N-CSRS

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM N-CSRS

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-05583

Franklin Templeton Variable Insurance Products Trust

(Exact name of registrant as specified in charter)

One Franklin Parkway, San Mateo, CA 94403-1906

(Address of principal executive offices) (Zip code)

Craig S. Tyle, One Franklin Parkway, San Mateo, CA 94403-1906

(Name and address of agent for service)

Registrant’s telephone number, including area code: (650) 312-2000

Date of fiscal year end: 12/31

Date of reporting period: 06/30/20

Item 1. Reports to Stockholders.

Internet Delivery of Shareholder Reports: Effective January 1, 2021, as permitted by regulations adopted by the SEC, you may not be receiving paper copies of the Fund’s annual or semiannual shareholder reports by mail, unless you specifically request them from the insurance company that offers your variable annuity or variable life insurance contract or your financial intermediary. Instead of delivering paper copies of the report, the insurance company may choose to make the reports available on a website, and will notify you by mail each time a shareholder report is posted and provide you with a website link to access the report. Instructions for requesting paper copies will be provided by your insurance company.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the insurance company or your financial intermediary electronically by following the instructions provided by the insurance company or by contacting your financial intermediary.

You may elect to receive all future Fund shareholder reports in paper free of charge from the insurance company. You can inform the insurance company or your financial intermediary that you wish to continue receiving paper copies of your shareholder reports by following the instructions provided by the insurance company or by contacting your financial intermediary. Your election to receive reports in paper will apply to all portfolio companies available under your contract with the insurance company.

This notice is not legally a part of the shareholder report.

Franklin Templeton Variable Insurance

Products Trust Semiannual Report

Table of Contents
Important Notes to Performance Information	i
Fund Summaries
Franklin Allocation VIP Fund	FFA-1
Franklin Global Real Estate VIP Fund	FGR-1
Franklin Growth and Income VIP Fund	FGI-1
Franklin Income VIP Fund	FI-1
Franklin Large Cap Growth VIP Fund	FLG-1
Franklin Mutual Global Discovery VIP Fund	MGD-1
Franklin Mutual Shares VIP Fund	MS-1
Franklin Rising Dividends VIP Fund	FRD-1
Franklin Small Cap Value VIP Fund	FSV-1
Franklin Small-Mid Cap Growth VIP Fund	FSC-1
Franklin Strategic Income VIP Fund	FSI-1
Franklin U.S. Government Securities VIP Fund	FUS-1
Templeton Developing Markets VIP Fund	TD-1
*Prospectus Supplement	TD-7
Templeton Foreign VIP Fund	TF-1
Templeton Global Bond VIP Fund	TGB-1
Templeton Growth VIP Fund	TG-1
Index Descriptions	I-1
Shareholder Information	SI-1

*Not part of the semiannual report. Retain for your records.

Not FDIC Insured | May Lose Value | No Bank Guarantee 

MASTER CLASS – 1

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Important Notes to

Performance Information

Performance data is historical and cannot predict or guarantee future results. Principal value and investment return will fluctuate with market conditions, and you may have a gain or loss when you withdraw your money. Inception dates of the funds may have preceded the effective dates of the subaccounts, contracts or their availability in all states.

When reviewing the index comparisons, please keep in mind that indexes have a number of inherent performance differentials over the funds. First, unlike the funds, which must hold a minimum amount of cash to maintain liquidity,

indexes do not have a cash component. Second, the funds are actively managed and, thus, are subject to management fees to cover salaries of securities analysts or portfolio managers in addition to other expenses. Indexes are unmanaged and do not include any commissions or other expenses typically associated with investing in securities. Third, indexes often contain a different mix of securities than the fund to which they are compared. Additionally, please remember that indexes are simply a measure of performance and cannot be invested in directly.

Semiannual Report         i

Franklin Allocation VIP Fund

This semiannual report for Franklin Allocation VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -1.09% total return* for the six-month period ended June 30, 2020.

*On May 1, 2019, the Fund’s investment strategies changed. Performance prior to May 1, 2019, is attributable to the Fund’s performance before the strategy change. The Fund has an expense reduction contractually guaranteed through 4/30/21. Fund investment results reflect the expense reduction; without this reduction, the results would have been lower.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         FFA-1

FRANKLIN ALLOCATION VIP FUND

Fund Goal and Main Investments

The Fund seeks capital appreciation, with income as a secondary goal. Under normal market conditions, the Fund allocates approximately 60% of its assets to the equity asset class and 40% of its assets to the fixed income asset class by allocating the Fund’s assets among various sleeves (investment strategies).

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Because the Fund invests in underlying funds, and the Fund’s performance is directly related to the performance of the underlying funds held by it, the ability of the Fund to achieve its investment goals is directly related to the ability of the underlying funds to meet their investment goals. Additionally, because these underlying funds may engage in a variety of investment strategies involving certain risks, the Fund may be subject to these same risks. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Bonds are affected by changes in interest rates and the creditworthiness of their issuers. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds adjust to a rise in interest rates, the Fund’s share price may decline. Higher yielding, lower rated corporate bonds entail a greater degree of credit risk compared to investment-grade securities. Foreign investing carries additional risks such as currency and market volatility and political or social instability, risks that are heightened in developing countries. Value securities may not increase in price as anticipated or may decline further in value. The Fund’s prospectus also includes a description of the main investment risks.

Asset Allocation*

Based on Total Net Assets as of 6/30/20

*The asset allocation is based on the Statement of Investments (SOI), which classifies each underlying fund into a broad asset class.

**Rounds to less than 0.1%.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Fund’s benchmark, the Standard & Poor’s^® 500 Index (S&P 500^®), posted a -3.08% total return. The Fund’s other benchmarks, the Bloomberg Barclays U.S. Aggregate Bond Index posted a +6.14% total return; the MSCI World ex USA Index-NR posted a -11.20% total return; and the Linked Allocation VIP Fund Benchmark posted a -0.81% total return.^1,2

1. Source: Morningstar.

2. Source: FactSet. The Linked Allocation VIP Fund benchmark was calculated internally and rebalanced monthly and was composed of 40% S&P 500, 40% Bloomberg Barclays U.S. Aggregate Bond Index and 20% MSCI World ex USA Index-NR.

One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

FFA-2         Semiannual Report

FRANKLIN ALLOCATION VIP FUND

Economic and Market Overview

Global developed and emerging market equities, as measured by the MSCI All Country World Index (USD), posted a -5.99% total return during the six months under review.¹ Stocks fell sharply in early 2020 as countries around the world implemented lockdown measures in an effort to slow the spread of the novel coronavirus (COVID-19). Global supply chain disruptions, business and personal restrictions, and subdued consumer spending drove many investors to sell equity holdings in favor of perceived safe investments such as government bonds and cash. While global equities, notably in the U.S., rebounded in April and May amid optimism about easing lockdown restrictions, concerns about a second wave of infections hindered equities in June, as investors weighed the possibility of renewed restrictions.

In the U.S., government mandates to mitigate the COVID-19 pandemic severely impacted the economy beginning in March 2020. As a result, the unemployment rate surged to 14.7% in April, as many businesses, particularly those involved in hospitality, retail and travel, announced mass layoffs.³ According to the National Bureau of Economic Research, the longest U.S. economic expansion in history ended in February 2020 as the country slipped into a severe recession. Nonetheless, near period-end, there were signs that a recovery was underway, as jobless claims fell considerably from their peak in early April, retail sales rose sharply in May, and the unemployment rate fell to 11.1% in June.³ Along with optimism about improved treatments and potential vaccines for COVID-19, the positive economic signals contributed to a significant equity rebound in April and May. However, an increase in COVID-19 infections in many states throughout June pressured U.S. stocks.

The U.S. Federal Reserve (Fed) made significant efforts to support the U.S. economy. In March 2020, as the pandemic began to severely impact the economy and financial markets, the Fed implemented two emergency rate cuts, lowering the federal funds target rate to a range of 0.00%–0.25%, and announced sweeping quantitative easing measures aimed at ensuring credit flow to borrowers and supporting credit markets with unlimited amounts of bond purchasing.

In the eurozone, some analysts forecasted a significant contraction in 2020, particularly in southern European countries, as the magnitude of the economic disruption

Geographic Composition

Based on Total Net Assets as of 6/30/20

caused by the pandemic became apparent. European developed market equities, as measured by the MSCI Europe Index (USD), posted a -12.43% total return for the period.¹ To stimulate growth, the European Central Bank implemented a broad bond-buying program, and many countries passed fiscal stimulus measures.

Asian developed and emerging market equities, as measured by the MSCI All Country Asia Index (USD), posted a -5.51% total return during the six-month period.¹ The onset of the pandemic brought dramatically slower economic activity in Asia, as businesses halted operations and manufacturing and export activity declined sharply in the region’s major economies. Asian markets generally advanced toward period-end, bolstered by fiscal stimulus measures and economies reopening throughout the region.

Emerging market stocks, as measured by the MSCI Emerging Markets Index (USD), posted a -9.67% total return due primarily to the COVID-19 pandemic.¹ A sharp decrease in prices for oil and other natural resources also hurt emerging market economies reliant on these exports. In the last quarter of the reporting period, however, investor optimism led to a stock rally, particularly in emerging market countries that had successfully lowered infection rates.

3. Source: U.S. Bureau of Labor Statistics.

See www.franklintempletondatasources.com for additional data provider information.

Semiannual Report         FFA-3

FRANKLIN ALLOCATION VIP FUND

Investment Strategy

The Fund seeks to achieve its investment goals by allocating its assets among the broad asset classes of equity and fixed income investments through a variety of investment strategies or “sleeves” managed by the investment manager or its affiliates, which include Franklin U.S. Smart Beta Equity Strategy, Franklin Total Return Strategy, Franklin Growth Strategy, Templeton Foreign Strategy, Franklin International Growth Strategy, Franklin U.S. Government Securities Strategy, Franklin Rising Dividends Strategy, Franklin Investment Grade Corporate Strategy, Templeton Global Bond VIP Fund Strategy, Franklin International Core Equity Strategy, Franklin U.S. Core Equity (IU) Strategy, Franklin Emerging Market Core Equity (IU) Strategy and Franklin U.S. Core Bond Strategy. The Fund is structured as a multi-manager fund (meaning the Fund’s assets are managed by multiple sub-advisors), with the investment manager having overall responsibility for the Funds’ investments. Allocation to each sleeve will generally not exceed 20% and will vary with market conditions. However, under normal market conditions, no sleeve constitutes a majority of the Fund’s assets.

Top 10 Holdings

6/30/20

Company Sector/Industry	% of Total Net Assets
Templeton Global Bond VIP Fund Diversified Financials	3.8%
Microsoft Corp. Software & Services	1.6%
Apple Inc. Technology Hardware & Equipment	1.1%
Amazon.com Inc. Retailing	0.8%
Texas Instruments Inc. Semiconductors & Semiconductor Equipment	0.6%
Mastercard Inc. Software & Services	0.5%
Accenture PLC Software & Services	0.5%
NIKE Inc. Consumer Durables & Apparel	0.5%
Johnson & Johnson Pharmaceuticals, Biotechnology & Life Sciences	0.5%
Air Products and Chemicals Inc. Materials	0.5%

Manager’s Discussion

The Fund’s performance can be attributed largely to its allocation among the underlying sleeves and their investments in domestic and foreign equities, fixed income securities, and short-term investments and other net assets. The allocation to the sleeves did not change over the period.

During the six months under review, the Franklin Growth Strategy outperformed the S&P 500, the Franklin Rising Dividends Strategy underperformed the S&P 500, the Templeton Foreign Strategy underperformed the MSCI All Country World ex USA Index-NR, the Franklin International Growth Strategy outperformed the MSCI World ex-USA Index, the U.S. Smart Beta Equity Strategy underperformed the Russell 1000^® Index, the Franklin International Core Equity Strategy outperformed the MSCI EAFE Index, the Franklin U.S. Government Securities Strategy underperformed the Bloomberg Barclays U.S. Government Index: Intermediate Component, the Franklin Investment-Grade Corporate Strategy outperformed the Bloomberg Barclays U.S. Corporate Investment-Grade Index, the Templeton Global Bond VIP Fund outperformed the J.P. Morgan Global Government Bond Index, the Franklin U.S. Core Bond Strategy underperformed the Bloomberg Barclays U.S. Aggregate Bond Index.

Thank you for your participation in Franklin Allocation VIP Fund. We look forward to serving your Future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

FFA-4         Semiannual Report

FRANKLIN ALLOCATION VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual (actual return after expenses)		Hypothetical (5% annual return before expenses)
Share    Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio1, 2
Class 1	$1,000	$989.10	$2.67	$1,022.18	$2.72	0.54%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include acquired fund fees and expenses.

Semiannual Report         FFA-5

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin Allocation VIP Fund

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$ 6.86			$ 6.37			$ 7.44			$ 7.13			$ 6.80			$ 7.47
Income from investment operationsa:
Net investment incomeb		0.07			0.11	c		0.23	c		0.21	c		0.21	c		0.26	c
Net realized and unrealized gains (losses)		(0.17	)		1.11			(0.89	)		0.63			0.64			(0.68	)
Total from investment operations		(0.10	)		1.22			(0.66	)		0.84			0.85			(0.42	)
Less distributions from:
Net investment income		(0.12	)		(0.27	)		(0.24	)		(0.22	)		(0.29	)		(0.24	)
Net realized gains		(1.80	)		(0.46	)		(0.17	)		(0.31	)		(0.23	)		(0.01	)
Total distributions		(1.92	)		(0.73	)		(0.41	)		(0.53	)		(0.52	)		(0.25	)
Net asset value, end of period		$ 4.84			$ 6.86			$ 6.37			$ 7.44			$ 7.13			$ 6.80
Total returnd		(1.09)%			20.04%			(9.34)%			12.17%			13.43%			(5.93)%
Ratios to average net assetse
Expenses before waiver and payments by affiliates		0.59%			0.44%			0.12%			0.12%			0.11%			0.11%
Expenses net of waiver and payments by affiliates		0.54%	f		0.39%			0.10%			0.10%			0.10%			0.10%
Net investment income		2.32%			1.55%			3.13%			2.75%			3.09%			3.51%
Supplemental data
Net assets, end of period (000’s)		$804			$842			$984			$1,047			$1,025			$1,083
Portfolio turnover rate		49.61%			170.79%			2.23%			1.28%			0.10%			0.26%
Portfolio turnover rate excluding mortgage dollar rolls		42.14%	g		158.11%	g		2.23%			1.28%			0.10%			0.26%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the Fund invests.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fBenefit of expense reduction rounds to less than 0.01%.

^gSee Note 1(f) regarding mortgage dollar rolls.

FFA-6         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Allocation VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$ 6.81			$ 6.32			$ 7.39			$ 7.08			$ 6.75			$ 7.42
Income from investment operationsa:
Net investment incomeb		0.06			0.09	c		0.21	c		0.18	c		0.19	c		0.24
Net realized and unrealized gains (losses)		(0.18	)		1.11			(0.89	)		0.64			0.64			(0.68	)
Total from investment operations		(0.12	)		1.20			(0.68	)		0.82			0.83			(0.44	)
Less distributions from:
Net investment income		(0.10	)		(0.25	)		(0.22	)		(0.20	)		(0.27	)		(0.22	)
Net realized gains		(1.80	)		(0.46	)		(0.17	)		(0.31	)		(0.23	)		(0.01	)
Total distributions		(1.90	)		(0.71	)		(0.39	)		(0.51	)		(0.50	)		(0.23	)
Net asset value, end of period		$ 4.79			$ 6.81			$ 6.32			$ 7.39			$ 7.08			$ 6.75
Total returnd		(1.43)%			19.86%			(9.65)%			11.98%			13.18%			(6.21)%
Ratios to average net assetse
Expenses before waiver and payments by affiliates		0.84%			0.69%			0.37%			0.37%			0.36%			0.36%
Expenses net of waiver and payments by affiliates		0.79%	f		0.64%			0.35%			0.35%			0.35%			0.35%
Net investment income		2.07%			1.30%			2.88%			2.50%			2.84%			3.26%
Supplemental data
Net assets, end of period (000’s)		$371,639			$403,040			$390,300			$480,402			$474,669			$480,715
Portfolio turnover rate		49.61%			170.79%			2.23%			1.28%			0.10%			0.26%
Portfolio turnover rate excluding mortgage dollar rolls		42.14%	g		158.11%	g		2.23%			1.28%			0.10%			0.26%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the Fund invests.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fBenefit of expense reduction rounds to less than 0.01%.

^gSee Note 1(f) regarding mortgage dollar rolls.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FFA-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Allocation VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$ 6.97			$ 6.46			$ 7.53			$ 7.21			$ 6.87			$ 7.54
Income from investment operationsa:
Net investment incomeb		0.06			0.08	c		0.20	c		0.18	c		0.19	c		0.23	c
Net realized and unrealized gains (losses)		(0.18	)		1.13			(0.89	)		0.64			0.64			(0.68	)
Total from investment operations		(0.12	)		1.21			(0.69	)		0.82			0.83			(0.45	)
Less distributions from:
Net investment income		(0.09	)		(0.24	)		(0.21	)		(0.19	)		(0.26	)		(0.21	)
Net realized gains		(1.80	)		(0.46	)		(0.17	)		(0.31	)		(0.23	)		(0.01	)
Total distributions		(1.89	)		(0.70	)		(0.38	)		(0.50	)		(0.49	)		(0.22	)
Net asset value, end of period		$ 4.96			$ 6.97			$ 6.46			$ 7.53			$ 7.21			$ 6.87
Total returnd		(1.37)%			19.56%			(9.58)%			11.78%			12.92%			(6.24)%
Ratios to average net assetse
Expenses before waiver and payments by affiliates		0.94%			0.79%			0.47%			0.47%			0.46%			0.46%
Expenses net of waiver and payments by affiliates		0.89%	f		0.74%			0.45%			0.45%			0.45%			0.45%
Net investment income		1.97%			1.20%			2.78%			2.40%			2.74%			3.16%
Supplemental data
Net assets, end of period (000’s)		$378,968			$406,693			$393,385			$528,862			$530,403			$550,825
Portfolio turnover rate		49.61%			170.79%			2.23%			1.28%			0.10%			0.26%
Portfolio turnover rate excluding mortgage dollar rolls		42.14%	g		158.11%	g		2.23%			1.28%			0.10%			0.26%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the Fund invests.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fBenefit of expense reduction rounds to less than 0.01%.

^gSee Note 1(f) regarding mortgage dollar rolls.

