60,353,681   

NVIT Large Cap Growth Fund - Class II ( NVOLG2 )

      5,150,886         49,634,061   

Templeton NVIT International Value Fund - Class III ( NVTIV3 )

      21,998,498         32,828,954   

Van Kampen NVIT Comstock Value Fund - Class II ( EIF2 )

      5,778,806         21,425,563   

NVIT Real Estate Fund - Class I ( NVRE1 )

      9,943,028         12,483,266   

NVIT Real Estate Fund - Class II ( NVRE2 )

      20,666,810         17,299,079   

TOPS Protected Balanced ETF Portfolio - Class 4 ( NOTB4 )

      283,701         106   

TOPS Protected Growth ETF Portfolio - Class 4 ( NOTG4 )

      151,844         51   

TOPS Protected Moderate Growth ETF Portfolio - Class 4 ( NOTMG4 )

      77,187         37   

VPS Balanced Wealth Strategy Portfolio - Class B ( ALVBWB )

      136,232         3,420   

VPS Growth and Income Portfolio - Class B ( ALVGIB )

      215,965         1,533,345   

VPS Small/Mid Cap Value Portfolio: Class B ( ALVSVB )

      12,110,196         10,510,408   

VP Balanced Fund - Class I ( ACVB )

      2,626,699         4,776,705   

VP Capital Appreciation Fund - Class I ( ACVCA )

      7,199         34,143   

VP Income & Growth Fund - Class I ( ACVIG )

      858,141         2,769,332   

VP Income & Growth Fund - Class II ( ACVIG2 )

      317,519         1,017,792   

American Century VP Inflation Protection Fund - Class II ( ACVIP2 )

      51,154,252         26,509,607   

VP International Fund - Class I ( ACVI )

      724         7,344   

VP International Fund - Class III ( ACVI3 )

      1         96   

VP Mid Cap Value Fund - Class I ( ACVMV1 )

      2,016,387         2,122,866   

VP Mid Cap Value Fund - Class II ( ACVMV2 )

      13,668,955         7,544,662   

VP Ultra(R) Fund - Class II ( ACVU2 )

      -         5,760   

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

      -         1,642   

Small Cap Stock Index Portfolio - Service Shares ( DVSCS )

      10,447,757         15,182,371   

Appreciation Portfolio - Initial Shares ( DCAP )

      6,719,114         6,298,920   

Appreciation Portfolio - Service Shares ( DCAPS )

      31,444,791         15,032,923   

Opportunistic Small Cap Portfolio: Service Shares ( DVDLS )

      143,390         938,013   

Growth and Income Portfolio - Initial Shares ( DGI )

      574,381         2,283,331   

Managed Tail Risk Fund II: Service Shares ( FCA2S )

      100,720         451,826   

Quality Bond Fund II - Primary Shares ( FQB )

      1,595,233         1,873,169   

Quality Bond Fund II - Service Shares ( FQBS )

      2,826,920         8,956,328   

Equity-Income Portfolio - Initial Class ( FEIP )

      31,875,281         52,039,165   

VIP Value Strategies Portfolio - Service Class 2 ( FVSS2 )

      615,166         2,822,866   

High Income Portfolio - Initial Class ( FHIP )

      2,888,713         9,804,665   

VIP Asset Manager Portfolio - Initial Class ( FAMP )

      3,250,836         22,277,159   

VIP Energy Portfolio - Service Class 2 ( FNRS2 )

      9,048,700         19,823,024   

VIP Equity-Income Portfolio - Service Class 2 ( FEI2 )

      29,504,867         20,305,743   

VIP Freedom Fund 2010 Portfolio - Service Class ( FF10S )

      1,281,372         1,191,081   

VIP Freedom Fund 2010 Portfolio - Service Class 2 ( FF10S2 )

      28,937,449         5,308,796   

VIP Freedom Fund 2020 Portfolio - Service Class ( FF20S )

      1,239,333         1,684,140   

VIP Freedom Fund 2020 Portfolio - Service Class 2 ( FF20S2 )

      60,083,042         12,553,986   

VIP Freedom Fund 2030 Portfolio - Service Class ( FF30S )

      1,378,190         953,222   

VIP Freedom Fund 2030 Portfolio - Service Class 2 ( FF30S2 )

      5,448,216         3,449,143   

VIP Growth Portfolio - Initial Class ( FGP )

      2,030,249         55,000,231   

VIP Growth Portfolio - Service Class 2 ( FG2 )

      15,807,945         20,830,270   

VIP High Income Portfolio - Initial Class R ( FHIPR )

      13,429,952         11,602,281   

VIP Investment Grade Bond Portfolio - Service Class ( FIGBS )

      4,487,665         5,956,705   

VIP Investment Grade Bond Portfolio - Service Class 2 ( FIGBP2 )

      69,020,000         69,458,180   

VIP Mid Cap Portfolio - Service Class ( FMCS )

      2,935,292         6,517,458   

VIP Mid Cap Portfolio - Service Class 2 ( FMC2 )

      30,777,630         35,760,953   

VIP Overseas Portfolio - Initial Class ( FOP )

      1,144,664         8,321,108   

VIP Overseas Portfolio - Initial Class R ( FOPR )

      1,075,242         3,794,105   

VIP Overseas Portfolio - Service Class 2 ( FO2 )

      47,232         477,990   

VIP Overseas Portfolio - Service Class 2 R ( FO2R )

      8,659,458         9,536,141   

VIP Value Strategies Portfolio - Service Class ( FVSS )

      1,058,454         1,643,704   

Franklin Income Securities Fund - Class 2 ( FTVIS2 )

      23,413,195         11,532,003   

Franklin Rising Dividends Securities Fund - Class 2 ( FTVRD2 )

      1,700,980         14,423,641   

Franklin Small Cap Value Securities Fund - Class 2 ( FTVSV2 )

      7,782,132         39,905,824   

Templeton Developing Markets Securities Fund - Class 3 ( FTVDM3 )

      3,313,504         5,095,394   

Templeton Foreign Securities Fund - Class 2 ( TIF2 )

      98,990         631,753   

Templeton Foreign Securities Fund - Class 3 ( TIF3 )

      4,237,833         13,410,185   

Templeton Global Bond Securities Fund - Class 3 ( FTVGI3 )

      16,933,991         10,465,849   

VIP Founding Funds Allocation Fund - Class 2 ( FTVFA2 )

      6,571,416         2,954,494   

Advisers Management Trust - Short Duration Bond Portfolio - I Class Shares ( AMTB )

      21,305,909         38,348,612   

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

Growth Portfolio - I Class Shares ( AMTG )

         1,287         2,701   

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

         4,689         12,115   

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

         34,800         34,800   

Small-Cap Growth Portfolio - S Class Shares ( AMFAS )

         491,468         1,691,269   

Socially Responsive Portfolio - I Class Shares ( AMSRS )

         302,439         6,621,725   

Balanced Fund/VA - Non-Service Shares ( OVMS )

         712,591         8,197,243   

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

         2,573,494         7,256,301   

Global Securities Fund/VA - Class 3 ( OVGS3 )

         2,387,367         8,914,401   

Global Securities Fund/VA - Class 4 ( OVGS4 )

         8,300,775         11,514,888   

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

         2,228,927         17,620,140   

Global Securities Fund/VA - Service Class ( OVGSS )

         158,232         1,363,563   

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

         1,768,342         3,375,507   

Main Street Fund(R)/VA - Service Class ( OVGIS )

         8,102,660         51,935,866   

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

         1,022,675         1,275,157   

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

         5,502,149         10,592,978   

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

         702,687         2,907,509   

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

         745,216         64,980   

Global Strategic Income Fund/VA: Service Shares ( OVSBS )

         9,228,683         501,536   

All Asset Portfolio - Advisor Class ( PMVAAD )

         19,899,643         180,978   

Foreign Bond Portfolio (Unhedged) - Advisor Class ( PMVFAD )

         5,134,870         4,712,613   

Low Duration Portfolio - Advisor Class ( PMVLAD )

         88,346,091         23,232,207   

Total Return Portfolio - Advisor Class ( PMVTRD )

         128,559,604         4,087,297   

Putnam VT Growth and Income Fund - Class IB ( PVGIB )

         375,052         690,082   

Putnam VT International Equity Fund - Class IB ( PVTIGB )

         8,144         106,530   

Putnam VT Voyager Fund - Class IB ( PVTVB )

         207,374         1,553,174   

Van Kampen V.I. American Franchise Fund: Series II Shares ( ACEG2 )

         6,233,583         773,903   

Van Kampen V.I. Value Opportunities Fund: Series II Shares ( AVBV2 )

         15         4,646   

Diversified Stock Fund Class A Shares ( VYDS )

         3,723         13,712   

Blue Chip Growth Portfolio - II ( TRBCG2 )

         68,073         67,944   

Equity Income Portfolio - II ( TREI2 )

         -         1   

Health Sciences Portfolio - II ( TRHS2 )

         30,794,335         10,928,807   

Eck VIP Trust - Global Hard Assets Fund - Service Class ( VWHAS )

         14,460,436         1,040,372   

VIP Trust - Global Bond Fund: Initial Class ( VWBF )

         6,042,012         2,554,166   

VIP Trust - Emerging Markets Fund: Initial Class ( VWEM )

         14,405,162         3,938,545   

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

         61,590,413         17,608,570   

Variable Insurance Portfolios - Asset Strategy ( WRASP )

         23,551,095         12,403,823   

Variable Insurance Portfolios - High Income ( WRHIP )

         26,185,872         1,897,113   

Variable Insurance Portfolios - Mid Cap Growth ( WRMCG )

         7,222,931         118,991   

Variable Insurance Portfolios - Pathfinder Conservative ( WRPCP )

         1,398,732         132,926   

Variable Insurance Portfolios - Pathfinder Moderate ( WRPMP )

         11,900,581         163,280   

Variable Insurance Portfolios - Pathfinder Moderately Aggressive ( WRPMAP )

         13,050,998         652,406   

Variable Insurance Portfolios - Pathfinder Moderately Conservative ( WRPMCP )

         3,880,912         297,476   

Advantage VT Discovery Fund ( SVDF )

         44         4,090   

Advantage VT Opportunity Fund - Class 2 ( SVOF )

         339         27,121   

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

         10,874,300         9,960,669   

Advantage VT Small Cap Value Fund - Class 2 ( WFVSMV )

         583         2,509   

Advantage VT Core Bond Fund ( WFVTRB )

         9,930         3,773   

Advantage - VT Omega Growth Fund - Class 2 ( WFVOG2 )

         3,480         12,338   

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

         4,910,265         17,922,204   

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

         2,568,373         96,480,226   

Managed Allocation Fund - Moderate Growth II (obsolete) ( VFMG2 )

         21,461         3,392,795   

V.I. Capital Appreciation Fund - Series II (obsolete) ( AVCA2 )

         309,263         6,878,703   

V.I. Capital Development Fund - Series II (obsolete) ( AVCD2 )

         437,070         26,287,599   

VIP Trust - Global Bond Fund: Class R1 (obsolete) ( VWBFR )

         287,542         6,048,171   

VIP Trust - Emerging Markets Fund: Class R1 (obsolete) ( VWEMR )

         881,154         14,495,933   

VIP Trust - Global Hard Assets Fund: Class R1 (obsolete) ( VWHAR )

         8,018,941         61,325,051   

High Income Fund/VA - Class 3 (obsolete) ( OVHI3 )

         364,563         815,718   

High Income Fund/VA - Class 4 (obsolete) ( OVHI4 )

         2,425,012         9,352,273   

High Income Fund/VA - Non-Service Shares (obsolete) ( OVHI )

         3,187         25,829   

High Income Fund/VA - Service Class (obsolete) ( OVHIS )

         393,915         2,789,953   
     

 

 

     

 

 

  
     Total       $         4,820,788,315       $         3,495,307,900   
     

 

 

     

 

 

  

(5) Financial Highlights

The Company offers several variable annuity products through the Account that have unique combinations of features and fees that are assessed to the contract owner. Differences in fee structures result in a variety of contract expense rates, unit fair values and total returns. The following tabular presentation is a summary of units, unit fair values, contract owners’ equity outstanding and contract expense rates for variable annuity contracts as of December 31, 2012, and the investment income ratio and total return for each of the periods in the five year period ended December 31, 2012. The information is presented as a range of minimum to maximum values based upon product grouping. The range is determined by identifying the lowest and the highest contract expense rate for contracts with units outstanding as of the balance sheet date. The unit fair values and total returns related to these identified contract expense rates are also disclosed as a range below. Accordingly, some individual contract amounts may not be within the ranges presented. Total return and investment income ratio for periods with no ending contract owners’ equity were considered to be irrelevant, and therefore are not presented. Contract owner’s equity presented below may not agree to the contract owner’s equity presented in the Statements of Changes due to reserves for annuity contracts in payout.

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    Contract
Expense
Rate*		     Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		     Inception
Date****

Mid Cap Growth Portfolio - Class S Shares (ALMCS)

2012

     0.95% to 1.05%        29,102       $   13.92 to $ 13.79       $ 402,340        0.00%        14.59% to 14.47%     

2011

     0.95% to 1.45%        32,647        12.15 to 11.64        393,138        0.00%        -9.46% to -9.91%     

2010

     0.95% to 1.45%        34,119        13.41 to 12.93        452,475        0.00%        17.75% to 17.16%     

2009

     0.95% to 1.45%        38,321        11.39 to 11.03        432,673        0.00%        49.88% to 49.12%     

2008

     0.95% to 1.45%        35,463        7.60 to 7.40        267,952        0.00%        -58.87% to -59.08%     

VPS Dynamic Asset Allocation Portfolio - Class B (ALVDAB)

2012

     1.15% to 2.55%        196,701        10.16 to 10.07        1,991,149        0.09%        1.64% to 0.68%      ****

Growth Fund - Class 1 (AFGF)

2012

     1.30%        125,616        85.31        10,715,793        1.06%        16.65%     

2011

     1.30%        133,488        73.13        9,761,912        0.85%        -5.30%     

2010

     1.30%        142,179        77.23        10,979,803        0.97%        17.46%     

2009

     1.30%        156,482        65.75        10,287,967        0.86%        37.93%     

2008

     1.30%        185,887        47.67        8,860,655        1.05%        -44.56%     

High-Income Bond Fund - Class 1 (AFHY)

2012

     1.30%        35,854        54.39        1,950,049        7.73%        12.42%     

2011

     1.30%        37,304        48.38        1,804,784        9.81%        0.85%     

2010

     1.30%        37,078        47.97        1,778,708        10.52%        13.88%     

2009

     1.30%        41,033        42.12        1,728,444        7.90%        37.64%     

2008

     1.30%        42,363        30.60        1,296,441        5.45%        -24.74%     

Protected Asset Allocation Fund - Class P2 (AVPAP2)

2012

     1.15% to 2.30%        1,300,941        10.12 to 10.10        13,160,237        1.27%        1.22% to 1.03%      ****

U.S. Government/AAA-Rated Securities Fund - Class 1 (AFGC)

2012

     1.30%        30,588        35.80        1,095,025        1.20%        0.88%     

2011

     1.30%        34,457        35.49        1,222,715        2.00%        6.46%     

2010

     1.30%        36,578        33.33        1,219,260        1.84%        4.56%     

2009

     1.30%        42,499        31.88        1,354,789        2.60%        1.45%     

2008

     1.30%        48,345        31.42        1,519,125        3.08%        6.44%     

Global Allocation V.I. Fund - Class III (MLVGA3)

2012

     0.65% to 2.65%        11,530,622        13.83 to 12.84        154,015,464        1.60%        9.25% to 7.05%     

2011

     0.75% to 2.65%        10,016,317        12.62 to 11.99        123,669,985        2.63%        -4.36% to -6.19%     

2010

     0.75% to 2.65%        6,572,107        13.20 to 12.78        85,557,591        1.68%        8.94% to 6.85%     

2009

     0.75% to 2.65%        2,338,768        12.12 to 11.96        28,183,661        2.59%        21.17% to 19.62%      ****

Money Market Portfolio(TM) (CHSMM)

2012

     0.65% to 1.55%        1,047,948        9.94 to 10.06        10,825,869        0.01%        -0.64% to -1.54%     

2011

     0.75% to 1.55%        1,391,226        9.97 to 10.22        14,443,732        0.01%        -0.74% to -1.54%     

2010

     0.75% to 1.55%        1,300,472        10.04 to 10.38        13,862,136        0.01%        -0.70% to -1.50%     

2009

     0.75% to 1.55%        1,588,787        10.11 to 10.54        17,129,897        0.11%        -0.65% to -1.45%     

2008

     0.75% to 1.85%        2,367,841        10.18 to 10.52        25,748,263        2.08%        1.35% to 0.23%     

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

2012

     0.80% to 1.40%        6,373,721        27.94 to 32.29          208,787,008        2.02%        14.81% to 14.11%     

2011

     0.80% to 1.40%        7,343,204        24.34 to 28.29        210,627,633        1.79%        1.06% to 0.45%     

2010

     0.80% to 1.40%        8,556,559        24.08 to 28.17        244,155,883        1.80%        13.92% to 13.23%     

2009

     0.80% to 1.40%        10,005,487        21.14 to 24.87        251,973,988        2.07%        25.32% to 24.57%     

2008

     0.80% to 1.40%        11,829,308        16.87 to 19.97        239,007,065        2.04%        -37.64% to -38.02%     

Stock Index Fund, Inc. - Service Shares (DSIFS)

2012

     0.40% to 2.85%        7,884,652        10.82 to 13.70        131,104,877        1.82%        15.01% to 12.18%     

2011

     0.40% to 2.85%        7,723,730        9.41 to 12.21        113,970,712        1.60%        1.21% to -1.27%     

2010

     0.40% to 2.85%        7,353,016        9.30 to 12.37        109,163,971        1.61%        14.08% to 11.28%     

2009

     0.75% to 2.85%        7,000,385        7.98 to 11.11        92,376,592        1.85%        25.10% to 22.45%     

2008

     0.95% to 2.85%        6,903,789        9.20 to 9.08        73,597,957        1.77%        -37.92% to -39.11%     

The Dreyfus Socially Responsible Growth Fund, Inc. - Initial Shares (DSRG)

2012

     0.80% to 1.40%        1,435,555        21.46 to 25.23        38,303,631        0.82%        11.08% to 10.40%     

2011

     0.80% to 1.40%        1,619,263        19.32 to 22.85        39,089,761        0.90%        0.10% to -0.51%     

2010

     0.80% to 1.40%        1,858,295        19.31 to 22.97        45,067,265        0.89%        13.90% to 13.21%     

2009

     0.80% to 1.40%        2,105,786        16.95 to 20.29        45,091,981        0.98%        32.69% to 31.88%     

2008

     0.80% to 1.40%        2,380,596        12.77 to 15.38        38,616,074        0.77%        -34.95% to -35.34%     

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

2012

     1.15% to 2.20%        55,968        10.23 to 10.16        570,936        0.00%        2.33% to 1.61%      ****

VA International Equity Fund (HVIE)

2012

     0.40% to 2.50%        917,015        10.33 to 9.87        9,259,820        1.50%        13.58% to 11.18%     

2011

     0.40% to 2.35%        672,762        9.10 to 8.89        6,042,943        2.60%        -11.91% to -13.63%     

2010

     1.15% to 2.25%        25,460        10.32 to 10.30        262,513        0.00%        3.16% to 2.97%      ****

VA Situs Fund (HVSIT)

2012

     0.40% to 2.65%        1,678,205        13.63 to 12.97        22,301,050        0.00%        22.13% to 19.37%     

2011

     0.75% to 2.70%        1,261,261        11.11 to 10.86        13,876,653        0.05%        -1.65% to -3.58%     

2010

     0.85% to 2.35%        45,685        11.30 to 11.27        515,595        0.00%        12.97% to 12.69%      ****

V.I. Mid Cap Core Equity - Series II Shares (IVMCC2)

2012

     0.40% to 2.65%        153,532        10.02 to 9.87        1,525,895        0.00%        0.19% to -1.32%      ****

Van Kampen V.I. Mid Cap Growth Fund - Series II Shares (IVKMG2)

2012

     0.75% to 2.85%        2,201,353        9.78 to 9.64        21,398,232        0.00%        -2.23% to -3.64%      ****

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    Contract
Expense
Rate*		     Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		     Inception
Date****

Mid Cap Value Portfolio: Class 1 (JPMMV1)

2012

     0.80% to 1.40%        597,636       $   17.99 to $ 17.07       $   10,278,714        0.98%        19.41% to 18.69%     

2011

     0.80% to 1.40%        404,489        15.07 to 14.38        5,854,364        1.33%        1.35% to 0.73%     

2010

     0.80% to 1.40%        463,358        14.87 to 14.28        6,650,267        1.21%        22.47% to 21.73%     

2009

     0.80% to 1.40%        515,602        12.14 to 11.73        6,074,214        0.00%        25.68% to 24.92%     

Janus Aspen Series - Balanced Portfolio - Service Shares (JABS)

2012

     0.95% to 2.20%        637,267        18.14 to 17.44        11,759,269        2.54%        12.30% to 10.88%     

2011

     0.95% to 2.30%        655,718        16.15 to 15.59        10,841,461        2.28%        0.39% to -0.97%     

2010

     0.95% to 2.45%        781,885        16.09 to 15.55        12,961,037        2.54%        7.09% to 5.47%     

2009

     0.95% to 2.45%        876,368        15.02 to 14.75        13,598,156        2.79%        24.39% to 22.51%     

2008

     0.95% to 2.55%        848,549        12.08 to 11.96        10,629,343        2.43%        -16.86% to -18.20%     

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

2012

     0.40% to 2.95%        8,531,781        10.17 to 17.41        141,263,768        0.59%        23.36% to 20.20%     

2011

     0.40% to 2.95%        8,157,179        8.24 to 14.48        111,233,520        0.25%        -7.31% to -9.68%     

2010

     0.40% to 2.95%        8,528,417        8.90 to 16.04        127,857,338        0.24%        6.05% to 3.34%     

2009

     0.40% to 2.95%        7,958,375        8.39 to 15.52        108,881,608        0.01%        45.43% to 41.71%     

2008

     0.80% to 2.85%        6,759,021        6.45 to 11.01        62,774,776        0.01%        -44.76% to -45.90%     

Janus Aspen Series - Global Technology Portfolio - Service Shares (JAGTS)

2012

     0.75% to 2.55%        2,402,225        10.00 to 9.87        17,312,385        0.00%        -0.02% to -1.25%      ****

2011

     0.80% to 1.40%        378,492        4.92 to 4.59        1,750,288        0.00%        -9.39% to -9.93%     

2010

     0.80% to 1.40%        429,603        5.43 to 5.09        2,204,148        0.00%        23.40% to 22.66%     

2009

     0.80% to 1.40%        566,071        4.40 to 4.15        2,364,877        0.00%        55.64% to 54.70%     

2008

     0.80% to 1.40%        628,439        2.83 to 2.68        1,696,007        0.09%        -44.42% to -44.76%     

Janus Aspen Series - Overseas Portfolio - Service Shares (JAIGS)

2012

     0.75% to 2.65%        4,239,187        9.96 to 26.94        80,356,795        0.91%        -0.39% to 10.17%      ****

2011

     0.80% to 2.15%        391,151        11.78 to 25.59        5,139,442        0.38%        -32.88% to -33.79%     

2010

     0.80% to 2.15%        470,786        17.55 to 38.65        9,286,940        0.52%        24.02% to 22.33%     

2009

     0.80% to 2.15%        602,788        14.15 to 31.60        9,534,039        0.41%        77.64% to 75.22%     

2008

     0.80% to 2.15%        711,183        7.97 to 18.03        6,402,172        2.65%        -52.61% to -53.26%     

Investors Growth Stock Series - Service Class (MIGSC)

2012

     0.95% to 2.80%        480,417        14.89 to 13.71        8,220,030        0.22%        15.57% to 13.41%     

2011

     0.95% to 2.80%        638,301        12.89 to 12.09        9,464,140        0.25%        -0.58% to -2.43%     

2010

     0.95% to 2.80%        809,425        12.96 to 12.39        12,090,332        0.30%        11.09% to 9.01%     

2009

     0.95% to 2.80%        996,255        11.67 to 11.37        13,426,951        0.45%        37.77% to 35.20%     

2008

     0.95% to 2.80%        1,184,843        8.47 to 8.41        11,622,597        0.30%        -37.58% to -38.75%     

New Discovery Series - Service Class (MNDSC)

2012

     0.40% to 2.55%        250,099        10.29 to 10.14        2,551,639        0.00%        2.90% to 1.41%      ****

Value Series - Service Class (MVFSC)

2012

     0.40% to 3.20%        16,598,824        10.71 to 15.10        308,624,081        1.41%        15.42% to 12.17%     

2011

     0.40% to 3.20%        19,464,081        9.28 to 13.46        317,118,489        1.23%        -0.86% to -3.65%     

2010

     0.65% to 3.20%        20,429,012        9.20 to 13.97        339,926,147        1.39%        10.49% to 7.66%     

2009

     0.65% to 3.25%        22,272,897        8.33 to 12.93        339,364,913        1.18%        21.66% to 18.47%     

2008

     0.80% to 3.05%        5,622,918        7.91 to 11.04        71,657,666        1.02%        -33.28% to -34.80%     

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

2012

     0.40% to 2.65%        6,568,051        12.22 to 11.50        77,870,623        1.47%        15.47% to 12.85%     

2011

     0.40% to 2.80%        4,818,705        10.58 to 10.16        50,011,075        1.17%        -2.17% to -4.52%     

2010

     0.65% to 2.65%        1,400,680        10.80 to 10.65        15,034,804        0.00%        7.97% to 6.52%      ****

Core Plus Fixed Income Portfolio - Class I (MSVFI)

2012

     0.80% to 1.40%        114,987        12.80 to 12.29        1,420,643        4.60%        8.56% to 7.90%     

2011

     0.80% to 1.40%        139,216        11.79 to 11.39        1,592,352        3.55%        4.80% to 4.17%     

2010

     0.80% to 1.40%        180,620        11.25 to 10.94        1,981,504        5.84%        6.29% to 5.64%     

2009

     0.80% to 1.40%        199,374        10.59 to 10.35        2,069,531        9.61%        8.77% to 8.11%     

2008

     0.80% to 1.40%        312,617        9.73 to 9.58        2,999,638        4.42%        -10.92% to -11.46%     

Core Plus Fixed Income Portfolio - Class II (MSVF2)

2012

     0.95% to 2.70%        1,488,971        13.32 to 11.13        18,531,355        4.40%        8.15% to 6.24%     

2011

     0.95% to 3.05%        1,719,934        12.32 to 10.16        19,859,702        3.46%        4.40% to 2.20%     

2010

     0.95% to 3.05%        2,060,566        11.80 to 9.94        22,903,727        5.14%        5.84% to 3.60%     

2009

     0.95% to 3.05%        2,319,135        11.15 to 9.59        24,504,304        12.99%        8.34% to 6.05%     

2008

     0.65% to 3.25%        22,132,369        8.92 to 8.94        214,874,888        4.27%        -11.04% to -13.37%     

Emerging Markets Debt Portfolio - Class I (MSEM)

2012

     0.80% to 1.40%        119,137        30.95 to 28.18        3,393,878        2.84%        17.02% to 16.31%     

2011

     0.80% to 1.40%        146,190        26.45 to 24.23        3,579,650        3.51%        6.18% to 5.54%     

2010

     0.80% to 1.40%        172,642        24.91 to 22.96        4,003,378        4.15%        8.87% to 8.21%     

2009

     0.80% to 1.40%        206,910        22.88 to 21.22        4,430,726        8.01%        29.17% to 28.39%     

2008

     0.80% to 1.40%        256,891        17.71 to 16.52        4,280,827        7.11%        -15.66% to -16.17%     

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    

Contract

Expense

Rate*

    Units      Unit
Fair
Value		      Contract
Owners’
Equity		     

Investment

Income

Ratio**

    Total
Return***		      Inception
Date****

Emerging Markets Debt Portfolio - Class II (MSEMB)

2012

    1.10% to 2.05%      40,884       $  25.46 to $ 23.12       $ 1,006,127       2.77%      16.58% to 15.45%      

2011

    1.10% to 2.05%      47,925         21.84 to 20.02         1,015,627       3.48%      5.71% to 4.70%      

2010

    1.10% to 2.05%      56,191         20.66 to 19.12         1,129,707       4.12%      8.53% to 7.49%      

2009

    1.10% to 2.15%      72,537         19.03 to 17.66         1,345,283       7.91%      28.68% to 27.32%      

2008

    1.10% to 2.15%      91,031         14.79 to 13.87         1,317,461       7.10%      -15.92% to -16.81%      

Global Real Estate Portfolio - Class II (VKVGR2)

2012

    1.75% to 2.55%      6,184         9.81 to 9.38         59,694       0.53%      27.67% to 26.62%      

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

2010

    1.30%      312         46.86         14,620       1.02%      28.27%      

2008

    0.80% to 1.40%      2,056,027         30.32 to 28.44         59,067,311       3.36%      -38.39% to -38.77%      

U.S. Real Estate Portfolio - Class II (MSVREB)

2012

    1.35%      27         27.28         737       0.55%      14.06%      

2011

    1.35%      27         23.92         646       0.34%      4.24%      

2010

    1.35%      27         22.95         620       0.78%      27.78%      

2009

    1.35%      27         17.96         485       5.06%      26.76%      

2008

    0.95% to 2.80%      3,061,013         11.91 to 12.96         42,791,166       2.76%      -38.64% to -39.80%      

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

2012

    0.80% to 1.40%      3,121,609         15.97 to 15.62         48,909,691       0.95%      13.74% to 13.05%      

2011

    0.80% to 1.40%      3,763,621         14.04 to 13.82         52,118,578       1.57%      -0.16% to -0.76%      

2010

    0.80% to 1.40%      4,645,835         14.07 to 13.93         64,777,629       1.95%      12.56% to 11.88%      

2009

    0.80% to 1.40%      5,595         12.50 to 12.45         69,699       1.43%      24.97% to 24.47%       ****

American Century NVIT Multi Cap Value Fund - Class II (NVAMV2)

2012

    0.40% to 3.30%      9,244,748         16.09 to 14.44         142,658,402       0.80%      13.99% to 10.66%      

2011

    0.40% to 3.30%      10,757,342         14.12 to 13.05         147,205,264       1.50%      0.09% to -2.82%      

2010

    0.65% to 3.30%      11,529,269         14.05 to 13.43         159,467,938       1.41%      12.42% to 9.42%      

2009

    1.10% to 2.75%      349,190         12.46 to 12.32         4,337,527       1.09%      24.59% to 23.20%       ****

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

2012

    0.40% to 3.25%      331,857,633         15.61 to 10.19         3,804,061,084       1.32%      15.25% to 11.95%      

2011

    0.65% to 3.25%      298,878,335         9.64 to 9.10         3,003,333,545       1.22%      0.27% to -2.34%      

2010

    0.65% to 3.35%      211,427,824         9.62 to 9.27         2,134,403,370       1.30%      11.29% to 8.34%      

2009

    0.65% to 3.35%      138,502,206         8.64 to 8.56         1,265,434,415       0.08%      22.61% to 19.18%      

2008

    0.80% to 3.10%      81,161,084         7.70 to 7.23         609,557,811       3.17%      -30.34% to -31.96%      

American Funds NVIT Bond Fund - Class II (GVABD2)

2012

    0.40% to 3.30%      106,649,138         11.61 to 10.32         1,236,279,493       2.29%      4.55% to 1.49%      

2011

    0.65% to 3.30%      91,572,178         11.07 to 10.16         1,024,351,460       2.11%      5.04% to 2.24%      

2010

    0.65% to 3.35%      71,841,137         10.54 to 9.92         770,617,482       1.80%      5.30% to 2.49%      

2009

    0.75% to 3.35%      50,794,802         9.98 to 9.68         521,115,164       0.36%      11.31% to 8.39%      

2008

    0.80% to 3.10%      33,032,987         9.57 to 8.99         306,925,600       7.38%      -10.59% to -12.67%      

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

2012

    0.40% to 3.30%      11,903,007         10.73 to 10.61         142,527,413       0.88%      21.60% to 18.05%      

2011

    0.40% to 3.30%      11,697,772         8.82 to 8.99         116,477,223       0.91%      -9.67% to -12.30%      

2010

    0.40% to 3.30%      10,053,778         9.77 to 10.25         112,124,889       0.77%      10.86% to 7.63%      

2009

    0.75% to 3.30%      8,693,755         8.75 to 9.53         88,480,893       0.00%      40.54% to 36.93%      

2008

    0.75% to 3.05%      6,969,825         6.22 to 7.00         50,870,236       2.90%      -39.10% to -40.51%      

American Funds NVIT Growth Fund - Class II (GVAGR2)

2012

    0.40% to 3.30%      21,178,621         10.35 to 9.49         226,732,776       0.22%      16.93% to 13.52%      

2011

    0.40% to 3.30%      21,925,386         8.85 to 8.36         203,005,498       0.26%      -5.07% to -7.83%      

2010

    0.65% to 3.30%      19,445,092         9.12 to 9.07         191,754,817       0.16%      17.43% to 14.30%      

2009

    0.75% to 3.30%      16,804,221         7.75 to 7.94         142,381,453       0.00%      37.74% to 34.20%      

2008

    0.65% to 3.25%      15,955,035         5.63 to 5.92         98,887,216       2.18%      -44.58% to -46.03%      

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

2012

    0.40% to 3.30%      135,436,985         10.45 to 8.41         1,257,381,268       1.07%      16.59% to 13.19%      

2011

    0.40% to 3.30%      125,082,554         8.97 to 7.43         1,005,278,616       0.90%      -2.63% to -5.46%      

2010

    0.65% to 3.35%      94,709,952         8.93 to 7.83         789,529,433       0.84%      10.25% to 7.34%      

2009

    0.75% to 3.35%      64,562,256         8.08 to 7.29         491,918,665       0.00%      29.71% to 26.15%      

2008

    0.80% to 3.10%      38,038,535         6.05 to 5.81         225,395,652       3.41%      -38.56% to -39.99%      

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

2012

    0.95% to 2.15%      317,408         17.88 to 17.75         6,043,995       7.51%      13.47% to 12.09%      

2011

    0.95% to 2.20%      405,899         15.76 to 16.00         6,836,295       8.15%      2.83% to 1.58%      

2010

    0.95% to 2.35%      540,532         15.32 to 15.33         8,856,399       8.30%      12.08% to 10.50%      

2009

    0.95% to 2.35%      689,492         13.67 to 13.88         10,134,551       9.64%      44.61% to 42.57%      

2008

    0.95% to 2.35%      833,712         9.45 to 9.73         8,523,732       8.79%      -28.67% to -29.68%      

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

2012

    0.75% to 2.80%      6,661,716         13.70 to 13.69         101,010,556       8.06%      13.85% to 11.49%      

2011

    0.75% to 2.80%      7,233,930         12.03 to 12.28         97,191,051       7.75%      3.03% to 0.91%      

2010

    0.75% to 2.80%      7,280,016         11.68 to 12.17         95,630,359       8.85%      12.31% to 9.99%     

2009

    0.75% to 2.80%      6,014,764         10.40 to 11.07         70,825,989       9.70%      44.98% to 41.99%      

2008

    0.80% to 2.75%      3,688,239         7.78 to 7.81         30,220,484       8.86%      -28.67% to -30.08%      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     Contract
Expense
Rate*		      Units      Unit
Fair
Value		      Contract
Owners’
Equity		      Investment
Income
Ratio**		      Total
Return***		      Inception
Date****

NVIT Emerging Markets Fund - Class I (GEM)

2012

      0.80% to 1.40%         8,617       $  24.38 to $ 22.63        $ 196,533         0.46%         16.28% to 15.57%      

2011

      0.80% to 1.40%         14,503         20.97 to 19.58         285,375         0.64%         -22.99% to -23.46%      

2010

      0.80% to 1.40%         18,106         27.23 to 25.59         465,619         0.05%         15.25% to 14.55%      

2009

      0.80% to 1.40%         25,866         23.62 to 22.34         580,996         1.17%         62.01% to 61.03%      

2008

      0.80% to 1.40%         33,579         14.58 to 13.87         468,183         1.15%         -58.10% to -58.36%      

NVIT Emerging Markets Fund - Class II (GEM2)

2012

      1.15% to 2.25%         32,659         34.28 to 30.70         1,087,434         0.21%         15.64% to 14.35%      

2011

      1.10% to 2.25%         44,117         29.78 to 26.84         1,272,348         0.44%         -23.45% to -24.34%      

2010

      1.10% to 2.45%         52,785         38.90 to 34.91         1,988,828         0.00%         14.64% to 13.08%      

2009

      1.10% to 2.45%         66,147         33.93 to 30.87         2,165,809         1.16%         61.29% to 59.09%      

2008

      1.10% to 2.45%         88,202         21.04 to 19.41         1,800,059         0.82%         -58.39% to -58.96%      

NVIT Emerging Markets Fund - Class III (GEM3)

2012

      0.80% to 1.40%         878,960         26.67 to 25.00         22,181,145         0.46%         16.30% to 15.59%      

2011

      0.80% to 1.40%         1,075,051         22.93 to 21.63         23,447,431         0.66%         -23.01% to -23.48%      

2010

      0.80% to 1.40%         1,413,626         29.79 to 28.26         40,245,214         0.07%         15.29% to 14.59%      

2009

      0.80% to 1.40%         1,637,414         25.84 to 24.66         40,653,617         1.30%         62.18% to 61.20%      

2008

      0.80% to 1.40%         1,827,343         15.93 to 15.30         28,122,168         1.09%         -58.17% to -58.42%      

NVIT Emerging Markets Fund - Class VI (GEM6)

2012

      0.75% to 2.80%         2,705,132         7.09 to 17.58         52,295,751         0.26%         16.04% to 13.64%      

2011

      0.75% to 2.80%         2,598,477         6.11 to 15.47         43,888,708         0.45%         -23.17% to -24.76%      

2010

      0.75% to 2.80%         2,890,791         7.95 to 20.57         63,579,406         0.00%         15.02% to 12.65%      

2009

      0.75% to 2.80%         2,858,691         6.91 to 18.26         54,764,422         1.12%         61.87% to 58.52%      

2008

      0.75% to 2.80%         2,681,445         4.27 to 11.52         32,388,303         0.99%         -58.18% to -59.05%      

NVIT International Equity Fund - Class I (GIG)

2012

      0.80% to 1.40%         3,168         12.80 to 11.88         38,015         0.84%         14.68% to 13.99%      

2011

      0.80% to 1.40%         3,386         11.16 to 10.42         35,746         1.25%         -10.49% to -11.03%      

2010

      0.80% to 1.40%         3,675         12.47 to 11.72         43,672         0.96%         12.38% to 11.71%      

2009

      0.80% to 1.40%         6,007         11.09 to 10.49         63,507         1.18%         28.68% to 27.91%      

2008

      0.80% to 1.40%         7,437         8.62 to 8.20         61,400         1.38%         -46.49% to -46.81%      

NVIT International Equity Fund - Class III (GIG3)

2012

      0.80% to 1.40%         1,277,738         20.24 to 18.98         24,424,151         0.82%         14.65% to 13.96%      

2011

      0.80% to 1.40%         1,510,544         17.66 to 16.65         25,320,360         1.23%         -10.48% to -11.03%      

2010

      0.80% to 1.40%         1,753,932         19.73 to 18.72         33,009,096         0.96%         12.36% to 11.69%      