FFA-8         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin Allocation VIP Fund

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests 58.5%
Automobiles & Components 0.7%
Aptiv PLC		United States		7,000	$        545,440
Bayerische Motoren Werke AG		Germany		8,162	521,021
Cie Generale des Etablissements Michelin SCA		France		8,517	887,674
aFaurecia SE		France		3,230	126,891
aFiat Chrysler Automobiles NV		United Kingdom		36,368	367,942
General Motors Co.		United States		18,814	475,994
Gentex Corp.		United States		8,426	217,138
Honda Motor Co. Ltd.		Japan		16,200	418,830
Isuzu Motors Ltd.		Japan		67,200	610,669
Lear Corp.		United States		1,868	203,649
aPeugeot SA		France		25,032	410,467
Toyota Industries Corp.		Japan		6,500	345,492
					5,131,207
Banks 1.2%
Banco de Sabadell SA		Spain		242,207	85,090
aBank of Ireland Group PLC		Ireland		32,153	66,246
aFinecoBank Banca Fineco SpA		Italy		135,215	1,829,846
Housing Development Finance Corp. Ltd.		India		27,108	629,974
ING Groep NV		Netherlands		149,749	1,043,793
Kasikornbank PCL, fgn.		Thailand		96,700	293,867
KB Financial Group Inc.		South Korea		29,025	823,885
KBC Groep NV		Belgium		24,134	1,386,404
Shinhan Financial Group Co. Ltd.		South Korea		14,863	360,143
Shinsei Bank Ltd.		Japan		8,000	96,762
Standard Chartered PLC		United Kingdom		211,107	1,144,321
Sumitomo Mitsui Financial Group Inc.		Japan		30,100	849,476
Sumitomo Mitsui Financial Group Inc., ADR		Japan		112,000	629,440
					9,239,247
Capital Goods 5.9%
3M Co.		United States		8,752	1,365,225
Allegion PLC		United States		4,871	497,914
Allison Transmission Holdings Inc.		United States		2,215	81,468
Amada Co. Ltd.		Japan		13,500	110,536
AMETEK Inc.		United States		4,018	359,089
aAndritz AG		Austria		3,171	115,607
Atlas Copco AB		Sweden		7,152	265,723
Atlas Copco AB, A		Sweden		11,437	486,992
BAE Systems PLC		United Kingdom		77,090	460,938
BWX Technologies Inc.		United States		8,401	475,833
CAE Inc.		Canada		15,000	243,306
Carlisle Cos. Inc.		United States		3,400	406,878
Caterpillar Inc.		United States		3,346	423,269
CK Hutchison Holdings Ltd.		Hong Kong		152,000	984,283
Cummins Inc.		United States		4,550	788,333
aDassault Aviation SA		France		253	232,106
Deere & Co.		United States		3,086	484,965

Semiannual Report         FFA-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Capital Goods (continued)
Donaldson Co. Inc.		United States		8,500	$        395,420
Dover Corp.		United States		8,900	859,384
Emerson Electric Co.		United States		18,102	1,122,867
Epiroc AB, A		Sweden		9,709	121,643
Epiroc AB, B		Sweden		17,653	216,773
Fastenal Co.		United States		34,853	1,493,103
Ferguson PLC		United Kingdom		15,500	1,267,330
Fortive Corp.		United States		6,517	440,940
Geberit AG		Switzerland		1,568	786,721
General Dynamics Corp.		United States		8,887	1,328,251
Graco Inc.		United States		4,752	228,048
GrafTech International Ltd.		United States		844	6,735
Honeywell International Inc.		United States		19,445	2,811,553
Huntington Ingalls Industries Inc.		United States		1,176	205,200
Illinois Tool Works Inc.		United States		10,617	1,856,382
aIngersoll-Rand Inc.		United States		5,626	158,203
Johnson Controls International PLC		United States		22,400	764,736
Kingspan Group PLC		Ireland		2,612	168,606
Komatsu Ltd.		Japan		22,800	466,956
Kone OYJ, B		Finland		6,442	444,261
Kurita Water Industries Ltd.		Japan		4,000	111,272
Lennox International Inc.		United States		502	116,961
Lockheed Martin Corp.		United States		6,731	2,456,277
Masco Corp.		United States		2,247	112,822
aMercury Systems Inc.		United States		3,640	286,322
Mitsubishi Electric Corp.		Japan		54,100	706,614
MSC Industrial Direct Co. Inc., A		United States		1,257	91,522
MTU Aero Engines AG		Germany		7,900	1,375,272
Northrop Grumman Corp.		United States		7,855	2,414,941
nVent Electric PLC		United States		15,900	297,807
Obayashi Corp.		Japan		27,400	257,600
Otis Worldwide Corp.		United States		7,237	411,496
PACCAR Inc.		United States		4,976	372,454
Pentair PLC		United States		13,900	528,061
Raytheon Technologies Corp.		United States		50,395	3,105,340
Rockwell Automation Inc.		United States		3,621	771,273
Roper Technologies Inc.		United States		8,700	3,377,862
Schneider Electric SE		France		6,764	752,338
Siemens AG		Germany		4,442	523,830
Sinopec Engineering Group Co. Ltd.		China		615,000	264,064
SKF AB, B		Sweden		15,639	292,313
Snap-on Inc.		United States		1,016	140,726
Stanley Black & Decker Inc.		United States		4,652	648,396
Sumitomo Heavy Industries Ltd.		Japan		4,500	98,420
Toro Co.		United States		3,572	236,967
Trane Technologies PLC		United States		6,456	574,455
W.W. Grainger Inc.		United States		3,289	1,033,272

FFA-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Capital Goods (continued)
Watsco Inc.		United States		809	$        143,759
Yangzijiang Shipbuilding Holdings Ltd.		Singapore		98,600	66,379
					44,494,392
Commercial & Professional Services 1.6%
Adecco Group AG		Switzerland		6,392	301,291
Cintas Corp.		United States		6,084	1,620,534
aCopart Inc.		United States		6,003	499,870
aCoStar Group Inc.		United States		300	213,201
Equifax Inc.		United States		3,190	548,297
Experian PLC		United Kingdom		45,000	1,579,384
aIAA Inc.		United States		1,139	43,931
IHS Markit Ltd.		United States		21,309	1,608,829
KAR Auction Services Inc.		United States		1,042	14,338
ManpowerGroup Inc.		United States		57	3,919
Matthews International Corp., A		United States		5,800	110,780
Persol Holdings Co. Ltd.		Japan		6,900	95,129
Randstad NV		Netherlands		4,940	220,873
Recruit Holdings Co. Ltd.		Japan		11,000	378,292
RELX PLC		United Kingdom		36,436	843,305
Republic Services Inc.		United States		3,900	319,995
Robert Half International Inc.		United States		4,264	225,267
Rollins Inc.		United States		4,605	195,206
SGS SA		Switzerland		267	654,055
Verisk Analytics Inc.		United States		8,961	1,525,162
Wolters Kluwer NV		Netherlands		11,387	889,311
					11,890,969
Consumer Durables & Apparel 1.5%
aAdidas AG		Germany		785	206,948
Bandai Namco Holdings Inc.		Japan		1,500	78,957
Barratt Developments PLC		United Kingdom		19,371	119,052
The Berkeley Group Holdings PLC		United Kingdom		4,927	253,731
Burberry Group PLC		United Kingdom		7,850	155,111
aCapri Holdings Ltd.		United States		4,944	77,275
Carter’s Inc.		United States		1,386	111,850
D.R. Horton Inc.		United States		2,668	147,941
Garmin Ltd.		United States		4,296	418,860
Hanesbrands Inc.		United States		5,102	57,602
Hasbro Inc.		United States		3,501	262,400
Hermes International		France		878	737,110
Leggett & Platt Inc.		United States		3,927	138,034
aLululemon Athletica Inc.		United States		3,432	1,070,818
aMoncler SpA		Italy		5,423	208,515
NIKE Inc., B		United States		40,408	3,962,005
aNVR Inc.		United States		112	364,980
Pandora AS		Denmark		4,400	240,280
aPersimmon PLC		United Kingdom		8,975	253,996

Semiannual Report         FFA-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Consumer Durables & Apparel (continued)
PulteGroup Inc.		United States		3,970	$        135,099
Sekisui Chemical Co. Ltd.		Japan		13,100	187,693
Sekisui House Ltd.		Japan		25,600	488,759
Sony Corp.		Japan		7,700	531,532
Tapestry Inc.		United States		9,480	125,894
Taylor Wimpey PLC		United Kingdom		87,452	154,347
VF Corp.		United States		9,705	591,423
Whirlpool Corp.		United States		525	68,003
					11,148,215
Consumer Services 1.0%
Carnival Corp.		United States		11,718	192,409
Choice Hotels International Inc.		United States		1,034	81,583
Darden Restaurants Inc.		United States		4,295	325,432
Domino’s Pizza Inc.		United States		1,302	481,011
H&R Block Inc.		United States		7,332	104,701
Las Vegas Sands Corp.		United States		17,329	789,163
McDonald’s Corp.		United States		13,301	2,453,635
Six Flags Entertainment Corp.		United States		1,814	34,847
Starbucks Corp.		United States		10,065	740,683
aTAL Education Group, ADR		China		23,000	1,572,740
Wyndham Destinations Inc.		United States		1,962	55,289
Yum! Brands Inc.		United States		11,125	966,874
					7,798,367
Diversified Financials 2.2%
3i Group PLC		United Kingdom		40,649	418,546
American Express Co.		United States		3,590	341,768
aAmundi SA		France		2,687	211,215
aBerkshire Hathaway Inc., B		United States		6,469	1,154,781
BlackRock Inc.		United States		1,465	797,092
Challenger Ltd.		Australia		17,538	54,303
The Charles Schwab Corp.		United States		17,831	601,618
Daiwa Securities Group Inc.		Japan		33,500	140,730
Deutsche Boerse AG		Germany		9,427	1,705,916
EXOR NV		Netherlands		3,689	211,720
FactSet Research Systems Inc.		United States		1,114	365,916
Flow Traders		Netherlands		10,867	388,782
Hargreaves Lansdown PLC		United Kingdom		11,932	240,612
Hong Kong Exchanges and Clearing Ltd.		Hong Kong		24,800	1,056,267
Intercontinental Exchange Inc.		United States		8,255	756,158
Intermediate Capital Group PLC		United Kingdom		74,000	1,180,534
Invesco Ltd.		United States		7,131	76,730
Japan Exchange Group Inc.		Japan		2,600	60,216
Lazard Ltd., A		United States		3,513	100,577
M&G PLC		United Kingdom		112,702	234,010
Magellan Financial Group Ltd.		Australia		5,399	220,439
MarketAxess Holdings Inc.		United States		1,105	553,517

FFA-12         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Diversified Financials (continued)
MFA Financial Inc.		United States		4,330	$         10,782
Mitsubishi UFJ Lease & Finance Co. Ltd.		Japan		16,800	80,167
Moody’s Corp.		United States		2,363	649,187
Morningstar Inc.		United States		545	76,829
MSCI Inc.		United States		2,378	793,824
Nasdaq Inc.		United States		1,600	191,152
aNatixis SA		France		39,782	104,917
Nomura Holdings Inc.		Japan		46,600	209,401
ORIX Corp.		Japan		46,500	577,402
Partners Group Holding AG		Switzerland		780	710,340
S&P Global Inc.		United States		2,099	691,579
Santander Consumer USA Holdings Inc.		United States		3,125	57,531
SEI Investments Co.		United States		3,055	167,964
Singapore Exchange Ltd.		Singapore		34,000	204,608
State Street Corp.		United States		2,700	171,585
T. Rowe Price Group Inc.		United States		7,039	869,316
Tradeweb Markets Inc.		United States		2,100	122,094
UBS Group AG		Switzerland		4,941	57,064
					16,617,189
Energy 1.3%
Ampol Ltd.		Australia		10,004	203,815
BP PLC		United Kingdom		168,151	644,167
Cabot Oil & Gas Corp., A		United States		6,007	103,200
Chevron Corp.		United States		6,700	597,841
Cimarex Energy Co.		United States		1,926	52,946
ConocoPhillips		United States		15,805	664,126
Eni SpA		Italy		9,775	93,695
EOG Resources Inc.		United States		6,000	303,960
Equinor ASA		Norway		51,818	746,655
Exxon Mobil Corp.		United States		28,776	1,286,863
Galp Energia SGPS SA, B		Portugal		38,527	446,873
HollyFrontier Corp.		United States		2,216	64,707
Husky Energy Inc.		Canada		82,500	271,040
Neste Oil OYJ		Finland		8,059	316,498
ONEOK Inc.		United States		3,393	112,715
Phillips 66		United States		10,544	758,114
Royal Dutch Shell PLC, B		United Kingdom		45,465	689,235
SBM Offshore NV		Netherlands		46,666	687,586
Tenaris SA		Italy		20,416	132,664
Total SA		France		22,632	872,577
Valero Energy Corp.		United States		12,245	720,251
					9,769,528
Food & Staples Retailing 1.3%
Casey’s General Stores Inc.		United States		947	141,595
Coles Group Ltd.		Australia		13,349	158,661
Costco Wholesale Corp.		United States		4,887	1,481,787

Semiannual Report         FFA-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Food & Staples Retailing (continued)
aJeronimo Martins SGPS SA		Portugal		7,526	$        131,693
Koninklijke Ahold Delhaize NV		Netherlands		45,170	1,230,957
The Kroger Co.		United States		14,920	505,042
Lawson Inc.		Japan		2,000	100,601
Matsumotokiyoshi Holdings Co. Ltd.		Japan		15,700	570,516
Seven & i Holdings Co. Ltd.		Japan		8,500	278,065
Seven & I Holdings Co. Ltd., ADR		Japan		24,600	399,750
aSprouts Farmers Market Inc.		United States		2,539	64,973
Sundrug Co. Ltd.		Japan		20,200	668,533
Sysco Corp.		United States		15,175	829,466
Walgreens Boots Alliance Inc.		United States		17,826	755,644
Walmart Inc.		United States		20,575	2,464,474
Welcia Holdings Co. Ltd.		Japan		1,000	80,787
					9,862,544
Food, Beverage & Tobacco 2.4%
aa2 Milk Co. Ltd.		New Zealand		4,168	54,558
Altria Group Inc.		United States		30,176	1,184,408
Anheuser-Busch InBev SA/NV		Belgium		1,207	59,495
Brown-Forman Corp., A		United States		1,586	91,306
Brown-Forman Corp., B		United States		10,899	693,830
Calbee Inc.		Japan		3,300	91,211
The Coca-Cola Co.		United States		27,892	1,246,215
Constellation Brands Inc., A		United States		3,204	560,540
Flowers Foods Inc.		United States		5,437	121,571
General Mills Inc.		United States		18,181	1,120,859
The Hershey Co.		United States		5,251	680,635
Hormel Foods Corp.		United States		8,792	424,390
Imperial Brands PLC		United Kingdom		35,970	684,720
Ingredion Inc.		United States		1,870	155,210
J M Smucker Co/The		United States		2,302	243,575
Kellogg Co.		United States		4,386	289,739
Kirin Holdings Co. Ltd.		Japan		39,200	826,326
Lamb Weston Holdings Inc.		United States		3,132	200,229
McCormick & Co. Inc.		United States		5,900	1,058,519
Mondelez International Inc., A		United States		8,669	443,246
aMonster Beverage Corp.		United States		25,224	1,748,528
Nestle SA		Switzerland		3,119	345,805
Orkla ASA		Norway		8,204	72,045
PepsiCo Inc.		United States		23,188	3,066,845
Philip Morris International Inc.		United States		17,946	1,257,297
Suntory Beverage & Food Ltd.		Japan		5,300	206,797
Tyson Foods Inc.		United States		8,574	511,953
bWH Group Ltd., Reg S		Hong Kong		435,500	376,354
Yamazaki Baking Co. Ltd.		Japan		6,100	104,781
					17,920,987

FFA-14         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Health Care Equipment & Services 3.5%
Abbott Laboratories		United States		21,260	$        1,943,802
Baxter International Inc.		United States		2,315	199,322
Becton Dickinson and Co.		United States		8,200	1,962,014
Cerner Corp.		United States		7,697	527,629
Chemed Corp.		United States		371	167,347
Cochlear Ltd.		Australia		10,700	1,404,588
Coloplast AS, B		Denmark		3,667	571,512
CVS Health Corp.		United States		7,000	454,790
Danaher Corp.		United States		6,787	1,200,145
Dentsply Sirona Inc.		United States		5,700	251,142
aEdwards Lifesciences Corp.		United States		7,321	505,954
Fisher & Paykel Healthcare Corp. Ltd.		New Zealand		11,382	262,205
GN Store Nord AS		Denmark		25,000	1,338,128
aHaemonetics Corp.		United States		5,724	512,642
HCA Healthcare Inc.		United States		5,464	530,336
Hoya Corp.		Japan		5,000	478,795
aIDEXX Laboratories Inc.		United States		645	212,953
aIntuitive Surgical Inc.		United States		2,822	1,608,060
aLaboratory Corp. of America Holdings		United States		3,110	516,602
aLivaNova PLC		United Kingdom		21,000	1,010,730
Medipal Holdings Corp.		Japan		6,000	115,804
Medtronic PLC		United States		17,500	1,604,750
aPremier Inc., A		United States		636	21,802
Quest Diagnostics Inc.		United States		5,173	589,515
ResMed Inc.		United States		3,990	766,080
Sinopharm Group Co. Ltd., H		China		121,600	312,626
Stryker Corp.		United States		14,092	2,539,238
Suzuken Co. Ltd.		Japan		2,900	108,343
Teleflex Inc.		United States		3,284	1,195,310
UnitedHealth Group Inc.		United States		2,600	766,870
Universal Health Services Inc., B		United States		1,389	129,024
aVarian Medical Systems Inc.		United States		1,904	233,278
aVeeva Systems Inc.		United States		400	93,768
West Pharmaceutical Services Inc.		United States		8,100	1,840,077
					25,975,181
Household & Personal Products 1.3%
Church & Dwight Co. Inc.		United States		7,316	565,527
Clorox Co.		United States		4,417	968,957
Colgate-Palmolive Co.		United States		31,604	2,315,309
aEssity AB, B		Sweden		9,223	298,987
Estee Lauder Cos. Inc., A		United States		7,118	1,343,024
Kimberly-Clark Corp.		United States		7,114	1,005,564
Nu Skin Enterprises Inc., A		United States		1,539	58,836
The Procter & Gamble Co.		United States		21,338	2,551,385
Unilever NV		United Kingdom		3,053	162,765

Semiannual Report         FFA-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Household & Personal Products (continued)
Unilever PLC		United Kingdom		5,139	$        277,192
					9,547,546
Insurance 0.5%
Admiral Group PLC		United Kingdom		7,784	220,737
Aflac Inc.		United States		9,100	327,873
AIA Group Ltd.		Hong Kong		104,540	978,237
Allianz SE		Germany		1,938	395,980
American National Insurance Co.		United States		258	18,594
Assured Guaranty Ltd.		United States		1,941	47,380
Aviva PLC		United Kingdom		103,080	349,363
aCNP Assurances		France		7,394	85,751
Direct Line Insurance Group PLC		United Kingdom		60,093	201,487
Erie Indemnity Co., A		United States		3,000	575,700
Fidelity National Financial Inc.		United States		2,105	64,539
Japan Post Insurance Co. Ltd.		Japan		9,400	123,858
Medibank Private Ltd.		Australia		29,647	61,457
MS&AD Insurance Group Holdings Inc.		Japan		6,400	176,248
NN Group NV		Netherlands		1,839	61,799
RenaissanceRe Holdings Ltd.		United States		565	96,632
					3,785,635
Materials 3.3%
Air Products and Chemicals Inc.		United States		15,272	3,687,577
Albemarle Corp.		United States		15,630	1,206,792
aArcelorMittal SA		France		46,281	490,158
BHP Group PLC		United Kingdom		14,994	306,811
Celanese Corp.		United States		9,041	780,600
Covestro AG		Germany		12,999	495,065
Eastman Chemical Co.		United States		2,905	202,304
Ecolab Inc.		United States		9,621	1,914,098
EMS-Chemie Holding AG		Switzerland		344	267,255
Evraz PLC		Russia		20,712	73,381
Fortescue Metals Group Ltd.		Australia		61,175	594,637
International Flavors & Fragrances Inc.		United States		2,516	308,109
Johnson Matthey PLC		United Kingdom		11,509	299,727
Koninklijke DSM NV		Netherlands		12,000	1,665,668
Linde PLC		United Kingdom		14,985	3,178,468
LyondellBasell Industries NV, A		United States		11,096	729,229
Martin Marietta Materials Inc.		United States		2,363	488,125
NewMarket Corp.		United States		243	97,317
Nitto Denko Corp.		Japan		6,500	368,486
Nucor Corp.		United States		4,370	180,962
Packaging Corp. of America		United States		2,231	222,654
Reliance Steel & Aluminum Co.		United States		536	50,882
Rio Tinto Ltd.		Australia		9,594	656,840
Rio Tinto PLC		Australia		7,923	445,861
Royal Gold Inc.		United States		493	61,290

FFA-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Materials (continued)
Shin-Etsu Chemical Co. Ltd.		Japan		400	$        46,945
Sonoco Products Co.		United States		2,993	156,504
Steel Dynamics Inc.		United States		4,132	107,804
Sumitomo Metal Mining Co. Ltd.		Japan		24,100	678,892
Symrise AG		Germany		14,000	1,635,708
Taiheiyo Cement Corp.		Japan		5,000	116,171
Tosoh Corp.		Japan		30,800	423,096
Umicore SA		Belgium		36,000	1,699,195
Valvoline Inc.		United States		2,681	51,824
Wheaton Precious Metals Corp.		Canada		21,490	945,209
					24,633,644
Media & Entertainment 2.1%
aAlphabet Inc., A		United States		2,146	3,043,135
aAMC Networks Inc., A		United States		1,108	25,916
Ascential PLC		United Kingdom		324,885	1,165,435
aBaidu Inc., ADR		China		5,625	674,381
Cable One Inc.		United States		555	985,042
Cinemark Holdings Inc.		United States		2,017	23,296
Comcast Corp., A		United States		38,307	1,493,207
aCTS Eventim AG & Co. KGaA		Germany		24,000	1,002,055
CyberAgent Inc.		Japan		35,000	1,720,378
aFacebook Inc., A		United States		12,128	2,753,905
The Interpublic Group of Cos. Inc.		United States		8,214	140,952
Kakaku.com Inc.		Japan		5,700	145,203
aMatch Group Inc.		United States		1,348	144,304
aMatch Group Inc.		United States		2,007	649,064
Nippon Television Holdings Inc.		Japan		13,500	146,218
Omnicom Group Inc.		United States		6,512	355,555
Tokyo Broadcasting System Holdings Inc.		Japan		14,900	238,346
aUbisoft Entertainment SA		France		1,485	122,963
The Walt Disney Co.		United States		10,412	1,161,042
					15,990,397
Pharmaceuticals, Biotechnology & Life Sciences 5.9%
a10X Genomics Inc., A		United States		900	80,379
AbbVie Inc.		United States		25,727	2,525,877
Agilent Technologies Inc.		United States		7,385	652,612
Amgen Inc.		United States		12,284	2,897,304
Astellas Pharma Inc.		Japan		27,800	464,248
AstraZeneca PLC, ADR		United Kingdom		12,114	640,709
Bayer AG		Germany		21,485	1,592,402
aBiogen Inc.		United States		4,887	1,307,517
Bristol-Myers Squibb Co.		United States		26,105	1,534,974
aBristol-Myers Squibb Co., rts., 2/01/49		United States		5,723	20,488
aCatalent Inc.		United States		20,489	1,501,844
Chugai Pharmaceutical Co. Ltd.		Japan		3,600	192,744
CSL Ltd.		Australia		12,186	2,423,310

Semiannual Report         FFA-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Pharmaceuticals, Biotechnology & Life Sciences (continued)
aDeciphera Pharmaceuticals Inc.		United States		3,500	$        209,020
Eli Lilly and Co.		United States		7,262	1,192,275
aExelixis Inc.		United States		7,348	174,441
aGalapagos NV		Belgium		1,565	308,869
aGenmab A/S		Denmark		2,200	741,752
Gilead Sciences Inc.		United States		21,800	1,677,292
aGW Pharmaceuticals PLC, ADR		United Kingdom		1,326	162,727
Hikma Pharmaceuticals PLC		United Kingdom		45,000	1,234,799
aIllumina Inc.		United States		3,446	1,276,226
aIovance Biotherapeutics Inc.		United States		2,500	68,625
Johnson & Johnson		United States		26,655	3,748,493
Merck & Co. Inc.		United States		22,963	1,775,729
aMettler-Toledo International Inc.		United States		3,480	2,803,314
aNeurocrine Biosciences Inc.		United States		2,809	342,698
Novartis AG		Switzerland		12,343	1,075,335
Novo Nordisk AS, B		Denmark		15,177	988,650
Orion OYJ		Finland		1,749	84,809
Pfizer Inc.		United States		70,822	2,315,879
aPTC Therapeutics Inc.		United States		2,300	116,702
aReata Pharmaceuticals Inc.		United States		700	109,214
aRegeneron Pharmaceuticals Inc.		United States		1,113	694,122
Roche Holding AG		Switzerland		8,164	2,828,414
Sanofi		France		12,151	1,239,104
Santen Pharmaceutical Co. Ltd.		Japan		50,000	920,473
Sartorius Stedim Biotech		France		1,200	304,218
Shionogi & Co. Ltd.		Japan		3,500	219,567
Takeda Pharmaceutical Co. Ltd., ADR		Japan		69,900	1,253,307
aWaters Corp.		United States		3,696	666,758
aWuXi Biologics (Cayman) Inc.		China		6,500	119,311
					44,486,531
Real Estate 1.5%
American Tower Corp.		United States		6,129	1,584,592
aAroundtown SA		Germany		36,347	208,315
CapitaLand Mall Trust		Singapore		39,200	55,624
CK Asset Holdings Ltd.		Hong Kong		140,330	841,524
Crown Castle International Corp.		United States		6,785	1,135,470
Daito Trust Construction Co. Ltd.		Japan		3,000	276,484
EPR Properties		United States		2,325	77,027
Equinix Inc.		United States		1,198	841,355
Gaming and Leisure Properties Inc.		United States		5,396	186,702
Gecina SA		France		1,959	241,929
Goodman Group		Australia		7,321	75,529
Kerry Properties Ltd.		Hong Kong		27,500	71,434
Kimco Realty Corp.		United States		10,578	135,822
Link REIT		Hong Kong		11,100	91,132
Mitsui Fudosan Co. Ltd.		Japan		32,700	580,907

FFA-18         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Real Estate (continued)
National Retail Properties Inc.		United States		5,357	$        190,066
OMEGA Healthcare Investors Inc.		United States		6,649	197,675
Public Storage		United States		5,214	1,000,515
Realty Income Corp.		United States		9,590	570,605
Segro PLC		United Kingdom		39,210	433,644
Simon Property Group Inc.		United States		7,737	529,056
Spirit Realty Capital Inc.		United States		3,149	109,774
STORE Capital Corp.		United States		5,795	137,979
Sun Hung Kai Properties Ltd.		Hong Kong		23,500	300,216
Swire Pacific Ltd., A		Hong Kong		69,500	369,374
Ventas Inc.		United States		6,506	238,250
VEREIT Inc.		United States		30,782	197,928
WP Carey Inc.		United States		3,880	262,482
					10,941,410
Retailing 3.7%
ABC-Mart Inc.		Japan		1,300	76,262
aAlibaba Group Holding Ltd.		China		12,600	339,994
aAlibaba Group Holding Ltd., ADR		China		3,145	678,377
aAmazon.com Inc.		United States		2,238	6,174,239
aAutoZone Inc.		United States		569	641,900
Best Buy Co. Inc.		United States		7,734	674,946
aboohoo Group PLC		United Kingdom		290,000	1,485,006
aBooking Holdings Inc.		United States		423	673,560
aBurlington Stores Inc.		United States		531	104,570
Dick’s Sporting Goods Inc.		United States		2,556	105,461
Dollar General Corp.		United States		6,650	1,266,892
Expedia Group Inc.		United States		2,151	176,812
Foot Locker Inc.		United States		4,357	127,050
The Gap Inc.		United States		8,417	106,223
Genuine Parts Co.		United States		4,377	380,624
Hennes & Mauritz AB, B		Sweden		20,642	301,261
The Home Depot Inc.		United States		6,699	1,678,166
Industria de Diseno Textil SA		Spain		25,457	675,402
Kohl’s Corp.		United States		6,012	124,869
L Brands Inc.		United States		7,713	115,464
Lowe’s Cos. Inc.		United States		8,700	1,175,544
Macy’s Inc.		United States		10,257	70,568
aMercadoLibre Inc.		Argentina		1,500	1,478,655
Next PLC		United Kingdom		5,466	330,925
Nitori Holdings Co. Ltd.		Japan		300	58,821
Nordstrom Inc.		United States		3,773	58,444
aO’Reilly Automotive Inc.		United States		2,453	1,034,357
Penske Automotive Group Inc.		United States		782	30,271
Pool Corp.		United States		1,094	297,426
Ross Stores Inc.		United States		24,749	2,109,605
Seria Co. Ltd.		Japan		9,400	335,267

Semiannual Report         FFA-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Retailing (continued)
Target Corp.		United States		22,141	$        2,655,370
The TJX Cos. Inc.		United States		24,414	1,234,372
Tractor Supply Co.		United States		3,801	500,934
aUlta Beauty Inc.		United States		1,843	374,903
aUrban Outfitters Inc.		United States		2,374	36,132
Williams-Sonoma Inc.		United States		2,842	233,072
aZalando SE		Germany		2,247	159,389
Zozo Inc.		Japan		4,300	95,856
					28,176,989
Semiconductors & Semiconductor Equipment 3.1%
Advantest Corp.		Japan		2,900	165,504
Analog Devices Inc.		United States		16,200	1,986,768
Applied Materials Inc.		United States		25,796	1,559,368
ASML Holding NV		Netherlands		5,200	1,902,058
ASML Holding NV, N.Y. shs		Netherlands		4,022	1,480,217
Intel Corp.		United States		25,458	1,523,152
KLA Corp.		United States		4,502	875,549
Lam Research Corp.		United States		4,069	1,316,159
Maxim Integrated Products Inc.		United States		8,003	485,062
Monolithic Power Systems		United States		2,700	639,900
NVIDIA Corp.		United States		3,187	1,210,773
NXP Semiconductors NV		Netherlands		11,677	1,331,645
QUALCOMM Inc.		United States		10,224	932,531
Skyworks Solutions Inc.		United States		6,004	767,672
Taiwan Semiconductor Manufacturing Co. Ltd.		Taiwan		84,000	899,686
Texas Instruments Inc.		United States		36,020	4,573,459
Tokyo Electron Ltd.		Japan		3,200	789,580
Xilinx Inc.		United States		7,578	745,600
					23,184,683
Software & Services 7.7%
Accenture PLC, A		United States		18,612	3,996,369
aAdobe Inc.		United States		1,077	468,829
aAdyen NV		Netherlands		1,568	2,282,012
Amdocs Ltd.		United States		4,288	261,053
aAspen Technology Inc.		United States		1,336	138,423
aAtlassian Corp. PLC		United States		1,000	180,270
aAutodesk Inc.		United States		5,142	1,229,915
Automatic Data Processing Inc.		United States		12,915	1,922,914
aAvalara Inc.		United States		2,280	303,445
AVEVA Group PLC		United Kingdom		28,000	1,419,633
aBill.Com Holdings Inc.		United States		4,300	387,903
Booz Allen Hamilton Holding Corp.		United States		1,899	147,723
Broadridge Financial Solutions Inc.		United States		3,665	462,486
aCadence Design Systems Inc.		United States		4,030	386,719
aCheck Point Software Technologies Ltd.		Israel		4,600	494,178
Citrix Systems Inc.		United States		1,868	276,296

FFA-20         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Software & Services (continued)
Cognizant Technology Solutions Corp., A		United States		11,809	$        670,987
aCyberArk Software Ltd.		Israel		15,000	1,489,050
Fujitsu Ltd.		Japan		7,800	913,250
International Business Machines Corp.		United States		11,026	1,331,610
Intuit Inc.		United States		11,888	3,521,107
Jack Henry & Associates Inc.		United States		2,322	427,318
Keywords Studios PLC		Ireland		74,000	1,661,417
Mastercard Inc., A		United States		13,525	3,999,343
Microsoft Corp.		United States		59,398	12,088,087
NEC Corp.		Japan		3,500	168,160
aNice Ltd.		Israel		669	126,104
Nomura Research Institute Ltd.		Japan		13,300	363,259
aOkta Inc., A		United States		400	80,092
Oracle Corp. Japan		Japan		1,500	177,919
Otsuka Corp.		Japan		4,200	221,826
Paychex Inc.		United States		10,879	824,084
aPayPal Holdings Inc.		United States		3,600	627,228
aPTC Inc.		United States		7,221	561,722
The Sage Group PLC		United Kingdom		198,153	1,644,788
asalesforce.com Inc.		United States		3,353	628,118
SAP SE		Germany		12,172	1,701,366
aServiceNow Inc.		United States		6,255	2,533,650
aShopify Inc., A		Canada		1,550	1,471,260
aSynopsys Inc.		United States		2,700	526,500
Trend Micro Inc.		Japan		2,100	117,357
aTwilio Inc., A		United States		2,562	562,154
aTyler Technologies Inc.		United States		1,196	414,869
aVeriSign Inc.		United States		2,984	617,181
Visa Inc., A		United States		14,984	2,894,459
aWorkday Inc., A		United States		4,520	846,867
					57,569,300
Technology Hardware & Equipment 2.2%
Amphenol Corp., A		United States		8,633	827,128
Apple Inc.		United States		23,012	8,394,778
Avnet Inc.		United States		8,800	245,388
Cisco Systems Inc.		United States		32,765	1,528,160
Cognex Corp.		United States		2,387	142,552
aF5 Networks Inc.		United States		2,000	278,960
Hitachi Ltd.		Japan		31,300	994,865
HP Inc.		United States		50,192	874,846
aKeysight Technologies Inc.		United States		4,262	429,524
Motorola Solutions Inc.		United States		4,497	630,165
NetApp Inc.		United States		6,842	303,579
Samsung Electronics Co. Ltd.		South Korea		28,228	1,252,930
TE Connectivity Ltd.		United States		10,949	892,891

Semiannual Report         FFA-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Technology Hardware & Equipment (continued)
Ubiquiti Inc.		United States		323	$	56,383
						16,852,149
Telecommunication Services 0.9%
AT&T Inc.		United States		39,921		1,206,812
Deutsche Telekom AG		Germany		46,352		777,682
KDDI Corp.		Japan		32,100		957,772
Nippon Telegraph & Telephone Corp.		Japan		19,700		458,999
NTT DOCOMO Inc.		Japan		39,100		1,038,027
Proximus SADP		Belgium		6,611		134,701
Softbank Corp.		Japan		15,200		193,743
Swisscom AG		Switzerland		432		226,541
aTelefonica SA		Spain		1,055		5,033
Telefonica SA		Spain		25,330		121,137
aTelefonica SA, rts., 7/01/20		Spain		10		2
Verizon Communications Inc.		United States		24,629		1,357,797
Vodafone Group PLC		United Kingdom		381,269		606,101
						7,084,347
Transportation 1.9%
Alaska Air Group Inc.		United States		3,923		142,248
AP Moeller-Maersk A/S, B		Denmark		354		414,850
C.H. Robinson Worldwide Inc.		United States		4,472		353,556
Canadian National Railway Co.		Canada		5,714		506,089
Canadian Pacific Railway Ltd.		Canada		2,972		758,870
ComfortDelGro Corp. Ltd.		Singapore		105,100		110,454
Delta Air Lines Inc.		United States		17,452		489,529
aDeutsche Lufthansa AG		Germany		6,653		66,740
DSV Panalpina A/S		Denmark		13,500		1,658,109
Expeditors International of Washington Inc.		United States		5,057		384,534
Japan Airlines Co. Ltd.		Japan		4,700		84,814
JB Hunt Transport Services Inc.		United States		5,526		664,999
Kamigumi Co. Ltd.		Japan		4,300		84,566
Kansas City Southern		United States		4,295		641,201
aKuehne + Nagel International AG		Switzerland		2,278		379,443
Landstar System Inc.		United States		1,110		124,664
Norfolk Southern Corp.		United States		4,400		772,508
Old Dominion Freight Line Inc.		United States		776		131,602
Southwest Airlines Co.		United States		14,883		508,701
aUber Technologies Inc.		United States		5,938		184,553
Union Pacific Corp.		United States		20,596		3,482,166
United Parcel Service Inc., B		United States		18,127		2,015,360
						13,959,556
Utilities 1.8%
AGL Energy Ltd.		Australia		28,153		333,006
Alliant Energy Corp.		United States		6,338		303,210
Ameren Corp.		United States		4,398		309,443

FFA-22         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Utilities (continued)
American Electric Power Co. Inc.		United States		3,773	$	300,482
American Water Works Co. Inc.		United States		4,219		542,817
Atmos Energy Corp.		United States		3,092		307,901
Centrica PLC		United Kingdom		184,452		87,639
Consolidated Edison Inc.		United States		8,867		637,803
Dominion Energy Inc.		United States		11,218		910,677
DTE Energy Co.		United States		5,418		582,435
E.ON SE		Germany		68,411		772,133
Endesa SA		Spain		13,312		330,191
Evergy Inc.		United States		4,253		252,160
Eversource Energy		United States		7,824		651,504
Exelon Corp.		United States		26,169		949,673
Hawaiian Electric Industries Inc.		United States		3,031		109,298
NextEra Energy Inc.		United States		9,508		2,283,536
OGE Energy Corp.		United States		5,530		167,891
PPL Corp.		United States		13,989		361,476
Public Service Enterprise Group Inc.		United States		15,856		779,481
Red Electrica Corp. SA		Spain		12,336		230,780
Sempra Energy		United States		2,118		248,293
The Southern Co.		United States		19,795		1,026,371
Toho Gas Co. Ltd.		Japan		1,500		74,974
Tokyo Gas Co. Ltd.		Japan		15,300		366,352
Veolia Environnement SA		France		14,635		330,446
Xcel Energy Inc.		United States		3,971		248,188
						13,498,160
Total Common Stocks and Other Equity Interests (Cost $408,190,714)						439,558,173
Management Investment Companies (Cost $34,937,947) 3.8%
Diversified Financials 3.8%
cTempleton Global Bond VIP Fund, Class 1		United States		1,981,831		28,696,911
Preferred Stocks (Cost $116,835) 0.0%†
Materials 0.0%†
dFuchs Petrolub SE, 2.711%, pfd.		Germany		3,045		122,379
			Principal   Amount*
Corporate Bonds 14.6%
Automobiles & Components 0.0%†
eAdient U.S. LLC, senior secured note, 144A, 7.00%, 5/15/26		United States		100,000		103,664
eAllison Transmission Inc., senior bond, 144A, 5.875%, 6/01/29		United States		100,000		104,290
						207,954

Semiannual Report         FFA-23

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal   Amount*		Value
Corporate Bonds (continued)
Banks 2.5%
eAkbank T.A.S., senior note, 144A, 5.125%, 3/31/25		Turkey		200,000	$	189,199
Bancolombia SA, senior note, 3.00%, 1/29/25		Colombia		650,000		637,676
Bank of America Corp.,
sub. bond, 4.183%, 11/25/27		United States		1,810,000		2,066,924
sub. note, 4.20%, 8/26/24		United States		400,000		444,115
bBDO Unibank Inc., senior note, Reg S, 2.95%, 3/06/23		Philippines		200,000		204,978
eBNP Paribas SA,
senior bond, 144A, 3.052% to 1/13/30, FRN thereafter, 1/13/31		France		200,000		210,650
senior note, 144A, 2.219% to 6/09/25, FRN thereafter, 6/09/26		France		200,000		204,567
eBPCE SA,
senior note, 144A, 5.70%, 10/22/23		France		400,000		447,738
sub. note, 144A, 5.15%, 7/21/24		France		800,000		893,776
sub. note, 144A, 4.875%, 4/01/26		France		500,000		567,548
Citigroup Inc.,
senior note, 2.572% to 6/30/30, FRN thereafter, 6/03/31		United States		200,000		206,967
senior note, 3.352% to 4/24/24, FRN thereafter, 4/24/25		United States		1,700,000		1,837,771
fComerica Inc., junior sub. bond, 5.625% to 10/01/25, FRN thereafter, Perpetual		United States		100,000		101,730
Credit Suisse Group Funding Guernsey Ltd.,
senior note, 3.80%, 9/15/22		Switzerland		1,200,000		1,275,232
senior note, 3.80%, 6/09/23		Switzerland		400,000		431,082
HSBC Holdings PLC, senior bond, 2.848% to 6/04/30, FRN thereafter, 6/04/31		United Kingdom		300,000		307,443
JPMorgan Chase & Co.,
senior bond, 3.54% to 5/01/27, FRN thereafter, 5/01/28		United States		1,350,000		1,508,302
senior bond, 4.493% to 3/23/30, FRN thereafter, 3/24/31		United States		400,000		489,650
sub. note, 3.875%, 9/10/24		United States		400,000		443,748
Lloyds Banking Group PLC,
senior note, 4.05%, 8/16/23		United Kingdom		400,000		435,339
senior note, 3.87%, 7/09/25		United Kingdom		200,000		217,832
PNC Bank NA, senior bond, 3.10%, 10/25/27		United States		400,000		448,879
eStandard Chartered PLC, senior note, 144A, 4.05%, 4/12/26		United Kingdom		970,000		1,056,757
SVB Financial Group, senior note, 3.125%, 6/05/30		United States		100,000		107,311
Truist Bank, sub. Bond, 2.25%, 3/11/30		United States		400,000		404,486
Truist Financial Corp., sub. bond, 3.875%, 3/19/29		United States		1,660,000		1,884,069
US Bancorp., sub. bond, 3.00%, 7/30/29		United States		300,000		325,992
Wells Fargo & Co., senior note, 2.393% to 6/02/27, FRN thereafter, 6/02/28		United States		200,000		206,803
gWells Fargo Bank NA, senior note, FRN, 2.082%, 9/09/22		United States		1,100,000		1,118,009
						18,674,573
Capital Goods 0.4%
eBeacon Roofing Supply Inc., senior note, 144A, 4.875%, 11/01/25		United States		100,000		89,517
eCarrier Global Corp., senior note, 144A, 3.577%, 4/05/50		United States		430,000		421,447
Caterpillar Inc.,
senior bond, 3.25%, 4/09/50		United States		200,000		224,454
senior note, 2.60%, 4/09/30		United States		500,000		544,382

FFA-24         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal   Amount*		Value
Corporate Bonds (continued)
Capital Goods (continued)
Lockheed Martin Corp., senior bond, 4.70%, 5/15/46		United States		200,000	$	273,458
Northrop Grumman Corp., senior bond, 5.25%, 5/01/50		United States		200,000		288,848
Raytheon Technologies Corp., senior bond, 4.50%, 6/01/42		United States		800,000		992,043
eResideo Funding Inc., senior note, 144A, 6.125%, 11/01/26		United States		200,000		196,131
eWESCO Distribution Inc., senior note, 144A, 7.125%, 6/15/25		United States		100,000		105,720
Westinghouse Air Brake Technologies Corp., senior note, 3.20%, 6/15/25		United States		100,000		102,201
						3,238,201
Commercial & Professional Services 0.1%
eAshtead Capital Inc., secured note, second lien, 144A, 4.125%, 8/15/25		United Kingdom		575,000		587,937
eHarsco Corp., senior note, 144A, 5.75%, 7/31/27		United States		100,000		100,503
						688,440
Consumer Durables & Apparel 0.1%
eAshton Woods USA LLC/Ashton Woods Finance Co., senior note, 144A, 6.75%, 8/01/25		United States		100,000		98,615
Mohawk Industries Inc., senior bond, 3.625%, 5/15/30		United States		290,000		316,479
NIKE Inc.,
senior bond, 2.375%, 11/01/26		United States		100,000		108,992
senior bond, 3.875%, 11/01/45		United States		100,000		120,738
						644,824
Consumer Services 0.1%
Marriott International Inc., senior note, 3.60%, 4/15/24		United States		300,000		301,802
eWynn Las Vegas LLC/Wynn Las Vegas Capital Corp., senior bond, 144A, 5.25%, 5/15/27		United States		100,000		86,663
						388,465
Diversified Financials 1.2%
Capital One Financial Corp.,
senior note, 3.20%, 1/30/23		United States		200,000		210,786
senior note, 3.75%, 3/09/27		United States		1,035,000		1,143,811
DY9 Leasing LLC, secured bond, 2.372%, 3/19/27		United States		672,597		705,437
The Goldman Sachs Group Inc.,
senior note, 3.50%, 1/23/25		United States		1,400,000		1,525,959
sub. note, 4.25%, 10/21/25		United States		400,000		451,116
Goldman Sachs Group Inc., senior note, 2.60%, 2/07/30		United States		300,000		313,576
Morgan Stanley,
senior bond, 3.591% to 7/22/27, FRN thereafter, 7/22/28		United States		1,460,000		1,644,025
sub. bond, 4.875%, 11/01/22		United States		400,000		435,336
Private Export Funding Corp., secured bond, 2.80%, 5/15/22		United States		1,600,000		1,668,687
Springleaf Finance Corp., senior bond, 5.375%, 11/15/29		United States		100,000		94,620
bTNB Global Ventures Capital Bhd., senior note, Reg S, 3.244%, 10/19/26		Malaysia		300,000		319,549
eUBS AG London, senior note, 144A, 1.75%, 4/21/22		Switzerland		200,000		203,828
						8,716,730
Energy 2.5%
eAker BP ASA,
senior note, 144A, 4.75%, 6/15/24		Norway		200,000		201,615
senior note, 144A, 3.75%, 1/15/30		Norway		500,000		471,358