2009

      0.80% to 1.40%         2,072,015         17.56 to 16.76         34,894,818         0.69%         28.63% to 27.86%      

2008

      0.80% to 1.40%         1,123,906         13.65 to 13.11         14,805,125         1.25%         -46.47% to -46.80%      

Variable Insurance Trust: NVIT International Equity Fund - Class VI (NVIE6)

2012

      0.40% to 2.75%         3,157,577         8.51 to 7.34         24,533,603         0.60%         14.76% to 12.05%      

2011

      0.40% to 2.75%         3,528,777         7.42 to 6.55         24,130,603         1.18%         -10.36% to -12.47%      

2010

      0.40% to 2.80%         2,754,847         8.28 to 7.47         21,261,973         0.94%         12.55% to 9.84%      

2009

      0.40% to 2.75%         2,369,404         7.35 to 6.81         16,443,478         0.61%         28.93% to 25.89%      

2008

      1.10% to 2.60%         510,631         5.47 to 5.41         2,781,264         1.52%         -45.33% to -45.88%       ****

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

2012

      0.80% to 1.40%         7,916,101         9.12 to 8.87         70,427,668         1.41%         16.00% to 15.30%      

2011

      0.80% to 1.40%         9,418,341         7.86 to 7.69         72,619,219         0.56%         -12.32% to -12.85%      

2010

      0.80% to 1.40%         11,003,045         8.97 to 8.83         97,286,636         0.20%         14.68% to 13.99%      

2009

      0.80% to 1.40%         13,158,118         7.82 to 7.74         101,993,343         0.18%         51.74% to 50.82%      

2008

      1.30% to 1.40%         12,714         5.14 to 5.13         65,309         0.00%         -48.63% to -48.66%       ****

Neuberger Berman NVIT Multi Cap Opportunities Fund - Class II (NVNMO2)

2012

      0.40% to 2.75%         2,768,451         9.13 to 8.24         24,154,968         1.40%         16.37% to 13.62%      

2011

      0.40% to 2.80%         3,122,319         7.84 to 7.24         23,656,246         0.56%         -12.01% to -14.13%      

2010

      0.65% to 2.75%         2,127,346         8.94 to 8.44         18,515,437         0.17%         14.64% to 12.21%      

2009

      0.75% to 2.75%         1,491,186         7.79 to 7.53         11,436,241         0.00%         51.82% to 48.76%      

2008

      1.10% to 2.75%         165,613         5.12 to 5.06         843,322         0.00%         -48.84% to -49.41%       ****

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

2012

      0.80% to 1.40%         234,137         10.44 to 10.15         2,387,237         1.29%         10.60% to 9.93%      

2011

      0.80% to 1.40%         227,602         9.44 to 9.23         2,108,691         0.69%         -3.95% to -4.53%      

2010

      0.80% to 1.40%         202,690         9.83 to 9.67         1,964,901         0.86%         22.59% to 21.85%      

2009

      0.80% to 1.40%         202,450         8.02 to 7.94         1,609,379         0.49%         30.48% to 29.69%      

2008

      0.80% to 1.40%         255,949         6.15 to 6.12         1,567,453         0.43%         -38.55% to -38.80%       ****

Neuberger Berman NVIT Socially Responsible Fund - Class II (NVNSR2)

2012

      0.40% to 3.20%         15,266,456         11.12 to 9.27         152,375,245         1.04%         10.94% to 7.81%      

2011

      0.40% to 3.20%         19,248,367         10.02 to 8.60         174,928,764         0.62%         -3.65% to -6.36%      

2010

      0.65% to 3.20%         21,270,528         9.85 to 9.19         203,052,828         0.56%         22.76% to 19.61%      

2009

      0.65% to 3.25%         35,752,844         8.02 to 7.67         281,271,459         0.41%         30.42% to 27.00%      

2008

      0.65% to 3.25%         41,560,970         6.15 to 6.04         253,618,648         0.39%         -38.50% to -39.59%       ****

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     Contract
Expense
Rate*		      Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		      Inception
Date****

NVIT Cardinal Aggressive Fund - Class II (NVCRA2)

2012

      0.75% to 2.60%         2,931,734      $   15.73 to $ 9.16      $ 28,162,711        1.04%        15.28% to 13.13%      

2011

      0.75% to 2.65%         2,675,730        13.65 to 8.08        22,508,074        1.95%        -7.08% to -8.86%      

2010

      0.80% to 2.65%         2,416,119        9.32 to 8.87        22,008,706        0.35%        14.04% to 11.91%      

2009

      0.80% to 2.60%         1,320,362        8.18 to 7.93        10,654,779        0.99%        28.16% to 25.84%      

2008

      0.80% to 2.60%         688,094        6.38 to 6.30        4,366,517        1.64%        -36.21% to -36.99%       ****

NVIT Cardinal Balanced Fund - Class II (NVCRB2)

2012

      0.40% to 3.10%         145,128,586        11.96 to 10.00        1,561,559,296        1.57%        10.62% to 7.61%      

2011

      0.40% to 3.25%         128,328,881        10.81 to 9.24        1,259,936,055        2.45%        -1.74% to -4.54%      

2010

      0.40% to 3.25%         91,327,946        11.01 to 9.68        921,933,574        0.92%        9.96% to 6.82%      

2009

      0.80% to 3.10%         45,054,749        9.45 to 9.08        418,125,250        2.30%        18.86% to 16.11%      

2008

      1.10% to 3.10%         17,964,614        7.93 to 7.82        141,470,743        1.93%        -20.70% to -21.77%       ****

NVIT Cardinal Capital Appreciation Fund - Class II (NVCCA2)

2012

      0.40% to 3.00%         233,768,591        11.74 to 9.64        2,418,598,441        1.37%        13.19% to 10.23%      

2011

      0.40% to 3.00%         215,720,584        10.37 to 8.75        1,993,782,374        2.23%        -3.83% to -6.34%      

2010

      0.65% to 3.00%         134,184,859        10.72 to 9.34        1,303,699,380        0.69%        11.66% to 9.02%      

2009

      0.80% to 3.00%         61,562,208        8.89 to 8.57        540,299,784        1.96%        23.17% to 20.44%      

2008

      0.80% to 2.95%         15,353,953        7.22 to 7.12        110,154,375        1.75%        -27.78% to -28.83%       ****

NVIT Cardinal Conservative Fund - Class II (NVCCN2)

2012

      0.65% to 3.05%         67,968,499        12.55 to 10.42        761,069,541        1.92%        6.80% to 4.21%      

2011

      0.65% to 3.05%         54,984,947        11.75 to 10.00        581,434,652        2.58%        0.75% to -1.67%      

2010

      0.85% to 3.05%         35,658,142        11.63 to 10.17        377,651,311        1.21%        5.89% to 3.54%      

2009

      1.10% to 3.05%         19,312,567        10.15 to 9.82        194,470,746        3.10%        11.78% to 9.57%      

2008

      1.10% to 2.95%         5,226,256        9.08 to 8.97        47,264,496        2.21%        -9.18% to -10.32%       ****

NVIT Cardinal Moderate Fund - Class II (NVCMD2)

2012

      0.40% to 3.40%         212,166,284        11.85 to 9.67        2,246,273,889        1.45%        11.92% to 8.54%      

2011

      0.40% to 3.40%         194,824,445        10.59 to 8.91        1,863,452,955        2.32%        -2.72% to -5.65%      

2010

      0.65% to 3.25%         133,082,298        10.82 to 9.48        1,321,688,824        0.79%        10.65% to 7.75%      

2009

      0.80% to 2.95%         54,968,785        9.17 to 8.84        498,076,084        2.23%        20.97% to 18.35%      

2008

      0.80% to 2.95%         13,903,119        7.58 to 7.47        104,822,308        1.77%        -24.19% to -25.29%       ****

NVIT Cardinal Moderately Aggressive Fund - Class II (NVCMA2)

2012

      0.75% to 3.05%         36,890,388        11.37 to 9.35        369,237,595        1.20%        13.72% to 11.08%      

2011

      0.75% to 3.25%         38,634,829        9.99 to 8.35        343,084,881        2.36%        -5.38% to -7.76%      

2010

      0.75% to 3.25%         40,125,331        10.56 to 9.05        379,893,041        0.56%        12.46% to 9.63%      

2009

      0.80% to 2.70%         21,578,200        8.61 to 8.34        183,374,699        1.47%        25.57% to 23.16%      

2008

      1.10% to 2.70%         14,026,096        6.84 to 6.77        95,660,793        1.72%        -31.56% to -32.31%       ****

NVIT Cardinal Moderately Conservative Fund - Class II (NVCMC2)

2012

      0.40% to 2.95%         65,866,801        12.05 to 10.25        723,179,275        1.73%        9.60% to 6.79%      

2011

      0.40% to 2.95%         54,955,819        11.00 to 9.60        556,682,830        2.57%        -0.67% to -3.21%      

2010

      0.75% to 2.95%         39,080,002        10.98 to 9.92        402,595,617        1.02%        8.22% to 5.82%      

2009

      0.80% to 2.95%         18,399,363        9.72 to 9.37        176,473,619        2.81%        16.74% to 14.21%      

2008

      1.10% to 2.95%         4,777,489        8.31 to 8.21        39,524,433        1.94%        -16.89% to -17.93%       ****

NVIT Core Bond Fund - Class I (NVCBD1)

2012

      0.80% to 1.40%         263,240        12.81 to 12.46        3,289,537        3.36%        6.89% to 6.24%      

2011

      0.80% to 1.40%         235,110        11.99 to 11.72        2,763,344        3.22%        5.74% to 5.11%      

2010

      0.80% to 1.40%         209,916        11.34 to 11.15        2,346,078        2.54%        6.20% to 5.56%      

2009

      0.80% to 1.40%         279,023        10.67 to 10.57        2,952,194        3.81%        7.91% to 7.26%      

2008

      1.30% to 1.40%         42,991        9.86 to 9.85        423,815        3.07%        -1.41% to -1.48%       ****

NVIT Core Bond Fund - Class II (NVCBD2)

2012

      0.40% to 3.05%         9,816,211        13.10 to 11.37        119,381,480        2.62%        7.05% to 4.20%      

2011

      0.40% to 3.05%         11,130,478        12.24 to 10.91        127,534,053        2.69%        5.81% to 3.01%      

2010

      0.40% to 3.05%         13,216,889        11.56 to 10.59        144,795,792        2.18%        6.35% to 3.52%      

2009

      0.40% to 3.25%         19,490,331        10.87 to 10.20        203,646,838        3.50%        8.16% to 5.06%      

2008

      1.05% to 2.70%         279,918        9.85 to 9.74        2,747,847        3.51%        -1.46% to -2.56%       ****

NVIT Core Plus Bond Fund - Class II (NVLCP2)

2012

      0.40% to 2.70%         3,683,753        14.23 to 12.50        48,657,773        2.17%        6.69% to 4.22%      

2011

      0.40% to 2.70%         3,256,827        13.33 to 11.99        40,774,802        2.51%        5.62% to 3.19%      

2010

      0.75% to 2.70%         2,269,048        12.25 to 11.62        27,153,406        2.61%        7.30% to 5.20%      

2009

      0.80% to 2.70%         1,213,629        11.41 to 11.05        13,649,167        5.17%        15.50% to 13.29%      

2008

      0.80% to 2.70%         224,113        9.88 to 9.75        2,199,217        2.74%        -1.24% to -2.50%       ****

NVIT Nationwide Fund - Class I (TRF)

2012

      0.80% to 1.40%         2,096,623        23.09 to 25.39        119,341,085        1.37%        13.30% to 12.61%      

2011

      0.80% to 1.40%         2,459,013        20.38 to 22.54        123,499,751        1.13%        -0.27% to -0.88%      

2010

      0.80% to 1.40%         2,827,396        20.43 to 22.74        144,432,190        1.00%        12.54% to 11.86%      

2009

      0.80% to 1.40%         3,250,148        18.16 to 20.33        147,253,756        1.33%        25.09% to 24.33%      

2008

      0.80% to 1.40%         3,836,090        14.51 to 16.35        139,622,623        1.38%        -42.02% to -42.37%      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    Contract
Expense
Rate*		     Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		     Inception
Date****

NVIT Nationwide Fund - Class II (TRF2)

2012

     0.65% to 3.20%       9,811,244        $ 9.45 to $ 12.08        $148,902,932        1.11%        13.11% to 10.20%     

2011

     0.65% to 3.20%        12,416,055        8.35 to 10.96        167,499,307        0.88%        -0.27% to -2.83%     

2010

     0.65% to 3.20%        14,608,151        8.38 to 11.28        199,289,832        0.68%        12.49% to 9.60%     

2009

     0.65% to 3.25%        23,090,202        7.45 to 10.26        283,628,433        1.14%        24.74% to 21.48%     

2008

     0.65% to 3.25%        28,046,162        5.97 to 8.44        280,666,419        1.23%        -41.99% to -43.51%     

NVIT Government Bond Fund - Class I (GBF)

2012

     0.40% to 3.20%        22,621,715        12.47 to 11.11        368,323,060        2.12%        2.64% to -0.25%     

2011

     0.40% to 3.20%        25,298,375        12.15 to 11.14        406,977,698        2.92%        6.83% to 3.83%     

2010

     0.40% to 3.20%        30,230,403        11.37 to 10.73        449,815,636        2.88%        4.36% to 1.43%     

2009

     0.65% to 3.25%        43,318,770        11.00 to 10.54        603,120,896        3.35%        2.02% to -0.65%     

2008

     0.65% to 3.25%        51,150,296        10.78 to 10.61        710,154,637        4.30%        7.02% to 4.22%     

American Century NVIT Growth Fund - Class I (CAF)

2012

     0.80% to 1.40%        1,556,489        17.41 to 18.70        32,162,891        0.54%        13.11% to 12.42%     

2011

     0.80% to 1.40%        1,730,666        15.40 to 16.63        31,767,638        0.57%        -1.48% to -2.08%     

2010

     0.80% to 1.40%        1,929,649        15.63 to 16.98        36,136,993        0.62%        18.29% to 17.58%     

2009

     0.80% to 1.40%        2,234,563        13.21 to 14.44        35,566,596        0.55%        32.40% to 31.60%     

2008

     0.80% to 1.40%        2,568,010        9.98 to 10.98        31,041,966        0.27%        -39.20% to -39.57%     

American Century NVIT Growth Fund - Class II (CAF2)

2012

     0.40% to 2.80%        2,300,514        10.35 to 9.94        23,350,674        0.98%        13.32% to 10.59%     

2011

     0.40% to 2.55%        1,133,015        9.13 to 9.00        10,266,928        1.35%        -8.65% to -9.97%      ****

NVIT International Index Fund - Class VIII (GVIX8)

2012

     0.65% to 2.75%        2,316,939        7.96 to 8.06        20,283,307        2.53%        17.44% to 14.95%     

2011

     0.65% to 2.75%        2,533,356        6.78 to 7.01        19,050,533        2.62%        -13.41% to -15.24%     

2010

     0.65% to 2.75%        1,822,983        7.83 to 8.28        15,977,303        2.10%        6.70% to 4.45%     

2009

     0.80% to 2.75%        1,437,538        8.52 to 7.92        11,902,303        2.84%        27.58% to 25.07%     

2008

     0.80% to 2.75%        996,023        6.68 to 6.33        6,515,309        1.84%        -43.55% to -44.66%     

NVIT Investor Destinations Aggressive Fund - Class II (GVIDA)

2012

     0.75% to 3.05%        12,793,695        10.08 to 14.84        229,284,249        1.39%        15.03% to 12.36%     

2011

     0.75% to 3.05%        16,836,607        8.76 to 13.21        264,183,026        1.79%        -4.65% to -6.86%     

2010

     0.75% to 3.10%        20,614,506        9.19 to 14.12        341,454,727        1.70%        13.77% to 11.08%     

2009

     0.80% to 3.10%        25,390,427        12.62 to 12.71        372,961,401        1.08%        26.19% to 23.26%     

2008

     0.80% to 3.10%        28,976,150        10.00 to 10.31        340,600,981        2.05%        -37.35% to -38.81%     

NVIT Investor Destinations Balanced Fund - Class II (NVDBL2)

2012

     0.40% to 3.05%        54,359,537        13.90 to 12.59        725,544,444        1.98%        8.95% to 6.04%     

2011

     0.40% to 3.20%        39,506,703        12.76 to 11.83        489,089,921        2.15%        0.48% to -2.34%     

2010

     0.65% to 3.20%        21,980,236        12.64 to 12.11        273,719,201        1.26%        9.10% to 6.30%     

2009

     0.75% to 3.05%        5,086,185        11.58 to 11.40        58,589,875        1.75%        15.82% to 14.02%      ****

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

2012

     0.40% to 3.00%        82,215,483        14.98 to 13.60        1,182,944,342        1.83%        11.80% to 8.88%     

2011

     0.40% to 3.00%        69,667,022        13.40 to 12.49        906,298,809        2.07%        -1.33% to -3.90%     

2010

     0.65% to 3.00%        32,219,088        13.52 to 13.00        429,561,830        1.21%        11.30% to 8.67%     

2009

     0.65% to 2.65%        9,516,319        12.15 to 11.99        114,993,475        1.84%        21.52% to 19.88%      ****

NVIT Investor Destinations Conservative Fund - Class II (GVIDC)

2012

     0.65% to 2.80%        50,903,848        11.48 to 11.46        672,166,296        1.95%        4.49% to 2.22%     

2011

     0.65% to 2.80%        40,657,415        10.99 to 11.21        518,552,257        2.41%        2.26% to 0.06%     

2010

     0.65% to 2.85%        29,968,371        10.75 to 11.16        377,440,958        2.19%        5.20% to 2.88%     

2009

     0.65% to 2.85%        23,544,842        10.22 to 10.85        283,709,134        1.88%        8.38% to 5.98%     

2008

     0.65% to 2.90%        17,322,335        9.43 to 10.21        194,173,796        3.48%        -6.63% to -8.75%     

NVIT Investor Destinations Moderate Fund - Class II (GVIDM)

2012

     0.40% to 3.05%        155,508,138        11.19 to 13.24        2,443,754,059        1.64%        10.37% to 7.42%     

2011

     0.40% to 3.15%        163,597,374        10.14 to 12.21        2,362,475,885        2.13%        -0.44% to -3.18%     

2010

     0.40% to 3.25%        166,698,445        10.19 to 12.51        2,456,068,489        1.95%        10.47% to 7.31%     

2009

     0.65% to 3.25%        159,101,261        9.17 to 11.66        2,150,669,858        1.54%        18.36% to 15.26%     

2008

     0.65% to 3.25%        149,844,350        7.75 to 10.12        1,725,868,410        2.83%        -23.70% to -25.69%     

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

2012

     0.65% to 3.00%        67,732,226        10.57 to 14.38        1,179,694,762        1.55%        13.02% to 10.34%     

2011

     0.65% to 3.30%        80,738,644        9.36 to 12.69        1,253,194,315        2.01%        -2.76% to -5.35%     

2010

     0.65% to 3.10%        92,239,100        9.62 to 13.62        1,484,512,669        1.88%        12.10% to 9.34%     

2009

     0.65% to 3.15%        99,614,695        8.58 to 12.41        1,442,819,680        1.32%        23.58% to 20.47%     

2008

     0.65% to 3.25%        102,697,193        6.95 to 10.24        1,214,743,220        2.48%        -31.84% to -33.62%     

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

2012

     0.40% to 3.05%        54,508,202        11.56 to 12.35        794,778,742        1.72%        7.61% to 4.74%     

2011

     0.40% to 3.05%        55,287,171        10.75 to 11.79        756,070,865        2.31%        1.65% to -1.04%     

2010

     0.40% to 3.05%        51,232,905        10.57 to 11.92        698,910,323        2.11%        8.08% to 5.21%     

2009

     0.65% to 3.20%        46,770,342        9.73 to 11.21        598,037,127        1.73%        13.82% to 10.90%     

2008

     0.65% to 3.20%        42,212,488        8.55 to 10.11        478,690,281        3.20%        -15.60% to -17.76%     

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    Contract
Expense
Rate*		     Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		     Inception
Date****

NVIT Mid Cap Index Fund - Class I (MCIF)

2012

     0.40% to 2.75%        4,886,268        $ 12.92 to $ 19.40        $105,624,395        1.09%        17.00% to 14.24%     

2011

     0.40% to 3.05%        5,247,331        11.04 to 16.54        98,339,715        0.78%        -2.93% to -5.51%     

2010

     0.40% to 3.05%        5,115,318        11.37 to 17.50        99,473,389        1.28%        25.70% to 22.36%     

2009

     0.80% to 3.05%        5,707,255        14.59 to 14.30        88,938,969        0.99%        35.66% to 32.58%     

2008

     0.80% to 3.05%        5,965,468        10.76 to 10.79        67,891,140        1.25%        -36.97% to -38.41%     

NVIT Money Market Fund - Class I (SAM)

2012

     0.40% to 3.30%        55,839,551        10.01 to 8.34        669,400,136        0.00%        -0.40% to -3.31%     

2011

     0.40% to 3.30%        52,755,926        10.05 to 8.63        654,112,501        0.00%        -0.40% to -3.29%     

2010

     0.40% to 3.30%        45,261,889        10.09 to 8.92        566,041,327        0.00%        -0.40% to -3.30%     

2009

     0.40% to 3.30%        47,298,089        10.13 to 9.23        611,884,145        0.05%        -0.36% to -3.26%     

2008

     0.65% to 3.25%        58,886,454        10.20 to 9.57        801,127,428        1.98%        1.39% to -1.26%     

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

2012

     0.80% to 1.40%        3,566,046        9.66 to 9.39        33,593,312        0.58%        14.85% to 14.15%     

2011

     0.80% to 1.40%        4,100,818        8.41 to 8.22        33,815,868        1.26%        -10.09% to -10.63%     

2010

     0.80% to 1.40%        4,850,543        9.35 to 9.20        44,725,588        0.74%        13.12% to 12.44%     

2009

     0.80% to 1.40%        5,811,834        8.27 to 8.18        47,623,886        0.86%        35.37% to 34.55%     

2008

     0.80% to 1.40%        236,983        6.11 to 6.08        1,442,366        0.11%        -38.93% to -39.17%      ****

NVIT Multi-Manager International Growth Fund - Class VI (NVMIG6)

2012

     0.40% to 3.20%        17,611,397        10.34 to 8.51        161,275,138        0.33%        15.06% to 11.82%     

2011

     0.65% to 3.20%        20,747,296        8.37 to 7.61        166,929,621        1.07%        -10.21% to -12.51%     

2010

     0.65% to 3.20%        21,858,795        9.32 to 8.70        197,781,700        0.45%        13.07% to 10.17%     

2009

     0.65% to 3.25%        33,492,360        8.25 to 7.89        271,002,647        1.03%        35.22% to 31.68%     

2008

     0.65% to 3.25%        33,672,563        6.10 to 5.99        203,779,302        0.00%        -39.02% to -40.09%      ****

NVIT Multi-Manager International Value Fund - Class II (GVDIV2)

2012

     0.95% to 2.10%        35,976        13.03 to 13.71        517,528        0.12%        15.93% to 14.58%     

2011

     0.95% to 2.10%        44,925        11.24 to 11.97        559,837        1.41%        -17.21% to -18.17%     

2010

     0.95% to 2.15%        58,167        13.57 to 14.57        884,469        1.88%        4.89% to 3.62%     

2009

     0.95% to 2.15%        70,793        12.94 to 14.06        1,032,142        1.79%        28.28% to 26.72%     

2008

     0.95% to 2.20%        93,231        10.09 to 11.08        1,064,102        1.54%        -46.99% to -47.74%     

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

2012

     0.80% to 1.40%        334,802        15.94 to 15.03        5,067,035        0.37%        16.30% to 15.59%     

2011

     0.80% to 1.40%        415,870        13.70 to 13.00        5,441,335        1.76%        -16.78% to -17.29%     

2010

     0.80% to 1.40%        485,438        16.47 to 15.72        7,673,903        2.20%        5.26% to 4.63%     

2009

     0.80% to 1.40%        567,848        15.64 to 15.02        8,573,083        2.08%        28.80% to 28.02%     

2008

     0.80% to 1.40%        801,982        12.15 to 11.74        9,450,119        1.71%        -46.76% to -47.09%     

NVIT Multi-Manager International Value Fund - Class VI (GVDIV6)

2012

     0.40% to 3.30%        5,926,599        7.29 to 8.74        60,197,485        0.16%        16.48% to 13.08%     

2011

     0.40% to 3.30%        5,935,093        6.25 to 7.73        52,384,680        1.81%        -16.73% to -19.16%     

2010

     0.40% to 3.30%        5,274,892        7.51 to 9.56        56,592,567        2.39%        5.43% to 2.36%     

2009

     0.40% to 3.30%        4,221,490        7.13 to 9.34        43,539,817        1.99%        28.97% to 25.22%     

2008

     0.65% to 3.25%        14,917,379        5.44 to 7.48        119,779,486        1.55%        -46.80% to -48.20%     

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

2012

     0.80% to 1.40%        904,873        10.38 to 10.09        9,170,528        0.45%        15.42% to 14.72%     

2011

     0.80% to 1.40%        1,104,279        8.99 to 8.80        9,746,079        0.01%        -3.68% to -4.26%     

2010

     0.80% to 1.40%        1,296,267        9.34 to 9.19        11,938,684        0.06%        14.59% to 13.89%     

2009

     0.80% to 1.40%        435,720        8.15 to 8.07        3,519,745        0.80%        28.74% to 27.96%     

2008

     0.80% to 1.40%        4,988        6.33 to 6.30        31,488        0.49%        -36.70% to -36.95%      ****

NVIT Multi-Manager Large Cap Growth Fund - Class II (NVMLG2)

2012

     0.40% to 3.20%        10,753,793        10.55 to 9.16        106,290,589        0.22%        15.67% to 12.42%     

2011

     0.40% to 3.20%        13,148,749        9.12 to 8.15        113,477,686        0.00%        -3.62% to -6.32%     

2010

     0.65% to 3.20%        14,383,005        9.33 to 8.70        130,345,255        0.00%        14.61% to 11.67%     

2009

     0.65% to 3.25%        20,688,233        8.14 to 7.79        165,234,419        0.48%        28.51% to 25.15%     

2008

     1.10% to 2.60%        100,379        6.31 to 6.25        631,180        0.35%        -36.86% to -37.51%      ****

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

2012

     0.80% to 1.40%        284,923        11.42 to 11.24        3,208,201        1.25%        16.87% to 16.16%     

2011

     0.80% to 1.40%        341,497        9.77 to 9.67        3,307,487        1.09%        -6.58% to -7.15%     

2010

     0.80% to 1.40%        368,018        10.46 to 10.42        3,835,629        0.50%        4.59% to 4.17%      ****

NVIT Multi-Manager Large Cap Value Fund - Class II (NVMLV2)

2012

     0.40% to 2.80%        5,175,853        10.50 to 8.82        48,453,793        1.19%        17.12% to 14.29%     

2011

     0.40% to 2.95%        5,145,247        8.96 to 7.67        41,597,008        0.87%        -6.47% to -8.86%     

2010

     0.40% to 2.95%        4,831,835        9.58 to 8.42        42,225,995        0.54%        12.29% to 9.42%     

2009

     0.40% to 2.95%        4,932,338        8.54 to 7.69        38,825,340        1.10%        26.90% to 23.65%     

2008

     0.80% to 2.75%        538,618        6.31 to 6.23        3,379,434        0.97%        -36.85% to -37.69%      ****

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

2012

     0.80% to 1.40%        16,471,475        10.73 to 10.43        172,515,313        0.00%        13.98% to 13.29%     

2011

     0.80% to 1.40%        18,999,885        9.41 to 9.21        175,492,290        0.00%        -4.99% to -5.57%     

2010

     0.80% to 1.40%        21,964,214        9.91 to 9.75        214,642,760        0.00%        25.80% to 25.04%     

2009

     0.80% to 1.40%        25,406,505        7.88 to 7.80        198,383,368        0.00%        26.10% to 25.34%     

2008

     0.80% to 1.40%        82,831        6.25 to 6.22        515,576        0.00%        -37.54% to -37.79%      ****

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    Contract
Expense
Rate*		     Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		      Inception
Date****

NVIT Multi-Manager Mid Cap Growth Fund - Class II (NVMMG2)

2012

     0.40% to 3.20%        11,668,408        $ 10.59 to $ 9.46        $118,934,528        0.00%        14.18% to 10.97%      

2011

     0.40% to 3.20%        14,187,931        9.27 to 8.52        127,998,792        0.00%        -4.83% to -7.50%      

2010

     0.65% to 3.20%        15,990,746        9.87 to 9.21        153,386,874        0.00%        25.65% to 22.43%      

2009

     0.65% to 3.25%        21,823,573        7.86 to 7.52        168,407,542        0.00%        25.88% to 22.59%      

2008

     0.65% to 3.25%        13,384,980        6.24 to 6.13        82,917,533        0.00%        -37.57% to -38.67%       ****

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

2012

     0.40% to 3.20%        22,970,709        12.07 to 10.30        257,001,207        1.09%        15.88% to 12.61%      

2011

     0.40% to 3.20%        27,202,766        10.41 to 9.14        265,164,390        0.81%        -2.71% to -5.44%      

2010

     0.65% to 3.20%        30,788,320        10.37 to 9.67        311,820,186        1.26%        18.85% to 15.81%      

2009

     0.65% to 3.25%        38,969,703        8.72 to 8.34        334,877,361        1.06%        29.62% to 26.23%      

2008

     0.65% to 3.25%        25,339,928        6.73 to 6.61        169,207,097        1.07%        -32.72% to -33.90%       ****

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

2012

     0.80% to 1.40%        896,886        7.85 to 7.27        6,598,263        0.00%        12.53% to 11.85%      

2011

     0.80% to 1.40%        954,853        6.98 to 6.50        6,273,549        0.00%        -1.44% to -2.04%      

2010

     0.80% to 1.40%        1,058,529        7.08 to 6.64        7,084,169        0.00%        24.44% to 23.69%      

2009

     0.80% to 1.40%        1,069,631        5.69 to 5.37        5,784,908        0.00%        26.44% to 25.68%      

2008

     0.80% to 1.40%        1,159,659        4.50 to 4.27        4,987,989        0.00%        -46.85% to -47.17%      

NVIT Multi-Manager Small Cap Growth Fund - Class II (SCGF2)

2012

     0.40% to 2.80%        1,133,372        9.84 to 12.56        17,482,428        0.00%        12.64% to 9.92%      

2011

     0.65% to 2.80%        1,534,116        8.49 to 11.43        21,201,023        0.00%        -1.50% to -3.63%      

2010

     0.65% to 2.80%        1,120,559        8.62 to 11.86        16,035,870        0.00%        24.29% to 21.61%      

2009

     0.95% to 2.65%        983,361        7.04 to 10.84        11,455,239        0.00%        25.98% to 23.82%      

2008

     0.95% to 2.65%        968,639        5.59 to 8.75        9,006,487        0.00%        -47.04% to -47.96%      

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

2012

     0.80% to 1.40%        1,335,920        26.08 to 23.86        32,239,790        0.82%        19.48% to 18.76%      

2011

     0.80% to 1.40%        1,530,375        21.83 to 20.09        31,072,461        0.44%        -5.83% to -6.40%      

2010

     0.80% to 1.40%        1,869,906        23.18 to 21.46        40,531,559        0.59%        25.59% to 24.83%      

2009

     0.80% to 1.40%        2,126,736        18.45 to 17.19        36,900,577        0.58%        25.21% to 24.45%      

2008

     0.80% to 1.40%        2,629,323        14.74 to 13.81        36,629,666        1.08%        -32.70% to -33.10%      

NVIT Multi-Manager Small Cap Value Fund - Class II (SCVF2)

2012

     0.40% to 2.90%        1,031,471        12.76 to 17.99        23,534,009        0.53%        19.82% to 16.81%      

2011

     0.40% to 2.90%        1,135,796        10.65 to 15.40        22,006,668        0.31%        -5.83% to -8.19%      

2010

     0.85% to 2.90%        1,184,181        10.57 to 16.78        24,902,171        0.44%        25.40% to 22.81%      

2009

     0.85% to 2.90%        1,573,837        8.43 to 13.66        26,272,189        0.48%        24.79% to 22.21%      

2008

     0.85% to 2.90%        1,254,598        6.75 to 11.18        17,069,075        0.90%        -32.88% to -34.27%      

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

2012

     0.80% to 1.40%        1,793,384        43.04 to 38.81        70,518,786        0.15%        14.58% to 13.88%      

2011

     0.80% to 1.40%        2,073,053        37.57 to 34.08        71,520,637        0.53%        -6.31% to -6.88%      

2010

     0.80% to 1.40%        2,424,228        40.10 to 36.60        89,746,825        0.28%        24.32% to 23.57%      

2009

     0.80% to 1.40%        2,862,552        32.25 to 29.62        85,697,283        0.27%        33.62% to 32.82%      

2008

     0.80% to 1.40%        3,418,854        24.14 to 22.30        76,995,047        0.79%        -38.68% to -39.06%      

NVIT Multi-Manager Small Company Fund - Class II (SCF2)

2012

     0.40% to 2.95%        2,003,112        11.58 to 17.25        43,191,550        0.00%        14.76% to 11.82%      

2011

     0.75% to 2.95%        2,180,295        9.60 to 15.43        41,474,802        0.47%        -6.51% to -8.58%      

2010

     0.75% to 2.95%        2,354,378        10.27 to 16.88        48,456,246        0.06%        24.04% to 21.30%      

2009

     0.85% to 2.95%        2,565,425        8.26 to 13.92        42,920,845        0.15%        33.29% to 30.46%      

2008

     0.65% to 3.25%        4,915,642        6.21 to 10.48        61,690,354        0.61%        -38.76% to -40.36%      

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

2012

     0.40% to 2.95%        10,834,509        13.11 to 12.81        169,630,801        2.63%        11.80% to 8.93%      

2011

     0.40% to 2.95%        9,793,974        11.72 to 11.76        138,341,481        4.40%        5.13% to 2.44%      

2010

     0.65% to 2.95%        8,055,038        11.15 to 11.48        109,383,488        6.73%        9.87% to 7.33%      

2009

     0.80% to 2.95%        5,998,819        14.93 to 10.70        75,080,727        10.13%        23.38% to 20.71%      

2008

     0.80% to 2.95%        4,888,835        12.10 to 8.86        50,278,472        7.18%        -17.95% to -19.73%      

NVIT Short Term Bond Fund - Class II (NVSTB2)

2012

     0.40% to 3.30%        7,363,429        11.26 to 9.78        78,140,497        1.40%        3.11% to 0.10%      

2011

     0.40% to 3.30%        6,676,235        10.92 to 9.77        69,466,322        1.59%        0.89% to -2.04%      

2010

     0.65% to 3.30%        7,264,937        10.72 to 9.97        75,846,288        1.32%        1.75% to -0.96%      

2009

     0.80% to 3.30%        7,363,311        10.51 to 10.07        76,304,875        2.29%        6.25% to 3.58%      

2008

     0.80% to 2.90%        1,618,282        9.89 to 9.75        15,898,860        2.47%        -1.10% to -2.50%       ****

NVIT Large Cap Growth Fund - Class I (NVOLG1)

2012

     0.80% to 1.40%        20,923,729        16.01 to 15.66        328,501,051        0.69%        17.73% to 17.02%      

2011

     0.80% to 1.40%        24,571,339        13.60 to 13.38        329,412,509        0.66%        -3.01% to -3.60%      

2010

     0.80% to 1.40%        30,384,486        14.02 to 13.88        422,241,384        0.06%        7.93% to 7.28%      

2009

     0.80% to 1.40%        46,211        12.99 to 12.94        598,142        0.34%        29.90% to 29.38%       ****

NVIT Large Cap Growth Fund - Class II (NVOLG2)

2012

     0.40% to 2.95%        14,521,525        16.10 to 14.64        224,173,932        0.43%        17.95% to 14.92%      

2011

     0.65% to 2.95%        17,340,176        13.56 to 12.74        229,464,344        0.41%        -3.13% to -5.37%      

2010

     0.65% to 3.10%        21,739,959        14.00 to 13.43        299,585,237        0.07%        7.81% to 5.16%      

2009

     1.05% to 2.45%        126,715        12.95 to 12.82        1,636,114        0.01%        29.46% to 28.24%       ****

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    Contract
Expense
Rate*		     Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		     Inception
Date****

Templeton NVIT International Value Fund - Class III (NVTIV3)

2012

     0.40% to 3.20%        17,866,204        $ 14.30 to $ 12.88        $244,192,723        2.44%        19.08% to 15.73%     

2011

     0.40% to 3.20%        19,166,748        12.01 to 11.13        222,434,162        2.83%        -12.78% to -15.23%     

2010

     0.65% to 3.20%        16,971,191        13.71 to 13.13        228,494,131        1.85%        5.65% to 2.95%     

2009

     0.65% to 3.25%        24,685,147        12.98 to 12.75        317,975,246        0.42%        29.78% to 27.50%      ****

Van Kampen NVIT Comstock Value Fund - Class II (EIF2)

2012

     0.65% to 3.20%        7,739,216        10.32 to 13.55        133,169,084        1.01%        17.40% to 14.38%     

2011

     0.65% to 3.20%        8,681,768        8.79 to 11.85        128,259,076        1.14%        -3.18% to -5.66%     

2010

     0.65% to 3.20%        8,163,585        9.08 to 12.56        125,378,639        1.29%        14.70% to 11.75%     

2009

     0.65% to 3.25%        6,274,173        7.92 to 11.20        85,166,606        1.05%        27.43% to 24.10%     

2008

     0.65% to 3.25%        8,010,536        6.21 to 9.03        85,951,615        1.57%        -37.63% to -39.26%     

NVIT Real Estate Fund - Class I (NVRE1)

2012

     0.80% to 1.40%        5,802,593        11.42 to 11.10        64,663,437        1.03%        14.86% to 14.16%     

2011

     0.80% to 1.40%        6,584,064        9.95 to 9.73        64,220,052        0.86%        5.65% to 5.01%     

2010

     0.80% to 1.40%        7,607,257        9.41 to 9.26        70,603,939        1.91%        29.14% to 28.36%     

2009

     0.80% to 1.40%        8,476,274        7.29 to 7.22        61,240,260        2.17%        29.79% to 29.00%     

2008

     0.80% to 1.40%        146,484        5.62 to 5.59        819,751        4.56%        -43.84% to -44.06%      ****

NVIT Real Estate Fund - Class II (NVRE2)

2012

     0.65% to 2.80%        6,374,471        11.36 to 10.25        69,601,956        0.81%        14.83% to 12.34%     

2011

     0.65% to 2.80%        6,645,388        9.89 to 9.13        63,716,493        0.61%        5.45% to 3.17%     

2010

     0.85% to 2.80%        7,395,551        9.33 to 8.85        67,769,999        1.69%        28.72% to 26.19%     

2009

     0.75% to 2.70%        7,149,290        7.26 to 7.02        51,256,307        1.92%        29.54% to 26.99%     

2008

     0.95% to 2.80%        319,169        5.60 to 5.53        1,779,763        3.53%        -44.02% to -44.73%      ****

TOPS Protected Balanced ETF Portfolio - Class 4 (NOTB4)

2012

     1.50% to 1.75%        28,003        10.15 to 10.14        284,049        0.00%        1.47% to 1.42%      ****

TOPS Protected Growth ETF Portfolio - Class 4 (NOTG4)