Semiannual Report         FFA-25

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal  Amount*		Value
Corporate Bonds (continued)
Energy (continued)
Baker Hughes a GE Co. LLC/Baker Hughes Co-Obligor Inc.,
senior bond, 3.337%, 12/15/27		United States		400,000	$	426,383
senior bond, 4.08%, 12/15/47		United States		735,000		765,449
BP Capital Markets America Inc,
senior note, 3.937%, 9/21/28		United States		100,000		114,462
senior note, 4.234%, 11/06/28		United States		400,000		465,008
Canadian Natural Resources Ltd.,
senior bond, 3.90%, 2/01/25		Canada		1,010,000		1,082,876
senior bond, 3.85%, 6/01/27		Canada		300,000		321,039
senior note, 2.95%, 1/15/23		Canada		400,000		412,851
Cheniere Corpus Christi Holdings LLC,
senior secured bond, first lien, 5.125%, 6/30/27		United States		200,000		219,750
senior secured note, first lien, 5.875%, 3/31/25		United States		200,000		224,668
Chevron Corp., senior note, 2.355%, 12/05/22		United States		100,000		104,089
Ecopetrol SA, senior bond, 4.125%, 1/16/25		Colombia		250,000		251,539
Enable Midstream Partners LP, senior bond, 4.95%, 5/15/28		United States		300,000		278,813
Energy Transfer Operating LP,
senior bond, 4.75%, 1/15/26		United States		100,000		109,289
senior bond, 6.05%, 6/01/41		United States		700,000		722,467
Enterprise Products Operating LLC,
senior bond, 3.125%, 7/31/29		United States		400,000		428,895
senior bond, 6.125%, 10/15/39.		United States		700,000		890,773
EOG Resources Inc., senior bond, 4.375%, 4/15/30		United States		50,000		59,638
Exxon Mobil Corp.,
senior bond, 2.61%, 10/15/30		United States		100,000		106,845
senior note, 3.294%, 3/19/27		United States		400,000		449,479
Kinder Morgan Inc., senior bond, 5.55%, 6/01/45		United States		800,000		972,493
Kinder Morgan Inc./DE, senior note, 4.30%, 3/01/28		United States		400,000		453,824
MPLX LP,
senior bond, 5.50%, 2/15/49		United States		425,000		482,948
senior note, 4.875%, 12/01/24		United States		400,000		444,519
senior note, 4.875%, 6/01/25		United States		100,000		111,690
Occidental Petroleum Corp., senior note, 2.60%, 8/13/21		United States		400,000		391,990
Reliance Industries Ltd., senior note, 2.06%, 1/15/26		United States		750,000		769,926
eSchlumberger Holdings Corp., senior note, 144A, 3.75%, 5/01/24		United States		1,510,000		1,627,484
eSchlumberger Investment SA, senior bond, 144A, 2.40%, 8/01/22		United States		400,000		410,103
Total Capital International SA, senior note, 3.455%, 2/19/29		France		670,000		762,280
Total Capital SA, senior note, 3.883%, 10/11/28		France		400,000		465,015
TransCanada PipeLines Ltd, senior bond, 4.25%, 5/15/28		Canada		500,000		575,541
TransCanada PipeLines Ltd., senior bond, 4.875%, 5/15/48		Canada		200,000		247,534
Transcontinental Gas Pipe Line Co. LLC, senior note, 7.85%, 2/01/26		United States		400,000		521,253
Valero Energy Corp., senior bond, 4.00%, 4/01/29		United States		935,000		1,041,086
The Williams Cos. Inc.,
senior bond, 4.125%, 11/15/20		United States		1,350,000		1,352,237
senior bond, 4.85%, 3/01/48		United States		320,000		350,449
						19,087,658

FFA-26         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal  Amount*		Value
Corporate Bonds (continued)
Food & Staples Retailing 0.5%
eCencosud SA, senior note, 144A, 4.375%, 7/17/27		Chile		300,000	$	306,206
eCK Hutchison International 19 Ltd., senior note, 144A, 3.25%, 4/11/24		Hong Kong		1,035,000		1,097,138
Costco Wholesale Corp., senior note, 1.375%, 6/20/27		United States		200,000		204,666
The Kroger Co., senior bond, 5.40%, 1/15/49		United States		550,000		771,701
Walgreens Boots Alliance Inc., senior note, 3.80%, 11/18/24		United States		500,000		551,078
Walmart Inc., senior note, 3.55%, 6/26/25		United States		100,000		113,434
Wal-Mart Stores Inc., senior bond, 5.25%, 9/01/35		United States		300,000		438,352
						3,482,575
Food, Beverage & Tobacco 0.4%
Anheuser-Busch Cos. LLC/InBev Worldwide Inc., senior bond, 4.90%, 2/01/46		Belgium		100,000		122,692
Anheuser-Busch InBev Worldwide Inc.,
senior bond, 3.50%, 6/01/30		Belgium		200,000		225,300
senior bond, 5.80%, 1/23/59		Belgium		100,000		142,643
B&G Foods Inc., senior note, 5.25%, 9/15/27		United States		100,000		100,344
Bunge Ltd. Finance Corp., senior note, 4.35%, 3/15/24		United States		200,000		218,554
The Coca-Cola Co.,
senior bond, 4.20%, 3/25/50		United States		200,000		263,283
senior note, 1.45%, 6/01/27		United States		100,000		102,801
eImperial Brands Finance PLC,
senior note, 144A, 4.25%, 7/21/25		United Kingdom		585,000		644,553
senior note, 144A, 3.50%, 7/26/26		United Kingdom		300,000		321,209
eJBS USA LUX SA/JBS USA Food Co./JBS USA Finance Inc., senior bond, 144A, 5.50%, 1/15/30		United States		100,000		102,669
eKraft Heinz Foods Co., senior note, 144A, 3.875%, 5/15/27		United States		100,000		104,634
ePost Holdings Inc., senior bond, 144A, 4.625%, 4/15/30		United States		200,000		196,630
Reynolds American Inc., senior bond, 5.85%, 8/15/45		United Kingdom		650,000		815,127
						3,360,439
Health Care Equipment & Services 0.9%
Abbott Laboratories,
senior bond, 3.75%, 11/30/26		United States		450,000		524,002
senior bond, 4.75%, 11/30/36		United States		200,000		269,343
Anthem Inc.,
senior bond, 4.65%, 1/15/43		United States		100,000		125,823
senior bond, 5.10%, 1/15/44		United States		600,000		792,839
senior note, 4.101%, 3/01/28		United States		400,000		468,092
CHS/Community Health Systems Inc., senior secured note, first lien, 6.25%, 3/31/23		United States		100,000		94,391
Cigna Corp.,
senior note, 4.375%, 10/15/28		United States		500,000		592,125
senior note, 2.40%, 3/15/30		United States		300,000		311,642
esenior note, 144A, 3.05%, 10/15/27		United States		550,000		598,624
CVS Health Corp.,
senior bond, 4.30%, 3/25/28		United States		300,000		350,956
senior bond, 4.78%, 3/25/38		United States		100,000		124,377
senior bond, 5.30%, 12/05/43		United States		800,000		1,047,375

Semiannual Report         FFA-27

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal  Amount*		Value
Corporate Bonds (continued)
Health Care Equipment & Services (continued)
CVS Health Corp., (continued)
senior bond, 5.125%, 7/20/45		United States		200,000	$	258,000
HCA Inc.,
senior secured bond, first lien, 4.50%, 2/15/27		United States		408,000		455,206
senior secured bond, first lien, 4.125%, 6/15/29		United States		300,000		331,222
Quest Diagnostics Inc., senior bond, 2.80%, 6/30/31		United States		600,000		630,297
						6,974,314
Household & Personal Products 0.1%
Avon Products Inc., senior bond, 7.00%, 3/15/23		United Kingdom		260,000		259,188
The Procter & Gamble Co., senior bond, 3.55%, 3/25/40		United States		400,000		483,469
						742,657
Insurance 0.8%
Aflac Inc.,
senior bond, 4.75%, 1/15/49		United States		700,000		902,890
senior note, 3.60%, 4/01/30		United States		600,000		701,279
The Allstate Corp., senior bond, 4.20%, 12/15/46		United States		700,000		867,845
Arch Capital Group Ltd., senior bond, 3.635%, 6/30/50		United States		300,000		315,363
Marsh & McLennan Cos. Inc., senior bond, 4.375%, 3/15/29		United States		400,000		482,555
MetLife Inc.,
junior sub. bond, 6.40%, 12/15/66		United States		450,000		532,283
senior bond, 5.70%, 6/15/35		United States		300,000		434,744
eMetropolitan Life Global Funding I,
secured note, 144A, 3.60%, 1/11/24		United States		940,000		1,028,437
senior note, 144A, 2.95%, 4/09/30		United States		250,000		274,255
Willis North America Inc., senior bond, 2.95%, 9/15/29		United States		100,000		106,154
						5,645,805
Materials 0.5%
Air Products and Chemicals Inc., senior bond, 2.70%, 5/15/40		United States		400,000		425,812
eAlpek SAB de CV, senior note, 144A, 4.25%, 9/18/29		Mexico		200,000		197,812
Bemis Co Inc., senior note, 2.63%, 6/19/30		United States		100,000		102,635
eBraskem Netherlands Finance BV, senior bond, 144A, 4.50%, 1/31/30		Brazil		300,000		275,025
eCCL Industries Inc., senior note, 144A, 3.05%, 6/01/30		Canada		200,000		205,031
bCNAC HK Finbridge Co. Ltd.,
senior note, Reg S, 4.875%, 3/14/25		China		200,000		222,360
senior note, Reg S, 3.875%, 6/19/29		China		200,000		217,267
EI du Pont de Nemours and Co., senior note, 1.70%, 7/15/25		United States		180,000		185,975
eGlencore Funding LLC, senior note, 144A, 4.625%, 4/29/24		Switzerland		900,000		994,147
eMauser Packaging Solutions Holding Co., senior note, 144A, 7.25%, 4/15/25		United States		100,000		90,974
eNovelis Corp., senior bond, 144A, 4.75%, 1/30/30.		United States		100,000		95,748
ePlastipak Holdings Inc., senior note, 144A, 6.25%, 10/15/25		United States		100,000		97,312
eReynolds Group Issuer Inc./Reynolds Group Issuer LLC/Reynolds Group Issuer Luxembourg SA, senior note, 144A, 7.00%, 7/15/24		United States		100,000		100,515
eSunCoke Energy Partners LP/SunCoke Energy Partners Finance Corp., senior note, 144A, 7.50%, 6/15/25		United States		100,000		84,832
Westlake Chemical Corp., senior bond, 3.375%, 6/15/30		United States		100,000		102,346
WRKCo Inc., senior bond, 3.00%, 6/15/33		United States		235,000		245,703

FFA-28         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal  Amount*		Value
Corporate Bonds (continued)
Materials (continued)
eYara International ASA, senior note, 144A, 3.148%, 6/04/30		Norway		100,000	$	104,177
						3,747,671
Media & Entertainment 0.5%
Charter Communications Operating LLC/Charter Communications Operating Capital,
senior bond, 2.80%, 4/01/31		United States		200,000		203,197
senior secured note, first lien, 4.50%, 2/01/24		United States		550,000		608,924
Comcast Corp., senior bond, 4.049%, 11/01/52		United States		1,025,000		1,260,704
eDiamond Sports Group LLC/Diamond Sports Finance Co., first lien, 144A, 5.375%, 8/15/26		United States		100,000		72,992
Fox Corp., senior bond, 5.476%, 1/25/39		United States		520,000		695,914
NBCUniversal Media LLC, senior bond, 5.95%, 4/01/41		United States		200,000		297,518
Netflix Inc., senior bond, 4.875%, 4/15/28		United States		100,000		107,090
eNexstar Broadcasting Inc., senior note, 144A, 5.625%, 7/15/27		United States		100,000		100,253
eUnivision Communications Inc., senior secured note, first lien, 144A, 5.125%, 2/15/25		United States		100,000		94,501
						3,441,093
Pharmaceuticals, Biotechnology & Life Sciences 0.9%
eAbbVie Inc.,
senior bond, 144A, 3.80%, 3/15/25		United States		400,000		446,476
senior bond, 144A, 4.85%, 6/15/44		United States		550,000		688,275
senior bond, 144A, 4.25%, 11/21/49		United States		370,000		445,493
senior note, 144A, 3.20%, 11/21/29		United States		500,000		558,276
Amgen Inc., senior note, 2.20%, 2/21/27		United States		100,000		105,606
AstraZeneca PLC,
senior bond, 4.375%, 11/16/45.		United Kingdom		750,000		976,723
senior note, 3.375%, 11/16/25		United Kingdom		100,000		112,464
Biogen Inc., senior bond, 5.20%, 9/15/45		United States		575,000		755,919
eBristol-Myers Squibb Co.,
senior bond, 144A, 4.625%, 5/15/44		United States		400,000		537,037
senior note, 144A, 2.60%, 5/16/22		United States		100,000		104,000
Gilead Sciences Inc.,
senior bond, 4.60%, 9/01/35		United States		200,000		261,560
senior bond, 4.80%, 4/01/44		United States		700,000		937,208
senior note, 3.25%, 9/01/22		United States		100,000		105,673
Perrigo Finance Unlimited Co., senior note, 3.15%, 6/15/30		United States		100,000		101,047
Takeda Pharmaceutical Co. Ltd.,
h3.175%, 7/09/50		Japan		400,000		403,477
senior note, 5.00%, 11/26/28		Japan		300,000		370,317
						6,909,551
Real Estate 0.1%
bChina Overseas Finance Cayman VI Ltd., senior note, Reg S, 5.95%, 5/08/24		China		200,000		228,939
Simon Property Group LP, senior note, 3.375%, 12/01/27		United States		595,000		632,297
						861,236

Semiannual Report         FFA-29

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal  Amount*		Value
Corporate Bonds (continued)
Retailing 0.4%
Alibaba Group Holding Ltd.,
senior bond, 4.00%, 12/06/37		China		300,000	$	348,735
senior bond, 4.20%, 12/06/47		China		800,000		987,959
AutoNation Inc., senior bond, 4.75%, 6/01/30		United States		100,000		108,551
AutoZone Inc., senior note, 3.75%, 4/18/29		United States		100,000		113,786
Dollar Tree Inc.,
senior bond, 4.20%, 5/15/28		United States		500,000		582,237
senior note, 4.00%, 5/15/25		United States		450,000		507,044
eParty City Holdings Inc., senior note, 144A, 6.625%, 8/01/26		United States		200,000		45,000
Target Corp., senior note, 2.25%, 4/15/25		United States		100,000		107,092
						2,800,404
Semiconductors & Semiconductor Equipment 0.0%†
Intel Corp., senior note, 3.90%, 3/25/30		United States		100,000		121,018
Software & Services 0.4%
Fiserv Inc., senior bond, 3.50%, 7/01/29		United States		870,000		978,793
Microsoft Corp, senior note, 3.30%, 2/06/27		United States		100,000		114,424
Microsoft Corp., senior note, 2.65%, 11/03/22		United States		1,720,000		1,810,875
						2,904,092
Technology Hardware & Equipment 0.0%†
eCommScope Technologies LLC, senior bond, 144A, 5.00%, 3/15/27		United States		100,000		90,371
ePresidio Holdings Inc., senior note, 144A, 8.25%, 2/01/28		United States		100,000		100,313
						190,684
Telecommunication Services 0.4%
eAltice France SA/France, senior secured note, 144A, 5.50%, 1/15/28		France		300,000		303,507
AT&T Inc.,
senior note, 3.80%, 2/15/27		United States		920,000		1,036,888
senior note, 2.30%, 6/01/27		United States		100,000		103,407
Bell Canada Inc., senior bond, 4.464%, 4/01/48		Canada		200,000		253,806
France Telecom SA, senior bond, 9.00%, 3/01/31		France		300,000		489,720
Telefonica Emisiones SA,
senior bond, 7.045%, 6/20/36		Spain		200,000		291,319
senior bond, 5.52%, 3/01/49		Spain		200,000		263,349
Time Warner Entertainment Co. LP, senior bond, 8.375%, 3/15/23		United States		100,000		117,268
Verizon Communications Inc.,
senior bond, 4.016%, 12/03/29		United States		100,000		119,767
senior bond, 4.00%, 3/22/50		United States		100,000		126,477
						3,105,508
Transportation 0.4%
Burlington Northern Santa Fe LLC,
senior bond, 4.90%, 4/01/44		United States		200,000		268,037
senior bond, 4.15%, 4/01/45		United States		100,000		124,209

FFA-30         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal  Amount*		Value
Corporate Bonds (continued)
Transportation (continued)
CSX Corp., senior bond, 4.75%, 11/15/48		United States		725,000	$	963,800
Fedex Corp., senior bond, 5.10%, 1/15/44		United States		550,000		643,368
FedEx Corp.,
senior bond, 4.75%, 11/15/45		United States		100,000		110,387
senior note, 3.80%, 5/15/25		United States		400,000		445,124
eMexico City Airport Trust, senior secured bond, first lien, 144A, 5.50%, 7/31/47		Mexico		200,000		176,615
b,iRZD Capital PLC, (Russian Railways), loan participation, senior bond, Reg S, 5.70%, 4/05/22		Russia		200,000		212,674
United Parcel Service Inc., senior bond, 5.30%, 4/01/50		United States		100,000		143,488
						3,087,702
Utilities 1.4%
eCalpine Corp., senior note, 144A, 5.125%, 3/15/28		United States		100,000		97,962
eColbun SA,
senior note, 144A, 3.95%, 10/11/27		Chile		200,000		215,471
senior note, 144A, 3.15%, 3/06/30		Chile		200,000		202,600
Dominion Energy Inc.,
senior note, 4.25%, 6/01/28		United States		1,250,000		1,440,190
senior note, 3.375%, 4/01/30		United States		100,000		110,850
Duke Energy Corp., senior bond, 3.75%, 9/01/46		United States		200,000		226,868
Duke Energy Florida LLC., secured bond, 6.40%, 6/15/38		United States		200,000		305,370
eElectricite de France SA, senior note, 144A, 4.50%, 9/21/28		France		1,055,000		1,229,909
eEnel Finance International NV, senior note, 144A, 4.25%, 9/14/23		Italy		1,200,000		1,306,734
Exelon Corp., senior bond, 4.05%, 4/15/30		United States		400,000		462,703
Georgia Power Co., senior bond, 4.30%, 3/15/42		United States		1,200,000		1,396,096
MidAmerican Energy Holdings Co., senior bond, 6.125%, 4/01/36		United States		200,000		288,651
Public Service Enterprise Group Inc., senior note, 2.875%, 6/15/24		United States		1,000,000		1,068,270
The Southern Co., senior bond, 3.70%, 4/30/30		United States		700,000		801,872
eState Grid Overseas Investment 2016 Ltd., senior note, 144A, 3.50%, 5/04/27		China		600,000		664,434
eTalen Energy Supply LLC, senior secured note, 144A, 7.25%, 5/15/27		United States		100,000		99,669
eVistra Operations Co. LLC, senior secured note, first lien, 144A, 3.55%, 7/15/24		United States		235,000		242,692
						10,160,341
Total Corporate Bonds (Cost $101,858,508)						109,181,935
g,jSenior Floating Rate Interests 0.3%
Automobiles & Components 0.0%†
Clarios Global LP (Power Solutions), Initial Dollar Term Loan, 3.678%, (1-month USD LIBOR + 3.50%), 4/30/26		United States		29,850		28,531
Capital Goods 0.1%
Altra Industrial Motion Corp., Term Loan, 2.178%, (1-month USD LIBOR + 2.00%), 10/01/25		United States		27,138		25,917
kDynasty Acquisition Co. Inc.,
Initial Term B-1 Loan, 3.808%, (3-month USD LIBOR + 3.50%), 4/04/26		United States		24,471		21,106
Initial Term B-2 Loan (CAD), 3.808%, (3-month USD LIBOR + 3.50%), 4/04/26		United States		13,156		11,347

Semiannual Report         FFA-31

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal  Amount*		Value
g,jSenior Floating Rate Interests (continued)
Capital Goods (continued)
Navistar Inc., Tranche B Term Loan, 3.70%, (1-month USD LIBOR + 3.50%), 11/06/24		United States		296,962	$        282,114
					340,484
Commercial & Professional Services 0.0%†
Pitney Bowes Inc., Incremental Tranche Term B Loans, 5.68%, (1-month USD LIBOR + 5.50%), 1/07/25		United States		98,750	83,444
kVentia Pty. Ltd., Term B Loans, 5.00%, (3-month USD LIBOR + 4.00%), 5/21/26		Australia		22,500	22,050
					105,494
Consumer Durables & Apparel 0.0%†
Playtika Holding Corp., Term B Loans, 7.072%, (3-month USD LIBOR + 6.00%), 12/10/24		United States		19,500	19,537
Consumer Services 0.1%
Caesars Resort Collection LLC, Term B Loans, 2.928%, (1-month USD LIBOR + 2.75%), 12/22/24		United States		99,490	89,154
NASCAR Holdings Inc., Initial Term Loans, 2.93%, (1-month USD LIBOR + 2.75%), 10/18/26		United States		259,179	249,590
					338,744
Energy 0.0%†
Buckeye Partners LP, Initial Term Loans, 2.923%, (1-month USD LIBOR + 2.75%), 11/01/26		United States		51,192	49,388
Food & Staples Retailing 0.0%†
Whatabrands LLC, 2020 Refinancing Term Loans, 2.925%, (1-month USD LIBOR + 2.75%), 8/02/26		United States		19,900	19,092
Food, Beverage & Tobacco 0.0%†
B&G Foods Inc., Tranche B-4 Term Loan, 2.678%, (1-month USD LIBOR + 2.50%), 10/10/26		United States		99,250	98,226
JBS USA Lux SA, New Term Loans, 3.072%, (3-month USD LIBOR + 2.00%), 5/01/26		United States		43,786	41,980
					140,206
Health Care Equipment & Services 0.0%†
Catalent Pharma Solutions Inc., Dollar Term B-2 Loan, 3.25%, (1-month USD LIBOR + 2.25%), 5/17/26		United States		99,496	98,501
Inovalon Holdings Inc., Refinancing Date Term Loans, 3.188%, (1-month USD LIBOR + 3.00%), 4/02/25		United States		4,426	4,311
Phoenix Guarantor Inc., Tranche B-1 Term Loan, 3.435%, (1-month USD LIBOR + 3.25%), 3/05/26		United States		36,806	35,540
					138,352
Household & Personal Products 0.0%†
k,lCoty Inc, Term Loan, TBD, 4/05/25		United States		29,924	26,894