2012

     1.50% to 1.75%        14,748        10.27 to 10.26        151,391        0.00%        2.65% to 2.61%      ****

TOPS Protected Moderate Growth ETF Portfolio - Class 4 (NOTMG4)

2012

     1.50% to 1.75%        7,494        10.28        77,059        0.00%        2.83% to 2.79%      ****

VPS Balanced Wealth Strategy Portfolio - Class B (ALVBWB)

2012

     0.40%        18,205        10.32        187,865        2.15%        12.92%     

2011

     0.40%        4,833        9.14        44,167        0.00%        -8.61%      ****

VPS Growth and Income Portfolio - Class B (ALVGIB)

2012

     0.95% to 2.30%        367,311        14.49 to 15.73        6,194,505        1.34%        16.13% to 14.54%     

2011

     0.95% to 2.30%        449,878        12.48 to 13.74        6,554,605        1.09%        5.06% to 3.64%     

2010

     0.95% to 2.60%        585,653        11.88 to 12.94        8,132,903        0.00%        11.73% to 9.87%     

2009

     0.95% to 2.80%        733,419        10.63 to 10.47        9,115,377        3.52%        19.21% to 16.98%     

2008

     0.95% to 2.80%        891,778        8.92 to 8.95        9,367,499        1.77%        -41.26% to -42.36%     

VPS Small/Mid Cap Value Portfolio: Class B (ALVSVB)

2012

     0.40% to 2.80%        2,682,273        12.61 to 19.34        62,525,958        0.29%        17.99% to 15.14%     

2011

     0.40% to 2.80%        2,665,187        10.68 to 16.79        53,434,948        0.24%        -8.99% to -11.18%     

2010

     0.40% to 2.80%        2,060,999        11.74 to 18.91        45,815,068        0.26%        26.08% to 23.05%     

2009

     0.40% to 2.90%        1,172,611        9.31 to 15.26        21,042,602        0.78%        42.09% to 38.52%     

2008

     0.80% to 2.80%        934,857        6.22 to 11.08        11,843,636        0.28%        -37.79% to -37.55%      ****

VP Balanced Fund - Class I (ACVB)

2012

     0.80% to 1.40%        1,270,811        23.99 to 25.24        34,413,231        2.06%        10.90% to 10.23%     

2011

     0.80% to 1.40%        1,363,531        21.63 to 22.90        33,399,691        1.87%        4.49% to 3.86%     

2010

     0.80% to 1.40%        1,591,690        20.70 to 22.04        37,481,345        1.87%        10.74% to 10.07%     

2009

     0.80% to 1.40%        1,885,279        18.70 to 20.03        40,271,753        5.37%        14.56% to 13.87%     

2008

     0.80% to 1.40%        2,314,333        16.32 to 17.59        43,388,355        2.68%        -20.97% to -21.45%     

VP Capital Appreciation Fund - Class I (ACVCA)

2010

     1.30%        197        49.69        9,789        0.00%        29.59%     

2008

     0.80% to 1.40%        2,882,462        11.93 to 14.27        70,456,060        0.00%        -46.62% to -46.94%     

VP Income & Growth Fund - Class I (ACVIG)

2012

     0.80% to 1.40%        1,072,863        14.13 to 12.92        14,026,017        2.08%        13.82% to 13.13%     

2011

     0.80% to 1.40%        1,231,796        12.41 to 11.42        14,222,208        1.54%        2.29% to 1.67%     

2010

     0.80% to 1.40%        1,330,183        12.13 to 11.24        15,091,629        1.52%        13.23% to 12.55%     

2009

     0.80% to 1.40%        1,564,365        10.71 to 9.98        15,758,920        4.85%        17.15% to 16.44%     

2008

     0.80% to 1.40%        1,902,498        9.15 to 8.57        16,446,480        2.09%        -35.11% to -35.50%     

VP Income & Growth Fund - Class II (ACVIG2)

2012

     0.95% to 2.40%        266,974        14.54 to 15.12        4,322,744        1.82%        13.37% to 11.70%     

2011

     0.95% to 2.40%        311,018        12.82 to 13.54        4,486,341        1.27%        1.88% to 0.39%     

2010

     0.95% to 2.55%        413,946        12.59 to 13.32        5,882,372        1.26%        12.78% to 10.96%     

2009

     0.95% to 2.85%        503,648        11.16 to 9.01        6,339,742        4.46%        16.66% to 14.25%     

2008

     0.95% to 2.85%        602,251        9.57 to 7.88        6,525,719        1.80%        -35.35% to -36.67%     

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    Contract
Expense
Rate*		     Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		     Inception
Date****

American Century VP Inflation Protection Fund - Class II (ACVIP2)

2012

     0.40% to 3.30%        18,958,776        $       13.41 to $ 12.35        $       280,132,988        2.45%        6.96% to 3.83%     

2011

     0.40% to 3.30%        17,822,531        12.54 to 11.89        248,904,528        4.07%        11.30% to 8.07%     

2010

     0.40% to 3.30%        14,505,426        11.27 to 11.00        184,077,579        1.65%        4.70% to 1.65%     

2009

     0.40% to 3.30%        12,382,367        10.76 to 10.83        151,758,191        1.80%        9.77% to 6.58%     

2008

     0.75% to 3.05%        10,709,237        10.07 to 10.32        120,944,215        4.72%        -2.33% to -4.59%     

VP International Fund - Class I (ACVI)

2008

     0.80% to 1.40%        1,852,745        15.27 to 14.16        26,470,256        0.84%        -45.27% to -45.60%     

VP International Fund - Class II (ACVI2)

2008

     0.95% to 2.15%        128,519        11.38 to 12.17        1,624,402        0.67%        -45.42% to -46.09%     

VP International Fund - Class III (ACVI3)

2008

     0.80% to 1.40%        1,568,771        10.15 to 9.75        15,380,530        0.83%        -45.27% to -45.60%     

VP International Fund - Class IV (ACVI4)

2008

     0.95% to 2.80%        943,918        9.95 to 9.11        9,133,453        0.68%        -45.47% to -46.50%     

VP Mid Cap Value Fund - Class I (ACVMV1)

2012

     0.80% to 1.40%        537,946        13.99 to 13.43        7,269,434        2.03%        15.40% to 14.70%     

2011

     0.80% to 1.40%        580,082        12.12 to 11.71        6,829,047        1.33%        -1.49% to -2.08%     

2010

     0.80% to 1.40%        563,062        12.30 to 11.96        6,762,218        2.25%        18.30% to 17.59%     

2009

     0.80% to 1.40%        535,378        10.40 to 10.17        5,462,541        3.84%        28.91% to 28.13%     

2008

     0.80% to 1.40%        566,200        8.07 to 7.94        4,504,507        0.09%        -24.95% to -25.41%     

VP Mid Cap Value Fund - Class II (ACVMV2)

2012

     0.40% to 3.30%        5,121,977        13.74 to 13.78        80,532,667        1.88%        15.76% to 12.38%     

2011

     0.40% to 3.30%        4,998,981        11.87 to 12.26        68,625,791        1.21%        -1.24% to -4.11%     

2010

     0.75% to 3.30%        4,240,631        11.42 to 12.79        59,493,597        2.24%        18.08% to 15.05%     

2009

     0.75% to 3.30%        3,038,070        9.67 to 11.11        36,485,640        3.39%        28.83% to 25.52%     

2008

     0.75% to 2.90%        2,949,866        7.51 to 8.99        27,697,339        0.09%        -25.08% to -26.70%     

VP Ultra(R) Fund - Class I (ACVU1)

2008

     0.80% to 1.40%        259,464        7.37 to 7.08        1,847,004        0.00%        -41.95% to -42.30%     

VP Ultra(R) Fund - Class II (ACVU2)

2008

     0.95% to 2.90%        868,516        7.82 to 7.74        7,868,731        0.00%        -42.20% to -43.34%     

VP Value Fund - Class I (ACVV)

2009

     0.80% to 1.40%        3,000,711        21.33 to 19.71        59,752,569        5.88%        18.90% to 18.19%     

2008

     0.80% to 1.40%        3,763,741        17.94 to 16.68        63,351,622        2.53%        -27.36% to -27.80%     

VP Value Fund - Class II (ACVV2)

2009

     0.75% to 3.30%        5,307,560        8.68 to 11.81        76,316,151        5.43%        18.82% to 15.77%     

2008

     0.75% to 2.95%        5,916,904        7.31 to 10.41        72,299,440        2.22%        -27.35% to -28.97%     

VP Vista(SM) Fund - Class I (ACVVS1)

2008

     0.80% to 1.40%        560,487        6.77 to 6.66        3,740,623        0.00%        -49.04% to -49.34%     

VP Vista(SM) Fund - Class II (ACVVS2)

2008

     0.95% to 2.80%        1,499,857        6.31 to 8.04        12,523,097        0.00%        -49.20% to -50.15%     

Small Cap Stock Index Portfolio - Service Shares (DVSCS)

2012

     0.40% to 3.20%        3,907,331        13.11 to 18.56        83,997,413        0.46%        15.28% to 12.03%     

2011

     0.40% to 3.20%        4,193,254        11.38 to 16.56        80,122,724        0.59%        0.16% to -2.65%     

2010

     0.40% to 3.20%        3,955,893        11.36 to 17.02        76,702,207        0.48%        25.32% to 21.80%     

2009

     0.40% to 2.90%        2,741,931        9.06 to 14.26        41,696,031        2.51%        24.53% to 21.40%     

2008

     0.80% to 2.80%        2,849,922        10.29 to 11.82        34,819,726        0.81%        -31.47% to -32.85%     

Appreciation Portfolio - Initial Shares (DCAP)

2012

     0.80% to 1.40%        1,973,392        19.60 to 17.84        35,662,378        3.67%        9.54% to 8.88%     

2011

     0.80% to 1.40%        1,991,035        17.89 to 16.39        33,021,204        1.60%        8.14% to 7.49%     

2010

     0.80% to 1.40%        1,798,776        16.54 to 15.25        27,718,064        2.19%        14.40% to 13.70%     

2009

     0.80% to 1.40%        1,906,125        14.46 to 13.41        25,808,007        2.70%        21.58% to 20.84%     

2008

     0.80% to 1.40%        2,251,894        11.90 to 11.10        25,206,414        2.03%        -30.12% to -30.54%     

Appreciation Portfolio - Service Shares (DCAPS)

2012

     0.40% to 2.75%        6,144,933        11.97 to 14.45        105,436,097        3.22%        9.70% to 7.10%     

2011

     0.40% to 2.80%        5,240,577        10.92 to 13.43        83,122,167        1.22%        8.30% to 5.70%     

2010

     0.75% to 2.80%        2,607,789        9.86 to 12.71        39,007,042        1.68%        14.18% to 11.83%     

2009

     0.75% to 3.00%        1,768,979        8.63 to 11.21        23,417,821        2.14%        21.31% to 18.56%     

2008

     0.75% to 3.00%        1,678,407        7.12 to 9.45        18,482,018        1.65%        -30.25% to -31.83%     

Opportunistic Small Cap Portfolio: Service Shares (DVDLS)

2012

     0.95% to 2.25%        86,233        11.22 to 12.70        1,187,684        0.00%        19.09% to 17.53%     

2011

     0.95% to 2.25%        146,781        9.42 to 10.80        1,693,426        0.31%        -14.87% to -15.99%     

2010

     0.95% to 2.40%        146,633        11.06 to 12.71        1,954,963        0.67%        29.57% to 27.68%     

2009

     0.95% to 2.40%        130,684        8.54 to 9.95        1,382,149        1.28%        24.57% to 22.74%     

2008

     0.95% to 2.40%        145,489        6.85 to 8.11        1,231,064        0.56%        -38.36% to -39.27%     

Growth and Income Portfolio - Initial Shares (DGI)

2012

     0.80% to 1.40%        861,337        16.46 to 14.93        13,022,469        1.43%        17.13% to 16.42%     

2011

     0.80% to 1.40%        981,613        14.05 to 12.83        12,734,711        1.23%        -3.57% to -4.15%     

2010

     0.80% to 1.40%        1,135,487        14.57 to 13.38        15,357,509        1.20%        17.66% to 16.95%     

2009

     0.80% to 1.40%        1,288,723        12.39 to 11.44        14,891,654        1.32%        27.76% to 26.98%     

2008

     0.80% to 1.40%        1,549,201        9.69 to 9.01        14,086,099        0.63%        -40.89% to -41.25%     

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     Contract
Expense
Rate*		      Units      Unit
Fair
Value		      Contract
Owners’
Equity		      Investment
Income
Ratio**		      Total
Return***		      Inception
Date****

Managed Tail Risk Fund II: Service Shares (FCA2S)

2012

      0.95% to 2.40%         90,443       $  13.01 to $ 13.37       $ 1,322,091         0.27%         8.98% to 7.38%      

2011

      0.95% to 2.40%         119,610         11.93 to 12.45         1,615,658         0.50%         -6.40% to -7.77%      

2010

      0.95% to 2.40%         159,179         12.75 to 13.50         2,289,941         0.62%         11.93% to 10.30%      

2009

      0.95% to 2.25%         134,046         11.39 to 9.41         1,702,974         0.76%         12.19% to 10.58%      

2008

      0.95% to 2.55%         173,986         10.15 to 10.97         1,971,709         0.02%         -30.34% to -31.46%      

Quality Bond Fund II - Primary Shares (FQB)

2012

      0.80% to 1.40%         741,288         16.22 to 15.21         11,356,698         4.05%         8.84% to 8.18%      

2011

      0.80% to 1.40%         780,758         14.90 to 14.06         11,050,770         5.28%         1.46% to 0.84%      

2010

      0.80% to 1.40%         917,867         14.69 to 13.94         12,879,317         4.92%         7.64% to 6.99%      

2009

      0.80% to 1.40%         988,389         13.65 to 13.03         12,949,621         6.58%         19.47% to 18.75%      

2008

      0.80% to 1.40%         1,061,286         11.42 to 10.97         11,701,500         5.61%         -8.03% to -8.59%      

Quality Bond Fund II - Service Shares (FQBS)

2012

      0.95% to 2.60%         2,755,559         14.42 to 12.25         37,620,602         3.95%         8.40% to 6.59%      

2011

      0.95% to 2.60%         3,296,763         13.30 to 11.49         41,686,179         5.15%         1.02% to -0.65%      

2010

      0.95% to 2.70%         4,051,047         13.16 to 11.48         50,963,526         4.80%         7.25% to 5.36%      

2009

      0.95% to 2.95%         4,565,974         12.27 to 10.54         53,792,192         6.26%         19.01% to 16.61%      

2008

      0.95% to 2.95%         4,844,381         10.31 to 9.04         48,257,499         4.88%         -8.43% to -10.28%      

Contrafund Portfolio - Service Class 2 (FC2)

2009

      0.95% to 3.10%         14,053,840         8.45 to 13.83         231,399,877         1.15%         34.18% to 31.27%      

2008

      0.95% to 3.10%         16,338,369         6.29 to 10.54         201,905,123         0.73%         -43.24% to -44.47%      

Equity-Income Portfolio - Initial Class (FEIP)

2012

      0.80% to 1.40%         7,055,782         26.62 to 32.08         329,203,117         3.02%         16.37% to 15.66%      

2011

      0.80% to 1.40%         8,145,845         22.88 to 27.73         327,038,946         2.36%         0.17% to -0.44%      

2010

      0.80% to 1.40%         9,449,660         22.84 to 27.86         380,431,480         1.77%         14.23% to 13.54%      

2009

      0.80% to 1.40%         11,095,521         19.99 to 24.53         392,467,682         2.23%         29.17% to 28.39%      

2008

      0.80% to 1.40%         13,248,157         15.48 to 19.11         363,508,408         2.28%         -43.11% to -43.46%      

VIP Value Strategies Portfolio - Service Class 2 (FVSS2)

2012

      1.10% to 2.65%         387,864         24.10 to 20.62         9,012,217         0.34%         25.66% to 23.69%      

2011

      1.10% to 2.65%         490,823         19.18 to 16.67         9,070,473         0.64%         -10.04% to -11.44%      

2010

      1.10% to 3.10%         670,043         21.32 to 16.18         13,530,923         0.28%         24.95% to 22.43%      

2009

      1.10% to 3.10%         778,358         17.06 to 13.21         12,618,401         0.37%         55.42% to 52.28%      

2008

      1.10% to 3.10%         844,676         10.98 to 8.68         8,862,131         0.49%         -51.82% to -52.80%      

High Income Portfolio - Initial Class (FHIP)

2012

      0.80% to 1.40%         1,611,234         20.83 to 21.66         50,388,870         5.46%         13.31% to 12.63%      

2011

      0.80% to 1.40%         1,920,320         18.38 to 19.23         53,138,689         6.45%         3.20% to 2.58%      

2010

      0.80% to 1.40%         2,252,355         17.81 to 18.75         60,665,536         7.27%         12.91% to 12.23%      

2009

      0.80% to 1.40%         2,706,774         15.77 to 16.70         64,906,933         7.64%         42.81% to 41.94%      

2008

      0.80% to 1.40%         3,333,874         11.05 to 11.77         56,114,072         7.80%         -25.59% to -26.04%      

VIP Asset Manager Portfolio - Initial Class (FAMP)

2012

      0.80% to 1.40%         3,849,011         25.26 to 23.88         137,525,874         1.47%         11.58% to 10.90%      

2011

      0.80% to 1.40%         4,443,665         22.64 to 21.53         142,760,992         1.83%         -3.34% to -3.92%      

2010

      0.80% to 1.40%         5,144,923         23.42 to 22.41         171,687,433         1.66%         13.35% to 12.67%      

2009

      0.80% to 1.40%         5,946,996         20.66 to 19.89         175,392,894         2.33%         28.08% to 27.31%      

2008

      0.80% to 1.40%         6,966,315         16.13 to 15.62         160,712,631         2.43%         -29.29% to -29.72%      

VIP Contrafund Portfolio - Initial Class (FCP)

2009

      0.80% to 1.40%         12,707,542         29.30 to 29.18         374,619,416         1.36%         34.62% to 33.81%      

2008

      0.80% to 1.40%         15,111,468         21.76 to 21.80         332,663,039         0.91%         -42.97% to -43.32%      

VIP Energy Portfolio - Service Class 2 (FNRS2)

2012

      0.65% to 2.80%         4,666,971         8.66 to 14.70         74,165,800         0.73%         4.05% to 1.79%      

2011

      0.75% to 2.80%         5,296,112         8.29 to 14.44         82,156,680         0.82%         -5.91% to -7.85%      

2010

      0.75% to 2.80%         4,869,955         8.81 to 15.67         81,031,765         0.36%         18.26% to 15.82%      

2009

      0.75% to 2.75%         5,512,532         7.45 to 13.56         78,214,047         0.23%         46.47% to 43.51%      

2008

      0.75% to 2.80%         5,594,487         5.08 to 9.43         54,788,140         0.00%         -54.75% to -55.69%      

VIP Equity-Income Portfolio - Service Class 2 (FEI2)

2012

      0.40% to 3.30%         10,692,821         10.29 to 13.18         179,943,768         2.97%         16.59% to 13.18%      

2011

      0.40% to 3.30%         10,951,320         8.82 to 11.64         160,429,469         2.42%         0.25% to -2.66%      

2010

      0.75% to 3.30%         9,964,580         8.55 to 11.96         147,773,910         1.75%         14.06% to 11.13%      

2009

      0.95% to 3.30%         8,973,964         6.91 to 10.76         117,787,793         2.15%         28.65% to 25.60%      

2008

      0.95% to 2.95%         9,142,932         5.37 to 8.75         93,902,730         2.22%         -43.36% to -44.50%      

VIP Freedom Fund 2010 Portfolio - Service Class (FF10S)

2012

      0.80% to 1.40%         468,537         12.75 to 12.25         5,769,429         1.84%         10.79% to 10.12%      

2011

      0.80% to 1.40%         470,396         11.51 to 11.12         5,255,064         1.94%         -1.08% to -1.68%      

2010

      0.80% to 1.40%         477,386         11.64 to 11.31         5,420,767         2.01%         11.84% to 11.16%      

2009

      0.80% to 1.40%         508,093         10.41 to 10.18         5,184,551         3.74%         23.16% to 22.41%      

2008

      0.80% to 1.40%         534,668         8.45 to 8.31         4,453,816         2.86%         -25.68% to -26.13%      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     Contract
Expense
Rate*		      Units      Unit
Fair
Value		      Contract
Owners’
Equity		      Investment
Income
Ratio**		      Total
Return***		      Inception
Date****

VIP Freedom Fund 2010 Portfolio - Service Class 2 (FF10S2)

2012

      1.10% to 2.65%         10,721,864       $  13.67 to $ 12.11       $ 141,890,971         1.85%         10.35% to 8.62%      

2011

      1.10% to 2.60%         9,073,579         12.39 to 11.19         109,039,045         2.09%         -1.52% to -3.01%      

2010

      1.10% to 2.60%         7,420,624         12.58 to 11.53         90,382,178         2.38%         11.31% to 9.62%      

2009

      1.10% to 2.70%         5,580,362         11.30 to 10.47         61,055,820         4.30%         22.59% to 20.61%      

2008

      1.10% to 2.70%         4,645,289         9.22 to 8.68         41,630,317         2.85%         -25.99% to -27.19%      

VIP Freedom Fund 2020 Portfolio - Service Class (FF20S)

2012

      0.80% to 1.40%         847,317         12.32 to 11.83         10,089,918         1.93%         12.28% to 11.60%      

2011

      0.80% to 1.40%         901,996         10.97 to 10.60         9,615,738         2.06%         -1.91% to -2.51%      

2010

      0.80% to 1.40%         879,170         11.19 to 10.87         9,603,062         2.31%         13.60% to 12.92%      

2009

      0.80% to 1.40%         762,019         9.85 to 9.63         7,363,537         3.51%         27.75% to 26.97%      

2008

      0.80% to 1.40%         715,854         7.71 to 7.58         5,443,001         2.80%         -33.25% to -33.65%      

VIP Freedom Fund 2020 Portfolio - Service Class 2 (FF20S2)

2012

      1.10% to 2.95%         31,873,679         13.82 to 11.96         427,562,784         1.90%         11.82% to 9.73%      

2011

      1.10% to 2.95%         28,669,879         12.36 to 10.90         344,893,609         2.37%         -2.33% to -4.15%      

2010

      1.10% to 2.85%         18,343,828         12.65 to 11.44         226,550,215         2.67%         13.07% to 11.07%      

2009

      1.10% to 2.85%         10,446,737         11.19 to 10.30         114,146,511         3.98%         27.13% to 24.88%      

2008

      1.10% to 2.90%         6,972,856         8.80 to 8.23         60,026,433         2.68%         -33.54% to -34.75%      

VIP Freedom Fund 2030 Portfolio - Service Class (FF30S)

2012

      0.80% to 1.40%         716,045         11.90 to 11.43         8,239,150         2.06%         14.56% to 13.86%      

2011

      0.80% to 1.40%         688,670         10.39 to 10.04         6,953,362         2.03%         -3.47% to -4.06%      

2010

      0.80% to 1.40%         640,936         10.76 to 10.46         6,737,911         2.10%         15.07% to 14.38%      

2009

      0.80% to 1.40%         589,970         9.35 to 9.15         5,416,444         2.40%         30.35% to 29.56%      

2008

      0.80% to 1.40%         481,061         7.17 to 7.06         3,404,900         2.59%         -38.57% to -38.94%      

VIP Freedom Fund 2030 Portfolio - Service Class 2 (FF30S2)

2012

      1.10% to 2.60%         2,196,243         13.72 to 12.20         28,863,603         1.99%         13.91% to 12.18%      

2011

      1.10% to 2.55%         2,066,391         12.04 to 10.91         23,919,498         1.88%         -3.90% to -5.30%      

2010

      1.10% to 2.55%         1,895,831         12.53 to 11.53         22,968,325         1.91%         14.62% to 12.94%      

2009

      1.10% to 2.70%         1,783,182         10.93 to 10.13         18,869,954         2.17%         29.74% to 27.64%      

2008

      1.10% to 2.70%         1,631,753         8.43 to 7.94         13,382,199         2.19%         -38.85% to -39.84%      

VIP Growth Opportunities Portfolio - Initial Class (FGOP)

2009

      0.80% to 1.40%         1,657,626         9.27 to 8.59         14,371,980         0.47%         44.68% to 43.81%      

2008

      0.80% to 1.40%         1,893,306         6.40 to 5.97         11,404,425         0.37%         -55.38% to -55.65%      

VIP Growth Portfolio - Initial Class (FGP)

2012

      0.80% to 1.40%         5,741,037         22.31 to 28.09         320,126,389         0.57%         13.77% to 13.08%      

2011

      0.80% to 1.40%         6,680,291         19.61 to 24.84         327,905,995         0.35%         -0.60% to -1.20%      

2010

      0.80% to 1.40%         7,616,804         19.73 to 25.14         376,504,339         0.27%         23.18% to 22.44%      

2009

      0.80% to 1.40%         8,786,028         16.02 to 20.53         353,773,768         0.43%         27.26% to 26.49%      

2008

      0.80% to 1.40%         10,315,116         12.59 to 16.23         326,253,847         0.76%         -47.59% to -47.91%      

VIP Growth Portfolio - Service Class 2 (FG2)

2012

      0.40% to 2.95%         5,923,542         9.74 to 13.20         96,753,422         0.36%         13.94% to 11.02%      

2011

      0.40% to 2.95%         6,092,294         8.55 to 11.89         89,150,856         0.15%         -0.43% to -2.98%      

2010

      0.75% to 2.95%         4,203,897         8.44 to 12.26         62,832,419         0.03%         22.93% to 20.21%      

2009

      0.85% to 3.00%         3,652,787         6.85 to 10.16         44,823,650         0.21%         26.88% to 24.13%      

2008

      0.85% to 3.00%         3,750,535         5.40 to 8.19         36,441,386         0.53%         -47.76% to -48.89%      

VIP High Income Portfolio - Initial Class R (FHIPR)

2012

      0.80% to 1.40%         1,901,222         13.83 to 13.36         25,500,923         6.07%         13.38% to 12.70%      

2011

      0.80% to 1.40%         1,853,305         12.19 to 11.85         22,040,608         6.79%         3.22% to 2.59%      

2010

      0.80% to 1.40%         2,166,797         11.81 to 11.55         25,100,312         8.12%         12.97% to 12.28%      

2009

      0.80% to 1.40%         2,439,833         10.46 to 10.29         25,152,368         8.56%         42.67% to 41.80%      

2008

      0.80% to 1.40%         1,960,090         7.33 to 7.26         14,240,462         8.85%         -25.48% to -25.94%      

VIP Investment Grade Bond Portfolio - Service Class (FIGBS)

2012

      0.80% to 1.40%         1,867,877         14.94 to 14.09         26,515,130         2.20%         4.92% to 4.28%      

2011

      0.80% to 1.40%         2,042,324         14.24 to 13.51         27,775,950         3.19%         6.35% to 5.71%      

2010

      0.80% to 1.40%         2,303,690         13.39 to 12.78         29,608,881         3.32%         6.82% to 6.17%      

2009

      0.80% to 1.40%         2,383,390         12.53 to 12.04         28,829,928         8.21%         14.75% to 14.05%      

2008

      0.80% to 1.40%         1,760,865         10.92 to 10.55         18,661,455         4.21%         -4.12% to -4.70%      

VIP Investment Grade Bond Portfolio - Service Class 2 (FIGBP2)

2012

      0.40% to 3.20%         28,617,794         13.17 to 11.62         397,465,850         2.07%         5.18% to 2.22%      

2011

      0.40% to 3.20%         29,688,055         12.52 to 11.37         394,645,282         2.82%         6.61% to 3.62%      

2010

      0.65% to 3.20%         33,793,486         11.81 to 10.97         424,705,116         2.81%         6.85% to 4.11%      

2009

      0.65% to 3.25%         43,332,353         11.06 to 10.50         513,869,040         8.32%         14.72% to 11.72%      

2008

      0.65% to 3.25%         38,795,425         9.64 to 9.40         405,358,697         3.91%         -4.09% to -6.60%      

VIP Mid Cap Portfolio - Service Class (FMCS)

2012

      0.80% to 1.40%         1,935,622         12.15 to 11.67         22,729,870         0.49%         13.83% to 13.14%      

2011

      0.80% to 1.40%         2,401,588         10.68 to 10.32         24,904,322         0.13%         -11.43% to -11.96%      

2010

      0.80% to 1.40%         2,988,963         12.06 to 11.72         35,170,703         0.31%         27.67% to 26.90%      

2009

      0.80% to 1.40%         2,397,217         9.44 to 9.23         22,207,442         0.64%         38.89% to 38.06%      

2008

      0.80% to 1.40%         2,030,889         6.80 to 6.69         13,616,500         0.35%         -39.99% to -40.36%      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     Contract
Expense
Rate*		      Units      Unit
Fair
Value		      Contract
Owners’
Equity		      Investment
Income
Ratio**		      Total
Return***		      Inception
Date****

VIP Mid Cap Portfolio - Service Class 2 (FMC2)

2012

      0.40% to 3.30%         9,324,722       $  11.19 to $ 21.50       $ 241,187,085         0.38%         14.10% to 10.77%      

2011

      0.40% to 3.30%         10,141,828         9.81 to 19.41         233,130,775         0.02%         -11.21% to -13.79%      

2010

      0.65% to 3.30%         10,137,469         10.99 to 22.51         264,905,928         0.13%         27.74% to 24.33%      

2009

      0.75% to 3.30%         9,082,067         8.59 to 18.10         187,933,011         0.47%         38.70% to 35.14%      

2008

      0.75% to 3.10%         8,779,121         6.19 to 13.55         132,721,800         0.24%         -40.06% to -41.48%      

VIP Overseas Portfolio - Initial Class (FOP)

2012

      0.80% to 1.40%         2,036,328         20.41 to 20.01         50,881,408         1.89%         19.77% to 19.05%      

2011

      0.80% to 1.40%         2,365,334         17.04 to 16.80         49,616,178         1.31%         -17.83% to -18.32%      

2010

      0.80% to 1.40%         2,742,146         20.74 to 20.57         70,349,684         1.37%         12.21% to 11.53%      

2009

      0.80% to 1.40%         3,184,055         18.48 to 18.45         73,086,949         2.10%         25.52% to 24.76%      

2008

      0.80% to 1.40%         3,203,770         14.72 to 14.79         68,743,113         2.41%         -44.26% to -44.59%      

VIP Overseas Portfolio - Initial Class R (FOPR)

2012

      0.80% to 1.40%         1,648,948         15.48 to 14.51         24,145,786         1.92%         19.75% to 19.02%      

2011

      0.80% to 1.40%         1,866,140         12.92 to 12.19         22,938,366         1.29%         -17.81% to -18.30%      

2010

      0.80% to 1.40%         2,228,091         15.72 to 14.92         33,493,024         1.38%         12.17% to 11.49%      

2009

      0.80% to 1.40%         2,611,534         14.02 to 13.38         35,178,482         2.07%         25.59% to 24.83%      

2008

      0.80% to 1.40%         3,742,007         11.16 to 10.72         34,538,550         2.39%         -44.26% to -44.60%      

VIP Overseas Portfolio - Service Class 2 (FO2)

2012

      1.15% to 2.25%         124,307         19.70 to 17.64         2,396,554         1.64%         18.99% to 17.66%      

2011

      1.10% to 2.25%         149,602         16.63 to 14.99         2,423,876         1.01%         -18.25% to -19.20%      

2010

      1.10% to 2.30%         198,160         20.35 to 18.48         3,912,132         1.16%         11.59% to 10.24%      

2009

      1.10% to 2.30%         224,881         18.23 to 16.77         3,903,354         1.77%         24.83% to 23.32%      

2008

      1.10% to 2.30%         286,835         14.61 to 13.60         4,029,619         2.20%         -44.58% to -45.25%      

VIP Overseas Portfolio - Service Class 2 R (FO2R)

2012

      0.40% to 2.95%         4,917,966         8.03 to 11.17         61,701,939         1.76%         19.97% to 16.89%      

2011

      0.40% to 2.95%         4,998,098         6.70 to 9.56         53,042,961         1.30%         -17.72% to -19.82%      

2010

      0.65% to 2.95%         4,618,811         8.08 to 11.92         60,187,730         1.31%         12.09% to 9.50%      

2009

      0.75% to 2.95%         4,511,884         7.19 to 10.88         53,010,704         2.15%         25.25% to 22.48%      

2008

      0.95% to 2.85%         3,739,265         5.90 to 8.93         35,540,446         2.29%         -44.48% to -45.55%      

VIP Value Strategies Portfolio - Service Class (FVSS)

2012

      0.80% to 1.40%         396,128         17.56 to 16.46         6,579,269         0.50%         26.08% to 25.32%      

2011

      0.80% to 1.40%         432,099         13.93 to 13.14         5,721,382         0.81%         -9.58% to -10.12%      

2010

      0.80% to 1.40%         540,940         15.41 to 14.62         7,964,920         0.42%         25.44% to 24.69%      

2009

      0.80% to 1.40%         592,992         12.28 to 11.72         6,997,937         0.52%         56.14% to 55.19%      

2008

      0.80% to 1.40%         634,932         7.87 to 7.55         4,824,772         0.60%         -51.57% to -51.86%      

Franklin Income Securities Fund - Class 2 (FTVIS2)

2012

      0.65% to 2.80%         11,580,755         12.21 to 11.94         150,710,957         6.36%         11.92% to 9.49%      

2011

      0.75% to 2.95%         11,167,150         10.86 to 10.81         131,070,725         5.75%         1.62% to -0.63%      

2010

      0.80% to 2.95%         10,974,594         12.05 to 10.88         127,750,790         6.59%         11.77% to 9.35%      

2009

      0.80% to 2.95%         10,706,434         10.78 to 9.95         112,298,334         7.94%         34.51% to 31.60%      

2008

      0.80% to 2.95%         10,666,736         8.01 to 7.56         83,813,696         5.45%         -30.22% to -31.73%      

Franklin Rising Dividends Securities Fund - Class 2 (FTVRD2)

2012

      0.95% to 2.80%         2,898,040         16.13 to 14.96         53,163,767         1.62%         10.90% to 8.82%      

2011

      0.95% to 2.80%         3,637,623         14.55 to 13.75         60,305,085         1.53%         4.99% to 3.04%      

2010

      0.95% to 2.95%         4,554,255         13.86 to 13.19         72,133,916         1.63%         19.50% to 17.09%      

2009

      0.95% to 3.00%         5,182,224         11.60 to 11.22         68,954,337         1.46%         16.23% to 13.82%      

2008

      0.95% to 3.00%         6,005,955         9.98 to 9.86         69,210,732         1.80%         -27.79% to -29.29%      

Franklin Small Cap Value Securities Fund - Class 2 (FTVSV2)

2012

      0.40% to 3.20%         5,909,169         13.21 to 18.92         140,705,161         0.76%         17.91% to 14.59%      

2011

      0.40% to 3.20%         7,354,175         11.20 to 16.51         149,929,914         0.66%         -4.14% to -6.83%      

2010

      0.65% to 3.20%         7,692,944         11.28 to 17.72         165,721,242         0.83%         27.39% to 24.12%      

2009

      0.65% to 3.25%         10,676,595         8.85 to 14.23         182,350,127         0.77%         28.32% to 24.96%      

2008

      0.75% to 3.05%         3,847,456         6.89 to 11.52         51,984,101         1.08%         -33.52% to -35.06%      

Templeton Developing Markets Securities Fund - Class 3 (FTVDM3)

2012

      0.80% to 2.65%         1,605,393         12.00 to 15.71         27,445,545         1.42%         12.25% to 10.15%      

2011

      0.80% to 2.65%         1,718,984         10.69 to 14.27         26,345,988         0.99%         -16.53% to -18.09%      

2010

      0.80% to 2.80%         1,928,435         12.81 to 17.26         35,662,153         1.60%         16.57% to 14.23%      

2009

      0.80% to 2.80%         2,307,480         10.99 to 15.11         36,881,360         4.14%         71.25% to 67.80%      

2008

      0.80% to 2.80%         2,181,313         6.42 to 9.01         20,523,237         2.72%         -53.05% to -54.00%      

Templeton Foreign Securities Fund - Class 2 (TIF2)

2012

      0.95% to 2.25%         165,137         17.90 to 19.09         3,401,372         2.97%         17.11% to 15.57%      

2011

      0.95% to 2.25%         196,259         15.28 to 16.52         3,471,745         1.67%         -11.48% to -12.64%      

2010

      0.95% to 2.25%         264,742         17.26 to 18.91         5,310,679         1.89%         7.38% to 5.97%      

2009

      0.95% to 2.25%         300,587         16.08 to 17.84         5,623,798         3.46%         35.74% to 33.96%      

2008

      0.95% to 2.25%         358,613         11.85 to 13.32         4,967,042         2.39%         -40.95% to -41.72%      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    Contract
Expense
Rate*		     Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		     Inception
Date****

Templeton Foreign Securities Fund - Class 3 (TIF3)

2012

     0.80% to 3.30%        4,857,387        $     11.23 to $ 12.58        $       71,028,710        2.99%        17.35% to 14.39%     

2011

     0.80% to 3.30%        5,613,198        9.57 to 10.99        70,423,411        1.69%        -11.39% to -13.62%     

2010

     0.80% to 3.30%        6,154,147        10.80 to 12.73        87,837,444        1.66%        7.54% to 4.83%     

2009

     0.80% to 3.30%        6,859,765        10.04 to 12.14        91,812,073        5.47%        36.10% to 32.67%     

2008

     0.65% to 3.25%        25,106,259        6.17 to 9.17        247,362,383        2.54%        -40.78% to -42.33%     

Templeton Global Bond Securities Fund - Class 3 (FTVGI3)

2012

     0.65% to 2.65%        6,702,502        15.88 to 16.58        121,596,625        6.32%        14.31% to 12.01%     

2011

     0.65% to 2.65%        6,648,136        13.89 to 14.80        106,571,620        5.61%        -1.47% to -3.45%     

2010

     0.65% to 2.75%        6,305,385        14.10 to 15.24        103,381,528        1.36%        13.64% to 11.24%     

2009

     0.80% to 2.75%        5,360,877        14.32 to 13.70        77,988,157        14.04%        17.74% to 15.42%     

2008

     0.80% to 2.80%        5,797,396        12.17 to 11.85        72,143,518        3.87%        5.36% to 3.23%     

VIP Founding Funds Allocation Fund - Class 2 (FTVFA2)

2012

     0.75% to 2.65%        2,790,624        10.48 to 9.58        28,120,573        2.64%        14.47% to 12.27%     

2011

     1.05% to 2.65%        2,438,014        9.05 to 8.53        21,662,279        0.02%        -2.57% to -4.15%     

2010

     0.85% to 2.65%        1,840,165        9.34 to 8.90        16,874,811        2.24%        9.32% to 7.33%     

2009

     0.80% to 2.65%        1,391,741        8.55 to 8.29        11,759,706        4.02%        29.21% to 26.80%     

2008

     0.80% to 2.65%        456,888        6.62 to 6.54        3,010,257        3.50%        -33.79% to -34.62%      ****

Advisers Management Trust - Short Duration Bond Portfolio - I Class Shares (AMTB)

2012

     0.40% to 3.05%        13,542,864        10.59 to 9.05        157,169,937        2.89%        4.19% to 1.41%     

2011

     0.40% to 3.05%        15,352,684        10.16 to 8.93        171,320,708        3.62%        -0.11% to -2.76%     

2010

     0.40% to 3.05%        18,038,619        10.18 to 9.18        200,415,989        4.85%        4.86% to 2.07%     

2009

     0.40% to 3.25%        24,900,539        9.70 to 8.87        262,364,479        7.00%        12.87% to 9.64%     

2008

     0.65% to 3.25%        38,156,662        8.59 to 8.09        355,647,246        4.55%        -13.99% to -16.24%     

Growth Portfolio - I Class Shares (AMTG)

2012

     1.30%        5        60.41        302        0.00%        11.13%     

2011

     1.30%        5        54.36        272        0.00%        -1.51%     

2010

     1.30%        153        55.19        8,499        0.00%        29.63%     

2009

     1.30%        12        42.58        511        0.00%        28.66%     

2008

     0.80% to 1.40%        2,411,370        12.76 to 14.52        67,084,772        0.00%        -44.13% to -44.47%     

Guardian Portfolio - I Class Shares (AMGP)

2008

     0.80% to 1.40%        928,163        9.15 to 8.57        8,023,491        0.53%        -37.75% to -38.13%     

International Portfolio - S Class Shares (AMINS)

2008

     0.80% to 3.25%        1,025,292        5.65 to 7.10        7,732,508        0.00%        -46.87% to -48.18%     

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

2008

     0.95% to 2.45%        400,219        10.54 to 11.44        4,818,061        0.00%        -44.05% to -44.90%     

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

2010

     1.30%        999        31.34        31,308        0.30%        14.16%     

2008

     0.80% to 1.40%        4,031,046        14.91 to 17.56        71,403,179        0.49%        -52.77% to -53.06%     

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

2008

     0.80% to 2.95%        1,216,019        5.60 to 6.46        8,275,433        0.93%        -46.38% to -47.55%     

Small-Cap Growth Portfolio - S Class Shares (AMFAS)

2012

     0.80% to 2.80%        252,460        8.95 to 11.16        3,401,665        0.00%        7.95% to 5.77%     

2011

     0.80% to 2.80%        335,319        8.29 to 10.56        4,222,440        0.00%        -1.85% to -3.83%     

2010

     0.80% to 2.80%        480,243        8.45 to 10.98        6,223,316        0.00%        18.65% to 16.27%     

2009

     0.80% to 2.80%        371,443        7.12 to 9.44        4,086,114        0.00%        21.77% to 19.32%     

2008

     0.80% to 2.80%        406,370        5.85 to 7.91        3,706,928        0.00%        -39.96% to -41.17%     

Socially Responsive Portfolio - I Class Shares (AMSRS)

2012

     0.80% to 2.65%        1,432,779        14.60 to 14.87        23,889,201        0.22%        10.09% to 8.03%     

2011

     0.80% to 2.65%        1,804,517        13.26 to 13.76        27,464,680        0.32%        -3.85% to -5.64%     

2010

     0.80% to 2.65%        2,033,231        13.79 to 14.59        32,344,561        0.04%        21.87% to 19.60%     

2009

     0.80% to 2.95%        2,058,008        11.32 to 11.95        27,018,092        2.16%        30.38% to 27.55%     

2008

     0.80% to 3.05%        2,392,040        8.68 to 9.31        24,246,445        0.27%        -39.93% to -41.29%     

Balanced Fund/VA - Non-Service Shares (OVMS)

2012

     0.80% to 1.40%        1,434,115        20.53 to 21.14        37,466,189        1.35%        11.44% to 10.76%     

2011

     0.80% to 1.40%        1,737,854        18.42 to 19.09        40,852,941        2.36%        -0.08% to -0.69%     

2010

     0.80% to 1.40%        2,027,729        18.44 to 19.22        48,012,221        1.44%        12.01% to 11.33%     

2009

     0.80% to 1.40%        2,404,729        16.46 to 17.26        50,938,065        0.00%        20.92% to 20.19%     

2008

     0.80% to 1.40%        2,972,160        13.61 to 14.36        52,339,138        2.98%        -43.92% to -44.26%     

Oppenheimer Capital Appreciation Fund/VA - Service Class (OVCAFS)

2009

     0.95% to 2.95%        3,035,663        11.08 to 10.93        40,147,457        0.01%        42.78% to 39.90%     

2008

     0.95% to 2.95%        3,576,621        7.76 to 7.81        33,310,024        0.00%        -46.18% to -47.27%     

Capital Appreciation Fund/VA - Non-Service Shares (OVGR)

2009

     0.80% to 1.40%        3,323,768        15.19 to 14.08        47,274,803        0.33%        43.36% to 42.50%     

2008

     0.80% to 1.40%        3,977,449        10.59 to 9.88        39,665,920        0.15%        -45.95% to -46.28%     

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     Contract
Expense
Rate*		      Units      Unit
Fair
Value		      Contract
Owners’
Equity		      Investment
Income
Ratio**		      Total
Return***		      Inception
Date****

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

2012

      0.80% to 1.40%         1,736,330       $  15.22 to $ 14.98       $ 33,119,981         4.89%         9.41% to 8.74%      

2011

      0.80% to 1.40%         2,055,734         13.91 to 13.78         36,087,270         6.02%         7.40% to 6.76%      

2010

      0.80% to 1.40%         2,443,496         12.95 to 12.91         40,204,609         1.86%         10.52% to 9.86%      

2009

      0.80% to 1.40%         2,839,959         11.72 to 11.75         42,563,966         0.00%         8.74% to 8.08%      

2008

      0.80% to 1.40%         3,473,316         10.78 to 10.87         48,106,805         4.82%         -39.54% to -39.90%      

Global Securities Fund/VA - Class 3 (OVGS3)

2012

      0.80% to 1.40%         2,245,911         24.41 to 23.02         52,131,298         2.12%         20.25% to 19.53%      

2011

      0.80% to 1.40%         2,572,768         20.30 to 19.26         49,919,305         1.30%         -9.00% to -9.55%      

2010

      0.80% to 1.40%         3,037,983         22.30 to 21.29         65,110,849         1.47%         15.05% to 14.35%      

2009

      0.80% to 1.40%         3,525,444         19.39 to 18.62         66,015,905         2.26%         38.58% to 37.74%      

2008

      0.80% to 1.40%         4,134,462         13.99 to 13.52         56,156,335         1.57%         -40.67% to -41.03%      

Global Securities Fund/VA - Class 4 (OVGS4)

2012

      0.75% to 2.80%         4,390,476         10.40 to 13.76         67,830,605         1.92%         20.05% to 17.56%      

2011

      0.75% to 2.55%         4,665,467         8.66 to 11.94         60,579,285         1.03%         -9.18% to -10.82%      

2010

      0.75% to 2.70%         4,965,773         9.54 to 13.25         71,526,134         1.23%         14.80% to 12.55%      

2009

      0.75% to 2.70%         5,304,073         8.31 to 11.77         67,081,618         1.89%         38.33% to 35.62%      

2008

      0.95% to 2.70%         5,863,169         9.43 to 8.68         53,981,607         1.24%         -40.91% to -41.96%      

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

2012

      0.80% to 1.40%         2,405,799         43.41 to 40.68         104,525,558         2.16%         20.29% to 19.56%      

2011

      0.80% to 1.40%         2,816,110         36.09 to 34.02         102,224,646         1.30%         -9.02% to -9.57%      

2010

      0.80% to 1.40%         3,271,262         39.67 to 37.62         131,293,425         1.48%         15.04% to 14.34%      

2009

      0.80% to 1.40%         3,835,051         34.48 to 32.90         134,559,408         2.32%         38.65% to 37.82%      

2008

      0.80% to 1.40%         4,605,983         24.87 to 23.88         117,211,377         1.61%         -40.67% to -41.03%      

Global Securities Fund/VA - Service Class (OVGSS)

2012

      0.95% to 2.25%         310,391         19.48 to 22.02         7,406,259         1.91%         19.80% to 18.22%      

2011

      0.95% to 2.25%         368,092         16.26 to 18.62         7,361,088         1.10%         -9.39% to -10.58%      

2010

      0.95% to 2.30%         466,144         17.95 to 20.74         10,268,381         1.32%         14.60% to 13.04%      

2009

      0.95% to 2.30%         584,534         15.66 to 18.35         11,225,732         2.01%         38.03% to 36.15%      

2008

      0.95% to 2.30%         675,950         11.35 to 13.48         9,467,392         1.32%         -40.90% to -41.71%      

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

2012

      0.80% to 1.40%         1,074,623         11.28 to 10.45         11,345,866         1.01%         15.93% to 15.23%      

2011

      0.80% to 1.40%         1,223,602         9.73 to 9.07         11,201,679         0.86%         -0.81% to -1.41%      

2010

      0.80% to 1.40%         1,392,924         9.81 to 9.20         12,926,440         1.15%         15.18% to 14.48%      

2009

      0.80% to 1.40%         1,710,096         8.52 to 8.03         13,848,126         1.95%         27.26% to 26.49%      

2008

      0.80% to 1.40%         2,022,607         6.69 to 6.35         12,938,096         1.56%         -38.96% to -39.33%      

Main Street Fund(R)/VA - Service Class (OVGIS)

2012

      0.40% to 3.20%         12,583,850         10.83 to 13.01         204,894,940         0.65%         16.14% to 12.87%      

2011

      0.40% to 3.20%         15,287,929         9.33 to 11.53         216,328,023         0.59%         -0.71% to -3.50%      

2010

      0.65% to 3.20%         17,274,630         9.16 to 11.94         248,917,497         0.96%         15.07% to 12.12%      

2009

      0.65% to 3.25%         24,250,057         7.96 to 10.62         307,298,432         1.47%         27.16% to 23.83%      

2008

      0.65% to 3.25%         27,005,578         6.26 to 8.57         272,771,613         1.22%         -39.02% to -40.62%      

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

2012

      0.80% to 1.40%         397,625         11.48 to 11.02         4,409,595         0.57%         17.04% to 16.33%      

2011

      0.80% to 1.40%         420,119         9.81 to 9.48         4,000,819         0.57%         -2.99% to -3.58%      

2010

      0.80% to 1.40%         411,283         10.11 to 9.83         4,059,854         0.72%         22.42% to 21.68%      

2009

      0.80% to 1.40%         552,543         8.26 to 8.08         4,477,598         0.88%         36.10% to 35.27%      

2008

      0.80% to 1.40%         440,857         6.07 to 5.97         2,638,595         0.51%         -38.33% to -38.70%      

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

2012

      0.40% to 3.30%         2,334,765         12.52 to 17.75         53,269,053         0.33%         17.20% to 13.78%      

2011

      0.40% to 3.30%         2,533,954         10.68 to 15.60         49,994,641         0.37%         -2.77% to -5.60%      

2010

      0.65% to 3.30%         2,225,257         10.43 to 16.52         46,157,728         0.40%         22.26% to 19.00%      

2009

      0.95% to 3.30%         2,081,552         13.34 to 13.88         35,691,628         1.16%         35.58% to 32.36%      

2008

      0.65% to 3.25%         8,337,343         6.27 to 10.52         105,311,346         0.29%         -38.41% to -40.02%      

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

2012

      0.80% to 1.40%         1,559,411         6.58 to 6.09         9,602,969         0.00%         15.51% to 14.81%      

2011

      0.80% to 1.40%         1,900,617         5.69 to 5.30         10,183,980         0.00%         0.29% to -0.32%      

2010

      0.80% to 1.40%         1,833,474         5.68 to 5.32         9,846,584         0.00%         26.45% to 25.68%      

2009

      0.80% to 1.40%         1,983,089         4.49 to 4.23         8,468,612         0.00%         31.55% to 30.75%      

2008

      0.80% to 1.40%         2,176,324         3.41 to 3.24         7,101,334         0.00%         -49.48% to -49.78%      

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

2012

      0.80% to 1.40%         67,987         10.16 to 10.15         690,480         0.00%         1.65% to 1.54%       ****

Global Strategic Income Fund/VA: Service Shares (OVSBS)

2012

      0.95% to 2.75%         874,911         10.16 to 10.12         8,879,113         0.00%         1.58% to 1.25%       ****

All Asset Portfolio - Advisor Class (PMVAAD)

2012

      0.65% to 2.55%         1,874,670         10.67 to 10.53         19,881,541         6.23%         6.71% to 5.35%       ****

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    Contract
Expense
Rate*		     Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		     Inception
Date****

Foreign Bond Portfolio (Unhedged) - Advisor Class (PMVFAD)

2012

     0.75% to 2.55%        1,763,524        $ 13.31 to $ 12.45        $  22,842,574        5.09%        4.44% to 2.54%     

2011

     0.75% to 2.55%        1,837,753        12.75 to 12.14        22,970,486        1.91%        7.61% to 5.66%     

2010

     0.80% to 2.55%        1,500,572        11.83 to 11.49        17,556,731        1.26%        8.50% to 6.58%     

2009

     0.75% to 2.45%        649,344        10.91 to 10.79        7,051,409        0.97%        9.11% to 7.86%      ****

Low Duration Portfolio - Advisor Class (PMVLAD)

2012

     0.40% to 3.20%        28,772,761        12.23 to 11.02        337,025,026        1.81%        5.33% to 2.36%     

2011

     0.40% to 3.20%        23,171,669        11.61 to 10.76        260,577,575        1.57%        0.60% to -2.22%     

2010

     0.40% to 3.20%        18,042,359        11.54 to 11.01        203,955,140        1.54%        4.77% to 1.82%     

2009

     0.65% to 3.25%        14,013,653        11.00 to 10.81        153,020,206        1.62%        9.98% to 8.05%      ****

Total Return Portfolio - Advisor Class (PMVTRD)

2012

     0.40% to 2.80%        17,987,204        10.98 to 10.54        193,716,161        2.44%        9.06% to 6.43%     

2011

     0.40% to 2.70%        6,540,321        10.06 to 9.91        65,327,248        1.60%        0.64% to -0.90%      ****

Putnam VT Growth and Income Fund - Class IB (PVGIB)

2012

     1.05% to 2.30%        187,620        13.43 to 13.06        2,644,472        1.81%        17.88% to 16.39%     

2011

     1.05% to 2.35%        212,998        11.40 to 11.18        2,559,811        1.31%        -5.64% to -6.88%     

2010

     1.05% to 2.60%        275,411        12.08 to 11.77        3,507,688        1.63%        13.18% to 11.41%     

2009

     1.05% to 2.60%        329,454        10.67 to 10.56        3,719,305        2.72%        28.45% to 26.44%     

2008

     1.05% to 2.80%        387,088        8.31 to 8.26        3,423,016        2.18%        -39.34% to -40.42%     

Putnam VT International Equity Fund - Class IB (PVTIGB)

2012

     1.15% to 2.05%        21,475        16.07 to 14.71        332,677        2.25%        20.51% to 19.41%     

2011

     1.15% to 2.10%        28,337        13.34 to 12.27        366,694        3.58%        -17.89% to -18.68%     

2010

     1.15% to 2.40%        39,549        16.24 to 14.73        626,033        3.71%        8.76% to 7.39%     

2009

     1.15% to 2.40%        46,786        14.93 to 13.72        681,273        0.00%        23.20% to 21.64%     

2008

     1.15% to 2.40%        61,180        12.12 to 11.28        724,632        2.19%        -44.60% to -45.30%     

Putnam VT Voyager Fund - Class IB (PVTVB)

2012

     0.95% to 2.35%        127,985        14.24 to 13.61        1,899,798        0.38%        13.14% to 11.54%     

2011

     0.95% to 2.45%        221,728        12.58 to 12.09        2,914,393        0.00%        -18.63% to -19.86%     

2010

     0.95% to 2.70%        248,463        15.46 to 14.80        3,997,037        1.31%        19.65% to 17.54%     

2009

     0.95% to 2.80%        213,154        12.92 to 12.50        2,875,568        0.65%        62.34% to 59.31%     

2008

     1.15% to 2.80%        142,184        8.63 to 7.85        1,187,340        0.00%        -37.76% to -38.80%     

Van Kampen V.I. American Franchise Fund: Series II Shares (ACEG2)

2012

     0.80% to 2.55%        548,055        9.68 to 9.56        5,277,298        0.00%        -3.21% to -4.37%      ****

Van Kampen V.I. Value Opportunities Fund: Series II Shares (AVBV2)

2008

     0.80% to 2.95%        2,569,381        5.12 to 7.08        21,201,989        0.47%        -52.29% to -53.33%     

Diversified Stock Fund Class A Shares (VYDS)

2012

     1.15% to 1.55%        26,781        14.73 to 14.18        390,226        0.99%        14.94% to 14.47%     

2011

     1.15% to 1.65%        27,442        12.82 to 12.29        348,002        0.64%        -7.90% to -8.36%     

2010

     1.15% to 1.95%        38,329        13.92 to 13.11        526,739        0.73%        11.05% to 10.16%     

2009

     1.15% to 2.10%        43,065        12.53 to 11.78        531,815        0.81%        25.60% to 24.39%     

2008

     1.15% to 2.10%        57,375        9.98 to 9.47        564,917        0.75%        -38.58% to -39.17%     

Blue Chip Growth Portfolio - II (TRBCG2)

2009

     0.80% to 2.95%        3,605,643        9.45 to 9.84        37,628,164        0.00%        40.66% to 37.61%     

2008

     0.65% to 3.25%        19,673,406        5.86 to 7.07        147,156,139        0.12%        -43.02% to -44.52%     

Equity Income Portfolio - II (TREI2)

2009

     0.80% to 3.30%        7,776,288        8.86 to 8.87        74,780,990        1.74%        24.25% to 21.12%     

2008

     0.80% to 2.95%        7,723,076        7.13 to 7.43        60,261,084        2.21%        -36.78% to -38.15%     

Health Sciences Portfolio - II (TRHS2)

2012

     0.65% to 2.80%        3,798,987        15.12 to 14.26        56,146,556        0.00%        30.15% to 27.32%     

2011

     0.75% to 2.80%        2,368,928        11.60 to 11.20        27,116,053        0.00%        9.56% to 7.30%     

2010

     0.80% to 2.45%        301,680        10.58 to 10.46        3,176,507        0.00%        5.80% to 4.63%      ****

Limited-Term Bond Portfolio - II (TRLT2)

2009

     1.30%        1        11.34        11        3.05%        5.96%     

2008

     0.80% to 2.90%        4,360,949        10.79 to 10.08        46,053,950        3.75%        0.50% to -1.63%     

Eck VIP Trust - Global Hard Assets Fund - Service Class (VWHAS)

2012

     0.75% to 2.55%        1,388,083        9.68 to 9.56        13,363,085        0.78%        -3.24% to -4.42%      ****

VIP Trust - Global Bond Fund: Initial Class (VWBF)

2012

     0.80% to 1.40%        576,088        22.02 to 22.53        15,204,351        1.74%        4.70% to 4.07%     

2011

     0.80% to 1.40%        445,923        21.03 to 21.65        11,388,013        8.06%        7.28% to 6.63%     

2010

     0.80% to 1.40%        511,066        19.60 to 20.30        12,265,103        3.66%        5.35% to 4.71%     

2009

     0.80% to 1.40%        581,103        18.61 to 19.39        13,329,078        3.83%        5.13% to 4.50%     

2008

     0.80% to 1.40%        703,225        17.70 to 18.55        15,375,868        9.07%        2.78% to 2.16%     

VIP Trust - Emerging Markets Fund: Initial Class (VWEM)

2012

     0.80% to 1.40%        1,277,864        25.87 to 23.47        30,377,030        0.00%        28.77% to 27.99%     

2011

     0.80% to 1.40%        797,445        20.09 to 18.34        14,792,818        1.09%        -26.33% to -26.78%     

2010

     0.80% to 1.40%        946,130        27.27 to 25.04        23,951,440        0.60%        25.83% to 25.07%     

2009

     0.80% to 1.40%        1,081,816        21.67 to 20.02        21,882,865        0.17%        111.47% to 110.20%     

2008

     0.80% to 1.40%        1,264,058        10.25 to 9.53        12,153,665        0.00%        -65.06% to -65.27%     

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

    Contract
Expense
Rate*		     Units     Unit
Fair
Value		     Contract
Owners’
Equity		     Investment
Income
Ratio**		     Total
Return***		     Inception
Date****

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

2012

     0.75% to 2.80%        2,974,012        $ 9.77 to $ 9.64        $  65,033,799        0.76%        -2.28% to -3.63%      ****

2011

     0.80% to 1.40%        552,304        41.36 to 38.86        25,073,059        1.21%        -17.12% to -17.62%     

2010

     0.80% to 1.40%        619,064        49.90 to 47.18        34,051,631        0.39%        28.20% to 27.43%     

2009

     0.80% to 1.40%        761,288        38.92 to 37.02        32,875,757        0.27%        56.27% to 55.33%     

2008

     0.80% to 1.40%        892,365        24.91 to 23.83        24,758,601        0.31%        -46.56% to -46.88%     

Variable Insurance Portfolios - Asset Strategy (WRASP)

2012

     0.65% to 2.80%        9,003,602        14.04 to 12.96        122,124,768        1.13%        18.40% to 15.83%     

2011

     0.65% to 2.80%        8,101,468        11.86 to 11.19        93,728,667        1.01%        -7.81% to -9.80%     

2010

     0.65% to 2.80%        6,143,715        12.86 to 12.40        77,797,454        1.03%        7.97% to 5.63%     

2009

     0.75% to 2.80%        2,978,019        11.91 to 11.74        35,256,090        0.04%        19.06% to 17.41%      ****

Variable Insurance Portfolios - High Income (WRHIP)

2012

     0.75% to 2.80%        2,344,079        10.86 to 10.71        25,294,682        0.05%        8.55% to 7.05%      ****

Variable Insurance Portfolios - Mid Cap Growth (WRMCG)

2012

     0.40% to 2.80%        741,676        10.13 to 9.97        7,454,095        0.00%        1.29% to -0.34%      ****

Variable Insurance Portfolios - Pathfinder Conservative (WRPCP)

2012

     0.40%        199,019        11.61        2,311,373        0.81%        6.52%     

2011

     0.40%        92,333        10.90        1,006,692        0.10%        0.35%     

Variable Insurance Portfolios - Pathfinder Moderate (WRPMP)

2012

     0.40%        1,406,121        12.03        16,912,148        0.74%        9.09%     

2011

     0.40%        424,157        11.03        4,676,395        0.61%        -1.85%     

2010

     0.40%        2,491        11.23        27,982        0.00%        12.18%     

Variable Insurance Portfolios - Pathfinder Moderately Aggressive (WRPMAP)

2012

     0.40%        2,235,029        12.20        27,276,311        0.71%        10.37%     

2011

     0.40%        1,230,558        11.06        13,606,615        0.72%        -3.40%     

Variable Insurance Portfolios - Pathfinder Moderately Conservative (WRPMCP)

2012

     0.40%        449,607        11.87        5,337,953        0.69%        7.98%     

2011

     0.40%        148,360        11.00        1,631,286        0.33%        -0.40%     

Advantage VT Discovery Fund (SVDF)

2012

     1.30%        74        48.13        3,562        0.00%        16.20%     

2011

     1.30%        74        41.42        3,065        0.00%        -0.88%     

2008

     0.80% to 1.40%        1,508,012        15.55 to 18.44        32,197,505        0.00%        -44.80% to -45.14%     

Advantage VT Opportunity Fund - Class 2 (SVOF)

2010

     1.30%        836        58.00        48,490        0.48%        22.15%     

2008

     0.80% to 1.40%        4,815,928        20.38 to 23.63        144,228,895        1.88%        -40.58% to -40.94%     

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

2012

     0.40% to 2.70%        2,006,569        16.97 to 14.80        32,340,952        0.00%        7.44% to 4.95%     

2011

     0.40% to 2.70%        2,029,850        15.80 to 14.11        30,844,147        0.00%        -4.98% to -7.17%     

2010

     0.80% to 2.70%        1,674,122        16.51 to 15.19        27,016,561        0.00%        25.76% to 23.35%     

2009

     0.75% to 2.50%        775,011        13.14 to 12.45        10,059,269        0.00%        31.36% to 48.83%      ****

Advantage VT Small Cap Value Fund - Class 2 (WFVSMV)

2012

     1.10%        753        9.84        7,408        0.87%        12.74%     

2011

     1.10%        951        8.73        8,299        0.67%        -8.28%     

2010

     1.10%        1,026        9.51        9,762        1.49%        15.96%     

2009

     1.10%        1,175        8.20        9,641        1.27%        58.42%     

2008

     1.10% to 1.25%        1,260        5.18 to 5.17        6,526        0.00%        -45.16% to -45.24%     

Advantage VT Core Bond Fund (WFVTRB)

2012

     1.15% to 1.25%        21,348        14.52 to 14.40        307,599        1.44%        4.87% to 4.77%     

2011

     1.15% to 1.25%        21,348        13.84 to 13.74        293,570        2.67%        7.07% to 6.96%     

2010

     1.15% to 1.25%        21,348        12.93 to 12.85        274,433        3.38%        5.81% to 5.70%     

2009

     1.15% to 1.25%        21,348        12.22 to 12.15        259,604        3.69%        10.71% to 10.59%     

2008

     1.15%        2,116        11.04        23,352        4.80%        1.21%     

Advantage - VT Omega Growth Fund - Class 2 (WFVOG2)

2012

     1.15% to 1.75%        3,493        14.03 to 13.82        48,543        0.00%        19.00% to 18.28%     

2011

     1.40% to 2.20%        4,361        11.74 to 11.60        51,038        0.00%        -6.86% to -7.62%     

2010

     1.40% to 2.20%        4,925        12.61 to 12.56        62,030        0.00%        26.08% to 25.61%      ****

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

2011

     0.75% to 2.55%        921,943        10.22 to 9.92        10,932,894        0.00%        -9.49% to -11.13%     

2010

     0.80% to 2.45%        765,556        15.90 to 11.17        10,472,391        0.00%        23.52% to 11.68%      ****

2009

     0.80% to 1.40%        417,666        12.87 to 12.29        5,164,464        0.00%        55.84% to 54.90%     

2008

     0.80% to 1.40%        342,194        8.26 to 7.93        2,732,234        0.09%        -44.35% to -44.68%     

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

2011

     0.65% to 2.80%        4,453,401        7.21 to 16.61        83,075,727        0.37%        -32.77% to -34.23%     

2010

     0.65% to 2.80%        5,924,822        10.72 to 25.25        165,454,474        0.57%        24.22% to 21.53%     

2009

     0.65% to 3.25%        8,647,430        8.63 to 20.24        194,404,524        0.41%        77.91% to 73.25%     

2008

     0.65% to 3.25%        8,802,005        4.85 to 11.68        113,283,262        2.77%        -52.52% to -53.77%     

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     Contract
Expense
Rate*		      Units      Unit
Fair
Value		      Contract
Owners’
Equity		      Investment
Income
Ratio**		      Total
Return***		      Inception
Date****

Managed Allocation Fund - Moderate Growth II (obsolete) (VFMG2)

2011

      1.15% to 2.20%         293,739       $  11.34 to $ 10.46       $ 3,311,354         1.57%         -6.59% to -7.58%      

2010

      1.15% to 2.35%         334,971         12.14 to 11.20         4,073,490         0.67%         9.28% to 7.96%      

2009

      1.15% to 2.35%         407,960         11.11 to 10.37         4,554,149         0.01%         24.18% to 22.67%      

2008

      1.15% to 2.60%         567,913         8.95 to 8.36         5,101,299         1.30%         -29.89% to -30.92%      

V.I. Capital Appreciation Fund - Series II (obsolete) (AVCA2)

2011

      0.80% to 2.95%         490,830         7.80 to 9.58         5,707,367         0.00%         -8.85% to -10.82%      

2010

      0.80% to 2.95%         579,187         8.56 to 10.74         7,427,438         0.51%         14.28% to 11.81%      

2009

      0.80% to 2.95%         687,506         7.49 to 9.60         7,749,730         0.27%         19.75% to 17.16%      

2008

      0.80% to 2.95%         804,764         6.25 to 8.20         7,651,910         0.00%         -43.09% to -44.32%      

V.I. Capital Development Fund - Series II (obsolete) (AVCD2)

2011

      0.80% to 2.95%         1,414,528         8.85 to 13.36         22,791,109         0.00%         -8.11% to -10.10%      

2010

      0.80% to 2.95%         1,298,000         9.63 to 14.87         23,011,080         0.00%         17.52% to 14.98%      

2009

      0.80% to 3.00%         1,278,768         8.19 to 12.88         19,440,268         0.00%         40.85% to 37.73%      

2008

      0.80% to 3.00%         1,176,724         5.82 to 9.35         12,813,434         0.00%         -47.55% to -48.72%      

VIP Trust - Global Bond Fund: Class R1 (obsolete) (VWBFR)

2011

      0.80% to 1.40%         399,375         15.18 to 14.49         5,818,090         8.13%         7.28% to 6.63%      

2010

      0.80% to 1.40%         437,415         14.15 to 13.59         5,970,833         3.67%         5.35% to 4.71%      

2009

      0.80% to 1.40%         509,578         13.43 to 12.98         6,638,304         3.92%         5.13% to 4.50%      

2008

      0.80% to 1.40%         642,414         12.77 to 12.42         8,003,418         8.12%         2.87% to 2.25%      

VIP Trust - Emerging Markets Fund: Class R1 (obsolete) (VWEMR)

2011

      0.80% to 1.40%         551,256         21.46 to 20.49         11,367,873         1.24%         -26.35% to -26.79%      

2010

      0.80% to 1.40%         827,950         29.14 to 27.99         23,300,754         0.62%         25.85% to 25.09%      

2009

      0.80% to 1.40%         886,135         23.16 to 22.37         19,920,111         0.14%         111.69% to 110.41%      

2008

      0.80% to 1.40%         763,916         10.94 to 10.63         8,156,428         0.00%         -65.03% to -65.25%      

VIP Trust - Global Hard Assets Fund: Class R1 (obsolete) (VWHAR)

2011

      0.75% to 2.80%         3,469,671         9.84 to 9.50         54,489,679         1.02%         -17.02% to -18.74%      

2010

      0.75% to 2.80%         2,350,975         11.86 to 11.69         53,750,243         0.32%         18.57% to 16.94%       ****

2009

      0.80% to 1.40%         1,143,054         28.03 to 27.09         31,107,182         0.26%         56.36% to 55.41%      

2008

      0.80% to 1.40%         1,219,284         17.93 to 17.43         21,333,920         0.35%         -46.53% to -46.85%      

Advantage Funds Variable Trust - VT Large Company Growth Fund (obsolete) (WFVLCG)

2009

      1.60% to 2.20%         11,201         9.46 to 9.17         103,735         0.38%         41.08% to 40.22%      

2008

      1.75% to 2.20%         11,776         6.66 to 6.54         77,336         0.27%         -40.06% to -40.34%      

Advantage Funds Variable Trust - VT Money Market Fund (obsolete) (WFVMM)

2009

      1.15% to 1.60%         14,747         10.83 to 10.58         156,783         0.24%         -1.04% to -1.49%      

2008

      1.15% to 1.40%         20,154         10.95 to 10.84         218,444         1.76%         1.10% to 0.84%      

AllianceBernstein NVIT Global Fixed Income Fund - Class III (obsolete) (NVAGF3)

2010

      0.80% to 2.15%         288,563         12.20 to 11.92         3,481,331         6.20%         7.37% to 5.91%      

2009

      0.80% to 2.40%         155,699         11.36 to 11.24         1,760,194         6.49%         13.58% to 12.35%       ****

Balanced Portfolio - Class S Shares (obsolete) (ALBS)

2009

      0.95% to 1.05%         18,711         11.82 to 11.74         220,306         2.91%         27.28% to 27.15%      

2008

      0.95% to 1.45%         18,716         9.29 to 9.04         173,104         0.00%         -32.55% to -32.89%      

Clover Value Fund II - Service Shares (obsolete) (FALFS)

2009

      0.95% to 2.40%         86,156         9.69 to 10.39         924,331         2.19%         13.42% to 11.76%      

2008

      0.95% to 2.75%         95,239         8.54         900,294         1.53%         -34.59% to -35.78%      

Credit Suisse Trust - International Equity Flex III Portfolio (obsolete) (CSIEF3)

2010

      0.80% to 1.40%         196,205         11.25 to 11.18         2,195,392         0.10%         11.33% to 10.66%      

2009

      0.80% to 1.40%         161,230         10.10         1,628,659         0.00%         1.04% to 1.01%       ****

Gartmore NVIT Global Utilities Fund - Class II (obsolete) (GVGU2)

2009

      1.15% to 2.10%         18,909         19.01 to 17.79         350,603         3.61%         6.47% to 5.45%      

2008

      1.15% to 2.10%         23,118         17.85 to 16.87         404,326         2.63%         -33.94% to -34.57%      

Gartmore NVIT Global Utilities Fund - Class III (obsolete) (GVGU)

2009

      0.80% to 1.40%         217,412         16.85 to 16.08         3,517,625         3.67%         7.11% to 6.47%      

2008

      0.80% to 1.40%         340,376         15.73 to 15.10         5,166,421         2.86%         -33.44% to -33.84%      

NVIT Worldwide Leaders Fund - Class III (obsolete) (GEF3)

2010

      0.80% to 1.40%         147,046         15.45 to 14.84         2,194,434         0.98%         10.47% to 9.80%      

2009

      0.80% to 1.40%         186,700         13.99 to 13.51         2,534,945         1.02%         24.00% to 23.25%      

2008

      0.80% to 1.40%         249,753         11.28 to 10.96         2,748,870         0.67%         -44.77% to -45.11%      

NVIT Worldwide Leaders Fund - Class VI (obsolete) (NVGWL6)

2010

      1.10% to 2.75%         152,509         14.65 to 14.25         2,217,538         1.20%         10.02% to 8.18%      

2009

      1.10% to 2.50%         41,212         13.32 to 13.19         546,984         0.90%         33.18% to 31.92%       ****

High Income Fund/VA - Class 3 (obsolete) (OVHI3)

2011

      0.80% to 1.40%         175,763         2.80 to 2.72         482,217         9.26%         -2.66% to -3.25%      

2010

      0.80% to 1.40%         196,791         2.88 to 2.81         557,028         4.97%         13.77% to 13.08%      

2009

      0.80% to 1.40%         153,077         2.53 to 2.49         382,251         0.00%         25.74% to 24.98%      

2008

      0.80% to 1.40%         126,679         2.01 to 1.99         252,740         4.88%         -79.06% to -79.19%      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     Contract
Expense
Rate*		      Units      Unit
Fair
Value		      Contract
Owners’
Equity		      Investment
Income
Ratio**		      Total
Return***		      Inception
Date****

High Income Fund/VA - Class 4 (obsolete) (OVHI4)

2011

      0.95% to 2.75%         2,632,631       $  2.79 to $ 2.56       $ 7,156,844         8.99%         -2.99% to -4.75%      

2010

      0.95% to 2.75%         2,685,043         2.88 to 2.69         7,562,792         5.30%         13.18% to 11.13%      

2009

      0.95% to 2.80%         2,841,679         2.54 to 2.42         7,101,139         0.00%         25.22% to 22.88%      

2008

      0.95% to 2.80%         2,070,239         2.03 to 1.97         4,158,939         5.83%         -78.83% to -79.23%      

High Income Fund/VA - Non-Service Shares (obsolete) (OVHI)

2011

      0.80% to 1.40%         7,881         3.03 to 2.93         23,296         12.77%         -3.12% to -3.70%      

2010

      0.80% to 1.40%         16,199         3.13 to 3.04         49,546         6.11%         13.90% to 13.21%      

2009

      0.80% to 1.40%         16,502         2.75 to 2.69         44,537         0.00%         24.31% to 23.56%      

2008

      0.80% to 1.40%         23,524         2.21 to 2.18         51,336         8.75%         -78.84% to -78.97%      

High Income Fund/VA - Service Class (obsolete) (OVHIS)

2011

      0.95% to 2.35%         642,234         3.60         2,495,365         9.54%         -3.48% to -4.84%      

2010

      0.95% to 2.70%         856,240         3.73 to 3.68         3,456,019         6.12%         13.35% to 11.35%      

2009

      0.95% to 2.70%         1,019,129         3.29 to 3.31         3,646,990         0.00%         24.75% to 22.55%      

2008

      0.95% to 2.70%         1,274,342         2.64 to 2.70         3,677,309         7.68%         -78.78% to -79.15%      

International Equity Flex I Portfolio (obsolete) (WIEP)

2008

      0.80% to 1.40%         1,761,884         10.95 to 10.40         18,463,105         1.68%         -41.51% to -41.86%      

International Equity Flex II Portfolio (obsolete) (WVCP)

2008

      0.80% to 1.40%         184,626         8.13 to 7.56         1,407,276         1.73%         -47.18% to -47.50%      

J.P. Morgan NVIT Balanced Fund - Class I (obsolete) (BF)

2008

      0.80% to 1.40%         243,504         9.34 to 9.08         2,218,666         2.75%         -26.14% to -26.59%      

INTECH Risk-Managed Core Portfolio - Service Shares (obsolete) (JARLCS)

2008

      0.80% to 2.60%         333,684         6.32 to 10.35         3,604,801         0.69%         -36.75% to -37.90%      

Large Cap Growth Fund II (obsolete) (VFLG2)

2008

      1.15% to 2.35%         85,778         7.46 to 7.05         641,766         0.42%         -39.76% to -40.49%      

Large Cap Value Fund II (obsolete) (VFLV2)

2008

      1.15% to 2.40%         105,574         8.62 to 8.13         912,662         1.27%         -40.10% to -40.86%      

Managed Allocation Fund - Aggressive Growth II (obsolete) (MBVAG2)

2008

      1.15% to 1.85%         22,130         7.61 to 7.42         166,461         0.45%         -41.31% to -41.73%      

Managed Allocation Fund - Conservative Growth II (obsolete) (MBVCG2)

2008

      1.15% to 1.75%         22,506         8.94 to 8.74         198,924         2.65%         -20.62% to -21.10%      

Market Opportunity Fund II - Service Shares (obsolete) (FVMOS)

2009

      0.80% to 2.65%         746,449         9.98 to 9.32         7,250,437         1.52%         0.47% to -1.40%      

2008

      0.80% to 2.80%         918,459         9.94 to 9.41         8,951,034         1.07%         -1.66% to -3.64%      

NVIT Global Financial Services Fund - Class II (obsolete) (GVGF2)

2009

      0.95% to 2.15%         47,904         12.37 to 13.90         694,038         0.89%         30.29% to 28.71%      

2008

      0.95% to 2.15%         55,720         9.49 to 10.80         623,060         1.65%         -46.85% to -47.50%      

NVIT Global Financial Services Fund - Class III (obsolete) (GVGFS)

2009

      0.80% to 1.40%         176,927         13.10 to 12.50         2,227,534         1.11%         30.88% to 30.08%      

2008

      0.80% to 1.40%         212,769         10.01 to 9.61         2,057,788         2.14%         -46.64% to -46.97%      

NVIT Health Sciences Fund - Class II (obsolete) (GVGH2)

2009

      0.95% to 2.40%         84,308         12.16 to 14.17         1,265,201         0.14%         17.71% to 15.99%      

2008

      0.95% to 2.40%         104,433         10.33 to 12.22         1,341,247         0.10%         -26.11% to -27.19%      

NVIT Health Sciences Fund - Class III (obsolete) (GVGHS)

2009

      0.80% to 1.40%         342,864         13.00 to 12.41         4,280,780         0.29%         18.16% to 17.45%      

2008

      0.80% to 1.40%         425,425         11.01 to 10.57         4,518,907         0.27%         -25.83% to -26.28%      

NVIT Health Sciences Fund - Class VI (obsolete) (GVGH6)

2009

      0.95% to 2.75%         1,400,047         10.46 to 9.43         14,121,966         0.15%         17.83% to 15.69%      

2008

      0.95% to 2.60%         1,764,395         8.88 to 8.21         15,216,848         0.03%         -26.15% to -27.38%      

NVIT Leaders Fund - Class III (obsolete) (GVUSL)

2009

      0.80% to 1.40%         257,511         11.35 to 10.83         2,809,711         0.84%         32.82% to 32.02%      

2008

      0.80% to 1.40%         344,880         8.54 to 8.20         2,847,343         0.77%         -50.34% to -50.64%      

NVIT Mid Cap Growth Fund - Class I (obsolete) (SGRF)

2008

      0.80% to 1.40%         1,380,783         3.82 to 3.63         5,042,610         0.00%         -46.54% to -46.87%      

NVIT Mid Cap Growth Fund - Class II (obsolete) (SGRF2)

2008

      0.95% to 3.20%         2,006,297         8.26 to 8.54         18,751,282         0.00%         -46.79% to -48.01%      

NVIT Technology & Communications Fund - Class I (obsolete) (GGTC)

2009

      0.80% to 1.40%         59,032         3.09 to 2.92         173,754         0.00%         51.25% to 50.33%      

2008

      0.80% to 1.40%         69,320         2.04 to 1.94         135,605         0.00%         -48.98% to -49.29%      

NVIT Technology & Communications Fund - Class II (obsolete) (GGTC2)

2009

      1.15% to 2.45%         49,650         15.30 to 13.97         742,990         0.00%         50.52% to 48.54%      

2008

      1.15% to 2.45%         59,489         10.17 to 9.41         593,313         0.00%         -49.38% to -50.05%      

NVIT Technology & Communications Fund - Class III (obsolete) (GGTC3)

2009

      0.80% to 1.40%         503,843         11.39 to 10.87         5,508,883         0.00%         51.23% to 50.31%      

2008

      0.80% to 1.40%         328,516         7.53 to 7.23         2,390,551         0.00%         -49.00% to -49.31%      

NVIT Technology & Communications Fund - Class VI (obsolete) (GGTC6)

2009

      0.95% to 2.80%         1,441,431         10.73 to 9.64         14,877,466         0.00%         51.04% to 48.22%      

2008

      0.95% to 2.80%         677,283         7.10 to 6.50         4,669,470         0.00%         -49.29% to -50.25%      

 

(Continued)

Table of Contents

NATIONWIDE VARIABLE ACCOUNT-II NOTES TO FINANCIAL STATEMENTS December 31, 2012

 

     Contract
Expense
Rate*		      Units      Unit
Fair
Value		      Contract
Owners’
Equity		      Investment
Income
Ratio**		      Total
Return***		      Inception
Date****

NVIT U.S. Growth Leaders Fund - Class II (obsolete) (GVUG2)

2009

      0.95% to 2.95%         964,339       $  8.10 to $ 12.26       $ 14,596,668         0.00%         24.49% to 21.97%      

2008

      0.95% to 2.95%         1,047,552         6.51 to 10.06         12,820,073         0.00%         -42.03% to -43.20%      

NVIT U.S. Growth Leaders Fund - Class III (obsolete) (GVUGL)

2009

      0.80% to 1.40%         188,997         13.43 to 12.82         2,437,489         0.00%         24.78% to 24.03%      

2008

      0.80% to 1.40%         270,231         10.76 to 10.33         2,805,775         0.00%         -41.73% to -42.08%      

Series Trust II - Mid Cap Value Portfolio (obsolete) (JPMCVP)

2008

      0.80% to 1.40%         654,300         9.66 to 9.39         6,164,916         1.13%         -33.74% to -34.14%      

U.S. Equity Flex I Portfolio (obsolete) (WSCP)

2010

      0.80% to 1.40%         2,155,736         15.16 to 15.42         33,594,652         0.15%         13.54% to 12.86%      

2009

      0.80% to 1.40%         2,532,513         13.36 to 13.66         34,947,501         1.16%         23.67% to 22.92%      

2008

      0.80% to 1.40%         2,973,366         10.80 to 11.11         33,357,355         0.08%         -35.12% to -35.52%      

Variable Contracts Trust - Small Cap Value VCT Portfolio - Class I Shares (obsolete) (PISVP1)

  

   

2008

      0.95% to 1.05%         105,733         6.12 to 6.10         646,042         0.60%         -38.59% to -38.65%      

2012

      Reserves for annuity contracts in payout phase:         8,281,156            

2012

      Contract owners equity:             $ 33,972,994,748            

2011

      Reserves for annuity contracts in payout phase:         8,361,300            

2011

      Contract owners equity:             $ 29,793,903,432            

2010

      Reserves for annuity contracts in payout phase:         8,598,792            

2010

      Contract owners equity:             $ 26,665,526,554            

2009

      Reserves for annuity contracts in payout phase:         8,394,197            

2009

      Contract owners equity:             $ 21,471,280,300            

2008

      Reserves for annuity contracts in payout phase:         7,453,205            

2008

      Contract owners equity:             $ 16,006,481,073            

 

*   This represents the range of annual contract expense rates 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 contract owner accounts through reductions in unit values. The recognition of investment income by the subaccount is affected by the timing of the declaration of dividends by the underlying fund in which the subaccounts invest.
***   This represents the range of minimum and maximum total returns for the period indicated, including changes in the value of the underlying mutual fund, which reflects the reduction of unit values for expenses assessed. 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. Minimum and maximum ranges are not shown for underlying mutual fund options for which a single contract expense rate (product option) exists. In such cases, the total return presented is representative of all units issued and outstanding at period end.
****   Subaccounts denoted indicate the underlying mutual fund option was initially added and funded during the period presented.