FFA-32         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal  Amount*		Value
g,jSenior Floating Rate Interests (continued)
Insurance 0.0%†
Alliant Holdings Intermediate LLC/Alliant Holdings Co-Issuer, Initial Term Loan, 2.928%, (1-month USD LIBOR + 2.75%), 5/10/25		United States		39,797	$        37,807
AssuredPartners Inc., 2020 February Refinancing Term Loans, 3.678%, (1-month USD LIBOR + 3.50%), 2/13/27		United States		29,850	28,619
					66,426
Materials 0.0%†
k,lIlluminate Buyer LLC, Term Loan, TBD, 6/15/27		United States		8,147	8,040
Mauser Packaging Solutions Holding Co., Initial Term Loan, 4.561%, (1-month USD LIBOR + 3.25%), 4/03/24		United States		29,923	27,021
					35,061
Media & Entertainment 0.0%†
k,lBanijay Group U.S. Holding Inc., Facility B (USD) Loan, TBD, 2/03/25		France		20,000	19,000
Diamond Sports Group LLC, Term Loan, 3.43%, (1-month USD LIBOR + 3.25%), 8/24/26		United States		67,755	55,474
					74,474
Pharmaceuticals, Biotechnology & Life Sciences 0.0%†
eResearch Technology Inc., Initial Term Loan, 5.50%, (1-month USD LIBOR + 4.50%), 2/04/27		United States		10,909	10,745
Grifols Worldwide Operations USA Inc., Dollar Tranche B Term Loan, 2.109%, (1-week USD LIBOR + 2.00%), 11/15/27		United States		69,650	67,261
					78,006
Retailing 0.0%†
Bass Pro Group LLC, Initial Term Loans, 6.072%, (3-month USD LIBOR + 5.00%), 9/25/24		United States		133,890	129,405
Harbor Freight Tools USA Inc., Refinancing Loans, 3.25%, (1-month USD LIBOR + 2.50%), 8/19/23		United States		60,332	58,236
Staples Inc., 2019 Refinancing Term B-1 Loans, 5.687%, (3-month USD LIBOR + 5.00%), 4/12/26		United States		14,561	12,577
					200,218
Software & Services 0.1%
Dcert Buyer Inc., Initial Term Loans, 4.178%, (1-month USD LIBOR + 4.00%), 10/16/26		United States		49,875	48,431
Hyland Software Inc., Term Loans, 4.00%, (1-month USD LIBOR + 3.25%), 7/01/24		United States		14,962	14,573
LegalZoom.com Inc., 2018 Term Loans, 4.678%, (1-month USD LIBOR + 4.50%), 11/21/24		United States		39,798	39,002
Surf Holdings LLC, Dollar Tranche Term Loan, 3.827%, (3-month USD LIBOR + 3.50%), 3/05/27		United States		30,372	29,239
TIBCO Software Inc., Term B-3 Loans, 3.93%, (1-month USD LIBOR + 3.75%), 7/31/26		United States		30,000	28,838
k,lThe Ultimate Software Group Inc., 2020 Incremental Term Loan, TBD, 5/03/26		United States		5,253	5,202
kVertafore Inc., Initial Term Loans, 3.428%, (1-month USD LIBOR + 3.25%), 7/02/25		United States		9,975	9,432
Waystar (Navicure Inc.), Initial Term Loans, 4.178%, (1-month USD LIBOR + 4.00%), 10/22/26		United States		29,925	28,952
					203,669

Semiannual Report         FFA-33

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal   Amount*				Value
g,jSenior Floating Rate Interests (continued)
Technology Hardware & Equipment 0.0%†
CommScope Inc., Initial Term Loans, 3.428%, (1-month USD LIBOR + 3.25%), 4/04/26		United States		69,649			$        66,384
Telecommunication Services 0.0%†
Aventiv Technologies LLC, Initial Term Loan, 5.500%, (3-month USD LIBOR + 4.50%), 11/01/24		United States		29,620			24,738
Global Tel*Link Corp., First Lien Term Loan, 4.428%, (1-month USD LIBOR + 4.25%), 11/29/25		United States		39,474			34,428
							59,166
Transportation 0.0%†
Avis Budget Car Rental LLC, Tranche B Term, 2.43%, (1-month USD LIBOR + 2.25%), 8/06/27		United States		116,014			103,736
JetBlue Airways Corporation, Term Loan, 6.25%, (3-month USD LIBOR + 5.25%), 6/16/24		United States		5,078			4,987
kThe Kenan Advantage Group Inc.,
Initial Canadian Term Loan, 4.00%, (1-month USD LIBOR + 3.00%), 7/29/22		United States		5,749			5,389
Initial U.S. Term Loans, 4.00%, (1-month USD LIBOR + 3.00%), 7/31/22		United States		24,173			22,617
							136,729
Total Senior Floating Rate Interests (Cost $2,224,556)							2,126,855
Foreign Government and Agency Securities 0.9%
eThe African Export-Import Bank, senior bond, 144A, 3.994%, 9/21/29		Supranationalm		200,000			197,859
eAngolan Government International Bond, senior note, 144A, 8.25%, 5/09/28		Angola		550,000			455,288
bBanque Centrale de Tunisie International Bond, senior note, Reg S, 5.625%, 2/17/24		Tunisia		350,000		EUR	362,808
eBanque Ouest Africaine de Developpement, senior note, 144A, 5.00%, 7/27/27		Supranationalm		300,000			313,755
eDominican Republic, senior note, 144A, 8.90%, 2/15/23		Dominican Republic		15,700,000		DOP	251,077
eGovernment of Belarus International Bond, senior note, 144A, 7.625%, 6/29/27		Belarus		200,000			206,855
Government of Colombia,
senior bond, 9.85%, 6/28/27		Colombia		630,000,000		COP	211,895
senior bond, 5.00%, 6/15/45		Colombia		500,000			563,398
eGovernment of Gabon, senior note, 144A, 6.625%, 2/06/31		Gabon		350,000			313,588
eGovernment of Indonesia, senior bond, 144A, 4.35%, 1/08/27		Indonesia		500,000			556,575
eGovernment of Iraq, 144A, 5.80%, 1/15/28		Iraq		350,000			316,295
eGovernment of Kazakhstan, senior bond, 144A, 4.875%, 10/14/44		Kazakhstan		300,000			382,057
Government of Mexico,
senior bond, M 20, 8.50%, 5/31/29		Mexico		61,000	n	MXN	314,510
senior note, 4.15%, 3/28/27		Mexico		500,000			535,938
Government of Peru, senior bond, 6.55%, 3/14/37		Peru		200,000			305,111
Government of South Africa, senior bond, 7.00%, 2/28/31		South Africa		5,800,000		ZAR	275,181
eGovernment of Ukraine, senior bond, 144A, 7.375%, 9/25/32		Ukraine		300,000			302,321
Government of Uruguay,
senior bond, 4.50%, 8/14/24		Uruguay		100,000			109,741
senior bond, 4.375%, 1/23/31		Uruguay		150,000			175,736
osenior bond, Index Linked, 3.70%, 6/26/37		Uruguay		10,507,408		UYU	250,169

FFA-34         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal   Amount*			Value
Foreign Government and Agency Securities (continued)
ePanama Notas del Tesoro, senior note, 144A, 3.75%, 4/17/26		Panama		250,000		$        261,991
Total Foreign Government and Agency Securities (Cost $6,894,290)						6,662,148
U.S. Government and Agency Securities 5.4%
Federal Agricultural Mortgage Corp., 2.90%, 1/03/22		United States		800,000		830,743
FFCB,
3.17%, 3/07/28		United States		800,000		922,163
senior bond, 2.86%, 7/11/28		United States		800,000		903,007
Overseas Private Investment Corp., senior note, 2.12%, 3/20/24		United States		400,000		412,615
TVA, 5.88%, 4/01/36		United States		630,000		983,651
U.S. Treasury Bond,
3.125%, 2/15/42		United States		500,000		678,838
2.50%, 2/15/46		United States		840,000		1,040,205
2.50%, 5/15/46		United States		395,000		489,839
2.25%, 8/15/46		United States		4,575,000		5,425,575
2.75%, 11/15/47		United States		150,000		196,216
p3.00%, 2/15/49		United States		2,150,000		2,967,462
2.25%, 8/15/49		United States		500,000		601,230
oIndex Linked, 2.00%, 1/15/26		United States		516,828		601,396
oIndex Linked, 1.75%, 1/15/28		United States		2,387,013		2,850,292
oIndex Linked, 3.625%, 4/15/28		United States		713,497		961,033
U.S. Treasury Note,
2.125%, 3/31/24		United States		16,100,000		17,252,785
2.375%, 8/15/24		United States		880,000		957,619
2.25%, 8/15/27		United States		920,000		1,033,544
oIndex Linked, 0.125%, 7/15/24		United States		864,016		903,608
oIndex Linked, 0.375%, 7/15/25		United States		648,838		693,918
United States Treasury Note/Bond, 1.25%, 5/15/50		United States		50,000		48,016
Total U.S. Government and Agency Securities (Cost $38,686,872)						40,753,755
Asset-Backed Securities and Commercial Mortgage-Backed Securities 3.0%
Diversified Financials 3.0%
e,qAdagio CLO VIII DAC, VIII-A, B1, 144A, FRN, 1.65%, 4/15/32		Ireland		250,000	EUR	275,695
American Express Credit Account Master Trust,
2019-1, A, 2.87%, 10/15/24		United States		600,000		625,901
2019-3, A, 2.00%, 4/15/25		United States		410,000		425,000
e,qAres European CLO VIII BV, 8A, BR, 144A, FRN, 1.60%, 4/17/32		Netherlands		250,000	EUR	271,989
e,rAtrium XII, 12A, CR, 144A, FRN, 2.748%, (3-month USD LIBOR + 1.65%), 4/22/27		United States		1,240,000		1,185,459
e,qAvoca CLO XVII Designated Activity Co., 17A, B1R, 144A, FRN, 1.70%, 10/15/32		Ireland		250,000	EUR	272,550
BA Credit Card Trust, 2018-A3, A3, 3.10%, 12/15/23		United States		500,000		514,200
e,qBlackrock European CLO IX DAC, 9A, B, 144A, FRN, 1.55%, 12/15/32		Ireland		250,000	EUR	268,141
e,qBlueMountain CLO XXII Ltd., 2018-1A, B, 144A, FRN, 2.46%, 7/30/30		United States		900,000		845,694
e,qBlueMountain Fuji Eur CLO V DAC, 5A, B, 144A, FRN, 1.55%, 1/15/33		Ireland		250,000	EUR	269,739

Semiannual Report         FFA-35

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal   Amount*			Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financials (continued)
eBWAY Mortgage Trust, 2013-1515, C, 144A, 3.454%, 3/10/33		United States		750,000		$        805,913
Capital One Multi-Asset Execution Trust, 2015-A4, A4, 2.75%, 5/15/25		United States		380,000		398,341
e,rCarlyle Global Market Strategies CLO Ltd., 2014-4RA, C, 144A, FRN, 4.119%, (3-month USD LIBOR + 2.90%), 7/15/30		United States		250,000		214,435
e,qCent CLO, 2018-28A, C, 144A, FRN, 3.894%, 11/07/30		United States		750,000		676,565
e,qCIM Trust, 2019-INV2, A3, 144A, FRN, 4.00%, 5/25/49		United States		437,518		452,360
qCitibank Credit Card Issuance Trust, 2017-A7, A7, FRN, 0.545%, 8/08/24		United States		130,000		130,591
Discover Card Execution Note Trust, 2019-A1, A1, 3.04%, 7/15/24		United States		500,000		520,604
e,rDryden 42 Senior Loan Fund, 2016-42A, CR, 144A, FRN, 3.269%, (3-month USD LIBOR + 2.05%), 7/15/30		United States		900,000		849,806
e,qEuro-Galaxy III CLO BV, 2013-3A, B2ER, 144A, FRN, 1.50%, 1/17/31		Netherlands		250,000	EUR	277,062
qFHLMC Structured Agency Credit Risk Debt Notes,
2017-HQA1, M2, FRN, 3.735%, 8/25/29		United States		216,624		222,054
2017-HQA3, M2, FRN, 2.535%, 4/25/30		United States		185,342		186,363
FNMA Connecticut Avenue Securities,
r2013-C01, M2, FRN, 5.435%, (1-month USD LIBOR + 5.25%), 10/25/23		United States		699,575		640,916
r2014-C01, M2, FRN, 4.585%, (1-month USD LIBOR + 4.40%), 1/25/24		United States		862,491		771,517
r2014-C03, 1M2, FRN, 3.185%, (1-month USD LIBOR + 3.00%), 7/25/24		United States		1,198,077		1,059,757
r2014-C04, 2M2, FRN, 5.185%, (1-month USD LIBOR + 5.00%), 11/25/24		United States		913,437		945,445
q2016-C02, 1M2, FRN, 6.185%, 9/25/28		United States		665,104		694,876
q2016-C04, 1M2, FRN, 4.435%, 1/25/29		United States		824,407		860,371
q2016-C05, 2M2, FRN, 4.635%, 1/25/29		United States		276,926		285,245
q2016-C06, 1M2, FRN, 4.435%, 4/25/29		United States		167,062		176,006
r2017-C01, 1M2, FRN, 3.735%, (1-month USD LIBOR + 3.55%), 7/25/29		United States		877,436		899,677
q2017-C02, 2M2, FRN, 3.835%, 9/25/29		United States		499,604		504,189
q2017-C05, 1M2, FRN, 2.385%, 1/25/30		United States		862,240		851,834
e,rLCM XXV Ltd., 25A, B2, 144A, FRN, 2.785%, (3-month USD LIBOR + 1.65%), 7/20/30		United States		1,200,000		1,158,579
e,qMadison Park Euro Funding VIII DAC, 8A, BRN, 144A, FRN, 1.70%, 4/15/32		Ireland		300,000	EUR	325,848
e,qNeuberger Berman CLO XVIII Ltd., 2014-18A, CR2, 144A, FRN, 4.109%, 10/21/30		United States		800,000		707,510
e,qOctagon Investment Partners 28 Ltd., 2016-1A, BR, 144A, FRN, 2.82%, 10/24/30		United States		1,200,000		1,169,561
e,rOctagon Investment Partners XVI Ltd., 2013-1A, CR, 144A, FRN, 2.985%, (3-month USD LIBOR + 1.85%), 7/17/30		United States		850,000		787,623
e,qProvident Funding Mortgage Trust,
2019-1, A2, 144A, FRN, 3.00%, 12/25/49		United States		283,436		301,016
2020-1, A3, 144A, FRN, 3.00%, 2/25/50		United States		443,152		453,491
e,qTowd Point Mortgage Trust, 2015-5, A1B, 144A, FRN, 2.75%, 5/25/55		United States		446,881		450,993
Total Asset-Backed Securities and Commercial Mortgage-Backed Securities (Cost $23,924,137)						22,732,916

FFA-36         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal  Amount*		Value
Mortgage-Backed Securities 9.4%
Federal Home Loan Mortgage Corp. (FHLMC) Fixed Rate 2.3%
FHLMC 15 Year, 2.00%, 7/01/35		United States		230,000	$        237,897
FHLMC 30 Year, 3.00%, 3/01/50		United States		6,091,031	6,442,356
FHLMC 30 Year, 3.50%, 2/01/47		United States		4,346,585	4,694,953
FHLMC 30 Year, 4.00%, 5/01/47 - 8/01/49		United States		5,127,141	5,489,693
					16,864,899
Federal National Mortgage Association (FNMA) Fixed Rate 3.3%
FNMA 15 Year, 2.50%, 6/01/35		United States		795,781	834,010
FNMA 15 Year, 3.00%, 6/01/35		United States		397,019	418,120
FNMA 30 Year, 2.50%, 6/01/50		United States		598,706	624,098
sFNMA 30 Year, 2.50%, 7/01/50		United States		1,050,000	1,094,256
FNMA 30 Year, 3.00%, 1/01/50		United States		5,058,795	5,333,157
sFNMA 30 Year, 3.00%, 6/01/50		United States		12,955,000	13,641,210
FNMA 30 Year, 4.00%, 1/01/50		United States		1,021,243	1,082,149
FNMA 30 Year, 4.50%, 2/01/50		United States		1,922,884	2,102,639
					25,129,639
Government National Mortgage Association (GNMA) Fixed Rate 3.8%
GNMA II SF 30 Year, 3.00%, 9/20/47 - 2/20/50		United States		3,908,495	4,148,312
GNMA II SF 30 Year, 3.50%, 12/20/49		United States		1,138,335	1,203,064
GNMA II SF 30 Year, 3.50%, 2/20/50		United States		10,816,883	11,454,365
GNMA II SF 30 Year, 3.50%, 6/20/50		United States		3,990,000	4,238,734
GNMA II SF 30 Year, 4.00%, 11/20/49		United States		4,612,420	4,890,698
GNMA II SF 30 Year, 4.00%, 12/20/49		United States		2,724,831	2,890,804
					28,825,977
Total Mortgage-Backed Securities (Cost $70,009,383)					70,820,515
Municipal Bonds 0.9%
Broward County Airport System Revenue, Refunding, Series C, 3.477%, 10/01/43		United States		140,000	140,078
California Health Facilities Financing Authority Revenue,
Senior, No Place Like Home Program, 2.934%, 6/01/32		United States		135,000	140,222
Senior, No Place Like Home Program, 2.984%, 6/01/33		United States		115,000	119,306
Senior, No Place Like Home Program, 3.034%, 6/01/34		United States		90,000	93,246
California State GO, Bid Group - A, Refunding, 2.50%, 10/01/29		United States		500,000	544,850
City of Austin Electric Utility System Revenue, Travis and Williamson Counties, Refunding, 6.262%, 11/15/32		United States		270,000	350,687
Foothill/Eastern Transportation Corridor Agency Toll Road Revenue, Refunding, Series A, 4.094%, 1/15/49		United States		70,000	71,989
Gilroy USD, GO, Santa Clara County, Refunding, 3.364%, 8/01/47		United States		290,000	298,036
Honolulu City and County Wastewater System Revenue, Second Bond Resolution, Refunding, Junior Series B, 2.585%, 7/01/28		United States		50,000	53,120
Maricopa County UHSD No. 210 Phoenix, GO, Series C, 5.00%, 7/01/31		United States		200,000	263,908
Massachusetts State College Building Authority Revenue, Refunding, Series C, 3.373%, 5/01/43		United States		230,000	238,443
Metro Wastewater Reclamation District Sewer Revenue, Refunding, Series B, 3.158%, 4/01/41		United States		220,000	230,908

Semiannual Report         FFA-37

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Country/ Organization		Principal  Amount*		Value
Municipal Bonds (continued)
New Jersey State Transportation Trust Fund Authority Revenue, Transportation System, Series B, 4.131%, 6/15/42		United States		160,000	$        149,426
New York State Dormitory Authority Revenues, Non State Supported Debt, State University of New York Dormitory Facilities, Series B, 3.142%, 7/01/43		United States		140,000	144,670
Ohio State Hospital Facility Revenue, Cleveland Clinic Health System Obligated Group, Refunding, Series G, 3.276%, 1/01/42		United States		90,000	95,211
Oregon State Department of Transportation Highway User Tax Revenue, senior lien, Refunding, Series B, 3.168%, 11/15/38		United States		175,000	189,107
Pennsylvania State Turnpike Commission Turnpike Revenue, Motor License Fund-Enhanced, Subordinate, Refunding, First Series, 3.579%, 12/01/43		United States		440,000	462,092
Regional Transportation District Sales Tax Revenue, FasTracks Project, Refunding, Series A, 3.258%, 11/01/38		United States		140,000	152,942
RWJ Barnabas Health Inc., 3.477%, 7/01/49		United States		120,000	126,892
Salt Lake City Sales and Excise Tax Revenue, Refunding, Series B, 3.102%, 4/01/38		United States		125,000	127,242
San Bernardino Community College District GO, San Bernadino and Riverside Counties, Election of 2018, Series A-1, 3.271%, 8/01/39		United States		100,000	108,995
San Diego County Regional Transportation Commission Sales Tax Revenue, Limited Tax, Refunding, Series A, 3.248%, 4/01/48		United States		105,000	111,983
San Francisco City and County Public Utilities Commission Water Revenue, Green Bonds, Refunding, Sub-Series A, 3.473%, 11/01/43		United States		105,000	112,534
Sarasota County Capital Import, Revenue, 5.00%, 10/01/34		United States		500,000	649,275
Texas State GO, Transportation Commission, Highway Improvement, Refunding, 3.211%, 4/01/44		United States		765,000	811,696
Texas State University System Financing Revenue,
Refunding, Series B, 2.938%, 3/15/33		United States		105,000	108,568
Refunding, Serise B, 3.289%, 3/15/40		United States		90,000	92,664
University of Pittsburgh of the Commonwealth System of Higher Education Revenue, Refunding, Series C, 3.005%, 9/15/41		United States		250,000	268,010
Utah Transit Authority Sales Tax Revenue, Refunding, Series B, 3.443%, 12/15/42		United States		175,000	181,659
Total Municipal Bonds (Cost $6,164,913)					6,437,759
Total Investments before Short Term Investments (Cost $693,008,155)					727,093,346
			Shares
Short Term Investments (Cost $31,820,585) 4.2%
Money Market Funds 4.2%
c,tInstitutional Fiduciary Trust Money Market Portfolio, 0.00%		United States		31,820,585	31,820,585
Total Investments (Cost $724,828,740) 101.0%					758,913,931
Options Written (0.0)%†					(2,898)
Other Assets, less Liabilities (1.0)%					(7,499,753)
Net Assets 100.0%					$ 751,411,280

FFA-38         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Number of Contracts		Notional Amount		Value
uOptions Written (Premiums received $4,426) (0.0)%†
Puts - Exchange-Traded
ManpowerGroup Inc., Put Option, Strike Price $65, Expires 7/17/20		19		1,900	$(2,898)

^†Rounds to less than 0.1% of net assets.