 

Table of Contents

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholder

Nationwide Life Insurance Company:

We have audited the accompanying consolidated balance sheets of Nationwide Life Insurance Company and subsidiaries (the Company) as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive income (loss), changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2012. 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 financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Nationwide Life Insurance Company and subsidiaries as of December 31, 2012 and 2011, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2012, 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.

As discussed in Note 2 to the consolidated financial statements, in 2012 the Company changed its method of accounting for insurance contract acquisition costs and applied the new method retrospectively.

/s/ KPMG LLP

Columbus, Ohio

March 1, 2013

 

1

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Consolidated Statements of Operations

(in millions)

 

                                                        
     Year ended December 31,  
     2012     2011     2010  
           (As Adjusted)     (As Adjusted)  

Revenues

       

Policy charges

    $ 1,670      $ 1,506      $ 1,399   

Premiums

      635        531        484   

Net investment income

      1,825        1,844        1,825   

Net realized investment gains (losses)

      350        (1,609 )      (236 ) 

Other-than-temporary impairment losses

       

Total other-than-temporary impairment losses

      (67 )      (162 )      (394 ) 

Non-credit portion of loss recognized in other comprehensive income

      36        95        174   

Net other-than-temporary impairment losses recognized in operations

      (31 )      (67 )      (220 ) 

Other revenues

      7        3        2   
  

 

 

    

 

 

    

 

 

  

Total revenues

    $ 4,456      $ 2,208      $ 3,254   
  

 

 

    

 

 

    

 

 

  

Benefits and expenses

       

Interest credited to policyholder account values

    $ 1,038      $ 1,033      $ 1,056   

Benefits and claims

      1,227        1,062        873   

Policyholder dividends

      54        67        78   

Amortization of deferred policy acquisition costs

      575        65        299   

Interest expense

      68        70        55   

Other expenses, net of deferrals

      795        760        722   
  

 

 

    

 

 

    

 

 

  

Total benefits and expenses

    $ 3,757      $ 3,057      $ 3,083   
  

 

 

    

 

 

    

 

 

  

Income (loss) before federal income taxes and noncontrolling interests

    $ 699      $ (849 )    $ 171   

Federal income tax expense (benefit)

      99        (427 )      12   
  

 

 

    

 

 

    

 

 

  

Net income (loss)

    $ 600      $ (422 )    $ 159   

Less: Loss attributable to noncontrolling interest, net of tax

      (61 )      (56 )      (60 ) 
  

 

 

    

 

 

    

 

 

  

Net income (loss) attributable to Nationwide Life Insurance Company

    $ 661      $ (366 )    $ 219   
  

 

 

    

 

 

    

 

 

  

See accompanying notes to consolidated financial statements and Note 2 for disclosure of the change in accounting principle.

 

2

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Consolidated Statements of Comprehensive Income (Loss)

(in millions)

 

                                                        
     Year ended December 31,  
     2012     2011     2010  
           (As Adjusted)     (As Adjusted)  

Net income (loss)

    $ 600      $ (422 )    $ 159   
  

 

 

    

 

 

    

 

 

  

Other comprehensive income, net of tax

       

Changes in:

       

Net unrealized gains on available-for-sale securities

      571        317        600   

Net unrealized (losses) gains on derivatives used in cash flow hedging relationships

      (5 )      12        18   
  

 

 

    

 

 

    

 

 

  

Total other comprehensive income, net of tax

    $ 566      $ 329      $ 618   
  

 

 

    

 

 

    

 

 

  

Total comprehensive income (loss)

    $ 1,166      $ (93 )    $ 777   
  

 

 

    

 

 

    

 

 

  

Less: Comprehensive loss attributable to noncontrolling interests, net of tax

      (61 )      (56 )      (60 ) 
  

 

 

    

 

 

    

 

 

  

Total comprehensive income (loss) attributable to Nationwide Life Insurance Company

    $ 1,227      $ (37 )    $ 837   
  

 

 

    

 

 

    

 

 

  

See accompanying notes to consolidated financial statements and Note 2 for disclosure of the change in accounting principle.

 

3

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Consolidated Balance Sheets

(in millions, except for share and per share amounts)

 

                                     
     December 31,  
     2012      2011  
            (As Adjusted)  

Assets

      

Investments

      

Fixed maturity securities, available-for-sale

    $ 31,811       $ 29,201   

Mortgage loans, net of allowance

      5,827         5,748   

Policy loans

      980         1,008   

Short-term investments

      1,034         1,125   

Other investments

      639         586   
  

 

 

     

 

 

  

Total investments

    $ 40,291       $ 37,668   

Cash and cash equivalents

      62         49   

Accrued investment income

      566         560   

Deferred policy acquisition costs

      3,249         3,487   

Value of business acquired

      224         238   

Goodwill

      200         200   

Other assets

      4,138         4,590   

Separate account assets

      71,440         65,194   
  

 

 

     

 

 

  

Total assets

    $ 120,170       $ 111,986   
  

 

 

     

 

 

  

Liabilities and equity

      

Liabilities

      

Future policy benefits and claims

    $ 36,154       $ 35,252   

Short-term debt

      300         777   

Long-term debt

      1,038         991   

Other liabilities

      4,507         4,230   

Separate account liabilities

      71,440         65,194   
  

 

 

     

 

 

  

Total liabilities

    $ 113,439       $ 106,444   
  

 

 

     

 

 

  

Shareholder’s equity

      

Common stock ($1 par value; authorized - 5,000,000 shares, issued and outstanding - 3,814,779 shares)

    $ 4       $ 4   

Additional paid-in capital

      1,718         1,718   

Retained earnings

      3,410         2,789   

Accumulated other comprehensive income

      1,252         686   
  

 

 

     

 

 

  

Total shareholder’s equity

    $ 6,384       $ 5,197   

Noncontrolling interest

      347         345   
  

 

 

     

 

 

  

Total equity

    $ 6,731       $ 5,542   
  

 

 

     

 

 

  

Total liabilities and equity

    $ 120,170       $ 111,986   
  

 

 

     

 

 

  

See accompanying notes to consolidated financial statements and Note 2 for disclosure of the change in accounting principle.

 

4

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Consolidated Statements of Changes in Equity

(in millions)

 

     Common
stock		      Additional
paid-in
capital		      Retained
earnings		     Accumulated
other
comprehensive
income (loss)		     Total
shareholder’s
equity		     Non-controlling
interest		     Total
equity		  

Balance as of December 31, 2009

    $ 4       $ 1,718       $ 3,510      $ (266 )    $ 4,966      $ 351      $ 5,317   

Cumulative effect of adoption of accounting principle

    $ —         $ —         $ (565 )    $ (4 )    $ (569 )    $ —        $ (569 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted balance as of December 31, 2009

    $ 4       $ 1,718       $ 2,945      $ (270 )    $ 4,397      $ 351      $ 4,748   

Cumulative effect of adoption of accounting principle

      —           —           (9 )      9        —          46        46   

Comprehensive income (loss):

                 

Net income (loss)

      —           —           219        —          219        (60 )      159   

Other comprehensive income

      —           —           —          618        618        —          618   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total comprehensive income (loss)

      —           —           219        618        837        (60 )      777   

Change in noncontrolling interest

      —           —           —          —          —          18        18   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Balance as of December 31, 2010

    $ 4       $ 1,718       $ 3,155      $ 357      $ 5,234      $ 355      $ 5,589   

Comprehensive (loss) income:

                 

Net loss

      —           —           (366 )      —          (366 )      (56 )      (422 ) 

Other comprehensive income

      —           —           —          329        329        —          329   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total comprehensive (loss) income

      —           —           (366 )      329        (37 )      (56 )      (93 ) 

Change in noncontrolling interest

      —           —           —          —          —          46        46   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Balance as of December 31, 2011

    $ 4       $ 1,718       $ 2,789      $ 686      $ 5,197      $ 345      $ 5,542   

Cash dividend paid

      —           —           (40 )      —          (40 )      —          (40 ) 

Comprehensive income (loss):

                 

Net income (loss)

      —           —           661        —          661        (61 )      600   

Other comprehensive income

      —           —           —          566        566        —          566   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total comprehensive income (loss)

      —           —           661        566        1,227        (61 )      1,166   

Change in noncontrolling interest

      —           —           —          —          —          63        63   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Balance as of December 31, 2012

    $ 4       $ 1,718       $ 3,410      $ 1,252      $ 6,384      $ 347      $ 6,731   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

See accompanying notes to consolidated financial statements and Note 2 for disclosure of the change in accounting principle.

 

5

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Consolidated Statements of Cash Flows

(in millions)

 

                                                        
     Year ended December 31,  
     2012     2011     2010  
           (As Adjusted)     (As Adjusted)  

Cash flows from operating activities:

       

Net income (loss)

    $ 600      $ (422 )    $ 159   

Adjustments to net income (loss):

       

Net realized investment (gains) losses

      (350 )      1,609        236   

Net other-than-temporary impairment losses recognized in earnings

      31        67        220   

Interest credited to policyholder account values

      1,038        1,033        1,056   

Capitalization of deferred policy acquisition costs

      (470 )      (604 )      (501 ) 

Amortization of deferred policy acquisition costs

      575        65        299   

Amortization and depreciation

      80        48        (2 ) 

Deferred tax expense (benefit)

      243        (482 )      103   

Changes in:

       

Policy liabilities

      (548 )      (608 )      (579 ) 

Derivatives, net

      (490 )      (364 )      (254 ) 

Other, net

      (84 )      (265 )      (51 ) 
  

 

 

    

 

 

    

 

 

  

Net cash provided by operating activities

    $ 625      $ 77      $ 686   
  

 

 

    

 

 

    

 

 

  

Cash flows from investing activities:

       

Proceeds from maturity of available-for-sale securities

    $ 2,909      $ 2,705      $ 3,251   

Proceeds from sales of available-for-sale securities

      796        1,585        2,168   

Purchases of available-for-sale securities

      (5,167 )      (6,176 )      (5,910 ) 

Proceeds from repayments of mortgage loans

      1,048        1,124        996   

Issuance and purchases of mortgage loans

      (1,114 )      (751 )      (373 ) 

Net decrease (increase) in short-term investments

      98        (61 )      (44 ) 

Collateral (paid) received, net

      (208 )      359        (23 ) 

Other, net

      (12 )      104        (29 ) 
  

 

 

    

 

 

    

 

 

  

Net cash (used in) provided by investing activities

    $ (1,650 )    $ (1,111 )    $ 36   
  

 

 

    

 

 

    

 

 

  

Cash flows from financing activities:

       

Net change in short-term debt

    $ (477 )    $ 477      $ 150   

Proceeds from issuance of long-term debt

      13        13        272   

Cash dividend paid to Nationwide Financial Services, Inc.

      (40 )      —          —     

Investment and universal life insurance product deposits

      5,566        5,314        4,540   

Investment and universal life insurance product withdrawals

      (4,063 )      (5,024 )      (5,405 ) 

Other, net

      39        (34 )      9   
  

 

 

    

 

 

    

 

 

  

Net cash provided by (used in) financing activities

    $ 1,038      $ 746      $ (434 ) 
  

 

 

    

 

 

    

 

 

  

Net increase (decrease) in cash and cash equivalents

    $ 13      $ (288 )    $ 288   

Cash and cash equivalents, beginning of period

      49        337        49   
  

 

 

    

 

 

    

 

 

  

Cash and cash equivalents, end of period

    $ 62      $ 49      $ 337   
  

 

 

    

 

 

    

 

 

  

See accompanying notes to consolidated financial statements and Note 2 for disclosure of the change in accounting principle.

 

6

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements

December 31, 2012, 2011 and 2010

 

(1) Nature of Operations

Nationwide Life Insurance Company (“NLIC”, or collectively with its subsidiaries, “the Company”) was incorporated in 1929 and is an Ohio domiciled stock life insurance company. The Company is a member of the Nationwide group of companies (“Nationwide”), which is comprised of Nationwide Mutual Insurance Company (“NMIC”) and all of its subsidiaries and affiliates.

All of the outstanding shares of NLIC’s common stock are owned by Nationwide Financial Services, Inc. (“NFS”), a holding company formed by Nationwide Corporation (“Nationwide Corp.”), a majority-owned subsidiary of NMIC.

Wholly-owned subsidiaries of NLIC as of December 31, 2012 include Nationwide Life and Annuity Insurance Company (“NLAIC”) and Nationwide Investment Services Corporation (“NISC”). NLAIC primarily offers universal life insurance, variable universal life insurance, term life insurance, corporate-owned life insurance (“COLI”) and individual annuity contracts on a non-participating basis. NISC is a registered broker-dealer.

The Company is a leading provider of long-term savings and retirement products in the United States (“U.S.”). The Company develops and sells a diverse range of products and services including individual annuities, private and public sector group retirement plans, investment products sold to institutions, life insurance and advisory services.

The Company sells its products through a diverse distribution network. Unaffiliated entities that sell the Company’s products to their own customer bases include independent broker-dealers, financial institutions, wirehouse and regional firms, pension plan administrators and life insurance specialists. Representatives of affiliates who market products directly to a customer base include Nationwide Retirement Solutions, Inc. (“NRS”) and Nationwide Financial Network (“NFN”) producers, which includes the agency distribution force of the Company’s ultimate parent company, NMIC.

As of December 31, 2012 and 2011, the Company did not have a significant concentration of financial instruments in a single investee, industry or geographic region of the 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

Basis of Presentation

The consolidated financial statements include the accounts of NLIC and companies in which NLIC directly or indirectly has a controlling financial interest. The consolidated financial statements include majority-owned subsidiaries and consolidated variable interest entities (“VIEs”). All significant intercompany accounts and transactions have been eliminated.

Entities in which NLIC does not have a controlling interest, but the Company has significant influence over the operating and financing decisions and also certain other investments, are reported using the equity method.

Use of Estimates

The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”). The preparation of the consolidated financial statements in accordance with GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Significant estimates include the balance and amortization of deferred policy acquisition costs (“DAC”), investment impairment losses, valuation allowances for mortgage loans, certain investment and derivative valuations, future policy benefits and claims including the valuation of embedded derivatives resulting from living benefit guarantees on variable annuity contracts, goodwill, provision for income taxes and valuation of deferred tax assets. Actual results could differ significantly from those estimates.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Revenues and Benefits

Investment and universal life insurance products. Investment products are long duration contracts which are not subject to significant mortality (the relative incidence of death in a given time) or morbidity (the relative incidence of disability resulting from disease or physical impairment) risk. These include individual and group variable and fixed deferred annuities in the accumulation phase and certain annuities without life contingencies. Universal life insurance products include long duration insurance contracts that do not have fixed or guaranteed terms. These include universal life insurance, variable universal life insurance, COLI, bank-owned life insurance (“BOLI”) and other interest-sensitive life insurance policies. Revenues for investment products and universal life insurance products consist of net investment income, surrender charges and other policy charges earned and assessed against policy account balances during the period. Policy charges are assessed on a daily or monthly basis and recognized as revenue when assessed and earned. Assessments for services provided in future periods are recorded as unearned revenue and recognized as revenue over the periods benefited. Surrender charges are recognized as revenue upon surrender of a contract in accordance with contractual terms. Policy benefits and claims that are charged to expense include interest credited to policyholder accounts and benefits and claims incurred in the period in excess of related policyholder accounts.

Traditional life insurance products. Traditional life insurance products include those products with fixed and guaranteed terms, primarily consisting of whole life insurance, term life insurance and certain annuities with life contingencies. Premiums for traditional life insurance products are generally recognized as revenue when due. For certain annuities with life contingencies, any excess of gross premium over the net premium is deferred and recognized with the amount of expected future benefits. Benefits and expenses are associated with earned premiums so that profits are recognized over the life of the contract. This association is accomplished through the provision for future policy benefits and the deferral and amortization of policy acquisition costs.

Future Policy Benefits and Claims

Investment and universal life insurance products. The Company calculates its liability for future policy benefits and claims for investment products in the accumulation phase and for universal life insurance policies as the policy accrued account balance, which represents participants’ net deposits plus investment performance and interest credited less applicable contract charges.

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 secondary 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 benefit payments and assessments are based on a range of scenarios and assumptions including those related to market rates of return and volatility, contract surrenders and mortality experience. The accounting for these guarantees impacts estimated gross profits used to calculate the balance and amortization of DAC, value of business acquired (“VOBA”) and unearned revenue reserves. Refer to Note 4 for discussion of these guarantees.

Guarantees to variable annuity contractholders can include a return of no less than total deposits made on the contract less any customer withdrawals, total deposits made on the contract less any customer withdrawals plus a minimum return, or the highest contract value on a specified anniversary date minus any customer withdrawals following the contract anniversary. In addition, these guarantees can include benefits payable in the event of death, upon annuitization, upon periodic withdrawal or at specified dates during the accumulation period. Refer to Note 4 for a discussion of these guarantees.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The Company’s guaranteed minimum accumulation benefit (“GMAB”) and guaranteed living withdrawal benefit (“GLWB”) are living benefit guarantees which represent embedded derivatives in variable annuity contracts that are required to be separated from, and valued apart from, the host variable annuity contracts. The embedded derivatives are carried at fair value. Subsequent changes in the fair value of the embedded derivatives are recognized in earnings as a component of net realized investment gains and losses. The fair value of the embedded derivatives is calculated based on a combination of capital market and actuarial assumptions. Projections of cash flows inherent in the valuation of the embedded derivative incorporate numerous assumptions including, but not limited to, mortality, lapse rates, index volatility, wait period (the number of years the policyholder is assumed to wait prior to beginning withdrawals once eligible), efficiency of benefit utilization (the percent of the maximum permitted withdrawal that a policyholder takes) and non-performance risk (the risk that the liability will not be fulfilled and affects the value at which the liability is transferred). The assumptions used to calculate the fair value of embedded derivatives are reviewed as part of an annual comprehensive study of assumptions during the second quarter. Quarterly, consideration is given as to whether adjustments to these assumptions are necessary.

Traditional life insurance products. The process of calculating reserve amounts for traditional life insurance products involves the use of a number of assumptions, including those related to persistency, mortality, morbidity, interest rates (the rates expected to be paid or received on financial instruments) and certain other expenses.

The liability for future policy benefits and claims for traditional life insurance policies was determined using the net level premium method with weighted average interest rates of 6.6% and estimates of mortality, morbidity, investment yields and persistency that were used or being experienced at the time the policies were issued with a provision for adverse deviation.

The liability for future policy benefits for certain annuities with life contingencies was calculated using the present value of future benefits and certain expenses discounted using weighted average interest rates of 5.6% with a provision for adverse deviation.

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

The Company has deferred certain acquisition costs that are directly related to the successful acquisition of new and renewal insurance and investment contracts. The methods and assumptions used to amortize and assess recoverability of the DAC balance depend on the type of product.

Investment and universal life insurance products. For certain investment and universal life insurance products, DAC is amortized with interest over the lives of the policies in relation to the present value of estimated gross profits, which is determined primarily from projected interest margins, policy charges and net realized investment gains and losses, less policy benefits and other expenses. The DAC asset related to investment and universal life insurance products is adjusted to reflect the impact of unrealized gains and losses on available-for-sale securities with the corresponding adjustment recorded in accumulated other comprehensive income (“AOCI”). This adjustment to DAC represents the change in amortization that would have been required as a charge or credit to operations had such unrealized amounts been realized. 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.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The assumptions used in the estimation of gross profits are based on the Company’s current best estimates of future events and are reviewed as part of an annual 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, renewal premiums and mortality. Quarterly, consideration is given as to whether adjustments to these assumptions are necessary. The Company uses a reversion to the mean process to determine the assumption for the future net separate account investment performance. This process assumes different performance levels over the next three years such that the separate account mean return measured from the anchor date to the end of the life of the product equals the long-term assumption. The Company’s long-term assumption for net separate account investment performance is approximately 7% growth per year.

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.

Traditional life insurance. DAC is amortized with interest over the premium-paying period of the related policies in proportion to premium revenue recognized. These assumptions are consistent with those used in the calculation of liabilities for future policy benefits at issuance. DAC is evaluated for recoverability at the time of policy issuance, and loss recognition testing is conducted each reporting period.

Refer to Note 5 for discussion regarding assumption changes impacting DAC amortization and related balances.

Investments

Purchases and sales of securities are recorded on the trade date. Realized gains and losses on sales of available-for-sale securities are recognized in income based on the specific identification method. Interest and dividend income is recognized when earned.

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 and other, future policy benefits and claims, policyholder dividend obligations 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, 2012 and 2011, 86% and 84%, respectively, of fixed maturity securities were priced using independent pricing services.

A corporate pricing matrix or an internally developed pricing model is used in valuing certain corporate debt securities. 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.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

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, corporate pricing matrix or internal pricing models. These securities are classified with the lowest priority in the fair value hierarchy as only one broker quote is ordinarily obtained, the investment is not traded on an exchange, the pricing is not available to other entities and/or the transaction volume in the same or similar investments has decreased. Inputs used in the development of prices are not provided to the Company by the brokers as the brokers often do not provide the necessary transparency into their quotes and methodologies. The Company performs reviews and tests to ensure that quotes are a reasonable estimate of the investments’ fair value at least annually. Price movements of broker quotes are subject to validation and require approval from the Company’s management. Management uses its knowledge of the investment and current market conditions to determine if the price is indicative of the investment’s fair value.

When the collectability of contractual interest payments on fixed maturity securities is considered doubtful, such securities are placed in non-accrual status and any accrued interest is excluded from investment income. These securities are not restored to accrual status until the Company determines that 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 in the period the estimates are revised. All other investment income is recorded using the effective-yield method without anticipating the impact of prepayments.

The Company periodically reviews its available-for-sale securities to determine if any decline in fair value to below amortized cost is other-than-temporary. Factors considered in determining whether a decline is other-than-temporary include the length of time a security has been in an unrealized loss position, the severity of the unrealized loss, reasons for the decline in value and expectations for the amount and timing of a recovery in fair value.

In assessing corporate debt securities for other-than-temporary impairment, the Company evaluates the ability of the issuer to meet its debt obligations, the value of the company or specific collateral securing the debt, the Company’s intent to sell the security and whether it is more likely than not the Company will be required to sell the security before the recovery of its amortized cost basis. The Company evaluates U.S. Treasury securities and obligations of U.S. Government corporations and agencies, obligations of states and political subdivisions, and debt securities issued by foreign governments for other-than-temporary impairment by examining similar characteristics.

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.

The Company evaluates its intent to sell on an individual security 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. 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.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

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.

Mortgage loans, net of allowance. The Company holds commercial mortgage loans that are collateralized by properties throughout the U.S. These mortgage loans are further segregated into the following classes based on the unique risk profiles of the underlying property types: office, warehouse, retail, apartment and other. Mortgage loans are carried at amortized cost less a valuation allowance.

As part of the underwriting process, specific guidelines are followed to ensure the initial quality of a new mortgage loan. Third-party appraisals are generally obtained to support loaned amounts as the loans are usually collateral dependent.

The collectability and value of a mortgage loan are based on the ability of the borrower to repay and/or the value of the underlying collateral. Many of the 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.

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 through special surveillance procedures and are evaluated 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 difference between the carrying value and either the fair value of the collateral or the present value of expected future cash flows discounted at the loan’s market interest rate. Loan-specific impairment reserve charges are recorded in other-than-temporary impairment losses. In the event a loan-specific impairment reserve charge is reversed, the recovery is recorded in other-than-temporary impairment losses.

In addition to the loan-specific reserves, the Company maintains a non-specific reserve based on loan surveillance categories and property type classes, which 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. Non-specific reserve charges 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 maturities of twelve months or less at acquisition. 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.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Other investments. Other investments consist primarily of equity method investments in joint ventures and partnerships, customer bank loans, equity securities, capital stock with the Federal Home Loan Bank of Cincinnati (“FHLB”) and trading securities.

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 recognizes loaned securities in either available-for-sale or short-term investments. A securities lending payable is recorded in other liabilities for the amount of cash collateral received. Net income received from securities lending activities is included in net investment income.

Variable interest entities. In the normal course of business, the Company has relationships with VIEs. If the Company determines that it has a variable interest and is the primary beneficiary, it consolidates the VIE. This determination is based on a review of the entity’s contract and other deal related information, such as the entity’s equity investment at risk, decision-making abilities, obligations to absorb economic risks and right to receive economic rewards of the entity. The Company is the primary beneficiary if the Company has the power to direct the activities of the VIE that most significantly impact the economic performance of the entity and the obligation to absorb losses or receive benefits from the entity that could be potentially significant to the VIE.

The majority of the VIEs consolidated by the Company are related to guarantees provided to limited partners related to the amount of tax credits that will be generated by the Low-Income-Housing Tax Credit Funds (“Tax Credit Funds”). The results of operations and financial position of each VIE for which the Company is the primary beneficiary as well as the corresponding noncontrolling interests are recorded in the accompanying consolidated financial statements. Ownership interests held by unrelated third parties in the consolidated VIEs are presented as noncontrolling interests in the equity section of the consolidated financial statements. Income (loss) attributable to noncontrolling interests is excluded from the net income (loss) attributable to NLIC on the consolidated statements of operations.

The Company invests in fixed maturity securities that could qualify as VIEs, including corporate securities, mortgage-backed securities and asset-backed securities. The Company is not the primary beneficiary of these securities as the Company does not have the power to direct the activities that most significantly impact the entities’ performance. The Company’s maximum exposure to loss is limited to the carrying values of these securities. There are no liquidity arrangements, guarantees or other commitments by third parties that affect the fair value of the Company’s interest in these assets. Refer to Note 6 for additional disclosures related to these investments.

The Company is not required, and does not intend, to provide financial or other support outside contractual requirements to any VIE.

Derivative Instruments

The Company uses derivative instruments to manage exposures and mitigate risks associated with interest rates, equity markets, foreign currency and credit. These derivative instruments primarily include interest rate swaps, futures contracts and options. Certain features embedded in the Company’s investments, indexed products and certain variable annuity contracts require derivative accounting. Refer to the prior discussion of Future Policy Benefits and Claims for a description of the valuation applicable to these products. All derivative instruments are carried at fair value and are reflected as assets or liabilities in the consolidated balance sheets.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Fair value of derivative instruments is determined using various valuation techniques relying predominately on observable market inputs. These inputs include interest rate swap curves, credit spreads, interest rates, counterparty credit risk, equity volatility and equity index levels. In cases where observable inputs are not available, the Company will utilize non-binding broker quotes to determine fair value. These instruments are classified with the lowest priority in the fair value hierarchy. Price movements of broker quotes are subject to validation and require approval from the Company’s management. Management uses models to internally value the instruments for comparison to the values received through broker quotes.

For derivatives that are not designated for hedge accounting, the gain or loss on the derivative is primarily recognized in net realized investment gains and losses.

For derivative instruments that are designated and qualify for fair value hedge accounting, the gain or loss on the derivative instrument as well as the hedged item, to the extent of the risk being hedged, are recognized in net realized investment gains and losses.

For derivative instruments that are designated and qualify for cash flow hedge accounting, the effective portion of the gain or loss on the derivative instrument is reported as a component of AOCI and reclassified into earnings in the same period or periods that the hedged transaction impacts earnings. The ineffective portion of the derivative’s change in value, if any, along with any of the derivative’s change in value that is excluded from the assessment of hedge effectiveness, are recorded in net realized investment gains and losses.

The Company’s derivative transaction counterparties are generally financial institutions. To reduce the credit risk associated with open contracts, the Company enters into master netting agreements which permit the closeout and netting of transactions with the same counterparty upon the occurrence of certain events. In addition, the Company attempts to reduce credit risk by obtaining collateral from counterparties. The determination of the need for and the levels of collateral vary based on an assessment of the credit risk of the counterparty. The Company accepts collateral in the form of cash and marketable securities.

The Company invests in certain structured securities that contain embedded credit derivatives. These securities are referred to as synthetic collateralized debt obligations and have maturity dates ranging from one to ten years. The credit derivatives embedded in these securities have not been separated from their host contracts for separate fair value reporting; rather, the Company has elected to carry the entire security at fair value with any changes in fair value included in net realized investment gains and losses.

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources while unobservable inputs reflect the Company’s view of market assumptions in the absence of observable market information. The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. In determining fair value, the Company uses various methods including market, income and cost approaches.

The Company categorizes its fair value measurements 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.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The Company categorizes 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. Primary inputs to this valuation technique may include comparative trades, bid/asks, interest rate movements, U.S. Treasury rates, London Interbank Offered Rate (“LIBOR”), prime rates, cash flows, maturity dates, call ability, estimated prepayments, and/or underlying collateral values.

 

  •  

Level 3 – Prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management’s best 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. Primary inputs to this valuation technique include broker quotes and comparative trades.

The Company reviews its fair value hierarchy classifications for 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, net operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income or loss in the years in which those temporary differences are expected to be recovered or settled. Under this method, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are recorded to reduce a deferred tax asset to the amount expected to be realized. Interest expense and any associated penalties which relate to tax years still subject to review by the Internal Revenue Service (“IRS”) are recorded as income tax expense.

The Company provides for federal income taxes based on amounts the Company believes it will ultimately owe. Inherent in the provision for federal income taxes are estimates regarding the deductibility of certain items and the realization of certain tax credits. In the event the ultimate deductibility of certain items or the realization of certain tax credits differs from estimates, the Company may be required to change the provision for federal income taxes recorded in the consolidated financial statements, which could be significant.

Tax reserves are reviewed regularly and are adjusted as events occur that 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, release of administrative guidance or rendering of a court decision affecting a particular tax issue.

NLIC files a separate consolidated federal income tax return, with its subsidiaries, and is eligible to join the NMIC consolidated tax return group in 2014.

Cash and Cash Equivalents

Cash and cash equivalents include highly liquid investments with original maturities of less than three months.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

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 to reflect the impact of unrealized gains and losses on available-for-sale securities with the corresponding adjustment recorded in AOCI. This adjustment to VOBA represents the change in amortization that would have been required as a charge or credit to operations 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.

Goodwill

In connection with acquisitions of operating entities, the Company recognizes the excess of the purchase price over the fair value of net assets acquired as goodwill. Goodwill is not amortized, but is evaluated for impairment at the reporting unit level annually. Goodwill of a reporting unit is tested for impairment on an interim basis, in addition to the annual evaluation if an event occurs or circumstances change which would more likely than not reduce the fair value of a reporting unit below its carrying amount. If a reporting unit’s fair value is less than its carrying value, the Company will perform an impairment evaluation. This evaluation utilizes an income approach to develop the implied fair value. An impairment is recognized on a reporting unit for the amount that the carrying value of its goodwill exceeds the implied fair value of its goodwill.

The process of evaluating goodwill for impairment requires several judgments and assumptions to be made to determine the fair value of the reporting units, including the method used to determine fair value, discount rates, expected levels of cash flows, revenues and earnings, and the selection of comparable companies used to develop market-based assumptions. The Company performed its 2012 annual impairment test and determined that no impairment was required.

Closed Block

In connection with the sponsored demutualization of Provident prior to its acquisition by the Company, Provident established a closed block for the benefit of certain classes of individual participating policies that had a dividend scale payable in 2001. Assets were allocated to the closed block in an amount that produces cash flows which, together with anticipated revenues from closed block business, is reasonably expected to be sufficient to provide for (1) payment of policy benefits, specified expenses and taxes, and (2) the continuation of dividends throughout the life of the Provident policies included in the closed block based upon the dividend scales payable for 2001, if the experience underlying such dividend scales continues.

Assets allocated to the closed block benefit only the holders of the policies included in the closed block and will not revert to the benefit of the Company. No reallocation, transfer, borrowing or lending of assets can be made between the closed block and other portions of the Company’s general account, any of its separate accounts, or any affiliate of the Company without the approval of the Pennsylvania Insurance Department and Ohio Department of Insurance (“ODI”). The closed block will remain in effect as long as any policy in the closed block is in force.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

If, over time, the aggregate performance of the closed block assets and policies is better than was assumed in funding the closed block, dividends to policyholders will increase. If, over time, the aggregate performance of the closed block assets and policies is less favorable than was assumed in the funding, dividends to policyholders could be reduced. If the closed block has insufficient funds to make guaranteed policy benefit payments, such payments will be made from the Company’s assets outside of the closed block, which are general account assets.

The assets and liabilities allocated to the closed block are recorded in the Company’s consolidated financial statements on the same basis as other similar assets and liabilities. The carrying amount of closed block liabilities in excess of the carrying amount of closed block assets at the date Provident was acquired by the Company represents the maximum future earnings from the assets and liabilities designated to the closed block that can be recognized in income, for the benefit of stockholders, over the period the policies in the closed block remain in force.

If actual cumulative earnings exceed expected cumulative earnings, the expected earnings are recognized in income. This is because the excess actual cumulative earnings over expected cumulative earnings, which represents undistributed accumulated earnings attributable to policyholders, is recorded as a policyholder dividend obligation. Therefore, the excess will be paid to closed block policyholders as an additional policyholder dividend expense in the future unless it is otherwise offset by future performance of the closed block that is less favorable than originally expected. If actual cumulative performance is less favorable than expected, actual earnings will be recognized in income.

The principal cash flow items that affect the amount of closed block assets and liabilities are premiums, net investment income, purchases and sales of investments, policyholder benefits, policyholder dividends, premium taxes and income taxes. The principal income and expense items excluded from the closed block are management and maintenance expenses, commissions and net investment income and realized gains and losses on investments held outside of the closed block that support the closed block business, all of which enter into the determination of total gross margins of closed block policies for the purpose of the amortization of VOBA. See Note 10 for further disclosure.

Separate Accounts

Separate account assets and liabilities represent contractholders’ funds that have been legally segregated into accounts with specific investment objectives. In the separate account, investment income and gains and losses on investments accrue directly to, and investment risk is borne by, the contractholder. Separate account assets are primarily comprised of public, privately registered and non-registered mutual funds. Separate account assets are recorded at fair value based on the methodology that would be applicable to the underlying assets. The value of separate account liabilities is set to equal the fair value for separate account assets.

Participating Business

Participating business, which refers to policies that participate in profits through policyholder dividends, represented approximately 5% of the Company’s life insurance in force in 2012 (5% in 2011 and 2010), 40% of the number of life insurance policies in force in 2012 (42% in 2011 and 45% in 2010). The provision for policyholder dividends was based on then current dividend scales and has been included in future policy benefits and claims in the consolidated balance sheets.

Change in Accounting Principle

In October 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2010-26, which amends FASB Accounting Standards Codification (“ASC”) 944, Financial Services – Insurance. The amended guidance modifies the definition of the types of costs incurred by insurance entities that can be capitalized in the acquisition of new and renewal insurance and investment contracts. Under the amended guidance, acquisition costs are to include only those costs that are directly related to the successful acquisition of new or renewal insurance and investment 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 $569 million, net of taxes, as of December 31, 2009.

 

17

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The Company adjusted the presentation of its consolidated financial statements and accompanying notes for all periods presented, to reflect the retrospective adoption of this change in accounting principle.

The following tables summarize the impact of the retrospective change in accounting principle on the consolidated statements of operations for the periods indicated:

 

     Year ended December 31, 2011  

(in millions)

    As Originally Reported     As Adjusted     Effect of Change  

Amortization of deferred policy acquisition costs

    $ 76      $ 65      $ 11   

Other expenses, net of deferrals

    $ 620      $ 760      $ (140 ) 

Federal income tax benefit

    $ (382 )    $ (427 )    $ 45   

Net loss attributable to Nationwide Life Insurance Company

    $ (282 )    $ (366 )    $ (84 ) 

 

     Year ended December 31, 2010  

(in millions)

    As Originally Reported      As Adjusted      Effect of Change  

Amortization of deferred policy acquisition costs

    $ 396       $ 299       $ 97   

Other expenses, net of deferrals

    $ 592       $ 722       $ (130 ) 

Federal income tax expense

    $ 24       $ 12       $ 12   

Net income attributable to Nationwide Life Insurance Company

    $ 240       $ 219       $ (21 ) 

The following table summarizes the impact of the retrospective change in accounting principle on the consolidated balance sheet as of the date indicated:

 

     December 31, 2011  

(in millions)

    As Originally Reported      As Adjusted      Effect of Change  

Deferred policy acquisition costs

    $ 4,425       $ 3,487       $ (938 ) 

Other assets1

    $ 4,348       $ 4,590       $ 242   

Other liabilities1

    $ 4,316       $ 4,230       $ (86 ) 

Retained earnings

    $ 3,459       $ 2,789       $ (670 ) 

Accumulated other comprehensive income2

    $ 626       $ 686       $ 60   

 

1 

Change relates to the Company’s net deferred tax liability position moving to a net deferred tax asset on the consolidated balance sheets.

2 

Represents the adjustments to DAC related to unrealized gains and losses on securities available-for-sale.

Subsequent Events

The Company evaluated subsequent events through March 1, 2013, the date the consolidated financial statements were issued.

 

(3) Recently Issued Accounting Standards

Adopted Accounting Standards

On January 1, 2012, the Company adopted 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 adoption of this guidance resulted in increased disclosures only and had no impact on the Company’s consolidated financial statements.

 

18

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

On January 1, 2012, the Company adopted 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. The Company elected two separate but consecutive statements of operations and comprehensive income and adopted ASU 2011-05 retrospectively.

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 financial statements.

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.

On July 1, 2010, the Company adopted ASU 2010-11, which clarifies the guidance and application of the scope exception for embedded credit derivatives contained within FASB ASC 815-15, Embedded Derivatives. This scope exception allows for embedded credit derivative features related only to the transfer of credit risk in the form of subordination of one financial instrument to another to not be subject to potential bifurcation and separate accounting. The guidance also allowed companies to irrevocably elect to apply the fair value option to any investment in a beneficial interest in securitized financial assets. The Company recorded an impact of adoption of $9 million, net of taxes, as a decrease to retained earnings with a corresponding increase to accumulated other comprehensive income on the consolidated statements of equity.

On January 1, 2010, the Company adopted guidance under FASB ASC 810, Consolidation, resulting in an increase to noncontrolling interest of $46 million on the consolidated statements of equity. This guidance changes the consolidation guidance applicable to a VIE. It also amends the guidance governing the determination of whether an entity is the VIE’s primary beneficiary (the reporting entity that must consolidate the VIE) by requiring a qualitative analysis rather than a quantitative analysis.

Pending Accounting Standards

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. In January 2013, the FASB issued ASU 2013-01, which clarifies the scope of these disclosures. The Company will adopt both ASUs 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 financial statements.

In February 2013, the FASB issued ASU 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, which amends FASB ASC 220, Comprehensive Income. The amended guidance requires entities to provide information about the amounts reclassified out of accumulated other comprehensive income by significant component. For significant amounts reclassified into net income in their entirety in the same reporting period, the amended guidance also requires entities to present or disclose the effect of these reclassifications on line items of net income. The amendments are effective prospectively for the Company’s annual and interim periods beginning January 1, 2013. The adoption of this guidance will result in increased disclosure and may impact the presentation of the Company’s consolidated financial statements.

 

19

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

(4) Certain Long-Duration Contracts

Variable Annuity Contracts

The Company issues variable annuity contracts through its separate accounts. Contractholder assets are invested in general and separate account investment options as directed by the contractholder. The Company also provides various forms of guarantees to benefit the related contractholders. The Company provides five primary guarantee types: (1) GMDB; (2) GMIB; (3) GMAB; (4) GLWB; and (5) a hybrid guarantee with GMAB and GLWB.

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 by having the death benefit paid into the contract and having a second death benefit paid upon the survivor’s death.

The GMAB, which was offered in the Company’s Capital Preservation Plus product, is a living benefit that provides the contractholder with a guaranteed return of deposits, adjusted proportionately for withdrawals, after a specified time period (5, 7 or 10 years) selected by the contractholder at the issuance of the variable annuity contract. In some cases, the contractholder also has the option, after a specified time period, to drop the guarantee and continue the variable annuity contract without the GMAB. In general, the GMAB requires a minimum allocation to guaranteed term options or adherence to limitations required by an approved asset allocation strategy.

The GLWB, offered in the Company’s Lifetime Income product, is a living benefit that provides for enhanced retirement income security without the liquidity loss associated with annuitization. The withdrawal rates vary based on the age when withdrawals begin and are applied to a benefit base to determine the guaranteed lifetime income amount available to a contractholder. The benefit base is equal to the variable annuity premium at contract issuance and may increase as a result of a feature driven by account performance and policy duration. Lifetime Income is the only living benefit guarantee offered on new variable annuity contract sales.

The GMIB, which was offered with several variable annuity contracts, is a living benefit that provides the contractholder with a guaranteed annuitization stream of income.

The following table summarizes information regarding variable annuity contracts with guarantees invested in general and separate accounts, as of the dates indicated (a contract may contain multiple guarantees):

 

     December 31, 2012      December 31, 2011  

(in millions)

    General
account
value		      Separate
account
value		      Net
amount
at risk1		      Average
age2		      General
account
value		      Separate
account
value		      Net
amount
at risk1		      Average
age2		  

GMDB:

                        

Return of net deposits

    $ 836       $ 14,963       $ 24         64       $ 999       $ 11,749       $ 175         63   

Minimum return or anniversary contract value

      2,048         29,787         561         68         2,233         28,754         1,882         67   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total GMDB

    $ 2,884       $ 44,750       $ 585         66       $ 3,232       $ 40,503       $ 2,057         66   

GMAB Return of net deposits

    $ 165       $ 3,230       $ 12         64       $ 342       $ 4,138       $ 149         65   

GLWB Minimum return or anniversary contract value

    $ 128       $ 22,031       $ 613         65       $ 380       $ 17,533       $ 573         65   

GMIB Minimum return or anniversary contract value

    $ 49       $ 514       $ 1         65       $ 50       $ 556       $ 1         65   

 

1 

Net amount at risk is calculated on a policy-level basis and equals the respective guaranteed benefit less the account value (or zero if the account value exceeds the guaranteed benefit).

2 

Represents the weighted average attained age of contractholders.

 

20

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table summarizes the reserve balances for variable annuity contracts with guarantees, as of the dates indicated:

 

(in millions)

    December 31,
2012		      December 31,
2011		  

GLWB

    $ 600       $ 1,624   

GMAB

    $ 57       $ 218   

GMDB

    $ 65       $ 80   

GMIB

    $ 2       $ 3   

Paid claims for GMDBs were $30 million and $40 million for the years ended December 31, 2012 and 2011, respectively.

Paid claims for GLWBs, GMABs and GMIBs were immaterial for the years ended December 31, 2012 and 2011.

The following table summarizes account balances of deferred variable annuity contracts with guarantees invested in separate accounts, as of the dates indicated:

 

(in millions)

    December 31,
2012		      December 31,
2011		  

Mutual funds:

      

Bond

    $ 5,634       $ 5,117   

Domestic equity

      35,277         31,618   

International equity

      2,614         2,447   
  

 

 

     

 

 

  

Total mutual funds

    $ 43,525       $ 39,182   

Money market funds

      1,225         1,321   
  

 

 

     

 

 

  

Total1

    $ 44,750       $ 40,503   
  

 

 

     

 

 

  

 

1 

Excludes $26.7 billion and $24.7 billion as of December 31, 2012 and 2011, respectively, of separate account assets not related to deferred variable annuity contracts with guarantees and are primarily attributable to retirement plan, variable universal life and COLI products.

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, 2012 and 2011.

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 $216 million and $162 million as of December 31, 2012 and 2011, respectively. Paid claims on contracts maintained in force by these guarantees were immaterial for the years ended December 31, 2012 and 2011.

 

21

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table summarizes information regarding universal and variable universal life insurance contracts with no-lapse guarantees invested in general and separate accounts, as of the dates indicated:

 

(in millions)

    General account
value		      Separate account
value		      Adjusted insurance
in force1		      Average age2  

December 31, 2012

    $ 992       $ 328       $ 12,321         56   

December 31, 2011

    $ 843       $ 311       $ 9,777         58   

 

1 

The adjusted insurance in force is calculated on a policy-level basis and equals the respective guaranteed death benefit less the account value (or zero if the account value exceeds the guaranteed benefit).

2 

Represents the weighted average attained age of contractholders.

 

(5) Deferred Policy Acquisition Costs and Value of Business Acquired

Deferred Policy Acquisition Costs

The following table summarizes changes in the DAC balance, for the years ended:

 

(in millions)

    December 31,
2012		     December  31,
20111		     December  31,
20101		  

Balance at beginning of year

    $ 3,487      $ 3,125      $ 3,107   

Capitalization of DAC

      470        604        501   

Amortization of DAC, excluding unlocks

      (525 )      (200 )      (290 ) 

Amortization of DAC related to unlocks

      (50 )      135        (9 ) 

Adjustments to DAC related to unrealized gains and losses on securities available-for-sale

      (133 )      (177 )      (184 ) 
  

 

 

    

 

 

    

 

 

  

Balance at end of year

    $ 3,249      $ 3,487      $ 3,125   
  

 

 

    

 

 

    

 

 

  

 

1 

The balances reflect a change in accounting principle, as described in Note 2.

During 2012, the Company incurred additional DAC amortization of $50 million related to the financial services operations as a result of the annual comprehensive review of model assumptions, as well as a deviation from equity market performance as compared to assumed net separate account returns. The updated assumptions were primarily related to actual gross profits and the in force block of business deviating from expectations, renewal premiums, general account margins and lapses.

During 2011, the Company recognized a reduction in DAC amortization of $135 million related to the financial services operations as a result of the annual comprehensive review of model assumptions. The updated assumptions related to interest spread, mortality, maintenance expense and market performance assumptions. The 2011 reduction in DAC amortization reflects the impact of the retrospective change in accounting principle described in Note 2.

 

22

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Value of Business Acquired

The following table summarizes changes in the VOBA balance for the years ended:

 

(in millions)

    December 31,
2012		     December 31,
2011		     December 31,
2010		  

Balance at beginning of year

    $ 238      $ 259      $ 277   

Amortization of VOBA, excluding unlocks

      (22 )      (29 )      (33 ) 

Amortization of VOBA related to unlocks

      8        16        13   

Net realized gains on investments

      2        2        1   

Adjustments to VOBA related to unrealized gains and losses on securities available-for-sale

      (2 )      (10 )      1   
  

 

 

    

 

 

    

 

 

  

Balance at end of year

    $ 224      $ 238      $ 259   
  

 

 

    

 

 

    

 

 

  

Interest on the unamortized VOBA balance (at interest rates ranging from 4.50% to 7.56%) is included in amortization and was $16 million, $17 million and $18 million during the years ended December 31, 2012, 2011 and 2010, respectively. Additionally, the VOBA gross carrying amount was $583 million and $585 million and accumulated amortization was $359 million and $347 million as of December 31, 2012 and 2011, respectively. The initial useful life related to the VOBA balances is 28 years.

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)

    VOBA  

2013

    $ 20   

2014

    $ 16   

2015

    $ 15   

2016

    $ 14   

2017

    $ 13   

 

23

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

(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:

 

(in millions)

    Amortized
cost		      Gross
unrealized
gains		      Gross
unrealized
losses		      Fair
value		  

December 31, 2012

            

Fixed maturity securities:

            

U.S. Treasury securities and obligations of U.S. Government corporations and agencies

    $ 476       $ 121       $ —         $ 597   

Obligations of states and political subdivisions

      1,722         281         1         2,002   

Debt securities issued by foreign governments

      98         20         —           118   

Corporate public securities

      16,152         1,891         33         18,010   

Corporate private securities

      4,216         392         19         4,589   

Residential mortgage-backed securities

      4,506         267         106         4,667   

Commercial mortgage-backed securities

      1,219         133         15         1,337   

Collateralized debt obligations

      393         28         86         335   

Other asset-backed securities

      140         17         1         156   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total fixed maturity securities

    $ 28,922       $ 3,150       $ 261       $ 31,811   

Equity securities

      15         5         —           20   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total available-for-sale securities

    $ 28,937       $ 3,155       $ 261       $ 31,831   
  

 

 

     

 

 

     

 

 

     

 

 

  

December 31, 2011

            

Fixed maturity securities:

            

U.S. Treasury securities and obligations of U.S. Government corporations and agencies

    $ 506       $ 124       $ —         $ 630   

Obligations of states and political subdivisions

      1,501         177         —           1,678   

Debt securities issued by foreign governments

      102         18         —           120   

Corporate public securities

      14,132         1,336         111         15,357   

Corporate private securities

      3,998         327         27         4,298   

Residential mortgage-backed securities

      5,280         255         311         5,224   

Commercial mortgage-backed securities

      1,347         64         32         1,379   

Collateralized debt obligations

      410         17         125         302   

Other asset-backed securities

      201         16         4         213   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total fixed maturity securities

    $ 27,477       $ 2,334       $ 610       $ 29,201   

Equity securities

      19         2         1         20   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total available-for-sale securities

    $ 27,496       $ 2,336       $ 611       $ 29,221   
  

 

 

     

 

 

     

 

 

     

 

 

  

The fair value of the Company’s investments may fluctuate significantly in response to changes in interest rates, investment quality ratings and credit spreads. The Company has the ability and intent to hold equity securities until recovery. The Company does not have the intent to sell, nor is it more likely than not it will be required to sell debt securities in an unrealized loss position. Investment losses, however, may be realized to the extent liquidity needs require the disposition of securities in unfavorable interest rate, liquidity or credit spread environments.

 

24

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table summarizes the amortized cost and fair value of fixed maturity securities, by maturity, as of December 31, 2012. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without early redemption penalties.

 

(in millions)

    Amortized
cost		      Fair
value		  

Fixed maturity securities:

      

Due in one year or less

    $ 1,394       $ 1,433   

Due after one year through five years

      7,316         7,993   

Due after five years through ten years

      8,295         9,283   

Due after ten years

      5,659         6,607   
  

 

 

     

 

 

  

Subtotal

    $ 22,664       $ 25,316   

Residential mortgage-backed securities

      4,506         4,667   

Commercial mortgage-backed securities

      1,219         1,337   

Collateralized debt obligations

      393         335   

Other asset-backed securities

      140         156   
  

 

 

     

 

 

  

Total fixed maturity securities

    $ 28,922       $ 31,811   
  

 

 

     

 

 

  

The following table summarizes components of net unrealized gains and losses, as of the dates indicated:

 

(in millions)

    December 31,
2012		     December 31,
2011		  

Net unrealized gains on available-for-sale securities, before adjustments, taxes and fair value hedging

    $ 2,894      $ 1,725   

Change in fair value attributable to fixed maturity securities designated in fair value hedging relationships

      (4 )      (8 ) 
  

 

 

    

 

 

  

Net unrealized gains on available-for-sale securities, before adjustments and taxes

    $ 2,890      $ 1,717   

Adjustment to DAC and VOBA1

      (482 )      (347 ) 

Adjustment to future policy benefits and claims

      (295 )      (183 ) 

Adjustment to policyholder dividend obligation

      (177 )      (132 ) 

Deferred federal income tax expense

      (672 )      (362 ) 
  

 

 

    

 

 

  

Net unrealized gains on available-for-sale securities

    $ 1,264      $ 693   
  

 

 

    

 

 

  

 

1 

The 2011 balance reflects a change in accounting principle, as described in Note 2.

 

25

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table summarizes the change in net unrealized gains and losses reported in accumulated other comprehensive income, for the years ended:

 

(in millions)

    December 31,
2012		     December 31,
2011		  

Balance at beginning of year

    $ 693      $ 376   

Unrealized gains and losses arising during the period:

     

Net unrealized gains on available-for-sale securities before adjustments

      990        896   

Non-credit impairments and subsequent changes in fair value of those debt securities1

      178        (11 ) 

Net adjustments to DAC and VOBA2

      (135 )      (187 ) 

Net adjustment to future policy benefits and claims

      (112 )      (210 ) 

Net adjustment to policyholder dividend obligation

      (45 )      (42 ) 

Related federal income tax expense

      (308 )      (147 ) 
  

 

 

    

 

 

  

Change in unrealized gains on available-for-sale securities

    $ 568      $ 299   
  

 

 

    

 

 

  

Reclassification adjustment for net losses realized on available-for-sale securities, net of tax benefit ($2 and $10 as of December 31, 2012 and 2011, respectively)

      (3 )      (18 ) 
  

 

 

    

 

 

  

Change in net unrealized gains on available-for-sale securities

    $ 571      $ 317   
  

 

 

    

 

 

  

Balance at end of year

    $ 1,264      $ 693   
  

 

 

    

 

 

  

 

1 

The non-credit portion of other-than-temporary impairments was $(48) million and $(226) million as of December 31, 2012 and 2011, respectively.

2 

The 2011 balance reflects a change in accounting principle, as described in Note 2.

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  

(in millions, except number of securities)

    Fair
value		      Gross
unrealized
losses		      Number
of
securities		      Fair
value		      Gross
unrealized
losses		      Number
of
securities		      Fair
value		      Gross
unrealized
losses		      Number
of
securities		  

December 31, 2012

                           

Fixed maturity securities:

                           

Corporate public securities

    $ 710       $ 11         68       $ 150       $ 22         10       $ 860       $ 33         78   

Residential mortgage-backed securities

      89         2         12         1,029         104         190         1,118         106         202   

Collateralized debt obligations

      27         1         5         151         85         36         178         86         41   

Other asset-backed securities

      326         4         23         296         32         46         622         36         69   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 1,152       $ 18         108       $ 1,626       $ 243         282       $ 2,778       $ 261         390   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

December 31, 2011

                           

Fixed maturity securities:

                           

Corporate public securities

    $ 1,460       $ 62         150       $ 309       $ 49         54       $ 1,769       $ 111         204   

Residential mortgage-backed securities

      278         9         52         1,339         302         240         1,617         311         292   

Collateralized debt obligations

      78         2         10         137         123         39         215         125         49   

Other asset-backed securities

      501         15         54         357         48         53         858         63         107   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total fixed maturity securities

    $ 2,317       $ 88         266       $ 2,142       $ 522         386       $ 4,459       $ 610         652   

Equity securities

      7         1         10         —           —           31         7         1         41   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 2,324       $ 89         276       $ 2,142       $ 522         417       $ 4,466       $ 611         693   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

 

26

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table summarizes gross unrealized losses based on the ratio of fair value to amortized cost, for available-for-sale securities in an unrealized loss position, as of the dates indicated:

 

                                                                                                                 
     December 31, 2012      December 31, 2011  

(in millions)

    Less
than or
equal to
one year		      More
than
one
year		      Total      Less
than or
equal to
one year		      More
than
one
year		      Total  

99.9% - 80.0%

    $ 18       $ 85       $ 103       $ 83       $ 158       $ 241   

Less than 80.0%

                  

Residential mortgage-backed securities

      —           50         50         —           191         191   

Collateralized debt obligations

      —           72         72         1         121         122   

Other

      —           36         36         5         52         57   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 18       $ 243       $ 261       $ 89       $ 522       $ 611   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

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 (“LTV”) 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.

Collateralized debt obligations are assessed for impairment using expected cash flows based on various inputs including default estimates based on the underlying corporate securities, historical and forecasted loss severities or other market inputs when recovery estimates are not feasible. When the collateral is regional bank and insurance company trust preferred securities, default estimates used to estimate cash flows are based on U.S. Bank Rating service data and broker research.

The Company believes the unrealized losses on these 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 is equal to or greater than the amortized cost basis of the securities. These unrealized losses represent temporary fluctuations in non-credit factors that are not indicative of other-than-temporary impairment.

 

27

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Mortgage Loans, Net of Allowance

The following table summarizes the amortized cost of mortgage loans by method of evaluation for credit loss, and the related valuation allowances by type of credit loss, as of the dates indicated:

 

(in millions)

    December 31,
2012		      December 31,
2011		  

Amortized cost:

      

Loans with non-specific reserves

    $ 5,820       $ 5,672   

Loans with specific reserves

      51         136   
  

 

 

     

 

 

  

Total amortized cost

    $ 5,871       $ 5,808   

Valuation allowance:

      

Non-specific reserves

    $ 33       $ 33   

Specific reserves

      11         27   
  

 

 

     

 

 

  

Total valuation allowance

    $ 44       $ 60   
  

 

 

     

 

 

  

Mortgage loans, net of allowance

    $ 5,827       $ 5,748   
  

 

 

     

 

 

  

The following table summarizes activity in the valuation allowance for mortgage loans, for the years ended:

 

(in millions)

    December 31,
2012		     December 31,
2011		  

Balance at beginning of year

    $ 60      $ 96   

Current period provision

      1        25   

Recoveries1

      (15 )      (7 ) 

Charge offs and other

      (2 )      (54 ) 
  

 

 

    

 

 

  

Balance at end of year

    $ 44      $ 60   
  

 

 

    

 

 

  

 

1 

Includes recoveries on sales and increases in the valuations of loans with specific reserves.

The following table summarizes impaired mortgage loans by class, for the years ended:

 

(in millions)

    Office     Warehouse     Retail     Apartment      Other     Total  

December 31, 2012

              

Amortized cost

    $ 13      $ 26      $ 12      $ —         $ —        $ 51   

Specific reserves

      (2 )      (7 )      (2 )      —           —        $ (11 ) 
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Carrying value of impaired mortgage loans, net of allowance

    $ 11      $ 19      $ 10      $ —         $ —        $ 40   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

December 31, 2011

              

Amortized cost

    $ 8      $ 31      $ 20      $ —         $ 77      $ 136   

Specific reserves

      (1 )      (9 )      (8 )      —           (9 )      (27 ) 
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

Carrying value of impaired mortgage loans, net of allowance

    $ 7      $ 22      $ 12      $ —         $ 68      $ 109   
  

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

  

 

28

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table summarizes average recorded investment and interest income recognized for impaired mortgage loans by class, for the years ended:

 

(in millions)

   Office     Warehouse     Retail     Apartment     Other     Total  

December 31, 2012

            

Average recorded investment

   $ 9      $ 20      $ 11      $ —        $ 34      $ 74   

Interest income recognized

   $ 1      $ 2      $ 1      $ —        $ 6      $ 10   

December 31, 2011

            

Average recorded investment

   $ 7      $ 33      $ 23      $ 10      $ 91      $ 164   

Interest income recognized

   $ 1      $ 5      $ 3      $ —        $ 8      $ 17   

As of December 31, 2012 and 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.

Management evaluates the credit quality of individual mortgage loans and the portfolio as a whole through a number of loan quality measurements, including, but not limited to, LTV and debt service coverage (“DSC”) ratios. The LTV ratio is calculated as a ratio of the amortized cost of a loan to the estimated value of the underlying collateral. DSC is the amount of cash flow generated by the underlying collateral of the mortgage loan available to meet periodic interest and principal payments of the loan. This process identifies mortgage loans representing the lowest risk profile and lowest potential for loss and those representing the highest risk profile and highest potential for loss. These factors are updated and evaluated at least annually.

The following table summarizes the LTV ratio and DSC ratios of the mortgage loan portfolio, as of the dates indicated:

 

    LTV ratio     DSC ratio  

(in millions)

   Less than
80%		     80% -
less than
90%		     90% or
greater		     Total     Greater
than 1.10		     1.00-1.10     Less than
1.00		     Total  

December 31, 2012:

                

Apartment

   $ 1,119      $ 129      $ 62      $ 1,310      $ 1,303      $ 5      $ 2      $ 1,310   

Warehouse

     922        76        162        1,160        951        121        88        1,160   

Office

     776        55        42        873        783        16        74        873   

Retail

     1,940        250        86        2,276        2,139        92        45        2,276   

Other

     189        57        6        252        252        —          —          252   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 4,946      $ 567      $ 358      $ 5,871      $ 5,428      $ 234      $ 209      $ 5,871   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Weighted-average DSC ratio

     1.74        1.27        1.07        1.65        n/a        n/a        n/a        n/a   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Weighted-average LTV ratio

     n/a        n/a        n/a        n/a        66 %      76 %      96 %      68 % 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

December 31, 2011:

                

Apartment

   $ 805      $ 245      $ 89      $ 1,139      $ 1,112      $ 23      $ 4      $ 1,139   

Warehouse

     1,015        123        149        1,287        1,153        53        81        1,287   

Office

     595        104        76        775        656        69        50        775   

Retail

     1,878        220        147        2,245        2,074        104        67        2,245   

Other

     172        63        127        362        284        11        67        362   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 4,465      $ 755      $ 588      $ 5,808      $ 5,279      $ 260      $ 269      $ 5,808   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Weighted-average DSC ratio

     1.77        1.29        1.15        1.64        n/a        n/a        n/a        n/a   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Weighted-average LTV ratio

     n/a        n/a        n/a        n/a        68 %      81 %      89 %      69 % 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

While the loan quality measurements contribute to management’s assessment of relative credit risk in the mortgage loan portfolio for the dates indicated based on underwriting criteria and ongoing assessment of the properties’ performance, management believes the amounts, net of valuation allowance, are collectible.

 

29

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Securities Lending

The fair value of loaned securities was $130 million and $103 million as of December 31, 2012 and 2011, respectively. The Company received $133 million and $105 million of cash collateral on securities lending as of December 31, 2012 and 2011, respectively. The Company did not receive any non-cash collateral on securities lending as of the balance sheet dates.

Assets on Deposit and Pledged as Collateral

Available-for-sale securities with a carrying value of $9 million and $8 million were on deposit with various regulatory agencies as required by law as of December 31, 2012 and 2011, respectively. Additionally, available-for-sale securities with a carrying value of $73 million were pledged as collateral to secure recoveries under reinsurance contracts and other financing agreements as of December 31, 2012. The Company had no amount pledged as collateral as of December 31, 2011. These securities primarily are included in fixed maturity securities in the consolidated balance sheets.

Tax Credit Funds

The Company has sold $859 million and $796 million in Tax Credit Funds to unrelated third parties as of December 31, 2012 and 2011, respectively. The Company has guaranteed cumulative after-tax yields to the third party investors ranging from 1.00% to 7.75% through periods ending in 2027. The Company held immaterial reserves on these transactions as of December 31, 2012 and 2011. These guarantees are in effect for periods of approximately 15 years each. The Tax Credit Funds provide a stream of tax benefits to the investors that will generate a yield and return of capital. If the tax benefits are not sufficient to provide these cumulative after-tax yields, the Company must fund any shortfall. The maximum amount of undiscounted future payments that the Company could be required to pay the investors under the terms of the guarantees is $288 million. The Company’s risks are mitigated in the following ways: (1) the Company has the right to buyout the equity related to the guarantee under certain circumstances, (2) the Company may replace underperforming properties to mitigate exposure to guarantee payments and (3) the Company oversees the asset management of the deals. The Company does not anticipate making any material payments related to the guarantees.

Consolidated VIEs

The Company has relationships with VIEs where the Company is the primary beneficiary. Net assets of all consolidated VIEs totaled $347 million and $345 million as of December 31, 2012 and 2011, respectively, which was composed primarily of other long-term investments of $348 million and $310 million as of December 31, 2012 and 2011, respectively. The Company’s general credit is not exposed to the creditors or beneficial interest holders of these consolidated VIEs.

During 2010, two Tax Credit Funds were consolidated as a result of the adoption of guidance under FASB ASC 810, Consolidation. Previously, the Company was not deemed the primary beneficiary. As the managing member of the Tax Credit funds, the Company has the power to direct the activities that most significantly impact the economic power of the entities and consolidated the funds. The impact of consolidation was an increase to noncontrolling interest of $46 million.

Unconsolidated VIEs

In addition to the consolidated VIEs described above, the Company holds investments in VIEs where the Company is not the primary beneficiary, which are primarily investments in Tax Credit Funds without guarantees to limited partners. The carrying value of these investments was $222 million and $220 million as of December 31, 2012 and 2011, respectively. In addition, the Company has made commitments for further investments in these VIEs of $66 million and $131 million as of December 31, 2012 and 2011, respectively.

 

30

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Net Investment Income

The following table summarizes net investment income by investment type, for the years ended:

 

(in millions)

   December 31,
2012		     December 31,
2011		     December 31,
2010		  

Fixed maturity securities, available-for-sale

   $ 1,506      $ 1,502      $ 1,474   

Mortgage loans

     366        370        396   

Policy loans

     53        56        55   

Other

     (45 )      (34 )      (41 ) 
 

 

 

    

 

 

    

 

 

  

Gross investment income

   $ 1,880      $ 1,894      $ 1,884   
 

 

 

    

 

 

    

 

 

  

Investment expenses

     55        50        59   
 

 

 

    

 

 

    

 

 

  

Net investment income

   $ 1,825      $ 1,844      $ 1,825   
 

 

 

    

 

 

    

 

 

  

Net Realized Investment Gains and Losses

The following table summarizes net realized investment gains and losses, by source, for the years ended:

 

(in millions)

   December 31,
2012		     December 31,
2011		     December 31,
2010		  

Net derivative gains (losses)

   $ 314      $ (1,636 )    $ (385 ) 

Realized gains on sales

     48        64        176   

Realized losses on sales

     (23 )      (45 )      (43 ) 

Other

     11        8        16   
 

 

 

    

 

 

    

 

 

  

Net realized investment gains (losses)

   $ 350      $ (1,609 )    $ (236 ) 
 

 

 

    

 

 

    

 

 

  

Proceeds from the sale of available-for-sale securities were $796 million, $1.6 billion and $2.2 billion during the years ended December 31, 2012, 2011 and 2010, respectively. Gross gains of $47 million, $50 million and $172 million and gross losses of $20 million, $39 million and $17 million were realized on sales of available-for-sale securities during the years ended December 31, 2012, 2011 and 2010, respectively.

 

31

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Other-Than-Temporary Impairment Losses

The following table summarizes other-than-temporary impairments, for the years ended:

 

(in millions)

   Total     Included in
other
comprehensive
income		     Net  

December 31, 2012

      

Fixed maturity securities

   $         68      $ (36 )    $         32   

Mortgage loans

     (14 )      —          (14 ) 

Other

     13        —          13   
 

 

 

    

 

 

    

 

 

  

Other-than-temporary impairment losses

   $ 67      $ (36 )    $ 31   
 

 

 

    

 

 

    

 

 

  

December 31, 2011

      

Fixed maturity securities

   $ 135      $ (95 )    $ 40   

Mortgage loans

     25        —          25   

Other

     2        —          2   
 

 

 

    

 

 

    

 

 

  

Other-than-temporary impairment losses

   $ 162      $ (95 )    $ 67   
 

 

 

    

 

 

    

 

 

  

December 31, 2010

      

Fixed maturity securities

   $ 330      $ (174 )    $ 156   

Equity securities

     5        —          5   

Mortgage loans

     59        —          59   
 

 

 

    

 

 

    

 

 

  

Other-than-temporary impairment losses

   $ 394      $ (174 )    $ 220   
 

 

 

    

 

 

    

 

 

  

The following table summarizes cumulative credit losses, for the years ended:

 

(in millions)

   December 31,
2012		     December 31,
2011		     December 31,
2010		  

Cumulative credit loss at beginning of year1

  $ 328      $ 340      $ 417   

New credit losses

     18        8        31   

Incremental credit losses

     10        29        116   

Losses related to securities included in the beginning balance sold or paid down during the period

     (67 )      (49 )      (202 ) 

Losses related to securities included in the beginning balance for which there was a change in intent

     —          —          (22 ) 
 

 

 

    

 

 

    

 

 

  

Cumulative credit loss at end of year1

   $ 289      $ 328      $ 340   
 

 

 

    

 

 

    

 

 

  

 

1 

Cumulative credit losses are defined as the 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.

 

32

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

(7) Derivative Instruments

The Company is exposed to certain risks related to its ongoing business operations which are managed using derivative instruments.

Interest rate risk management. The Company uses interest rate contracts, primarily interest rate swaps, to reduce or alter interest rate exposure arising from mismatches between assets and liabilities. In the case of interest rate swaps, the Company enters into a contractual agreement with a counterparty to exchange, at specified intervals, the difference between fixed and variable rates of interest, calculated on a reference notional amount.

Interest rate swaps are used by the Company in association with fixed and variable rate investments to achieve cash flow streams that support certain financial obligations of the Company and to produce desired investment returns. As such, interest rate swaps are generally used to convert fixed rate cash flow streams to variable rate cash flow streams or vice versa. The Company also enters into interest rate swap transactions which are structured to provide a hedge against the negative impact of higher interest rates on the Company’s capital position.

Equity market and interest rate risk management. The Company has a variety of variable annuity products with guaranteed benefit features. These products and related obligations expose the Company to various market risks, primarily equity and interest rate risk. Adverse changes in the equity markets or interest rate movements expose the Company to significant volatility. To mitigate these risks and hedge the guaranteed benefit obligations, the Company enters into a variety of derivatives including interest rate swaps, equity index futures, options and total return swaps.

Foreign currency risk management. As part of its regular investing activities, the Company may purchase foreign currency denominated investments. These investments and the associated income expose the Company to volatility associated with movements in foreign exchange rates. To mitigate this risk, the Company uses cross-currency swaps and futures. As foreign exchange rates change, the increase or decrease in the cash flows of the derivative instrument generally offsets the changes in the functional-currency equivalent cash flows of the hedged item.

Credit risk management. The Company enters into credit derivative contracts, primarily credit default swaps, under which the Company buys and sells credit default protection on specific corporate creditors. These derivatives allow the Company to manage or modify its credit risk profile in general or its credit exposure to specific creditors.

Derivatives Qualifying for Hedge Accounting

The Company uses derivative instruments that are designated and qualify as fair value hedges in various financial transactions as follows:

 

  •  

interest rate swaps are used to hedge certain fixed rate investments such as mortgage loans and certain fixed maturity securities and

 

  •  

cross-currency swaps are used to hedge foreign currency-denominated fixed maturity securities.

The Company uses derivative instruments that are designated and qualify as cash flow hedges in various financial transactions as follows:

 

  •  

interest rate swaps are used to hedge cash flows from variable rate investments such as mortgage loans and certain fixed maturity securities and to hedge payments of certain liabilities and

 

  •  

cross-currency swaps are used to hedge interest payments and principal payments on foreign currency-denominated financial instruments.

 

33

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Derivatives Not Qualifying for Hedge Accounting

The Company uses derivatives not qualifying for hedge accounting in various financial transactions as follows:

 

  •  

futures, options, interest rate swaps and total return swaps are used to economically hedge certain guaranteed benefit obligations included in variable annuity products,

 

  •  

interest rate swaps, futures and options are used to economically hedge portfolio duration and other interest rate risks to which the Company is exposed,

 

  •  

cross-currency swaps and futures are used to economically hedge foreign currency-denominated assets and liabilities and

 

  •  

credit default swaps are used to either buy or sell credit protection on a specific creditor.

Credit Risk Associated with Derivatives Transactions

The Company periodically evaluates the risks within the derivative portfolios due to credit exposure. When evaluating this risk, the Company considers several factors which include, but are not limited to, the counterparty credit risk associated with derivative receivables, the Company’s own credit as it relates to derivative payables, the collateral thresholds associated with each counterparty and changes in relevant market data in order to gain insight into the probability of default by the counterparty. In addition, the impact the Company’s exposure to credit risk could have on the effectiveness of the Company’s hedging relationships is considered. As of December 31, 2012 and 2011, the impact of the exposure to credit risk on the fair value measurement of derivatives and the effectiveness of the Company’s hedging relationships was immaterial.

The following table summarizes the fair value and related notional amounts of derivative instruments, as of the dates indicated:

 

    Derivative assets     Derivative liabilities  

(in millions)

   Fair value     Notional     Fair value     Notional  

December 31, 2012

        

Derivatives designated and qualifying as hedging instruments

   $ 4      $ 79      $ 21      $ 192   

Derivatives not designated as hedging instruments:

        

Interest rate contracts

   $ 1,960      $ 21,216      $ 2,065      $ 23,746   

Equity contracts

     822        7,445        —          —     

Total Return Swaps

     4        1,513        32        1,551   

Other derivative contracts

     —          10        5        17   
 

 

 

    

 

 

    

 

 

    

 

 

  

Total derivative positions1

   $ 2,790      $ 30,263      $ 2,123      $ 25,506   
 

 

 

    

 

 

    

 

 

    

 

 

  

December 31, 2011

        

Derivatives designated and qualifying as hedging instruments

   $ 11      $ 145      $ 29      $ 310   

Derivatives not designated as hedging instruments:

        

Interest rate contracts

   $ 2,182      $ 21,732      $ 2,142      $ 20,955   

Equity contracts

     1,004        7,162        —          —     

Total Return Swaps

     10        892        37        2,409   

Other derivative contracts

     1        13        7        17   
 

 

 

    

 

 

    

 

 

    

 

 

  

Total derivative positions1

   $ 3,208      $ 29,944      $ 2,215      $ 23,691   
 

 

 

    

 

 

    

 

 

    

 

 

  

 

1

Derivative assets and liabilities are included in other assets and other liabilities, respectively, in the consolidated balance sheets.