*The principal amount is stated in U.S. dollars unless otherwise indicated.

^aNon-income producing.

^bSecurity was purchased pursuant to Regulation S under the Securities Act of 1933, which exempts from registration securities offered and sold outside of the United States. Such a security cannot be sold in the United States without either an effective registration statement filed pursuant to the Securities Act of 1933, or pursuant to an exemption from registration. At June 30, 2020, the aggregate value of these securities was $2,144,929, representing 0.3% of net assets.

^cSee Note 3(e) regarding investments in affiliated management investment companies.

^dVariable rate security. The rate shown represents the yield at period end.

^eSecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in a public offering registered under the Securities Act of 1933. At June 30, 2020, the aggregate value of these securities was $38,699,308, representing 5.1% of net assets.

^fPerpetual security with no stated maturity date.

^gThe coupon rate shown represents the rate at period end.

^hSecurity purchased on a when-issued basis. See Note 1(c).

ⁱSee Note 1(e) regarding loan participation notes.

^jSee Note 1(g) regarding senior floating rate interests.

^kA portion or all of the security purchased on a delayed delivery basis. See Note 1(c).

^lA portion or all of the security represents an unsettled loan commitment. The coupon rate is to-be determined (TBD) at the time of settlement and will be based upon a reference index/floor plus a spread.

^mA supranational organization is an entity formed by two or more central governments through international treaties.

ⁿPrincipal amount is stated in 100 Mexican Peso Units.

^oPrincipal amount of security is adjusted for inflation. See Note 1(i).

^pA portion or all of the security has been segregated as collateral for open swap contracts. At June 30, 2020, the value of this security and/or cash pledged amounted to $370,353, representing less than 0.1% of net assets.

^qAdjustable rate security with an interest rate that is not based on a published reference index and spread. The rate is based on the structure of the agreement and current market conditions. The coupon rate shown represents the rate at period end.

^rThe coupon rate shown represents the rate inclusive of any caps or floors, if applicable, in effect at period end.

^sSecurity purchased on a to-be-announced (TBA) basis. See Note 1(c).

^tThe rate shown is the annualized seven-day effective yield at period end.

^uSee Note 1(d) regarding written options.

Semiannual Report         FFA-39

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

At June 30, 2020, the Fund had the following futures contracts outstanding. See Note 1(d).

Futures Contracts

Description	Type		Number of Contracts		Notional  Amount*		Expiration Date		Value/ Unrealized Appreciation (Depreciation)
Equity Contracts
S&P 500 E-Mini		Long		48		$  7,416,480		9/18/20		$  56,057
Interest Rate Contracts
Australian 3 Yr. Bond		Long		30		2,423,137		9/15/20		642
Australian 10 Yr. Bond		Long		4		410,656		9/15/20		4,214
Canada 10 Yr. Bond		Long		32		3,625,826		9/21/20		9,204
CME Ultra Long Term U.S. Treasury Bond		Long		4		872,625		9/21/20		11,369
Euro-OAT		Long		19		3,578,422		9/08/20		59,091
U.S. Treasury 2 Yr. Note		Long		32		7,066,500		9/30/20		1,335
U.S. Treasury 5 Yr. Note		Long		24		3,017,813		9/30/20		5,657
U.S. Treasury 10 Yr. Note		Short		10		1,391,719		9/21/20		(5,363	)
U.S. Treasury 10 Yr. Note		Long		54		7,515,281		9/21/20		24,370
U.S. Treasury 30 Yr. Bond		Long		7		1,249,938		9/21/20		4,146
Ultra 10 Yr. U.S. Treasury Note		Short		17		2,677,234		9/21/20		(15,806	)
						$33,829,151				$  98,859
Total Futures Contracts						$41,245,631				$154,916

*As of period end.

At June 30, 2020, the Fund had the following forward exchange contracts outstanding. See Note 1(d).

Forward Exchange Contracts

Currency	Counterpartya		Type		Quantity		Contract  Amount*		Settlement Date		Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts
Australian Dollar		JPHQ		Buy		1,100,000		719,644		7/02/20		$        39,372		$            —
Australian Dollar		JPHQ		Sell		1,100,000		758,373		7/02/20		—		(643	)
Turkish Lira		JPHQ		Buy		1,380,000		200,305		7/14/20		300		—
Japanese Yen		CITI		Buy		182,581,700		1,700,000		7/16/20		—		(8,679	)
Japanese Yen		CITI		Sell		182,581,700		1,699,264		7/16/20		7,943		—
Australian Dollar		JPHQ		Sell		390,000		267,856		7/21/20		—		(1,305	)
Japanese Yen		JPHQ		Buy		239,900,000		2,216,760		7/22/20		5,698		—
Japanese Yen		JPHQ		Sell		134,000,000		1,255,829		7/22/20		14,440		—
Canadian Dollar		JPHQ		Sell		430,000		327,148		7/23/20		10,370		—
Danish Krone		JPHQ		Buy		7,518,245		1,097,909		7/23/20		36,088		—
Danish Krone		JPHQ		Sell		7,518,245		1,122,696		7/23/20		—		(11,302	)
Euro		JPHQ		Sell		696,577		776,366		7/23/20		—		(6,611	)
Mexican Peso		JPHQ		Buy		6,950,000		360,128		7/23/20		—		(58,641	)
Mexican Peso		JPHQ		Sell		6,950,000		306,782		7/23/20		5,296		—
Norwegian Krone		JPHQ		Buy		6,740,000		745,252		7/23/20		—		(44,768	)
Norwegian Krone		JPHQ		Sell		6,740,000		661,303		7/23/20		—		(39,180	)
Euro		JPHQ		Buy		380,000		430,742		8/05/20		—		(3,480	)
Euro		JPHQ		Sell		380,000		427,861		8/05/20		599		—

FFA-40         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

Forward Exchange Contracts (continued)

Currency	Counterpartya		Type		Quantity		Contract  Amount*		Settlement Date		Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts (continued)
Australian Dollar		JPHQ		Sell		1,480,000		894,305		8/06/20	$	—	$	(127,243	)
Japanese Yen		JPHQ		Buy		102,000,000		956,669		8/13/20		—		(11,466	)
Japanese Yen		JPHQ		Sell		102,000,000		950,196		8/13/20		4,993		—
Singapore Dollar		JPHQ		Buy		1,400,000		104,547,800	JPY	8/13/20		35,917		—
Singapore Dollar		JPHQ		Sell		3,750,000		279,675,187	JPY	8/13/20		—		(99,576	)
Chinese Yuan Renminbi		JPHQ		Buy		5,095,000		730,016		8/21/20		—		(11,470	)
Chinese Yuan Renminbi		JPHQ		Sell		5,095,000		723,660		8/21/20		5,114		—
Japanese Yen		JPHQ		Buy		70,500,000		674,444		9/14/20		—		(20,834	)
Canadian Dollar		JPHQ		Buy		830,000		588,665		9/15/20		22,849		—
Canadian Dollar		JPHQ		Sell		1,450,000		1,047,083		9/15/20		—		(21,225	)
Euro		JPHQ		Buy		350,000		397,098		9/15/20		—		(3,207	)
Euro		JPHQ		Buy		860,000		930,892		9/15/20		36,952		—
Euro		JPHQ		Sell		1,504,009		1,691,860		9/15/20		—		(753	)
Norwegian Krone		JPHQ		Buy		7,680,000		760,411		9/15/20		37,918		—
Norwegian Krone		JPHQ		Sell		7,680,000		752,941		9/15/20		—		(45,388	)
South Korean Won		JPHQ		Buy		238,000,000		194,603		9/16/20		3,909		—
South Korean Won		JPHQ		Sell		467,500,000		380,855		9/16/20		—		(9,080	)
Indonesian Rupiah		JPHQ		Buy		4,950,000,000		339,041		12/07/20		—		(8,328	)
Total Forward Exchange Contracts											$	267,758	$	(533,179	)
Net unrealized appreciation (depreciation)													$	(265,421	)

*In U.S. dollars unless otherwise indicated.

^aMay be comprised of multiple contracts with the same counterparty, currency and settlement date.

At June 30, 2020, the Fund had the following credit default swap contracts outstanding. See Note 1(d).

Credit Default Swap Contracts

Description	Annual Payment Rate Received (Paid)		Payment Frequency		Counter- party		Maturity Date		Notional   Amounta		Value			Unamortized Upfront Payments (Receipts)			Unrealized Appreciation (Depreciation)		Ratingb
OTC Swap Contracts
Contracts to Buy Protectionc
Single Name
Avon Products Inc.		(5.00)%		Quarterly		CITI		3/20/23	$	260,000	$	(2,426	)		$  (20,577	)		$ 18,151
Contracts to Sell Protectionc,d
Single Name
Government of Russia		1.00%		Quarterly		CITI		12/20/24		300,000		(212	)		2,661			(2,873)		BBB-
Traded Index
eCitibank Bespoke Phoenix Index,
Mezzanine Tranche 5-7%		2.90%		Quarterly		CITI		12/20/21		250,000		(46,947	)		—			(46,947)		Non-
																				Investment Grade
Total Credit Default Swap Contracts											$	(49,585	)		$  (17,916	)		$(31,669)

Semiannual Report         FFA-41

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

Credit Default Swap Contracts (continued)

^aFor contracts to sell protection, the notional amount is equal to the maximum potential amount of the future payments and no recourse provisions have been entered into in association with the contracts.

^bBased on Standard and Poor’s (S&P) Rating for single name swaps. Internal ratings based on mapping into equivalent ratings from external vendors.

^cPerformance triggers for settlement of contract include default, bankruptcy or restructuring for single name swaps and failure to pay or bankruptcy of the underlying securities for traded index swaps.

^dThe fund enters contracts to sell protection to create a long credit position.

^eRepresents a custom index comprised of a basket of underlying instruments.

At June 30, 2020, the Fund had the following cross-currency swap contracts outstanding. See Note 1(d).

Cross-Currency Swap Contracts

Description

Payment Frequency

Coun- terparty

Maturity Date

Notional Amount

Value/  Unrealized  Appreciation  (Depreciation)

OTC Swap Contracts

Receive Floating 3-month USD LIBOR + 1.334%

Quarterly

280,000

USD

Pay Floating 3-month EUR LIBOR + 1.12%

Quarterly

CITI

7/10/21

250,000

EUR

$        389

Receive Floating 3-month USD LIBOR + 1.305%

Quarterly

387,450

USD

Pay Floating 3-month EUR LIBOR + 1.11%

Quarterly

JPHQ

8/20/21

350,000

EUR

(5,414

)

Receive Floating 3-month USD LIBOR + 1.23%

Quarterly

277,500

USD

Pay Floating 3-month EUR LIBOR + 1.07%

Quarterly

CITI

9/17/21

250,000

EUR

(3,372

)

Receive Floating 3-month USD LIBOR + 1.87%

Quarterly

275,000

USD

Pay Floating 3-month EUR LIBOR + 1.70%

Quarterly

CITI

10/15/21

250,000

EUR

(5,078

)

Receive Floating 3-month USD LIBOR + 1.318%

Quarterly

943,500

USD

Pay Floating 3-month EUR LIBOR + 1.20%

Quarterly

CITI

12/12/21

850,000

EUR

(12,185

)

Total Cross Currency Swap Contracts

$(25,660

)

At June 30, 2020, the Fund had the following inflation index swap contracts outstanding. See Note 1(d).

Inflation Index Swap Contracts

Description	Payment Frequency		Maturity Date		Notional Amount		Value/  Unrealized  Appreciaton  (Depreciation)
Centrally Cleared Swap Contracts
Receive Floating		At maturity
Pay Fixed 1.913%		At maturity		1/14/29	$	700,000		$  (36,368	)
Receive variable change in USA-CPI-U		At maturity
Pay Fixed 1.943%		At maturity		1/15/29		2,500,000		(137,239	)
Total Inflation Index Swap Contracts								$(173,607	)

See Note 8 regarding other derivative information.

See Abbreviations on page FFA-61.

FFA-42         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Allocation VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers	$658,070,208
Cost - Non-controlled affiliates (Note 3e)	66,758,532
Value - Unaffiliated issuers	$698,396,435
Value - Non-controlled affiliates (Note 3e)	60,517,496
Cash	23,930
Foreign currency, at value (cost $2,900,859)	2,893,378
Receivables:
Investment securities sold	3,508,337
Capital shares sold	88,619
Dividends and interest	2,335,622
Deposits with brokers for:
OTC derivative contracts	73,606
Futures contracts	927,821
Centrally cleared swap contracts	210,325
Variation margin on centrally cleared swap contracts	5,416
OTC swap contracts (upfront payments $3,122)	2,661
Unrealized appreciation on OTC forward exchange contracts	267,758
Unrealized appreciation on OTC swap contracts	18,540
Other assets	1,947
Total assets	769,271,891
Liabilities:
Payables:
Investment securities purchased	16,278,660
Capital shares redeemed	275,245
Management fees	274,484
Distribution fees	184,060
Trustees’ fees and expenses	314
Variation margin on futures contracts	109,597
OTC swap contracts (upfront receipts $26,254)	20,577
Options written, at value (premiums received $4,426)	2,898
Unrealized depreciation on OTC forward exchange contracts	533,179
Unrealized depreciation on OTC swap contracts	75,869
Deferred tax	216
Accrued expenses and other liabilities	105,512
Total liabilities	17,860,611
Net assets, at value	$751,411,280
Net assets consist of:
Paid-in capital	$725,212,750
Total distributable earnings (losses)	26,198,530
Net assets, at value	$751,411,280

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FFA-43

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities (continued)

June 30, 2020 (unaudited)

	Franklin Allocation VIP Fund
Class 1:
Net assets, at value	$        804,498
Shares outstanding	166,322
Net asset value and maximum offering price per share	$4.84
Class 2:
Net assets, at value	$371,639,070
Shares outstanding	77,524,145
Net asset value and maximum offering price per share	$4.79
Class 4:
Net assets, at value	$378,967,712
Shares outstanding	76,372,625
Net asset value and maximum offering price per share	$4.96

FFA-44         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Allocation VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers	$	4,260,934
Non-controlled affiliates (Note 3e)		2,531,672
Interest:(net of foreign taxes)~
Unaffiliated issuers		3,816,079
Total investment income		10,608,685
Expenses:
Management fees (Note 3a)		2,038,845
Distribution fees: (Note 3c)
Class 2		462,107
Class 4		654,011
Custodian fees (Note 4)		20,927
Reports to shareholders		42,652
Professional fees		39,957
Trustees’ fees and expenses		2,438
Other		44,986
Total expenses		3,305,923
Expense reductions (Note 4)		(14,316	)
Expenses waived/paid by affiliates (Note 3e and 3f)		(180,568	)
Net expenses		3,111,039
Net investment income		7,497,646
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		(14,133,947	)
Non-controlled affiliates (Note 3e)		(1,061,746	)
Written options		68,032
Realized gain distributions from REITs		4,867
Foreign currency transactions		213,395
Forward exchange contracts		(22,661	)
Futures contracts		1,639,105
Swap contracts		(857,729	)
Net realized gain (loss)		(14,150,684	)
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(2,867,896	)
Non-controlled affiliates (Note 3e)		(3,493,563	)
Translation of other assets and liabilities denominated in foreign currencies		(20,849	)
Forward exchange contracts		(199,386	)
Written options		1,528
Futures contracts		365,252
Swap contracts		(149,866	)
Change in deferred taxes on unrealized appreciation		16

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FFA-45

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations (continued)

for the six months ended June 30, 2020 (unaudited)

	Franklin Allocation VIP Fund
Net change in unrealized appreciation (depreciation)	$	(6,364,764	)
Net realized and unrealized gain (loss)		(20,515,448	)
Net increase (decrease) in net assets resulting from operations	$	(13,017,802	)
*Foreign taxes withheld on dividends	$	147,015
~Foreign taxes withheld on interest	$	2,318

FFA-46         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Franklin Allocation  VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income		$     7,497,646			$  10,197,177
Net realized gain (loss)		(14,150,684	)		239,840,198
Net change in unrealized appreciation (depreciation)		(6,364,764	)		(103,898,058	)
Net increase (decrease) in net assets resulting from operations		(13,017,802	)		146,139,317
Distributions to shareholders:
Class 1		(227,035	)		(114,944	)
Class 2		(106,811,345	)		(41,503,915	)
Class 4		(104,689,180	)		(39,405,922	)
Total distributions to shareholders		(211,727,560	)		(81,024,781	)
Capital share transactions: (Note 2)
Class 1		202,051			(205,346	)
Class 2		82,030,559			(18,907,288	)
Class 4		83,349,005			(20,095,745	)
Total capital share transactions		165,581,615			(39,208,379	)
Net increase (decrease) in net assets		(59,163,747	)		25,906,157
Net assets:
Beginning of period		810,575,027			784,668,870
End of period		$ 751,411,280			$ 810,575,027

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FFA-47

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin Allocation VIP Fund

1.  Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Allocation VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. The Fund offers three classes of shares: Class 1, Class 2, and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a.  Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities, exchange traded funds and derivative financial instruments listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade

in multiple markets or on multiple exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Debt securities generally trade in the OTC market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value. Securities denominated in a foreign currency are converted into their U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the date that the values of the foreign debt securities are determined.

Investments in open-end mutual funds are valued at the closing NAV.

Certain derivative financial instruments are centrally cleared or trade in the OTC market. The Fund’s pricing services use various techniques including industry standard option pricing models and proprietary discounted cash flow models to determine the fair value of those instruments. The Fund’s net benefit or obligation under the derivative contract, as measured by the fair value of the contract, is included in net assets.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the

FFA-48         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time. At June 30, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b.  Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent

value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c.  Securities Purchased on a When-Issued or Delayed Delivery and TBA Basis

The Fund purchases securities on a when-issued or delayed delivery and to-be-announced (TBA) basis, with payment and delivery scheduled for a future date. These transactions are subject to market fluctuations and are subject to the risk that the value at delivery may be more or less than the trade date purchase price. Although the Fund will generally purchase these securities with the intention of holding the securities, it may sell the securities before the settlement date. Sufficient assets have been segregated for these securities and collateral has been pledged and/or received for open TBA trades.

d.  Derivative Financial Instruments

The Fund invested in derivative financial instruments in order to manage risk or gain exposure to various other investments or markets. Derivatives are financial contracts based on an underlying or notional amount, require no initial investment or an initial net investment that is smaller than would normally be required to have a similar response to changes in market factors, and require or permit net settlement. Derivatives contain various risks including the potential inability of the counterparty to fulfill their obligations under the terms of the contract, the potential for an illiquid secondary market, and/or the potential for market movements which expose the Fund to gains or losses in excess of the amounts shown in the

Semiannual Report         FFA-49

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

1. Organization and Significant Accounting Policies (continued)

d. Derivative Financial Instruments (continued)

Statement of Assets and Liabilities. Realized gain and loss and unrealized appreciation and depreciation on these contracts for the period are included in the Statement of Operations.

Derivative counterparty credit risk is managed through a formal evaluation of the creditworthiness of all potential counterparties. The Fund attempts to reduce its exposure to counterparty credit risk on OTC derivatives, whenever possible, by entering into International Swaps and Derivatives Association (ISDA) master agreements with certain counterparties. These agreements contain various provisions, including but not limited to collateral requirements, events of default, or early termination. Termination events applicable to the counterparty include certain deteriorations in the credit quality of the counterparty. Termination events applicable to the Fund include failure of the Fund to maintain certain net asset levels and/or limit the decline in net assets over various periods of time. In the event of default or early termination, the ISDA master agreement gives the non-defaulting party the right to net and close-out all transactions traded, whether or not arising under the ISDA agreement, to one net amount payable by one counterparty to the other. However, absent an event of default or early termination, OTC derivative assets and liabilities are presented gross and not offset in the Statement of Assets and Liabilities. Early termination by the counterparty may result in an immediate payment by the Fund of any net liability owed to that counterparty under the ISDA agreement.