 

34

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The Company’s derivative positions, primarily offset by master netting agreements and collateral received from or posted with counterparties, resulted in immaterial net uncollateralized derivative asset and liability positions as of December 31, 2012 and 2011. As of December 31, 2012 and 2011, the Company held cash collateral from derivative counterparties of $798 million and $1.0 billion, respectively. The Company did not hold securities as off-balance sheet collateral as of December 31, 2012 and 2011. As of December 31, 2012 and 2011, the Company had posted cash collateral of $228 million and $223 million, respectively, and pledged securities with a fair value of $148 million and $152 million, respectively, with derivative counterparties.

The fair value of embedded derivatives on life and annuity programs was $748 million and $1.9 billion as of December 31, 2012 and 2011, respectively, which is included in future policy benefits and claims in the consolidated balance sheets.

The following table summarizes gains and losses for derivative instruments recognized in net realized investment gains and losses in the consolidated statements of operations, for the years ended:

 

(in millions)

   December 31,
2012		     December 31,
2011		     December 31,
2010		  

Derivatives designated and qualifying as hedging instruments

   $ (1 )    $ (4 )    $ (9 ) 

Derivatives not designated as hedging instruments:

      

Interest rate contracts

   $ (125 )    $ (44 )    $ (39 ) 

Equity contracts

     (665 )      (45 )      (389 ) 

Total return swaps

     (343 )      (17 )      (136 ) 

Other derivative contracts

     (1 )      (6 )      (20 ) 

Net interest settlements

     53        34        16   
 

 

 

    

 

 

    

 

 

  

Total derivative losses1

   $ (1,082 )    $ (82 )    $ (577 ) 
 

 

 

    

 

 

    

 

 

  

Change in embedded derivatives on guaranteed benefit annuity programs2

     1,185        (1,674 )      98   

Other revenue on guaranteed benefit annuity programs

     211        120        94   
 

 

 

    

 

 

    

 

 

  

Change in embedded derivative liabilities and related fees

   $ 1,396      $ (1,554 )    $ 192   
 

 

 

    

 

 

    

 

 

  

Net realized derivative gains (losses)

   $ 314      $ (1,636 )    $ (385 ) 
 

 

 

    

 

 

    

 

 

  

 

1 

Included in total derivative losses are economic hedging losses of $827 million, gains of $1.0 billion, and losses of $347 million related to the guaranteed benefit annuity programs for the years ended December 31, 2012, 2011 and 2010, respectively.

2 

As part of the Company’s annual comprehensive review of DAC model assumptions, all relevant assumptions impacting the fair value of embedded derivatives on guaranteed benefit annuity programs are also reviewed and updated. For the individual variable annuity business, the change in the embedded derivatives on guaranteed benefit annuity programs for the year ended December 31, 2012 includes updated assumptions in lapse, mortality, withdrawal behavior and benefit utilization. The change in embedded derivatives on guaranteed benefit annuity programs for the year ended December 31, 2011 includes updated assumptions in lapse, mortality and withdrawal behavior. Refer to Note 2 for further discussion of the annual review of DAC model assumptions.

 

35

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

(8) Fair Value Measurements

The following table summarizes assets and liabilities measured at fair value on a recurring basis as of December 31, 2012:

 

(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

   $ 592      $ 2      $ 3      $ 597   

Obligations of states and political subdivisions

     —          2,002        —          2,002   

Debt securities issued by foreign governments

     73        45        —          118   

Corporate public securities

     1        17,890        119        18,010   

Corporate private securities

     —          3,817        772        4,589   

Residential mortgage-backed securities

     484        4,173        10        4,667   

Commercial mortgage-backed securities

     —          1,335        2        1,337   

Collateralized debt obligations

     —          53        282        335   

Other asset-backed securities

     —          147        9        156   
 

 

 

    

 

 

    

 

 

    

 

 

  

Total fixed maturity securities at fair value

   $ 1,150      $ 29,464      $ 1,197      $ 31,811   

Equity securities

     —          12        8        20   

Short-term investments

     45        989        —          1,034   

Trading securities

     —          —          54        54   
 

 

 

    

 

 

    

 

 

    

 

 

  

Total other investments at fair value

   $ 45      $ 1,001      $ 62      $ 1,108   
 

 

 

    

 

 

    

 

 

    

 

 

  

Investments at fair value

   $ 1,195      $ 30,465      $ 1,259      $ 32,919   
 

 

 

    

 

 

    

 

 

    

 

 

  

Derivative assets

     —          1,968        822        2,790   

Separate account assets

     68,185        1,230        2,025        71,440   
 

 

 

    

 

 

    

 

 

    

 

 

  

Assets at fair value

   $ 69,380      $ 33,663      $ 4,106      $ 107,149   
 

 

 

    

 

 

    

 

 

    

 

 

  

Liabilities

        

Future policy benefits and claims:

        

Living benefits

   $ —        $ —        $ (657 )    $ (657 ) 

Indexed products

     —          —          (91 )      (91 ) 
 

 

 

    

 

 

    

 

 

    

 

 

  

Total future policy benefits and claims

   $ —        $ —        $ (748 )    $ (748 ) 

Derivative liabilities

     —          (2,118 )      (5 )      (2,123 ) 
 

 

 

    

 

 

    

 

 

    

 

 

  

Liabilities at fair value

   $ —        $ (2,118 )    $ (753 )    $ (2,871 ) 
 

 

 

    

 

 

    

 

 

    

 

 

  

 

36

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis during the year ended December 31, 2012:

 

     Balance as of
December 31,
2011		     Net gains (losses)                 Transfers
into
Level 3		     Transfers
out of
Level 3		     Balance as of
December 31,
2012		  

(in millions)

     In  operations1     In OCI     Purchases     Sales        

Assets

                

Investments:

                

Fixed maturity securities:

                

Corporate private securities

   $ 1,209      $ 2      $ 13      $ 69      $ (187 )    $ 40      $ (374 )    $ 772   

Collateralized debt obligations

     247        2        53        36        (56 )      —          —          282   

Other fixed maturity securities

     135        —          11        2        (13 )      11        (3 )      143   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total fixed maturity securities at fair value2

   $ 1,591      $ 4      $ 77      $ 107      $ (256 )    $ 51      $ (377 )    $ 1,197   

Other investments at fair value

     43        16        3        —          —          —          —          62   

Derivative assets3

     1,004        (353 )      —          350        (179 )      —          —          822   

Separate account assets

     1,952        73        —          —          —          —          —          2,025   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Assets at fair value

   $ 4,590      $ (260 )    $ 80      $ 457      $ (435 )    $ 51      $ (377 )    $ 4,106   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Liabilities

                

Future policy benefits and claims:

                

Living benefits

   $ (1,842 )    $ 1,185      $ —        $ —        $ —        $ —        $ —        $ (657 ) 

Indexed products

     (63 )      (28 )      —          —          —          —          —          (91 ) 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total future policy benefits and claims

   $ (1,905 )    $ 1,157      $ —        $ —        $ —        $ —        $ —        $ (748 ) 

Derivative liabilities3

     (6 )      1        —          —          —          —          —          (5 ) 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Liabilities at fair value

   $ (1,911 )    $ 1,158      $ —        $ —        $ —        $ —        $ —        $ (753 ) 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

1 

Net gains and losses included in operations are reported in net realized investment gains and losses, other-than-temporary impairment losses and interest credited to policyholder accounts. The net unrealized gains on separate account assets is attributable to contractholders and therefore is not included in the Company’s earnings. The change in unrealized gains (losses) in operations on assets and liabilities still held as of the end of the year was $16 million for other investments at fair value, $(257) million for derivative assets, $1.2 billion for future policy benefits and claims and $(1) million for derivative liabilities.

2 

Non-binding broker quotes were utilized to determine fair value of $1.1 billion of total fixed maturity securities as of December 31, 2012.

3 

Non-binding broker quotes were utilized to determine fair value of all Level 3 derivative assets and liabilities.

During the year ended December 31, 2012, transfers from Level 1 to Level 2 within the debt securities issued by foreign governments were $42 million. There were no transfers from Level 2 to Level 1 during the year ended December 31, 2012.

Transfers into and out of Level 3 during the year ended December 31, 2012 represent changes in the sources used to price certain securities and the Company’s assumptions related to the observability of certain inputs.

As discussed in Note 2, the valuation of embedded derivatives in living benefit guarantees incorporates many inputs, including significant unobservable inputs for mortality, lapse rates, wait period and benefit utilization. The Company derives these inputs, which vary widely by product, attained age, policy duration, benefits in the money and the existence of surrender charges, from current experience and industry data. The fair value for these benefits is calculated as the mean of discounted cash flows across numerous random scenarios, an approach that is commonly used by the insurance industry for this type of valuation. This process considers a broader range of assumptions than what would be found in a standard deterministic approach.

 

37

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table summarizes significant unobservable inputs used for fair value measurements for living benefits liabilities classified as Level 3 as of December 31, 2012:

 

Unobservable Inputs

   

Range

Mortality

    0.1%-8%2

Lapse

    0%-35%

Wait period

    0 yrs – 30 yrs3

Efficiency of benefit utilization1

    70%-100%

Non-performance risk

    See footnote 4

Index volatility

    15%-25%

 

1 

The unobservable input is not applicable to GMABs.

2 

Represents the mortality for the majority of business with living benefits, with policyholders ranging from 45 to 85.

3 

A portion of the contractholders could never use the benefit, which would extend the range to an indeterminate period.

4 

To reflect non-performance risk, benefits paid to policyholders are assumed to be reduced by 10% within the discounted cash flows projection whenever the S&P index is simulated to go below a certain threshold designed to represent non-performance.

The following changes in any of the significant unobservable inputs presented in the table above may result in a change in the fair value measurements of the living benefits liability:

Higher mortality rates tend to decrease the value of the liability and lower mortality rates tend to increase the value of the liability.

Higher lapse rates tend to decrease the value of the liability and lower lapse rates tend to increase the value of the liability. Factors that impact the predicted lapse rate can include: age, policy duration, policy size, benefit in-the-moneyness and applicable surrender charges. All else being equal, policies that are in-the-money will have lower lapse rates than policies that are out-of-the-money, and policies that have a surrender charge present will have lower lapse rates than policies without a surrender charge.

The assumed wait period and the efficiency of utilization determine the timing and amount of living benefits withdrawals. These assumptions vary by the product type, age of the policyholder and policy duration. Many products have a bonus feature which enhances the guarantee on every policy anniversary for the first ten years so long as withdrawals have not commenced. All else being equal, policies commencing withdrawals at a time around the year ten bonus will have higher liability values than policies commencing withdrawals 20 years after issue or policies commencing withdrawals only one year after issue. In addition, policies that are assumed to withdraw the maximum permitted amount will have a higher liability value than a policy that is assumed to withdraw less than the maximum allowed amount.

Higher non-performance risk tends to decrease the value of the liability and lower non-performance risk tends to increase the value of the liability.

Higher index volatility tends to increase the value of the liability and lower index volatility tends to decrease the value of the liability.

Separate Accounts

The Company’s separate account assets include an investment in a mutual fund with a non-readily determinable fair value. Net asset value has been used to estimate the fair value of this investment as a practical expedient. The investments are included in Level 3 as they may not be redeemed until a seven year guarantee period expires in 2016. The investment strategy of this fund is to build a portfolio where the assets shall be sufficient to achieve a target portfolio value by the end of the seven year guarantee period. The net asset value of this fund reported in separate account assets was $1.6 billion and $1.3 billion as of December 31, 2012 and 2011, respectively.

 

38

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

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

   $ 620      $ 6      $ 4      $ 630   

Obligations of states and political subdivisions

     —          1,678        —          1,678   

Debt securities issued by foreign governments

     120        —          —          120   

Corporate public securities

     1        15,239        117        15,357   

Corporate private securities

     —          3,089        1,209        4,298   

Residential mortgage-backed securities

     563        4,653        8        5,224   

Commercial mortgage-backed securities

     —          1,377        2        1,379   

Collateralized debt obligations

     —          55        247        302   

Other asset-backed securities

     —          209        4        213   
 

 

 

    

 

 

    

 

 

    

 

 

  

Total fixed maturity securities at fair value

   $ 1,304      $ 26,306      $ 1,591      $ 29,201   

Equity securities

     1        14        5        20   

Short-term investments

     23        1,102        —          1,125   

Trading securities

     —          —          38        38   
 

 

 

    

 

 

    

 

 

    

 

 

  

Total other investments at fair value

   $ 24      $ 1,116      $ 43      $ 1,183   
 

 

 

    

 

 

    

 

 

    

 

 

  

Investments at fair value

   $ 1,328      $ 27,422      $ 1,634      $ 30,384   
 

 

 

    

 

 

    

 

 

    

 

 

  

Derivative assets

     —          2,204        1,004        3,208   

Separate account assets

     62,242        1,000        1,952        65,194   
 

 

 

    

 

 

    

 

 

    

 

 

  

Assets at fair value

   $ 63,570      $ 30,626      $ 4,590      $ 98,786   
 

 

 

    

 

 

    

 

 

    

 

 

  

Liabilities

        

Future policy benefits and claims:

        

Living benefits

   $ —        $ —        $ (1,842 )    $ (1,842 ) 

Indexed products

     —          —          (63 )      (63 ) 
 

 

 

    

 

 

    

 

 

    

 

 

  

Total future policy benefits and claims

   $ —        $ —        $ (1,905 )    $ (1,905 ) 

Derivative liabilities

     —          (2,209 )      (6 )      (2,215 ) 
 

 

 

    

 

 

    

 

 

    

 

 

  

Liabilities at fair value

   $ —        $ (2,209 )    $ (1,911 )    $ (4,120 ) 
 

 

 

    

 

 

    

 

 

    

 

 

  

 

39

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis during the year ended December 31, 2011:

 

     Balance as of
December 31,
2010		     Net gains (losses)                 Transfers
into
Level 3		     Transfers
out of
Level 3		     Balance as of
December 31,
2011		  

(in millions)

     In  operations1     In OCI     Purchases     Sales        

Assets

                

Investments:

                

Fixed maturity securities:

                

Corporate private securities

   $ 1,161      $ (10 )    $ 26      $ 161      $ (242 )    $ 163      $ (50 )    $ 1,209   

Collateralized debt obligations

     191        (2 )      5        87        (34 )      —          —          247   

Other fixed maturity securities

     143        5        4        57        (63 )      4        (15 )      135   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total fixed maturity securities at fair value

   $ 1,495      $ (7 )    $ 35      $ 305      $ (339 )    $ 167      $ (65 )    $ 1,591   

Other investments at fair value

     45        (4 )      —          5        (3 )      —          —          43   

Derivative assets

     211        131        —          719        (57 )      —          —          1,004   

Separate account assets

     1,805        147        —          —          —          —          —          1,952   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Assets at fair value

   $ 3,556      $ 267      $ 35      $ 1,029      $ (399 )    $ 167      $ (65 )    $ 4,590   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Liabilities

                

Future policy benefits and claims:

                

Living benefits

   $ (168 )    $ (1,674 )    $ —        $ —        $ —        $ —        $ —        $ (1,842 ) 

Indexed products

     (58 )      (5 )      —          —          —          —          —          (63 ) 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total future policy benefits and claims

   $ (226 )    $ (1,679 )    $ —        $ —        $ —        $ —        $ —        $ (1,905 ) 

Derivative liabilities

     (4 )      (2 )      —          —          —          —          —          (6 ) 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Liabilities at fair value

   $ (230 )    $ (1,681 )    $ —        $ —        $ —        $ —        $ —        $ (1,911 ) 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

1 

Net gains and losses included in operations are reported in net realized investment gains and losses, other-than-temporary impairment losses and interest credited to policyholder account values. The net unrealized gains on separate account assets is attributable to contractholders and therefore is not included in the Company’s earnings. The change in unrealized gains (losses) in operations on assets and liabilities still held at the end of the year was $(6) million for other investments at fair value, $154 million for derivative assets and $(1.7) million for future policy benefits and claims.

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.

Fair Value Option

The Company assesses the fair value option election for newly acquired financial assets or liabilities on a prospective basis. Except for synthetic collateralized debt obligations, there are no material assets or liabilities for which the Company elected the fair value option.

Fair Value on a Nonrecurring Basis

The Company measures certain mortgage loans at fair value, or fair value of the collateral, 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.

 

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Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Financial Instruments Not Carried at Fair Value

The following table summarizes the carrying value and fair value of the Company’s financial instruments not carried at fair value as of the dates indicated. The valuation techniques used to estimate these fair values are described below.

 

     December 31, 2012      December 31, 2011  

(in millions)

    Carrying
value		      Fair
value		      Level 2      Level 3      Carrying
value		      Fair
value		  

Assets

                  

Investments:

                  

Mortgage loans, net of allowance

    $ 5,827       $ 5,988       $ —         $ 5,988       $ 5,748       $ 5,861   

Policy loans

    $ 980       $ 980       $ —         $ 980       $ 1,008       $ 1,008   

Liabilities

                  

Investment contracts

    $ 20,123       $ 19,561       $ —         $ 19,561       $ 18,318       $ 17,992   

Short-term debt

    $ 300       $ 300       $ —         $ 300       $ 777       $ 777   

Long-term debt

    $ 1,038       $ 1,323       $ 1,282       $ 41       $ 991       $ 1,081   

Mortgage loans, net of allowance. The fair values of mortgage loans are estimated using discounted cash flow analyses based on interest rates currently being offered for similar loans to borrowers with similar credit ratings.

Policy loans. The carrying amount reported in the consolidated balance sheets approximates fair value.

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.

Short-term debt. The carrying amount reported in the consolidated balance sheets approximates fair value.

Long-term debt. The fair values for long-term debt are based on estimated market prices using observable inputs from similar debt instruments.

 

(9) Goodwill

The following table summarizes changes in the carrying value of goodwill by segment for the years indicated:

 

(in millions)

    Retirement
Plans		      Individual
Products &
Solutions -
Life and
NBSG		      Total  

Balance as of December 31, 2010

    $         25       $         175       $         200   

Adjustments

      —           —           —     
  

 

 

     

 

 

     

 

 

  

Balance as of December 31, 2011

    $ 25       $ 175       $ 200   

Adjustments

      —           —           —     
  

 

 

     

 

 

     

 

 

  

Balance as of December 31, 2012

    $ 25       $ 175       $ 200   
  

 

 

     

 

 

     

 

 

  

The Company’s annual impairment testing did not result in any impairment on existing goodwill during 2012, 2011 and 2010. As of the 2012, 2011 and 2010 annual impairment testing, the fair value of the reporting units with goodwill was in excess of the carrying value. The goodwill balances as of December 31, 2012 and 2011 have not been previously impaired.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

(10) Closed Block

The amounts shown in the following tables for assets, liabilities, revenues and expenses of the closed block are those that enter into the determination of amounts that are to be paid to policyholders.

The following table summarizes financial information for the closed block, as of the dates indicated:

 

                                     

(in millions)

    December 31,
2012		     December 31,
2011		  

Liabilities:

     

Future policyholder benefits

    $ 1,732      $ 1,761   

Policyholder funds and accumulated dividends

      142        143   

Policyholder dividends payable

      24        27   

Policyholder dividend obligation

      198        156   

Other policy obligations and liabilities

      32        26   
  

 

 

    

 

 

  

Total liabilities

    $ 2,128      $ 2,113   
  

 

 

    

 

 

  

Assets:

     

Fixed maturity securities, available-for-sale

    $ 1,511      $ 1,424   

Mortgage loans, net of allowance

      183        210   

Policy loans

      164        170   

Other assets

      77        105   
  

 

 

    

 

 

  

Total assets

    $ 1,935      $ 1,909   
  

 

 

    

 

 

  

Excess of reported liabilities over assets

      193        204   
  

 

 

    

 

 

  

Portion of above representing other comprehensive income:

     

Increase in unrealized gain on fixed maturity securities available-for-sale

    $ 45      $ 42   

Adjustment to policyholder dividend obligation

      (45 )      (42 ) 
  

 

 

    

 

 

  

Total

    $ —        $ —     
  

 

 

    

 

 

  

Maximum future earnings to be recognized from assets and liabilities

    $ 193      $ 204   
  

 

 

    

 

 

  

Other comprehensive income:

     

Fixed maturity securities available-for-sale:

     

Fair value

    $ 1,511      $ 1,424   

Amortized cost

      1,334        1,292   

Shadow policyholder dividend obligation

      (177 )      (132 ) 
  

 

 

    

 

 

  

Net unrealized appreciation

    $ —        $ —     
  

 

 

    

 

 

  

 

42

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table summarizes closed block operations for the years ended:

 

                                                              

(in millions)

    December 31,
2012		     December 31,
2011		     December 31,
2010		  

Revenues:

       

Premiums

    $ 73      $ 77      $ 83   

Net investment income

      98        102        101   

Realized investment gains (losses)

      1        (3 )      (3 ) 

Realized losses credited to policyholder benefit obligation

      (5 )      (1 )      (1 ) 
  

 

 

    

 

 

    

 

 

  

Total revenues

    $ 167      $ 175      $ 180   
  

 

 

    

 

 

    

 

 

  

Benefits and expenses:

       

Policy and contract benefits

    $ 134      $ 145      $ 131   

Change in future policyholder benefits and interest credited to policyholder accounts

      (27 )      (35 )      (23 ) 

Policyholder dividends

      50        55        56   

Change in policyholder dividend obligation

      (8 )      (8 )      (3 ) 

Other expenses

      1        1        1   
  

 

 

    

 

 

    

 

 

  

Total benefits and expenses

    $ 150      $ 158      $ 162   
  

 

 

    

 

 

    

 

 

  

Total revenues, net of benefits and expenses, before federal income tax expense

    $ 17      $ 17      $ 18   

Federal income tax expense

      6        6        6   
  

 

 

    

 

 

    

 

 

  

Revenues, net of benefits and expenses and federal income tax expense

    $ 11      $ 11      $ 12   
  

 

 

    

 

 

    

 

 

  

Maximum future earnings from assets and liabilities:

       

Beginning of period

    $ 204      $ 215      $ 227   

Change during period

      (11 )      (11 )      (12 ) 
  

 

 

    

 

 

    

 

 

  

End of period

    $ 193      $ 204      $ 215   
  

 

 

    

 

 

    

 

 

  

Cumulative closed block earnings from inception through December 31, 2012, 2011 and 2010 were higher than expected as determined in the actuarial calculation. Therefore, policyholder dividend obligations (excluding the adjustment for unrealized gains on available-for-sale securities) were $21 million, $23 million and $31 million as of December 31, 2012, 2011 and 2010, respectively.

 

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Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

(11) Short-Term Debt

The Company classifies debt as short-term if the maturity date at inception is less than one year and all other debt instruments as long-term.

The following table summarizes short-term debt and weighted average annual interest rates, as of the dates indicated:

 

(in millions)

    December 31,
2012		      December 31,
2011		  

$600 million commercial paper program (0.29% and 0.30%, respectively)

    $ 300       $ 300   

$600 million promissory note and line of credit (1.90% and 1.73%, respectively)

    $ —         $ 477   
  

 

 

     

 

 

  

Total short-term debt

    $ 300       $ 777   
  

 

 

     

 

 

  

In March 2012, NLIC entered into an agreement with the FHLB that allows the Company access to borrow up to $250 million and expires on March 21, 2013. The Company had $10.2 billion in eligible collateral and no amounts outstanding under the agreement as of December 31, 2012. Additionally, as part of the agreement, NLIC purchased $25 million in capital stock with the FHLB.

In May 2011, NMIC, NFS, and NLIC entered into a $600 million revolving variable rate credit facility upon expiration of its existing facility of the same amount. The new facility matures on May 6, 2015 and is subject to various covenants, as defined in the agreement. NLIC had no amounts outstanding under the facility as of December 31, 2012 and 2011.

In April 2011, the Company entered into a $600 million unsecured revolving promissory note and line of credit agreement with its parent company, NFS. Outstanding principal balances of the line of credit bear interest at the rate of six-month U.S. LIBOR plus 1.25%. Interest is due and payable as of the last day of each interest period, as defined in the agreement, while there are outstanding principal balances. As of December 31, 2012, the agreement was cancelled with no outstanding balance.

The Company has entered into an agreement with its custodial bank to borrow against the cash collateral that is posted in connection with its securities lending program. The maximum amount available under the agreement is $350 million. The borrowing rate on this program is equal to one-month U.S. LIBOR. The Company had no amounts outstanding under this agreement as of December 31, 2012 and 2011.

The terms of each debt instrument contain various restrictive covenants, including, but not limited to, minimum statutory surplus and minimum net worth requirements, and maximum debt to tangible net worth requirements, as defined in the agreements. The Company was in compliance with all covenants as of December 31, 2012 and 2011.

The amount of interest paid on short-term debt was $6 million in 2012, $5 million in 2011 and immaterial in 2010.

 

(12) Long-Term Debt

The following table summarizes long-term debt, as of the dates indicated:

 

(in millions)

    December 31,
2012		      December 31,
2011		  

8.15% surplus note, due June 26, 2032, payable to NFS

    $ 300       $ 300   

7.50% surplus note, due December 17, 2031, payable to NFS

      300         300   

6.75% surplus note, due December 23, 2033, payable to NFS

      100         100   

Variable funding surplus note, due December 31, 2040

      297         285   

Other

      41         6   
  

 

 

     

 

 

  

Total long-term debt

    $ 1,038       $ 991   
  

 

 

     

 

 

  

 

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Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

On December 31, 2010, Olentangy Reinsurance, LLC, a special purpose financial captive insurance subsidiary of NLAIC domiciled in the State of Vermont, 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. LIBOR plus 2.80% payable quarterly. Olentangy Reinsurance, LLC 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 $313 million in 2016. The Company made interest payments on this surplus note totaling $10 million and $9 million for the years ending December 31, 2012 and 2011, respectively. Any payment of interest or principal on the note requires the prior approval of the State of Vermont.

The Company made interest payments to NFS on surplus notes totaling $54 million for the years ended December 31, 2012, 2011 and 2010. Payments of interest and principal under the notes require the prior approval of the ODI.

 

(13) Federal Income Taxes

The following table summarizes the federal income tax expense (benefit) attributable to income (loss) before loss attributable to noncontrolling interests, for the years ended:

 

(in millions)

    December 31,
2012		     December  31,
20111		     December  31,
20101		  

Current tax (benefit) expense

    $ (144 )    $ 55      $ (91 ) 

Deferred tax expense (benefit)

      243        (482 )      103   
  

 

 

    

 

 

    

 

 

  

Total tax expense (benefit)

    $ 99      $ (427 )    $ 12   
  

 

 

    

 

 

    

 

 

  

 

1 

The balances reflect a change in accounting principle, as described in Note 2.

The following table summarizes how the total federal income tax expense (benefit) differs from the amount computed by applying the U.S. federal income tax rate to income (loss) before loss attributable to noncontrolling interests, for the years ended:

 

                                                                                         
     December 31,
2012		     December  31,
20111		     December  31,
20101		  

(in millions)

    Amount         %         Amount         %         Amount         %      

Rate reconciliation:

             

Computed (expected tax expense (benefit))

    $ 245        35 %    $ (297 )      35 %    $ 59        35 % 

Dividends received deduction

      (75 )      (11 )%      (99 )      12 %      (50 )      (29 )% 

Impact of noncontrolling interest

      21        3 %      20        (3 )%      21        12 % 

Tax credits

      (85 )      (12 )%      (30 )      3 %      (27 )      (16 )% 

Change in tax contingency reserve

      (4 )      (1 )%      (15 )      2 %      (5 )      (3 )% 

Other, net

      (3 )      (1 )%      (6 )      1 %      14        8 % 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 99        14 %    $ (427 )      50 %    $ 12        7 % 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

1 

The balances reflect a change in accounting principle, as described in Note 2.

The Company’s current federal income tax receivable was $61 million and $16 million as of December 31, 2012 and 2011, respectively.

Total federal income taxes (refunded) paid were $(95) million, $121 million, and $(35) million for the years ended December 31, 2012, 2011, and 2010, respectively.

 

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Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

No material changes in estimated income tax expense were recorded in 2012 or 2010. During 2011, the Company recorded a tax benefit of $10 million primarily related to differences between the 2010 estimated tax liability and the amounts reported on the Company’s 2010 tax return. These changes in estimates were primarily driven by the Company’s separate account dividends received deduction (“DRD”).

As of December 31, 2012, the Company has $87 million in low-income-housing credit carryforwards, which expire between 2024 and 2032, and $169 million in alternative minimum tax credit carryforwards, which have an unlimited carryforward. In addition, the Company has $32 million in foreign tax credit carryforwards which expire between 2019 and 2022. The Company expects to fully utilize all carryforwards.

The following table summarizes the tax effects of temporary differences that gave rise to significant components of the net deferred tax (liability) asset included in other assets in the consolidated balance sheets, as of the dates indicated:

 

                             

(in millions)

    December 31,
2012		     December  31,
20111		  

Deferred tax assets:

     

Future policy benefits and claims

    $ 1,295      $ 1,193   

Derivatives

      94        574   

Tax credit carryforwards

      288        185   

Other

      478        330   
  

 

 

    

 

 

  

Gross deferred tax assets

    $ 2,155      $ 2,282   

Valuation allowance

      (18 )      (18 ) 
  

 

 

    

 

 

  

Net deferred tax assets

    $ 2,137      $ 2,264   
  

 

 

    

 

 

  

Deferred tax liabilities:

     

Deferred policy acquisition costs

    $ (874 )    $ (963 ) 

Available-for-sale securities

      (1,338 )      (840 ) 

Value of business acquired

      (81 )      (86 ) 

Other

      (158 )      (148 ) 
  

 

 

    

 

 

  

Gross deferred tax liabilities

    $ (2,451 )    $ (2,037 ) 
  

 

 

    

 

 

  

Net deferred tax (liability) asset

    $ (314 )    $ 227   
  

 

 

    

 

 

  

 

1 

The balances reflect a change in accounting principle, as described in Note 2.

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. The valuation allowance was $18 million as of December 31, 2012 and 2011. There was no change in valuation allowance for the year ended December 31, 2012 or 2010, while there was a change of $6 million for the year ended December 31, 2011. 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.

 

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Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following table is a rollforward of the beginning and ending uncertain tax positions, including permanent and temporary differences, but excluding interest and penalties:

 

                                                                 

(in millions)

    2012     2011     2010  

Balance at beginning of period

    $ 76      $ 119      $ 95   

Additions for current year tax positions

      (2 )      9        18   

Additions for prior years tax positions

      25        —          19   

Reductions for prior years tax positions

      (63 )      (52 )      (13 ) 
  

 

 

    

 

 

    

 

 

  

Balance at end of period

    $ 36      $ 76      $ 119   
  

 

 

    

 

 

    

 

 

  

The Company does not anticipate any significant changes to unrecognized tax benefits during the next twelve months.

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 2008 tax year. The IRS is conducting an examination of the Company’s U.S. income tax returns for the years 2009 through 2010. 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.

 

(14) Statutory Financial Information

Statutory Results

The Company’s life insurance subsidiaries are 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 primarily due to charging policy acquisition and other 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 table summarizes the statutory net income (loss) and statutory capital and surplus for the Company’s primary life insurance subsidiary for the years ended:

 

                                               

(in millions)

    December 31,
2012		     December 31,
2011		     December 31,
2010		  

Statutory net income (loss)

       

NLIC

    $ 764      $ 18      $ 560   

NLAIC

    $ (65 )    $ (61 )    $ (50 ) 

Statutory capital and surplus

       

NLIC

    $ 3,837      $ 3,591      $ 3,686   

NLAIC

    $ 280      $ 302      $ 287   

 

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Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

Dividend Restrictions

The payment of dividends by NLIC is subject to restrictions set forth in the insurance laws and regulations of the State of Ohio, its domiciliary state. The State of Ohio insurance laws require Ohio-domiciled life insurance companies to 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, 2012, NLIC paid a cash dividend of $40 million to NFS. During the year ended December 31, 2011 and 2010, NLIC did not pay any dividends to NFS. As of January 1, 2013, NLIC has the ability to pay dividends to NFS totaling $724 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 payment of dividends by the Company may also be subject to restrictions set forth in the insurance laws of the state of New York that limit the amount of statutory profits on the Company’s participating policies (measured before dividends to policyholders) available for the benefit of the Company and its stockholders.

The Company currently does not expect such regulatory requirements to impair the ability to pay operating expenses and dividends in the future.

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 NLIC and NLAIC are domiciled, imposes minimum RBC requirements that are developed by the NAIC. The formulas in the model for determining the amount of RBC specify various weighting factors that are applied to financial balances or various levels of activity based on the perceived degree of risk. Regulatory compliance is determined by a ratio of total adjusted capital, 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, all of which require specified corrective action. NLIC and NLAIC each exceeded the minimum RBC requirements for all periods presented herein.

 

(15) Related Party Transactions

The Company has entered into significant, recurring transactions and agreements with NMIC, other affiliates and subsidiaries as a part of its ongoing operations. These include annuity and life insurance contracts, employee benefit plans, office space leases, and agreements related to reinsurance, cost sharing, administrative services, marketing, intercompany loans, intercompany repurchases, cash management services and software licensing. 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.

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, 2012, 2011 and 2010, the Company made payments to NMIC and NSC totaling $283 million, $241 million and $250 million, respectively.

 

48

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The Company has issued group annuity and life insurance contracts and performs administrative services for various employee benefit plans sponsored by NMIC or its affiliates. Total account values of these contracts were $3.2 billion and $3.0 billion as of December 31, 2012 and 2011, respectively. Total revenues from these contracts were $140 million, $148 million and $139 million for the years ended December 31, 2012, 2011 and 2010, respectively, and include policy charges, net investment income from investments backing the contracts and administrative fees. Total interest credited to the account balances was $113 million, $122 million and $115 million for the years ended December 31, 2012, 2011 and 2010, respectively. The terms of these contracts are materially consistent with what the Company offers to unaffiliated parties.

The Company leases office space from NMIC. For the years ended December 31, 2012, 2011 and 2010, the Company made lease payments to NMIC of $15 million, $14 million and $20 million, respectively. In addition, the Company leases office space to an affiliate of NMIC.

NLIC has a reinsurance agreement with NMIC whereby all of NLIC’s accident and health business not ceded to unaffiliated reinsurers is ceded to NMIC on a modified coinsurance basis. Either party may terminate the agreement on January 1 of any year with prior notice. Under a modified coinsurance agreement, the ceding company retains invested assets, and investment earnings are paid to the reinsurer. Under the terms of NLIC’s agreements, the investment risk associated with changes in interest rates is borne by the reinsurer. The ceding of risk does not discharge the original insurer from its primary obligation to the policyholder. The Company believes that the terms of the modified coinsurance agreements are consistent in all material respects with what the Company could have obtained with unaffiliated parties. Revenues ceded to NMIC for the years ended December 31, 2012, 2011 and 2010 were $161 million, $203 million and $209 million, respectively, while benefits, claims and expenses ceded during these years were $167 million, $212 million and $241 million, 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, 2012 and 2011, customer allocations to NFG funds totaled $45.0 billion and $39.7 billion, respectively. For the years ended December 31, 2012, 2011 and 2010, NFG paid the Company $144 million, $129 million and $103 million, respectively, for the distribution and servicing of these funds.

Amounts on deposit with NCMC for the benefit of the Company were $854 million and $994 million as of December 31, 2012 and 2011, respectively.

Refer to Note 12 for discussion of variable funding surplus note between Olentangy Reinsurance, LLC and Nationwide Corporation.

Certain annuity products are sold through affiliated companies, which are also subsidiaries of NFS. Total commissions and fees paid to these affiliates for the years ended December 31, 2012, 2011 and 2010 were $54 million, $64 million and $61 million, respectively.

During 2012, the Company had no sales of commercial mortgage loans to NMIC. During 2011, the Company sold, at fair value, commercial mortgage loans with a carrying value of $41 million to NMIC. The sale resulted in a net realized loss of $5 million in 2011.

The Company provides financing to Nationwide Realty Investors, LTD, a subsidiary of NMIC. As of December 31, 2012 and 2011, the Company had notes receivable outstanding of $126 million and $148 million, respectively.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

(16) Contingencies

Legal and Regulatory Matters

The Company is subject to legal and regulatory proceedings in the ordinary course of its business. The Company’s legal and regulatory matters include proceedings specific to the Company and other proceedings generally applicable to business practices in the industries in which the Company operates. These matters are subject to many uncertainties, and given their complexity and scope, their outcomes cannot be predicted. Regulatory proceedings could also affect the outcome of one or more of the Company’s litigation matters. Furthermore, it is often not possible to determine the ultimate outcomes of the pending regulatory investigations and legal proceedings or to provide reasonable ranges of potential losses with any degree of certainty. Some matters, including certain of those referred to below, are in very preliminary stages, and the Company does not have sufficient information to make an assessment of the plaintiffs’ claims for liability or damages. In some of the cases seeking to be certified as class actions, the court has not yet decided whether a class will be certified or (in the event of certification) the size of the class and class period. In many of the cases, the plaintiffs are seeking undefined amounts of damages or other relief, including punitive damages and equitable remedies, which are difficult to quantify and cannot be defined based on the information currently available. The Company believes, however, that based on currently known information, the ultimate outcome of all pending legal and regulatory matters is not likely to have a material adverse effect on the Company’s consolidated financial position. Nonetheless, given the large or indeterminate amounts sought in certain of these matters and the inherent unpredictability of litigation, it is possible that such outcomes could materially affect the Company’s consolidated financial position or results of operations 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 IRS and state insurance authorities. Such regulatory entities may, in the normal course, be engaged in general or targeted inquiries, examinations and investigations of the Company and/or its affiliates. The financial services industry has been the subject of increasing scrutiny in connection with a broad spectrum of regulatory issues; with respect to all such scrutiny directed at the Company and/or its affiliates, the Company is cooperating with regulators. The Company will cooperate with NMIC insofar as any inquiry, examination or investigation encompasses NMIC’s operations.

In October 2012, NLIC and NLAIC entered into a Regulatory Settlement Agreement with the Florida Office of Insurance Regulation and twenty-one 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 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.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

On November 20, 2007, 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 February 15, 2013, the Court issued its Order determining the amount of fees due to PEBCO on its indemnification claim. The Company has until March 29, 2013 to file a notice of appeal. 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. On November 18, 2009, the plaintiffs filed a sixth amended complaint amending the list of named plaintiffs and claiming to represent a class of qualified retirement plan trustees under 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 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. On December 18, 2012, the District Court heard oral argument on the motion for class certification. 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. NMIC and NLIC filed a motion to dismiss. By order dated January 18, 2012, the State Court issued an order dismissing the lawsuit. On January 30, 2012, plaintiffs filed their appeal. On October 24, 2012, the Court of Appeals affirmed the dismissal. On November 9, 2012, plaintiffs filed a petition for rehearing en banc. On December 14, 2012, the Court of Appeals denied the petition for rehearing. Plaintiffs filed a notice of appeal to the Ohio Supreme Court on January 24, 2013. NMIC and NLIC have filed an opposition memorandum.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

In 2012 the Plaintiff, Debtor in Possession Lehman Brothers Special Financing, Inc., filed a class action suit in the United States Bankruptcy Court for the Southern District of New York seeking the recovery of nearly $3.0 billion in assets from all the named defendants including NLIC and NMIC. This litigation arises from two collateralized debt obligation transactions, 801 Grand and Alta, which resulted in payments to NLIC and NMIC. In 2008 the Plaintiff and its parent company, Lehman Brothers Holding, Inc. filed for bankruptcy which triggered an early termination of the above transactions. The Plaintiff seeks to have sums returned to the bankruptcy estate in addition to prejudgment interest and costs. The case is currently stayed and answers of defendants are due on March 5, 2013.

Tax Matters

The Company’s federal income tax returns are routinely audited by the IRS. The Company has established tax reserves as described in Note 2. The Company believes its tax reserves reasonably provide for potential assessments that may result from IRS examinations and other tax-related matters for all open tax years.

Indemnifications

In the normal course of business, the Company provides standard indemnifications to contractual counterparties. The types of indemnifications typically provided include breaches of representations and warranties, taxes and certain other liabilities, such as third party lawsuits. The indemnification clauses are often standard contractual terms and are entered into in the normal course of business based on an assessment that the risk of loss would be remote. The terms of the indemnifications vary in duration and nature. In many cases, the maximum obligation is not explicitly stated and the contingencies triggering the obligation to indemnify have not occurred and are not expected to occur. Consequently, the maximum amount of the obligation under such indemnifications is not determinable. Historically, the Company has not made any material payments pursuant to these obligations.

 

(17) Reinsurance

The following table summarizes the effects of reinsurance on life, accident and health insurance in force and premiums for the years ended:

 

                                                                 

(in millions)

    December 31,
2012		     December 31,
2011		     December 31,
2010		  

Premiums

       

Direct

    $ 890      $ 832      $ 808   

Assumed

      —          —          5   

Ceded

      (255 )      (301 )      (329 ) 
  

 

 

    

 

 

    

 

 

  

Net

    $ 635      $ 531      $ 484   
  

 

 

    

 

 

    

 

 

  

Life, accident and health insurance in force

       

Direct

    $ 216,002      $ 209,732      $ 208,920   

Assumed

      5        5        10   

Ceded

      (59,895 )      (60,499 )      (64,755 ) 
  

 

 

    

 

 

    

 

 

  

Net

    $ 156,112      $ 149,238      $ 144,175   
  

 

 

    

 

 

    

 

 

  

Total amounts recoverable under reinsurance contracts totaled $684 million, $704 million and $739 million as of December 31, 2012, 2011 and 2010, respectively.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

(18) Segment Information

Management views the Company’s business primarily based on its underlying products and uses this basis to define its four reportable segments: Individual Products and Solutions-Annuity (formerly named Individual Investments), Retirement Plans, Individual Products and Solutions-Life and NBSG (formerly named Individual Protection) and Corporate and Other.

The primary segment profitability measure that management uses is a non-GAAP financial measure called pre-tax operating earnings (loss), which is calculated by adjusting income before federal income taxes to exclude: (1) net realized investment gains and losses, except for operating items (trading portfolio realized gains and losses, trading portfolio valuation changes and net realized gains and losses related to hedges on GMDB contracts); (2) other-than-temporary impairment losses; (3) the adjustment to amortization of DAC and VOBA related to net realized investment gains and losses; and (4) net loss attributable to noncontrolling interest.

Individual Products and Solutions-Annuity

The Individual Products & Solutions - Annuity segment consists of individual annuity products marketed under the Nationwide DestinationSM and other Nationwide-specific or private label brands. Deferred annuity contracts provide the customer with tax-deferred accumulation of savings and flexible payout options including lump sum, systematic withdrawal or a stream of payments for life. In addition, deferred variable annuity contracts provide the customer with access to a wide range of investment options and asset protection features, while deferred fixed annuity contracts generate a return for the customer at a specified interest rate fixed for prescribed periods. Immediate annuities differ from deferred annuities in that the initial premium is exchanged for a stream of income for a certain period or for the owner’s lifetime without future access to the original investment. The majority of assets and recent sales for the Individual Products & Solutions - Annuity segment consist of deferred variable annuities.

Retirement Plans

The Retirement Plans segment is comprised of the Company’s private and public sector retirement plans business. The private sector primarily includes Internal Revenue Code (“IRC”) Section 401 fixed and variable group annuity business, and the public sector primarily includes IRC Section 457 and Section 401(a) business in the form of full-service arrangements that provide plan administration and fixed and variable group annuities as well as administration-only business.

Individual Products and Solutions-Life and NBSG

The Individual Products & Solutions - Life and NBSG segment consists of life insurance products, including individual variable universal life, COLI and BOLI products; traditional life insurance products; and fixed universal life insurance products. Life insurance products provide a death benefit and generally allow the customer to build cash value on a tax-advantaged basis.

Corporate and Other

The Corporate and Other segment includes non-operating realized gains and losses and related amortization, including mark-to-market adjustments on embedded derivatives, net of economic hedges, related to products with living benefits included in the Individual Products & Solutions - Annuity segment; other-than-temporary impairment losses and other revenues and expenses not allocated to other segments.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

The following tables summarize the Company’s business segment operating results for the years ended:

 

(in millions)

    Individual
Products and
Solutions-Annuity		     Retirement
Plans		      Individual Products
and Solutions-Life
and NBSG		      Corporate
and Other		     Total  

December 31, 2012

             

Revenues:

             

Policy charges

    $ 899      $ 94       $ 677       $ —        $ 1,670   

Premiums

      334        —           301         —          635   

Net investment income

      551        736         536         2        1,825   

Non-operating net realized investment gains1

      —          —           —           459        459   

Other-than-temporary impairment losses

      —          —           —           (31 )      (31 ) 

Other revenues2

      (124 )      —           —           22        (102 ) 
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Total revenues

    $ 1,660      $ 830       $ 1,514       $ 452      $ 4,456   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Benefits and expenses:

             

Interest credited to policyholder accounts

    $ 375      $ 457       $ 199       $ 7      $ 1,038   

Benefits and claims

      595        —           615         17        1,227   

Policyholder dividends

      —          —           54         —          54   

Amortization of DAC

      185        14         150         226        575   

Interest expense

      —          —           —           68        68   

Other operating expenses

      285        163         255         92        795   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Total benefits and expenses

    $ 1,440      $ 634       $ 1,273       $ 410      $ 3,757   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Income before federal income taxes and noncontrolling interests

    $ 220      $ 196       $ 241       $ 42      $ 699   
            

 

 

  

Less: non-operating net realized investment gains1

      —          —           —           (459 )   

Less: non-operating net other-than-temporary impairment losses

      —          —           —           31     

Less: adjustment to amortization of DAC and other related to net realized investment gains and losses

      —          —           —           243     

Less: net loss attributable to noncontrolling interest

      —          —           —           61     
  

 

 

    

 

 

     

 

 

     

 

 

    

Pre-tax operating earnings (loss)

    $ 220      $ 196       $ 241       $ (82 )   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Assets as of year end

    $ 58,707      $ 27,842       $ 25,301       $ 8,320      $ 120,170   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

 

1 

Excluding operating items (trading portfolio realized gains and losses, trading portfolio valuation changes and net realized gains and losses related to hedges on GMDB contracts).

2 

Includes operating items discussed above.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

(in millions)

    Individual
Products and
Solutions-Annuity		     Retirement
Plans		      Individual Products
and Solutions-Life
and NBSG		      Corporate
and Other		     Total  

December 31, 20113

             

Revenues:

             

Policy charges

    $ 781      $ 96       $ 629       $ —        $ 1,506   

Premiums

      234        —           297         —          531   

Net investment income

      527        715         533         69        1,844   

Non-operating net realized investment losses1

      —          —           —           (1,546 )      (1,546 ) 

Other-than-temporary impairment losses

      —          —           —           (67 )      (67 ) 

Other revenues2

      (59 )      —           —           (1 )      (60 ) 
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Total revenues

    $ 1,483      $ 811       $ 1,459       $ (1,545 )    $ 2,208   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Benefits and expenses:

             

Interest credited to policyholder accounts

    $ 374      $ 441       $ 198       $ 20      $ 1,033   

Benefits and claims

      476        —           598         (12 )      1,062   

Policyholder dividends

      —          —           67         —          67   

Amortization of DAC

      80        11         75         (101 )      65   

Interest expense

      —          —           —           70        70   

Other operating expenses

      269        166         238         87        760   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Total benefits and expenses

    $ 1,199      $ 618       $ 1,176       $ 64      $ 3,057   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Income (loss) before federal income taxes and noncontrolling interests

    $ 284      $ 193       $ 283       $ (1,609 )    $ (849 ) 
            

 

 

  

Less: non-operating net realized investment losses1

      —          —           —           1,546     

Less: non-operating net other-than-temporary impairment losses

      —          —           —           67     

Less: adjustment to amortization of DAC and other related to net realized investment gains and losses

      —          —           —           (115 )   

Less: net loss attributable to noncontrolling interest

      —          —           —           56     
  

 

 

    

 

 

     

 

 

     

 

 

    

Pre-tax operating earnings (loss)

    $ 284      $ 193       $ 283       $ (55 )   
  

 

 

    

 

 

     

 

 

     

 

 

    

Assets as of year end

    $ 57,741      $ 25,114       $ 22,503       $ 6,628      $ 111,986   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

 

1 

Excluding operating items (trading portfolio realized gains and losses, trading portfolio valuation changes and net realized gains and losses related to hedges on GMDB contracts).

2 

Includes operating items discussed above.

3 

The balances reflect a change in accounting principle, as described in Note 2.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

Notes to Consolidated Financial Statements, Continued

December 31, 2012, 2011 and 2010

 

(in millions)

    Individual
Products and
Solutions-Annuity		     Retirement
Plans		      Individual Products
and Solutions-Life
and NBSG		      Corporate
and Other		     Total  

December 31, 20103

             

Revenues:

             

Policy charges

    $ 646      $ 98       $ 652       $ 3      $ 1,399   

Premiums

      209        —           275         —          484   

Net investment income

      569        691         510         55        1,825   

Non-operating net realized investment losses1

      —          —           —           (177 )      (177 ) 

Other-than-temporary impairment losses

      —          —           —           (220 )      (220 ) 

Other revenues2

      (82 )      —           —           25        (57 ) 
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Total revenues

    $ 1,342      $ 789       $ 1,437       $ (314 )    $ 3,254   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Benefits and expenses:

             

Interest credited to policyholder accounts

    $ 391      $ 424       $ 199       $ 42      $ 1,056   

Benefits and claims

      354        —           524         (5 )      873   

Policyholder dividends

      —          —           78         —          78   

Amortization of DAC

      192        9         136         (38 )      299   

Interest expense

      —          —           —           55        55   

Other operating expenses

      244        165         237         76        722   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Total benefits and expenses

    $ 1,181      $ 598       $ 1,174       $ 130      $ 3,083   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

Income (loss) before federal income taxes and noncontrolling interests

    $ 161      $ 191       $ 263       $ (444 )    $ 171   
            

 

 

  

Less: non-operating net realized investment gains1

      —          —           —           177     

Less: non-operating net other-than-temporary impairment losses

      —          —           —           220     

Less: adjustment to amortization of DAC and other related to net realized investment gains and losses

      —          —           —           (48 )   

Less: net loss attributable to noncontrolling interest

      —          —           —           60     
  

 

 

    

 

 

     

 

 

     

 

 

    

Pre-tax operating earnings (loss)

    $ 161      $ 191       $ 263       $ (35 )   
  

 

 

    

 

 

     

 

 

     

 

 

    

Assets as of year end

    $ 52,786      $ 25,502       $ 22,434       $ 5,828      $ 106,550   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

  

 

1 

Excluding operating items (trading portfolio realized gains and losses, trading portfolio valuation changes and net realized gains and losses related to hedges on GMDB contracts).

2 

Includes operating items discussed above.

3 

The balances reflect a change in accounting principle, as described in Note 2.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

 

Schedule I Consolidated Summary of Investments – Other Than Investments in Related Parties

As of December 31, 2012 (in millions)

 

Column A

    Column B      Column C      Column D  

Type of investment

    Cost      Fair
value		      Amount at
which shown
in the
consolidated
balance sheet		  

Fixed maturity securities, available-for-sale:

         

Bonds:

         

U.S. Treasury securities and obligations of U.S. Government corporations and agencies

    $ 476       $ 597       $ 597   

Obligations of states and political subdivisions

      1,722         2,002         2,002   

Debt securities issued by foreign governments

      98         118         118   

Public utilities

      2,374         2,684         2,684   

All other corporate

      24,252         26,410         26,410   
  

 

 

     

 

 

     

 

 

  

Total fixed maturity securities, available-for-sale

    $ 28,922       $ 31,811       $ 31,811   
  

 

 

     

 

 

     

 

 

  

Equity securities, available-for-sale:

         

Common stocks:

         

Industrial, miscellaneous and all other

    $ 5       $ 8       $ 8   

Nonredeemable preferred stocks

      10         12         12   
  

 

 

     

 

 

     

 

 

  

Total equity securities, available-for-sale

    $ 15       $ 20       $ 20   
  

 

 

     

 

 

     

 

 

  

Trading assets

      49         54         54   

Mortgage loans, net of allowance

      5,871            5,827 1 

Policy loans

      980            980   

Other investments

      565            565   

Short-term investments

      1,034            1,034   
  

 

 

        

 

 

  

Total investments

    $ 37,436          $ 40,291   
  

 

 

        

 

 

  

 

1 

Difference from Column B primarily is attributable to valuation allowances due to impairments on mortgage loans (see Note 6 to the audited consolidated financial statements).

See accompanying notes to consolidated financial statements and report of independent registered public accounting firm.

 

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NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

 

Schedule III Supplementary Insurance Information

As of December 31, 2012, 2011 and 2010 and for each of the years then ended (in millions)

 

Column A

    Column B     Column C      Column D     Column E      Column F  

Year: Segment

    Deferred
policy
acquisition
costs3 		    Future policy
benefits, losses,
claims and
loss expenses		      Unearned
premiums1		     Other policy
claims and
benefits payable1		      Premium
revenue		  

2012

             

IPS - Annuity

    $ 2,110      $ 12,214            $ 334   

Retirement Plans

      168        13,628              —     

IPS - Life and NBSG

      1,442        9,564              301   

Corporate and Other

      (471 )      748              —     
  

 

 

    

 

 

          

 

 

  

Total

    $ 3,249      $ 36,154            $ 635   
  

 

 

    

 

 

          

 

 

  

2011

             

IPS - Annuity

    $ 2,232      $ 12,550            $ 234   

Retirement Plans

      172        12,638              —     

IPS - Life and NBSG

      1,421        9,338              297   

Corporate and Other

      (338 )      726              —     
  

 

 

    

 

 

          

 

 

  

Total

    $ 3,487      $ 35,252            $ 531   
  

 

 

    

 

 

          

 

 

  

2010

             

IPS - Annuity

    $ 1,761      $ 10,541            $ 209   

Retirement Plans

      172        11,874              —     

IPS - Life and NBSG

      1,354        9,163              275   

Corporate and Other

      (162 )      1,098              —     
  

 

 

    

 

 

          

 

 

  

Total

    $ 3,125      $ 32,676            $ 484   
  

 

 

    

 

 

          

 

 

  

Column A

    Column G     Column H      Column I     Column J      Column K  

Year: Segment

    Net
investment
income2 		    Benefits, claims,
losses and
settlement expenses		      Amortization
of deferred policy
acquisition costs3		     Other  operating
expenses2,3		      Premiums
written		  

2012

             

IPS - Annuity

    $ 551      $ 970       $ 185      $ 285      

Retirement Plans

      736        457         14        163      

IPS - Life and NBSG

      536        868         150        255      

Corporate and Other

      2        24         226        160      
  

 

 

    

 

 

     

 

 

    

 

 

     

Total

    $ 1,825      $ 2,319       $ 575      $ 863      
  

 

 

    

 

 

     

 

 

    

 

 

     

2011

             

IPS - Annuity

    $ 527      $ 850       $ 80      $ 269      

Retirement Plans

      715        441         11        166      

IPS - Life and NBSG

      533        863         75        238      

Corporate and Other

      69        8         (101 )      157      
  

 

 

    

 

 

     

 

 

    

 

 

     

Total

    $ 1,844      $ 2,162       $ 65      $ 830      
  

 

 

    

 

 

     

 

 

    

 

 

     

2010

             

IPS - Annuity

    $ 569      $ 745       $ 192      $ 244      

Retirement Plans

      691        424         9        165      

IPS - Life and NBSG

      510        801         136        237      

Corporate and Other

      55        37         (38 )      131      
  

 

 

    

 

 

     

 

 

    

 

 

     

Total

    $ 1,825      $ 2,007       $ 299      $ 777      
  

 

 

    

 

 

     

 

 

    

 

 

     

 

1 

Unearned premiums and other policy claims and benefits payable are included in Column C amounts.

2 

Allocations of net investment income and certain operating expenses are based on numerous assumptions and estimates, and reported segment operating results would change if different methods were applied.

3 

The 2011 and 2010 balances reflect a change in accounting principle, as described in Note 2.

See accompanying notes to consolidated financial statements and report of independent registered public accounting firm.

 

58

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

 

Schedule IV Reinsurance

As of December 31, 2012, 2011 and 2010 and for each of the years then ended (in millions)

 

Column A

    Column B      Column C     Column D      Column E      Column F  
      Gross
amount		      Ceded to
other
companies		     Assumed
from other
companies		      Net
amount		      Percentage
of amount
assumed
to net		  

2012

              

Life, accident and health insurance in force

    $ 216,002       $ (59,895 )    $ 5       $ 156,112                 —     
  

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Premiums:

              

Life insurance 1

    $ 701       $ (66 )    $     —         $ 635         —     

Accident and health insurance

      189         (189 )      —           —           —     
  

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Total

    $ 890       $ (255 )    $ —         $ 635         —     
  

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

2011

              

Life, accident and health insurance in force

    $ 209,732       $ (60,499 )    $ 5       $ 149,238         —     
  

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Premiums:

              

Life insurance 1

    $ 596       $ (65 )    $ —         $ 531         —     

Accident and health insurance

      236         (236 )      —           —           —     
  

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Total

    $ 832       $ (301 )    $ —         $ 531         —     
  

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

2010

              

Life, accident and health insurance in force

    $ 208,920       $ (64,755 )    $ 10       $ 144,175         —     
  

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Premiums:

              

Life insurance 1

    $ 570       $ (88 )    $ 1       $ 483         0.2 % 

Accident and health insurance

      238         (241 )      4         1         NM   
  

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Total

    $ 808       $ (329 )    $ 5       $ 484         1.0 % 
  

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

 

1 

Primarily represents premiums from traditional life insurance and life-contingent immediate annuities and excludes deposits on investment and universal life insurance products.

See accompanying notes to consolidated financial statements and report of independent registered public accounting firm.

 

59

Table of Contents

NATIONWIDE LIFE INSURANCE COMPANY AND SUBSIDIARIES

(a wholly-owned subsidiary of Nationwide Financial Services, Inc.)

 

Schedule V Valuation and Qualifying Accounts

Years ended December 31, 2012, 2011, and 2010 (in millions)

 

Column A

    Column B      Column C      Column D      Column E  

Description

    Balance at
beginning
of period		      Charged to
costs and
expenses		      Charged to
other
accounts		      Deductions1      Balance at
end of
period		  

2012

               

Valuation allowances - mortgage loans

    $ 60       $ 1       $         —         $ 17       $ 44   

2011

               

Valuation allowances - mortgage loans

    $ 96       $ 25       $ —         $ 61       $ 60   

2010

               

Valuation allowances - mortgage loans

    $         77       $         66       $ —         $         47       $         96   

 

1 

Amounts generally represent payoffs, sales and recoveries.

See accompanying notes to consolidated financial statements and report of independent registered public accounting firm.

 

60

Table of Contents
PART C. OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements
  Nationwide Variable Account-II:
Report of Independent Registered Public Accounting Firm.
Statement of Assets, Liabilities and Contract Owners' Equity as of December 31, 2012.
Statement of Operations for the year ended December 31, 2012.
Statements of Changes in Contract Owners Equity for the years ended December 31, 2012 and 2011.
Notes to Financial Statements.
Nationwide Life Insurance Company and subsidiaries:
Report of Independent Registered Public Accounting Firm.
Consolidated Statements of Operations for the years ended December 31, 2012, 2011 and 2010.
Consolidated Balance Sheets as of December 31, 2012 and 2011.
Consolidated Statements of Changes in Equity as of December 31, 2012, 2011 and 2010.
Consolidated Statements of Cash Flows for the years ended December 31, 2012, 2011 and 2010.
Notes to Consolidated Financial Statements.
Financial Statement Schedules.
(b) Exhibits
(1) Resolution of the Depositor's Board of Directors authorizing the establishment of the Registrant - Filed with Post-Effective Amendment No. 16 on April 30, 2007 (File No. 333-103093) as Exhibit (1) and hereby incorporated by reference.
(2) Not Applicable.
(3) Underwriting or Distribution of Contracts between the Depositor and NISC as Principal Underwriter - Filed with Post-Effective Amendment No. 16 on April 19, 2007 (File No. 333-103093) as Exhibit (3) and hereby incorporated by reference.
(4) The form of the variable annuity contract - Filed previously on March 15, 2012 with Pre-Effective Amendment No. 1 to the registration statement (File No. 333-177439) and hereby incorporated by reference.
(5) Variable Annuity Application - Filed previously on March 15, 2012 with Pre-Effective Amendment No. 1 to the registration statement (File No. 333-177439) and hereby incorporated by reference.
(6) Depositor's Certificate of Incorporation and By-Laws.
(a) Amended Articles of Incorporation for Nationwide Life Insurance Company. Filed previously with initial registration statement (333-164125) on January 4, 2010 as document "exhibit6a.htm" and hereby incorporated by reference.
(b) Amended and Restated Code of Regulations of Nationwide Life Insurance Company. Filed previously with initial registration statement (333-164125) on January 4, 2010 as document "exhibit6b.htm" and hereby incorporated by reference.
(c) Articles of Merger of Nationwide Life Insurance Company of America with and into Nationwide Life Insurance Company, effective December 31, 2009. Filed previously with initial registration statement (333-164125) on January 4, 2010 as document "exhibit6c.htm" and hereby incorporated by reference.
(7) Not Applicable.
(8) Form of Participation Agreements -
  The following Fund Participation Agreements were previously filed on July 17, 2007 with Pre-Effective Amendment No. 1 to the registration statement associated with 1933 Act File No. 333-140608 under Exhibit 26(h), and are hereby incorporated by reference.
(1) Amended and Restated Fund Participation and Shareholder Services Agreement with American Century Investment Services, Inc. dated September 15, 2004, as amended, under document "amcentfpa99h2."
(2) Restated and Amended Fund Participation Agreement with The Dreyfus Corporation dated January 27, 2000, as amended, under document "dreyfusfpa99h3.htm."
(3) Fund Participation Agreement with Fidelity Variable Insurance Products Fund dated May 1, 1988, as amended, including Fidelity Variable Insurance Products Fund IV and Fidelity Variable Insurance Products Fund V, under document "fidifpa99h5.htm."
(4) Amended and Restated Fund Participation with Franklin Templeton Variable Insurance Products Trust and Franklin/Templeton Distributors, Inc., as amended, dated May 1, 2003, as document "frankfpa99h8.htm. "
(5) Fund Participation Agreement, Service and Institutional Shares, with Janus Aspen Series, dated December 31, 1999, under document "janusfpa99h9a.htm."
(6) Amended and Restated Fund Participation Agreement with MFS Variable Insurance Trust and Massachusetts Financial Services Company dated February 1, 2003, as amended, under document "mfsfpa99h11.htm."
(7) Fund Participation Agreement with Nationwide Variable Insurance Trust (formerly, Gartmore Variable Insurance Trust) dated February 1, 2003, as amended, under document "nwfpa99h12a.htm."
(8) Fund Participation Agreement with Nationwide Variable Insurance Trust (formerly, Gartmore Variable Insurance Trust), American Funds Insurance Series, and Capital Research and Management Company dated May 1, 2006, under document "nwfpa99h12b.htm."
(9) Fund Participation Agreement with Neuberger Berman Advisers Management Trust / Lehman Brothers Advisers Management Trust (formerly, Neuberger Berman Advisers Management Trust) dated January 1, 2006, under document "neuberfpa99h13.htm."
(10) Fund Participation Agreement with Oppenheimer Variable Account Funds and Oppenheimer Funds, Inc. dated April 13, 2007, under document "oppenfpa99h14.htm."
(11) Fund Participation Agreement with T. Rowe Price Equity Series, Inc., T. Rowe Price International Series, Inc., T. Rowe Price Fixed Income Series, Inc., and T. Rowe Price Investment Services, Inc. dated October 1, 2002, as amended, under document "trowefpa99h15.htm."
  The following Fund Participation Agreements were previously filed on September 27, 2007 with Pre-Effective Amendment No. 3 to the registration statement associated with 1933 Act File No. 333-137202 under Exhibit 26(h), and are hereby incorporated by reference.
(12) Fund Participation Agreement (Amended and Restated) with Alliance Capital Management L.P. and Alliance-Bernstein Investment Research and Management, Inc. dated June 1, 2003, as document "alliancebernsteinfpa.htm."
(13) Fund Participation Agreement with BlackRock (formerly FAM Distributors, Inc. and FAM Variable Series Funds, Inc.), as amended, dated April 13, 2004, as document " blackrockfpa.htm."
(14) Fund Participation Agreement with PIMCO Variable Insurance Trust and PIMCO Fund Distributors, LLC, as amended, dated March 28, 2002, as document " pimcofpa.htm."
(15) Fund Participation Agreement with Waddell & Reed Services Company, Waddell & Reed, Inc., and W&R Target Funds, Inc., as amended, dated December 1, 2000, as document "waddellreedfpa.htm."
(16) Fund Participation Agreement with Wells Fargo Management, LLC, Stephens, Inc., as amended, dated November 15, 2004 as document "wellsfargofpa.htm."
(17) Fund Participation Agreement with Van Eck Investment Trust, Van Eck Associates Corporation, Van Eck Securities Corporation, as amended, dated September 1, 1989, as document "vaneckfpa.htm".
  The following Fund Participation Agreement was previously filed on May 13, 2010 with Pre-Effective Amendment No. 1 to the registration statement associated with 1933 Act File No. 333-164886 under Exhibit 26(h), and is hereby incorporated by reference.
(18) Fund Participation Agreement with INVESCO Funds Group, Inc., and INVESCO Distributors, Inc., as amended, dated August 1, 2001, as document "ex818.htm."
  The following Fund Participation Agreement was previously filed on October 26, 2010 with Post-Effective Amendment No. 2 to the registration statement associated with 1933 Act File No. 333-164886 under Exhibit 26(h), and is hereby incorporated by reference.
(19) Fund Participation Agreement with Unified Financial Securities and Huntington Asset Advisers, Inc., dated August 13, 2010, as document "huntingtonfpa.htm."
  The following Fund Participation Agreement was previously filed on June 11, 2012, with Post-Effective Amendment No. 28 to the registration statement associated with 1933 Act File No. 333-62692 under Exhibit 24(b), and is hereby incorporated by reference.
(20) Fund Participation Agreement with Northern Lights Variable Trust, dated February 8, 2012, as document "northernlightsfpa.htm."
  The following Fund Participation Agreement was previously filed on April 18, 2008, with Post-Effective Amendment No. 20 to the registration statement associated with 1933 Act File No. 333-62692 under Exhibit 24(b), and is hereby incorporated by reference.
(21) Fund Participation Agreement with Rydex Variable Trust & Rydex Distributors, Inc., dated September 10, 2001, as document "rydexfundpartagreement.htm."
  The following Fund Participation Agreement was previously filed on April 12, 2011, with Post-Effective Amendment No. 43 to the registration statement associated with 1933 Act File No. 333-43671 under Exhibit 24(b), and is hereby incorporated by reference.
(22) Fund Participation Agreement with Delaware Management Company and Delaware Distributors, L.P., as amended, dated February 5, 2008, as document " delawarefpa.htm."
  For information regarding payments Nationwide receives from underlying mutual funds, please see the "Information on Underlying Mutual Fund Payments" section of the prospectus and/or the underlying mutual fund prospectuses.
(9) Opinion of Counsel - Filed previously with initial registration statement (File No. 333-177439) and hereby incorporated by reference.
(10) Consent of Independent Registered Public Accounting Firm – Attached hereto.
(11) Not Applicable.
(12) Not Applicable.
(99) Power of Attorney - Attached hereto.
Item 25. Directors and Officers of the Depositor
The business address of the Directors and Officers of the Depositor is:
One Nationwide Plaza, Columbus, Ohio 43215
President and Chief Operating Officer and Director Kirt A. Walker
Executive Vice President-Chief Legal and Governance Officer Patricia R. Hatler
Executive Vice President Terri L. Hill
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-Government Relations Steven M. English
Senior Vice President Harry H. Hallowell
Senior Vice President and Treasurer David LaPaul
Senior Vice President-Business Transformation Office Mark A. Gaetano
Senior Vice President-Chief Claims Officer David A. Bano
Senior Vice President-Chief Compliance Officer Sandra L. Rich
Senior Vice President-Chief Economist David W. Berson
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 Allied Group Daniel G. Greteman
Senior Vice President-CIO Enterprise Applications Michael A. Richardson
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 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 and Director 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 Finance & Head of Sourcing Andrew Walker
Senior Vice President-IT Strategic Initiatives Tammy Craig
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-NFS Legal Rae Ann Dankovic
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
Senior Vice President-Talent, Div & Org Effect Terri L Forgy
Senior Vice President-Trial Division Peter J. Hersha
Vice President-Corporate Governance and Secretary Robert W. Horner, III
Director Stephen S. Rasmussen
Item 26. Persons Controlled by or Under Common Control with the Depositor or Registrant.
Following is a list of entities directly or indirectly controlled by or under common control with the depositor or registrant. Ownership is indicated through indentation. Unless otherwise indicated, each subsidiary is either wholly-owned or majority-owned by the parent company immediately preceding it. (For example, Nationwide Fund Distributors, LLC is either wholly-owned or majority owned by NFS Distributors, Inc.) Separate accounts that have been established pursuant to board resolution but are not, and have never been, active are omitted.
Company Jurisdiction of
Domicile 		Brief Description of Business
Nationwide Financial Services, Inc. Delaware The company acts primarily as a holding company for companies within the Nationwide organization that offer or distribute life insurance, long-term savings and retirement products.
NFS Distributors, Inc. Delaware The company acts primarily as a holding company for Nationwide Financial Services, Inc. companies.
Nationwide Financial General Agency, Inc. Pennsylvania The company is a multi-state licensed insurance agency.
Nationwide Financial Institution Distributors Agency, Inc. Delaware The company is an insurance agency.
Nationwide Fund Distributors, LLC Delaware The company is a limited purpose broker-dealer.
Nationwide Fund Management, LLC Delaware The company provides administration, transfer and dividend disbursing agent services to various mutual fund entities.
Nationwide Retirement Solutions, Inc. Delaware The company markets and administers deferred compensation plans for public employees.
Nationwide Retirement Solutions, Inc. of Arizona Arizona 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 Retirement Solutions, Inc. of Ohio, Inc.1 Ohio The company provides retirement products, marketing and education and administration to public employees.
Nationwide Retirement Solutions, Inc. of Texas, Inc.1 Texas The company markets and administers deferred compensation plans for public employees.
Nationwide Securities, LLC Delaware The company is a registered broker-dealer.
Nationwide Bank Federal This is a federally chartered savings bank supervised by the Office of 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 Financial Services Capital Trust Delaware The trust's sole purpose is to issue and sell certain securities representing individual beneficial interests in the assets of the trust
Nationwide Life Insurance Company2 Ohio A stock corporation. The corporation provides individual life insurance, group and health insurance, fixed and variable annuity products and other life insurance products.
MFS Variable Account2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Multi-Flex Variable Account2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-II2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-32,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-42,3 Ohio A separate account issuing variable annuity contracts.
Company Jurisdiction of
Domicile 		Brief Description of Business
Nationwide Variable Account-52,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-62,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-72,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-82,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-92,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-102,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-112,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-122,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-132,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Variable Account-142,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Provident VA Separate Account 12,3 Pennsylvania A separate account issuing variable annuity contracts.
Nationwide VLI Separate Account2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-22,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-32,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-42,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-52,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-62,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VLI Separate Account-72,3 Ohio A separate account issuing variable life insurance policies.
Nationwide Provident VLI Separate Account 12,3 Pennsylvania A separate account issuing variable life insurance policies.
Nationwide Investment Services Corporation3 Oklahoma This is a limited purpose broker-dealer and distributor of variable annuities and variable life products for Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company. The company also provides educational services to retirement plan sponsors and its participants.
Nationwide Financial Assignment Company3 Ohio The company is an administrator of structured settlements.
Nationwide Investment Advisors, LLC3 Ohio The company provides investment advisory services.
Life Reo Holdings, LLC3 Ohio The company is an investment holding company.
Nationwide Life and Annuity Insurance Company2,3 Ohio The company engages in underwriting life insurance and granting, purchasing and disposing of annuities.
Nationwide VA Separate Account-A2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide VA Separate Account-B2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide VA Separate Account-C2,3 Ohio A separate account issuing variable annuity contracts.
Company Jurisdiction of
Domicile 		Brief Description of Business
Nationwide VA Separate Account-D2,3 Ohio A separate account issuing variable annuity contracts.
Nationwide Provident VA Separate Account A2,3 Delaware A separate account issuing variable annuity contracts.
Nationwide VL Separate Account-A2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VL Separate Account-B2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VL Separate Account-C2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VL Separate Account-D2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide VL Separate Account-G2,3 Ohio A separate account issuing variable life insurance policies.
Nationwide Provident VLI Separate Account A2,3 Delaware A separate account issuing variable life insurance policies.
Olentangy Reinsurance, LLC3 Vermont The company is a captive life reinsurance company.
Registered Investment Advisors Services, Inc.3 Texas The company is a technology company that facilitates third-party money management services for registered investment advisors
Nationwide Community Development Corporation, LLC3 Ohio The company holds investments in low-income housing funds.
Nationwide Fund Advisors3,4 Delaware The trust acts as a registered investment advisor.
1 This subsidiary/entity is controlled by its immediate parent through contractual association.
2 This subsidiary/entity files separate financial statements.
3 Information for this subsidiary/entity is included in the consolidated financial statements of its immediate parent.
4 This subsidiary/entity is a business trust.
Item 27. Number of Contract Owners
The number of Contract Owners of Qualified and Non-Qualified Contracts as of March 8, 2013, was 3,547 and 2,404 respectively.
Item 28. Indemnification
Provision is made in Nationwide's Amended and Restated Code of Regulations and expressly authorized by the General Corporation Law of the State of Ohio, for indemnification by Nationwide of any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative by reason of the fact that such person is or was a director, officer or employee of Nationwide, against expenses, including attorneys fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, to the extent and under the circumstances permitted by the General Corporation Law of the State of Ohio.
Insofar as indemnification for liabilities arising under the Securities Act of 1933 ("Act") may be permitted to directors, officers or persons controlling Nationwide pursuant to the foregoing provisions, Nationwide has been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
Item 29. Principal Underwriter
Nationwide Investment Services Corporation ("NISC")
(a) NISC serves as principal underwriter and general distributor for the following separate investment accounts of Nationwide or its affiliates:
 
MFS Variable Account Nationwide VA Separate Account-D
Multi-Flex Variable Account Nationwide VLI Separate Account
Nationwide Variable Account Nationwide VLI Separate Account-2
Nationwide Variable Account-II Nationwide VLI Separate Account-3
Nationwide Variable Account-3 Nationwide VLI Separate Account-4
Nationwide Variable Account-4 Nationwide VLI Separate Account-5
Nationwide Variable Account-5 Nationwide VLI Separate Account-6
Nationwide Variable Account-6 Nationwide VLI Separate Account-7
Nationwide Variable Account-7 Nationwide VL Separate Account-A
Nationwide Variable Account-8 Nationwide VL Separate Account-C
Nationwide Variable Account-9 Nationwide VL Separate Account-D
Nationwide Variable Account-10 Nationwide VL Separate Account-G
Nationwide Variable Account-11 Nationwide Provident VA Separate Account 1
Nationwide Variable Account-12 Nationwide Provident VA Separate Account A
Nationwide Variable Account-13 Nationwide Provident VLI Separate Account 1
Nationwide Variable Account-14 Nationwide Provident VLI Separate Account A
Nationwide VA Separate Account-A  
Nationwide VA Separate Account-B  
Nationwide VA Separate Account-C  
(b) Directors and Officers of NISC:
 
President Robert O. Cline
Vice President, Treasurer and Director Keith L. Sheridan
Vice President-Chief Compliance Officer James J. Rabenstine
Associate Vice President and Secretary Kathy R. Richards
Associate Vice President and Assistant Secretary Parag H. Shah
Associate Vice President-Finance Operations and Assistant Treasurer Terry C. Smetzer
Assistant Treasurer J. Morgan Elliott
Assistant Treasurer Jerry L. Greene
Director John L. Carter
Director Eric S. Henderson
The business address of the Directors and Officers of NISC is:
One Nationwide Plaza, Columbus, Ohio 43215.
(c)
Name of Principal Underwriter   Net Underwriting
Discounts and
Commissions 		  Compensation on
Redemption or
Annuitization 		  Brokerage
Commissions 		  Compensation
Nationwide Investment Services Corporation
   N/A   N/A   N/A   N/A
Item 30. Location of Accounts and Records
Timothy G. Frommeyer
Nationwide Life Insurance Company
One Nationwide Plaza
Columbus, OH 43215
Item 31. Management Services
Not Applicable
Item 32. Undertakings
The Registrant hereby undertakes to:
(a) file a post-effective amendment to this registration statement as frequently as is necessary to ensure that the audited financial statements in the registration statement are never more than 16 months old for so long as payments under the variable annuity contracts may be accepted;
(b) include either (1) as part of any application to purchase a contract offered by the prospectus, a space that an applicant can check to request a Statement of Additional Information, or (2) a post card or similar written communication affixed to or included in the prospectus that the applicant can remove to send for a Statement of Additional Information; and
(c) deliver any Statement of Additional Information and any financial statements required to be made available under this form promptly upon written or oral request.
The Registrant represents that any of the contracts which are issued pursuant to Section 403(b) of the Internal Revenue Code, are issued by Nationwide through the Registrant in reliance upon, and in compliance with, a no-action letter issued by the Staff of the Securities and Exchange Commission to the American Council of Life Insurance (publicly available November 28, 1988) permitting withdrawal restrictions to the extent necessary to comply with Section 403(b)(11) of the Internal Revenue Code.
Nationwide Life Insurance Company represents that the fees and charges deducted under the contract in the aggregate are reasonable in relation to the services rendered, the expenses expected to be incurred and risks assumed by Nationwide Life Insurance Company.

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SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it has caused this Registration Statement to be signed by the undersigned, duly authorized, in the City of Columbus, and State of Ohio, on April 16, 2013.
Nationwide Variable Account-II
(Registrant)
Nationwide Life Insurance Company
(Depositor)
By: /s/ JAMIE RUFF CASTO
Jamie Ruff Casto
Attorney-in-Fact
As required by the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated, on April 16, 2013.
KIRT A. WALKER  
Kirt A. Walker, President and Chief Operating Officer, and Director  
MARK R. THRESHER  
Mark R. Thresher, Executive Vice President and Director  
TIMOTHY G. FROMMEYER  
Timothy G. Frommeyer, Senior Vice President-Chief Financial Officer and Director  
ERIC S. HENDERSON  
Eric S. Henderson, Senior Vice President - Individual Products & Solutions and Director  
JOHN L. CARTER  
John L. Carter, Senior Vice President - Distribution and Sales and Director  
STEPHEN S. RASMUSSEN  
Stephen S. Rasmussen, Director  
  By /s/ JAMIE RUFF CASTO
  Jamie Ruff Casto
Attorney-in-Fact