Collateral requirements differ by type of derivative. Collateral or initial margin requirements are set by the broker or exchange clearing house for exchange traded and centrally cleared derivatives. Initial margin deposited is held at the exchange and can be in the form of cash and/or securities. For OTC derivatives traded under an ISDA master agreement, posting of collateral is required by either the Fund or the applicable counterparty if the total net exposure of all OTC derivatives with the applicable counterparty exceeds the minimum transfer amount, which typically ranges from $100,000 to $250,000, and can vary depending on the counterparty and the type of the agreement. Generally, collateral is determined at the close of Fund business each day and any additional collateral required due to changes in derivative values may be delivered by the Fund or the

counterparty the next business day, or within a few business days. Collateral pledged and/or received by the Fund for OTC derivatives, if any, is held in segregated accounts with the Fund’s custodian/counterparty broker and can be in the form of cash and/or securities. Unrestricted cash may be invested according to the Fund’s investment objectives. To the extent that the amounts due to the Fund from its counterparties are not subject to collateralization or are not fully collateralized, the Fund bears the risk of loss from counterparty non-performance.

The Fund entered into exchange traded futures contracts primarily to manage and/or gain exposure to interest rate and equity price risk. A futures contract is an agreement between the Fund and a counterparty to buy or sell an asset at a specified price on a future date. Required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or receivable in the Statement of Assets and Liabilities.

The Fund entered into OTC forward exchange contracts primarily to manage and/or gain exposure to certain foreign currencies. A forward exchange contract is an agreement between the Fund and a counterparty to buy or sell a foreign currency at a specific exchange rate on a future date.

The Fund entered into credit default swap contracts primarily to manage and/or gain exposure to credit risk. A credit default swap is an agreement between the Fund and a counterparty whereby the buyer of the contract receives credit protection and the seller of the contract guarantees the credit worthiness of a referenced debt obligation. These agreements may be privately negotiated in the over-the-counter market (OTC credit default swaps) or may be executed in a multilateral trade facility platform, such as a registered exchange (centrally cleared credit default swaps). The underlying referenced debt obligation may be a single issuer of corporate or sovereign debt, a credit index, a basket of issuers or indices, or a tranche of a credit index or basket of issuers or indices. In the event of a default of the underlying referenced debt obligation, the buyer is entitled to receive the notional amount of the credit default swap contract from the seller in exchange for the referenced debt obligation, a net settlement amount equal to the notional amount of the credit default swap less the recovery value of the referenced debt obligation, or other agreed upon amount. For centrally cleared credit default swaps, required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or

FFA-50         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

receivable in the Statement of Assets and Liabilities. Over the term of the contract, the buyer pays the seller a periodic stream of payments, provided that no event of default has occurred. Such periodic payments are accrued daily as an unrealized appreciation or depreciation until the payments are made, at which time they are realized. Upfront payments and receipts are reflected in the Statement of Assets and Liabilities and represent compensating factors between stated terms of the credit default swap agreement and prevailing market conditions (credit spreads and other relevant factors). These upfront payments and receipts are amortized over the term of the contract as a realized gain or loss in the Statement of Operations.

The Fund entered into OTC cross currency swap contracts primarily to manage and/or gain exposure to certain foreign currencies. A cross currency swap is an agreement between the Fund and a counterparty to exchange cash flows (determined using either a fixed or floating rate) based on the notional amounts of two different currencies. The notional amounts are typically determined based on the spot exchange rates at the opening of the contract. Cross currency swaps may require the exchange of notional amounts at the opening and/or closing of the contract. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized depreciation and appreciation until the payments are made, at which time they are realized. Upfront payments and receipts are reflected in the Statement of Assets and Liabilities and represent compensating factors between stated terms of the cross currency swap contract and prevailing market conditions (interest rate spreads and other relevant factors). These upfront payments and receipts are amortized over the term of the contract as a realized gain or loss in the Statement of Operations.

The Fund entered into inflation index swap contracts primarily to manage and/or gain exposure to inflation risk. An inflation index swap is an agreement between the Fund and a counterparty to exchange cash flows whereby one party makes payments based on the percentage change in an index that serves as a measure of inflation and the other party makes a regular payment based on a compounded fixed rate, applied to a notional amount. These agreements may be privately negotiated in the over-the-counter market (OTC inflation index swap) or may be executed on a registered exchange (centrally cleared inflation index swap). For centrally cleared inflation index swaps, required initial margins are pledged by the Fund, and the daily change in fair

value is accounted for as a variation margin payable or receivable. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized depreciation and appreciation until the payments are made, at which time they are realized. Typically, an inflation index swap has payment obligations netted and exchanged upon maturity.

The Fund entered into interest rate swap contracts primarily to manage interest rate risk. An interest rate swap is an agreement between the Fund and a counterparty to exchange cash flows based on the difference between two interest rates, applied to a notional amount. These agreements may be privately negotiated in the over-the-counter market (OTC interest rate swaps) or may be executed on a registered exchange (centrally cleared interest rate swaps). For centrally cleared interest rate swaps, required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or receivable in the Statement of Assets and Liabilities. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized depreciation and appreciation until the payments are made, at which time they are realized.

The Fund entered into OTC total return swap contracts primarily to manage and/or gain exposure to credit and market risk of an underlying instrument such as a stock, bond, index or basket of securities or indices. A total return swap is an agreement between the Fund and a counterparty to exchange a return linked to an underlying instrument for a floating or fixed rate payment, both based upon a notional amount. Over the term of the contract, contractually required payments to be paid or received are accrued daily and recorded as unrealized appreciation or depreciation until the payments are made, at which time they are recognized as realized gain or loss.

See Note 8 regarding other derivative information.

e.  Loan Participation Notes

The Fund invests in loan participation notes (Participations). Participations are loans originally issued to a borrower by one or more financial institutions (the Lender) and subsequently sold to other investors, such as the Fund. Participations typically result in the Fund having a contractual relationship only with the Lender and not with the borrower. The Fund has the right to receive from the Lender any payments of principal, interest and fees which the Lender received from

Semiannual Report         FFA-51

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

1. Organization and Significant Accounting Policies (continued)

e. Loan Participation Notes (continued)

the borrower. The Fund generally has no rights to either enforce compliance by the borrower with the terms of the loan agreement or to any collateral relating to the original loan. As a result, the Fund assumes the credit risk of both the borrower and the Lender that is selling the Participation. The Participations may also involve interest rate risk and liquidity risk, including the potential default or insolvency of the borrower and/or the Lender.

f. Mortgage Dollar Rolls

The Fund enters into mortgage dollar rolls, typically on a TBA basis. Mortgage dollar rolls are agreements between the Fund and a financial institution where the Fund sells (or buys) mortgage-backed securities for delivery on a specified date and simultaneously contracts to repurchase (or sell) substantially similar (same type, coupon, and maturity) securities at a future date and at a predetermined price. Gains or losses are realized on the initial sale, and the difference between the repurchase price and the sale price is recorded as an unrealized gain or loss to the Fund upon entering into the mortgage dollar roll. In addition, the Fund may invest the cash proceeds that are received from the initial sale. During the period between the sale and repurchase, the Fund is not entitled to principal and interest paid on the mortgage backed securities. Transactions in mortgage dollar rolls are accounted for as purchases and sales and may result in an increase to the Fund’s portfolio turnover rate. The risks of mortgage dollar roll transactions include the potential inability of the counterparty to fulfill its obligations.

g. Senior Floating Rate Interests

The Fund invests in senior secured corporate loans that pay interest at rates which are periodically reset by reference to a base lending rate plus a spread. These base lending rates are generally the prime rate offered by a designated U.S. bank or the London InterBank Offered Rate (LIBOR). Senior secured corporate loans often require prepayment of principal from excess cash flows or at the discretion of the borrower. As a result, actual maturity may be substantially less than the stated maturity. Senior secured corporate loans in which the Fund invests are generally readily marketable, but may be subject to certain restrictions on resale. On

July 27, 2017, the United Kingdom’s Financial Conduct Authority announced its intention to cease sustaining LIBOR after 2021. There remains uncertainty regarding the future utilization of LIBOR and the nature of any replacement rate. As such, the potential effect of a transition away from LIBOR on the Fund or the Fund’s investments that use or may use a floating rate based on LIBOR cannot yet be determined.

h. Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

i. Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Amortization of premium and accretion of discount on debt securities are included in interest income. Paydown gains and losses are recorded as an adjustment to interest income. Dividend

FFA-52         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

income, capital gain distributions are recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

Inflation-indexed bonds are adjusted for inflation through periodic increases or decreases in the security’s interest accruals, face amount, or principal redemption value, by

amounts corresponding to the rate of inflation as measured by an index. Any increase or decrease in the face amount or principal redemption value will be included as interest income in the Statement of Operations.

j. Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

k. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31,
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		3,998		$	25,836			12,786		$	87,589
Shares issued in reinvestment of distributions		47,596			227,035			18,101			114,944
Shares redeemed		(7,955	)		(50,820	)		(62,639	)		(407,879	)
Net increase (decrease)		43,639		$	202,051			(31,752	)	$	(205,346	)

Semiannual Report         FFA-53

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

2. Shares of Beneficial Interest (continued)

	Six Months Ended June 30, 2020						Year Ended December 31,
	Shares			Amount			Shares			Amount
Class 2 Shares:
Shares sold		1,929,143		$	12,305,662			2,057,930		$	13,832,099
Shares issued in reinvestment of distributions		22,581,680			106,811,345			6,577,483			41,503,915
Shares redeemed		(6,182,367	)		(37,086,448	)		(11,168,839	)		(74,243,302	)
Net increase (decrease)		18,328,456		$	82,030,559			(2,533,426	)	$	(18,907,288	)
Class 4 Shares:
Shares sold		999,707		$	6,553,397			973,482		$	6,631,528
Shares issued in reinvestment of distributions		21,365,139			104,689,180			6,099,988			39,405,922
Shares redeemed		(4,318,741	)		(27,893,572	)		(9,669,394	)		(66,133,195	)
Net increase (decrease)		18,046,105		$	83,349,005			(2,595,924	)	$	(20,095,745	)

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Advisers, Inc. (Advisers)	Investment Manager
Templeton Global Advisors Limited (Global Advisors)	Investment Manager
Franklin Templeton Institutional, LLC (FT Institutional)	Investment Manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a. Management Fees

The Fund pays an investment management fee to Advisers of 0.55% per year of the average daily net assets of the Fund.

Under a subadvisory agreement, Global Advisors and FT Institutional, affiliates of Advisers, provide subadvisory services to the Fund. The subadvisory fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

b. Administrative Fees

Under an agreement with Advisers, FT Services provides administrative services to the Fund. The fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

FFA-54         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

c. Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets of each class. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

e. Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)			Net Change in Unrealized Appreciation (Depreciation)			Value at End of Period			Number of Shares Held at End of Period		Dividend Income
Non-Controlled Affiliates
Franklin LibertyQ U.S. Equity ETF	$	—	$	4,446,394	$	(4,056,817	)	$	(389,577	)	$	—		$	—	a		—	$	10,093
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		21,473,752		153,839,221		(143,492,388	)		—			—			31,820,585			31,820,585		72,098
Templeton Global Bond VIP Fund, Class 1		33,013,162		4,449,481		(4,600,000	)		(672,169	)		(3,493,563	)		28,696,911			1,981,831		2,449,481
Total Affiliated Securities	$	54,486,914	$	162,735,096	$	(152,149,205	)	$	(1,061,746	)	$	(3,493,563	)	$	60,517,496				$	2,531,672

^aAs of June 30, 2020, no longer held by the fund.

f. Waiver and Expense Reimbursements

Advisers has contractually agreed in advance to waive or limit its fees and to assume as its own expense certain expenses otherwise payable by the Fund so that the operating expenses (excluding distribution fees and certain non-routine expenses or costs, including those relating to litigation, indemnification, reorganizations, and liquidations) and acquired fund fees and expenses for each class of the Fund do not exceed 0.57%, based on the average net assets of each class until April 30, 2021. Total expenses waived or paid are not subject to recapture subsequent to the Fund’s fiscal year end.

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

Semiannual Report         FFA-55

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

5. Income Taxes

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$	725,772,409
Unrealized appreciation	$	68,781,770
Unrealized depreciation		(36,002,107)
Net unrealized appreciation (depreciation)	$	32,779,663

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of paydown losses, bond discounts and premiums and wash sales.

6. Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $365,133,226 and $412,343,542, respectively.

7. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

8. Other Derivative Information

At June 30, 2020, investments in derivative contracts are reflected in the Statement of Assets and Liabilities as follows:

	Asset Derivatives				Liability Derivatives
Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Assets and Liabilities Location	Fair Value			Statement of Assets and Liabilities Location	Fair Value
Interest rate contracts	Variation margin on futures contracts	$	120,028	a	Variation margin on futures contracts	$	21,169	a
	Unrealized appreciation on OTC swap contracts		389		Unrealized depreciation on OTC swap contracts		26,049
Foreign exchange contracts	Unrealized appreciation on OTC forward exchange contracts		267,758		Unrealized depreciation on OTC forward exchange contracts		533,179
Credit contracts	OTC swap contracts (upfront payments)		2,661		OTC swap contracts (upfront receipts)		20,577
	Unrealized appreciation on OTC swap contracts		18,151		Unrealized depreciation on OTC swap contracts		49,820
Equity contracts	Investments in securities, at value		—		Options written, at value		2,898
	Variation margin on futures contracts		56,057	a	Variation margin on futures contracts		—

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Asset Derivatives			Liability Derivatives
Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Assets and Liabilities Location	Fair Value		Statement of Assets and Liabilities Location	Fair Value
Inflation contracts	Variation margin on centrally cleared swap contracts	$	—	Variation margin on centrally cleared swap contracts	$	173,607	a
Totals		$	465,044		$	827,299

^aThis amount reflects the cumulative appreciation (depreciation) of futures contracts and centrally cleared swap contracts as reported in the Statement of Investments. Only the variation margin receivable/payable at period end is separately reported within the Statement of Assets and Liabilities. Prior variation margin movements were recorded to cash upon receipt or payment.

For the period ended June 30, 2020, the effect of derivative contracts in the Statement of Operations was as follows:

Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Operations Location	Net Realized Gain (Loss) for the Period			Statement of Operations Location	Net Change in Unrealized Appreciation (Depreciation) for the Period
	Net realized gain (loss) from:				Net change in unrealized appreciation (depreciation) on:
Interest rate contracts	Investments	$	(149,096	)	Investments	$	—
	Written options		59,737		Written options		—
	Futures contracts		1,307,952		Futures contracts		355,917
	Swap contracts		(53,983	)	Swap contracts		65,600
Foreign exchange contracts	Investments		27,482		Investments		—
	Forward exchange contracts		(22,661	)	Forward exchange contracts		(199,386	)
Credit contracts	Written options		6,663		Written options		—
	Swap contracts		(599,207	)	Swap contracts		(18,080	)
Equity contracts	Written options		1,632		Written options		1,528
	Futures contracts		331,153		Futures contracts		9,335
Inflation contracts	Swap contracts		(204,539	)	Swap contracts		(197,386	)
Totals		$	705,133			$	17,528

For the period ended June 30, 2020, the average month end notional amount of futures contracts, swap contracts and options, and the average month end contract value for forward exchange contracts were as follows:

Futures contracts	$	53,406,412
Swap contracts	$	16,007,098
Forward exchange contracts	$	21,986,085
Options		2,657,429	shares

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

8. Other Derivative Information (continued)

At June 30, 2020, OTC derivative assets and liabilities are as follows:

	Gross Amounts of Assets and Liabilities Presented   in the Statement of Assets and Liabilities
	Assetsa		Liabilitiesa
Derivatives
Forward exchange contracts		$267,758		$533,179
Swap contracts		21,201		96,446
Total		$288,959		$629,625

^aAbsent an event of default or early termination, OTC derivative assets and liabilities are presented gross and not offset in the Statement of Assets and Liabilities.

At June 30, 2020, OTC derivative assets, which may be offset against OTC derivative liabilities and collateral received from the counterparty, are as follows:

			Amounts Not Offset in the     Statement of Assets and Liabilities
	Gross Amounts of Assets Presented in the Statement of Assets and Liabilities		Financial Instruments Available for Offset			Financial Instruments Collateral Receiveda			Cash Collateral Received			Net Amount (Not less than zero)
Counterparty
CITI		$  29,144		$  (29,144	)		$  —			$  —			$  —
JPHQ		259,815		(259,815	)		—			—			—
Total		$288,959		$(288,959	)		$  —			$  —			$  —
At June 30, 2020, OTC derivative liabilities, which may be offset against OTC derivative assets and collateral pledged to the counterparty, are as follows:
			Amounts Not Offset in the     Statement of Assets and Liabilities
	Gross Amounts of Liabilities Presented in the Statement of Assets and Liabilities		Financial Instruments Available for Offset			Financial Instruments Collateral Pledgeda,b			Cash Collateral Pledgeda			Net Amount (Not less than zero)
Counterparty
CITI		$  99,711		$  (29,144	)		$          —			$(70,567	)		$  —
JPHQ		529,914		(259,815	)		(270,099	)		—			—
Total		$629,625		$(288,959	)		$(270,099	)		$(70,567	)		$  —

^aIn some instances, the collateral amounts disclosed in the table above were adjusted due to the requirement to limit collateral amounts to avoid the effect of overcollateralization. Actual collateral received and/or pledged may be more than the amounts disclosed herein.

^bSee the accompanying Statement of Investments for securities pledged as collateral for derivatives.

See Note 1(d) regarding derivative financial instruments.

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

See Abbreviations on page FFA-61.

9. Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

10. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

10. Fair Value Measurements (continued)

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets and liabilities carried at fair value, is as follows:

	Level 1		Level 2		Level 3		Total
Assets:
Investments in Securities:a
Equity Investments:b
Automobiles & Components	$	1,442,221	$	3,688,986	$	—	$	5,131,207
Banks		629,440		8,609,807		—		9,239,247
Capital Goods		33,917,815		10,576,577		—		44,494,392
Commercial & Professional Services		7,818,640		4,072,329		—		11,890,969
Consumer Durables & Apparel		7,532,184		3,616,031		—		11,148,215
Diversified Financials		37,246,911		8,067,189		—		45,314,100
Energy		4,935,763		4,833,765		—		9,769,528
Food & Staples Retailing		6,642,731		3,219,813		—		9,862,544
Food, Beverage & Tobacco		15,098,895		2,822,092		—		17,920,987
Health Care Equipment & Services		21,383,180		4,592,001		—		25,975,181
Household & Personal Products		8,808,602		738,944		—		9,547,546
Insurance		1,130,718		2,654,917		—		3,785,635
Materials		14,369,748		10,386,275		—		24,756,023
Media & Entertainment		11,449,799		4,540,598		—		15,990,397
Pharmaceuticals, Biotechnology & Life Sciences		29,748,526		14,738,005		—		44,486,531
Real Estate		7,395,298		3,546,112		—		10,941,410
Retailing		24,318,806		3,858,183		—		28,176,989
Semiconductors & Semiconductor Equipment		19,427,855		3,756,828		—		23,184,683
Software & Services		50,715,638		6,853,662		—		57,569,300
Technology Hardware & Equipment		14,604,354		2,247,795		—		16,852,149
Telecommunication Services		2,564,611		4,519,736		—		7,084,347
Transportation		11,160,580		2,798,976		—		13,959,556
Utilities		10,972,639		2,525,521		—		13,498,160
All Other Equity Investments		7,798,367		—		—		7,798,367
Corporate Bonds		—		109,181,935		—		109,181,935
Senior Floating Rate Interests		—		2,126,855		—		2,126,855
Foreign Government and Agency Securities		—		6,662,148		—		6,662,148
U.S. Government and Agency Securities		—		40,753,755		—		40,753,755
Asset-Backed Securities and Commercial Mortgage-Backed Securities		—		22,732,916		—		22,732,916
Mortgage-Backed Securities		—		70,820,515		—		70,820,515
Municipal Bonds		—		6,437,759		—		6,437,759
Short Term Investments		31,820,585		—		—		31,820,585
Total Investments in Securities	$	382,933,906	$	375,980,025	$	—	$	758,913,931
Other Financial Instruments:
Futures Contracts	$	176,085	$	—	$	—	$	176,085
Forward Exchange Contracts		—		267,758		—		267,758
Swap Contracts		—		18,540		—		18,540
Total Other Financial Instruments	$	176,085	$	286,298	$	—	$	462,383

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Allocation VIP Fund (continued)

	Level 1		Level 2		Level 3		Total
Liabilities:
Other Financial Instruments:
Options Written	$	2,898	$	—	$	—	$	2,898
Futures Contracts		21,169		—		—		21,169
Forward Exchange Contracts		—		533,179		—		533,179
Swap Contracts		—		249,476		—		249,476
Total Other Financial Instruments	$	24,067	$	782,655	$	—	$	806,722

^aFor detailed categories, see the accompanying Statement of Investments.

^bIncludes common stocks and management investment companies as well as other equity investments.

11. New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

12. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Counterparty		Currency		Selected Portfolio
CITI	Citigroup, Inc.	COP	Colombian Peso	ADR	American Depositary Receipt
JPHQ	JP Morgan Chase & Co.	CNY	Chinese Yuan	CLO	Collateralized Loan Obligations
		DOP	Dominican Peso	FFCB	Federal Farm Credit Bank
		DKK	Danish Krone	FRN	Floating Rate Note
		EUR	Euro	GO	General Obligation
		JPY	Japanese Yen	LIBOR	London InterBank Offered Rate
		MXN	Mexican Peso	SF	Single Family
		USD	United States Dollar	USD	United School District
		UYU	Uruguayan Peso	UHSD	Unified/Union High School District
		ZAR	South African Rand

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Franklin Global Real Estate VIP Fund

This semiannual report for Franklin Global Real Estate VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -17.39% total return* for the six-month period ended June 30, 2020.

*The Fund has an expense reduction contractually guaranteed through 4/30/21. Fund investment results reflect the expense reduction; without this reduction, the results would have been lower.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

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FRANKLIN GLOBAL REAL ESTATE VIP FUND

Fund Goal and Main Investments

The Fund seeks high total return. Under normal market conditions, the Fund invests at least 80% of its net assets in investments of companies located anywhere in the world that operate in the real estate sector, including: real estate investment trusts (REITs) and similar REIT-like entities domiciled outside the U.S.; companies qualifying under U.S. federal tax law as REITs; and companies that derive at least half of their assets or revenues from the ownership, management, development or sale of residential or commercial real estate (such as real estate operating or service companies).

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. The Fund concentrates in real estate securities, which involve special risks, such as declines in the value of real estate and increased susceptibility to adverse economic or regulatory developments affecting the sector. The Fund’s investments in REITs involve additional risks; since REITs typically are invested in a limited number of projects or in a particular market segment, they are more susceptible to adverse developments affecting a single project or market segment than more broadly diversified investments. Foreign investing, especially in emerging markets, involves additional risks such as currency and market volatility, as well as political and social instability. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the FTSE EPRA/NAREIT Developed Index posted a -20.93% total return for the same period.¹

Portfolio Composition

Based on Total Net Assets as of 6/30/20

Economic and Market Overview

Global developed and emerging market equities, as measured by the MSCI All Country World Index (USD), posted a -5.99% total return during the six months under review.¹ Stocks fell sharply in early 2020 as countries around the world implemented lockdown measures in an effort to slow the spread of the novel coronavirus (COVID-19). Global supply chain disruptions, business and personal restrictions, and subdued consumer spending drove many investors to sell equity holdings in favor of perceived safe investments such as government bonds and cash. While global equities, notably in the U.S., rebounded in April and May amid optimism about easing lockdown restrictions, concerns about a second wave of infections hindered equities in June, as investors weighed the possibility of renewed restrictions.

1. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

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In the U.S., government mandates to mitigate the COVID-19 pandemic severely impacted the economy beginning in March 2020. As a result, the unemployment rate surged to 14.7% in April, as many businesses, particularly those involved in hospitality, retail and travel, announced mass layoffs.² According to the National Bureau of Economic Research, the longest U.S. economic expansion in history ended in February 2020 as the country slipped into a severe recession. Nonetheless, near period-end, there were signs that a recovery was underway, as jobless claims fell considerably from their peak in early April, retail sales rose sharply in May, and the unemployment rate fell to 11.1% in June.² Along with optimism about improved treatments and potential vaccines for COVID-19, the positive economic signals contributed to a significant equity rebound in April and May. However, an increase in COVID-19 infections in many states throughout June pressured U.S. stocks.

The U.S. Federal Reserve (Fed) made significant efforts to support the U.S. economy. In March 2020, as the pandemic began to severely impact the economy and financial markets, the Fed implemented two emergency rate cuts, lowering the federal funds target rate to a range of 0.00%–0.25%, and announced sweeping quantitative easing measures aimed at ensuring credit flow to borrowers and supporting credit markets with unlimited amounts of bond purchasing.

In the eurozone, some analysts forecasted a significant contraction in 2020, particularly in southern European countries, as the magnitude of the economic disruption caused by the pandemic became apparent. European developed market equities, as measured by the MSCI Europe Index (USD), posted a -12.43% total return for the period.¹ To stimulate growth, the European Central Bank implemented a broad bond-buying program, and many countries passed fiscal stimulus measures.

Asian developed and emerging market equities, as measured by the MSCI All Country Asia Index (USD), posted a -5.51% total return during the six-month period.¹ The onset of the pandemic brought dramatically slower economic activity in Asia, as businesses halted operations and manufacturing and export activity declined sharply in the region’s major economies. Asian markets generally advanced toward period-end, bolstered by fiscal stimulus measures and economies reopening throughout the region.

Emerging market stocks, as measured by the MSCI Emerging Markets Index (USD), posted a -9.67% total return

Top 10 Countries

6/30/20

	% of Total Net Assets
U.S.	55.5%
Japan	10.8%
Germany	6.3%
U.K.	6.1%
Hong Kong	5.3%
Australia	4.4%
Singapore	3.4%
Canada	2.2%
Spain	1.5%
France	1.5%

due primarily to the COVID-19 pandemic.¹ A sharp decrease in prices for oil and other natural resources also hurt emerging market economies reliant on these exports. In the last quarter of the reporting period, however, investor optimism led to a stock rally, particularly in emerging market countries that had successfully lowered infection rates.

Investment Strategy

We seek to limit price volatility by investing across markets and property types. When selecting investments for the Fund’s portfolio, we apply a “bottom-up” stock selection process that incorporates macro-level views in the evaluation process. Our portfolio construction process combines bottom-up analysis of individual stock and real estate market fundamentals and top-down macro overlays to provide country/regional, property type, and company size perspectives in identifying international/local cyclical and thematic trends that highlight investment opportunities.

Manager’s Discussion

During the six months under review, the Fund had negative absolute returns but outperformed its benchmark, the FTSE EPRA/NAREIT Developed Index. Key contributors to relative performance included an overweighted position in the industrial property sector. Outperformance was led by an off-benchmark investment in Australian REIT Goodman Group, one of the world’s largest owners, developers and managers of industrial property. Like all industrial REITs, Goodman has benefited from the ongoing structural tailwinds of e-commerce penetration and increased investment in supply chains. Additionally, Goodman maintains what we view as one of the strongest growth outlooks within its

2. Source: U.S. Bureau of Labor Statistics.

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FRANKLIN GLOBAL REAL ESTATE VIP FUND

category due to its substantial development pipeline and a strong balance sheet, which enables ongoing reinvestment. Furthermore, the company’s third-party management platform has continued to attract capital, benefiting from the immense appetite from institutional investors for industrial real estate. Despite the disruption of COVID-19, Goodman reiterated its 2020 fiscal year earnings per share growth guidance in its most recent update as the prevailing growth drivers remain intact.

An underweighted position and stock selection in the struggling retail property sector also enhanced relative results, as did an off-benchmark position in the towers/ infrastructure sector. Notable contributors from the latter sector included U.S.-based SBA Communications. SBA owns and operates a portfolio of over 30,000 communications sites, mostly located in the U.S. American tower REITs like SBA have continued to enjoy a strong outlook owing to strong growth projections for mobile data usage over the next several years. The U.S. tower industry has been further supported by the early stages of deployment of assets for 5G technology. In addition, SBA and other tower REITs continued to outperform following the COVID-19 outbreak, as the essential nature of wireless services effectively shields tower operators from any notable slowdown in leasing activity amid the health crisis and macroeconomic weakness.

From the office space sector, relative contributors included U.S.-based medical and life-science office landlord Alexandria Real Estate. Alexandria continued to benefit from its unique life science focused development platform, which has been a notable differentiator amid the pandemic. Demand for lab space has remained healthy and is unlikely to be impaired by social distancing considerations or the recession the pandemic response has induced. This represents a notable contrast to office peers, where secular concerns on the viability of office demand and cyclical risks around negative net absorption trends predominate.

Conversely, an underweighting to the storage property sector detracted from relative performance as the sector, overall, performed better than the benchmark index during a volatile reporting period. We have maintained an underweighted investment in U.S.-based Public Storage due to concerns about industry-wide oversupply following three years of what we believe to be excessive new construction. The presence of this new supply has weighed on new rental pricing and, in turn, on same store net operating income growth and cash flow growth. However, the storage subsector remains highly defensive and Public Storage has maintained what we view as a particularly strong balance sheet, two attributes that

Top 10 Holdings

6/30/20

Company Sector/Industry, Country	% of Total Net Assets
Prologis Inc.	6.6%
Industrial REITs, U.S.
Vonovia SE	3.9%
Real Estate Operating Companies, Germany
Alexandria Real Estate Equities Inc.	3.3%
Office REITs, U.S.
AvalonBay Communities Inc.	2.7%
Residential REITs, U.S.
Realty Income Corp.	2.7%
Retail REITs, U.S.
Healthpeak Properties Inc.	2.6%
Health Care REITs, U.S.
Segro PLC	2.5%
Industrial REITs, U.K.
Goodman Group	2.4%
Industrial REITs, Australia
Extra Space Storage Inc.	2.3%
Specialized REITs, U.S.
Equinix Inc.	2.2%
Specialized REITs, U.S.

became particularly important once the COVID-19 pandemic became apparent in March.

Elsewhere, hotel operator Ryman Hospitality Properties (not held at period-end) hurt relative performance. Ryman owns group-oriented, destination hotel assets in urban and resort markets which are managed by Marriott International (not a Fund holding) under the Gaylord Hotels brand. Not surprisingly, hotel REITs were the first hit by COVID-19 as investors reacted to a broad-based evaporation of demand followed by the rapid closure of hotels across the country. This led to the extended closure of Ryman’s five Gaylord Hotels, and with the timing and magnitude of the current crisis too difficult to predict, company shares underperformed through the end of April. Prior to the crisis, Ryman had been a relative outperformer in the hotel space with its differentiated business model, focus on group demand, long booking window and external growth initiatives.

Although the shopping center sector was an overall relative contributor (due in part to a beneficial underweighting), Retail Properties of America hurt relative results. The shopping center landlord has a portfolio of lifestyle, grocery-anchored and power center properties across the U.S. Weak fundamental trends have persisted for retail landlords broadly as retailers look to rationalize their store

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fleets amid a broad consumer shift to online commerce. Furthermore, retailer bankruptcies accelerated in the second quarter of 2020 due to the COVID-19 induced lockdown of retail assets. The company’s portfolio specifically contains

exposure to several troubled retailers including Pier ¹ and Ascena Group. Additionally, rent collections for April and May were significantly impacted due to the extended closure of a substantial numbers of its properties.

Thank you for your participation in Franklin Global Real Estate VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

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Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual     (actual return after expenses)		Hypothetical     (5% annual return before expenses)
Share  Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$826.10	$4.54	$1,019.89	$5.02	1.00%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

FGR-6         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin Global Real Estate VIP Fund

	Six Months Ended
	June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$17.99			$15.41			$16.96			$15.83			$15.93			$16.36
Income from investment operationsa:
Net investment incomeb		0.12			0.29			0.33			0.17			0.30	c		0.24
Net realized and unrealized gains (losses)		(3.21	)		3.15			(1.41	)		1.52			(0.16	)		(0.12	)
Total from investment operations		(3.09	)		3.44			(1.08	)		1.69			0.14			0.12
Less distributions from:
Net investment income		(0.54	)		(0.50	)		(0.47	)		(0.56	)		(0.24	)		(0.55	)
Net realized gains		(1.59	)		(0.36	)		—			—			—			—
Total distributions		(2.13	)		(0.86	)		(0.47	)		(0.56	)		(0.24	)		(0.55	)
Net asset value, end of period		$12.77			$17.99			$15.41			$16.96			$15.83			$15.93
Total returnd		(17.39)%			22.62%			(6.52)%			10.76%			0.81%			0.83%
Ratios to average net assetse
Expenses before waiver and payments by affiliates		1.16%			1.14%			1.15%			1.14%			1.11%			1.11%
Expenses net of waiver and payments by affiliates		1.00%			1.04%	f		1.15%	f		1.14%	g		1.11%	g		1.11%
Net investment income		1.60%			1.66%			1.92%			1.04%			1.99%	c		1.49%
Supplemental data
Net assets, end of period (000’s)		$856			$1,057			$878			$819			$821			$32,161
Portfolio turnover rate		17.33%			28.34%			17.78%			22.18%			28.53%	h		23.35%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.06 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 1.59%.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fBenefit of expense reduction rounds to less than 0.01%.

^gBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^hExcludes the value of portfolio securities delivered as a result of a redemption in-kind.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FGR-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Global Real Estate VIP Fund (continued)

	Six Months Ended
	June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$17.50			$15.00			$16.52			$15.42			$15.52			$15.95
Income from investment operationsa:
Net investment incomeb		0.10			0.24			0.27			0.13			0.28	c		0.20
Net realized and unrealized gains (losses)		(3.13	)		3.08			(1.36	)		1.47			(0.19	)		(0.12	)
Total from investment operations		(3.03	)		3.32			(1.09	)		1.60			0.09			0.08
Less distributions from:
Net investment income		(0.49	)		(0.46	)		(0.43	)		(0.50	)		(0.19	)		(0.51	)
Net realized gains		(1.59	)		(0.36	)		—			—			—			—
Total distributions		(2.08	)		(0.82	)		(0.43	)		(0.50	)		(0.19	)		(0.51	)
Net asset value, end of period		$12.39			$17.50			$15.00			$16.52			$15.42			$15.52
Total returnd		(17.50)%			22.37%			(6.77)%			10.47%			0.54%			0.57%
Ratios to average net assetse
Expenses before waiver and payments by affiliates		1.41%			1.39%			1.40%			1.39%			1.36%			1.36%
Expenses net of waiver and payments by affiliates		1.25%			1.29%	f		1.40%	f		1.39%	g		1.36%	g		1.36%
Net investment income		1.35%			1.41%			1.67%			0.79%			1.74%	c		1.24%
Supplemental data
Net assets, end of period (000’s)		$125,216			$159,153			$146,408			$183,532			$193,707			$287,473
Portfolio turnover rate		17.33%			28.34%			17.78%			22.18%			28.53%	h		23.35%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.06 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 1.34%.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fBenefit of expense reduction rounds to less than 0.01%.

^gBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^hExcludes the value of portfolio securities delivered as a result of a redemption in-kind.

FGR-8         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin Global Real Estate VIP Fund

	Country		Shares/ Units		Value
Common Stocks and Other Equity Interests 99.0%
Diversified Real Estate Activities 9.0%
CapitaLand Ltd.		Singapore		718,561	$	1,518,118
Mitsubishi Estate Co. Ltd.		Japan		183,286		2,731,295
Mitsui Fudosan Co. Ltd.		Japan		149,202		2,650,532
New World Development Co. Ltd.		Hong Kong		239,322		1,136,313
Nomura Real Estate Holdings Inc.		Japan		50,228		935,115
Sun Hung Kai Properties Ltd.		Hong Kong		187,797		2,399,134
						11,370,507
Diversified REITs 6.1%
Gecina SA		France		12,073		1,490,969
GPT Group		Australia		307,770		893,977
Hulic REIT Inc.		Japan		807		1,003,069
Kenedix Office Investment Corp.		Japan		246		1,374,552
Premier Investment Corp.		Japan		911		1,012,094
VEREIT Inc.		United States		299,165		1,923,631
						7,698,292
Health Care REITs 5.5%
Healthpeak Properties Inc.		United States		118,711		3,271,675
Physicians Realty Trust		United States		70,654		1,237,858
Welltower Inc.		United States		47,236		2,444,463
						6,953,996
Hotel & Resort REITs 1.9%
Host Hotels & Resorts Inc.		United States		77,304		834,110
MGM Growth Properties LLC, A		United States		48,664		1,324,147
Summit Hotel Properties Inc.		United States		34,278		203,269
						2,361,526
Hotels, Resorts & Cruise Lines 0.6%
Extended Stay America Inc., units consisting of common stock and real estate investment trust		United States		66,832		747,850
Industrial REITs 18.7%
Americold Realty Trust		United States		49,935		1,812,640
First Industrial Realty Trust Inc.		United States		11,531		443,252
GLP J-REIT		Japan		1,461		2,111,218
Goodman Group		Australia		289,602		2,987,745
Mapletree Logistics Trust		Singapore		1,064,970		1,495,171
Prologis Inc.		United States		89,678		8,369,648
Rexford Industrial Realty Inc.		United States		56,457		2,339,014
Segro PLC		United Kingdom		284,215		3,143,285
Terreno Realty Corp.		United States		17,206		905,724
						23,607,697
Integrated Telecommunication Services 0.6%
Cellnex Telecom SA		Spain		12,510		764,015

Semiannual Report         FGR-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Global Real Estate VIP Fund (continued)

	Country		Shares/ Units		Value
Common Stocks and Other Equity Interests (continued)
Office REITs 12.3%
Alexandria Real Estate Equities Inc.		United States		25,428	$	4,125,693
Boston Properties Inc.		United States		13,761		1,243,719
Cousins Properties Inc.		United States		70,570		2,105,103
Derwent London PLC		United Kingdom		52,249		1,797,230
Dexus		Australia		259,023		1,662,252
Ichigo Office REIT Investment Corp.		Japan		1,021		709,435
aInmobiliaria Colonial SA		Spain		136,826		1,209,697
Kilroy Realty Corp.		United States		27,443		1,610,904
ORIX JREIT Inc.		Japan		797		1,050,551
						15,514,584
Real Estate Development 1.6%
CK Asset Holdings Ltd.		Hong Kong		335,805		2,013,739
Real Estate Operating Companies 9.4%
aAroundtown SA		Germany		171,228		981,358
Deutsche Wohnen AG		Germany		49,225		2,211,759
Fabege AB		Sweden		93,551		1,100,085
aFastighets AB Balder, B		Sweden		15,601		596,842
Grainger PLC		United Kingdom		397,206		1,409,398
Shurgard Self Storage SA		Belgium		19,461		732,596
Vonovia SE		Germany		79,309		4,847,177
						11,879,215
Residential REITs 13.8%
American Homes 4 Rent, A		United States		94,106		2,531,452
AvalonBay Communities Inc.		United States		22,306		3,449,400
Camden Property Trust		United States		30,292		2,763,237
Canadian Apartment Properties REIT		Canada		50,888		1,821,404
Equity Lifestyle Properties Inc.		United States		42,719		2,669,083
UDR Inc.		United States		70,750		2,644,635
Unite Group PLC		United Kingdom		122,804		1,429,932
						17,309,143
Retail REITs 10.7%
CapitaLand Mall Trust		Singapore		897,695		1,273,812
Link REIT		Hong Kong		141,051		1,158,044
Realty Income Corp.		United States		56,965		3,389,417
Regency Centers Corp.		United States		40,800		1,872,312
Retail Properties of America Inc., A		United States		107,398		786,153
Simon Property Group Inc.		United States		23,073		1,577,732
SmartCentres REIT		Canada		57,685		888,507
Spirit Realty Capital Inc.		United States		63,088		2,199,248
bUnibail-Rodamco-Westfield		France		6,595		371,706
						13,516,931

FGR-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Global Real Estate VIP Fund (continued)

	Country		Shares/ Units		Value
Common Stocks and Other Equity Interests (continued)
Specialized REITs 8.8%
Equinix Inc.		United States		4,004	$	2,812,009
Extra Space Storage Inc.		United States		31,987		2,954,639
Life Storage Inc.		United States		4,720		448,164
Public Storage		United States		2,992		574,135
QTS Realty Trust Inc., A		United States		33,908		2,173,164
SBA Communications Corp., A		United States		7,134		2,125,361
						11,087,472
Total Common Stocks and Other Equity Interests (Cost $101,733,784)						124,824,967
			Principal Amount
Short Term Investments 1.1%
Repurchase Agreements (Cost $946,246) 0.7%
cJoint Repurchase Agreement, 0.065%, 7/01/20 (Maturity Value $946,248)
BNP Paribas Securities Corp. (Maturity Value $656,497)
Deutsche Bank Securities Inc. (Maturity Value $180,336)
HSBC Securities (USA) Inc. (Maturity Value $109,415)
U.S. Government Agency Securities, 4.00%, 3/20/44; U.S. Government Agency Strips, 8/15/39; and U.S. Treasury Notes, 1.75% - 2.25%, 4/15/22 - 7/31/24 (valued at $966,234)		United States	$	946,246		946,246
			Shares
dInvestments from Cash Collateral Received for Loaned Securities 0.4%
Money Market Funds (Cost $358,000) 0.3%
e,fInstitutional Fiduciary Trust Money Market Portfolio, 0.00%.		United States		358,000		358,000
			Principal Amount
Repurchase Agreements (Cost $90,501) 0.1%
cJoint Repurchase Agreement, 0.07%, 7/01/20 ($90,501)
BNP Paribas Securities Corp.
Collateralized by U.S. Treasury Bonds, 7.875%, 2/5/21; U.S. Treasury Notes, 0.125% - 2.875%, 12/31/20 - 1/31/24; U.S. Treasury Strips, 8/15/20 - 11/15/22 (valued at $92,311)		United States	$	90,501		90,501
Total Investments from Cash Collateral Received for Loaned Securities (Cost $448,501)						448,501
Total Investments (Cost $103,128,531) 100.1%						126,219,714
Other Assets, less Liabilities (0.1)%						(147,955	)
Net Assets 100.0%					$	126,071,759

Semiannual Report         FGR-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Global Real Estate VIP Fund (continued)

See Abbreviations on page FGR-23.

^aNon-income producing.

^bA portion or all of the security is on loan at June 30, 2020. See Note 1(d).

^cSee Note 1(c) regarding joint repurchase agreement.

^dSee Note 1(d) regarding securities on loan.

^eSee Note 3(e) regarding investments in affiliated management investment companies.

^fThe rate shown is the annualized seven-day effective yield at period end.

FGR-12             Semiannual Report  |   The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Global Real Estate VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$101,733,784
Cost - Non-controlled affiliates (Note 3e)		358,000
Cost - Unaffiliated repurchase agreements		1,036,747
Value - Unaffiliated issuers+		$124,824,967
Value - Non-controlled affiliates (Note 3e)		358,000
Value - Unaffiliated repurchase agreements		1,036,747
Cash		431
Receivables:
Capital shares sold		5,740
Dividends		493,448
European Union tax reclaims		101,772
Other assets		325
Total assets		126,821,430
Liabilities:
Payables:
Capital shares redeemed		98,057
Management fees		93,336
Distribution fees		26,094
Trustees’ fees and expenses		75
Reports to shareholders		38,170
Payable upon return of securities loaned		448,501
Accrued expenses and other liabilities		45,438
Total liabilities		749,671
Net assets, at value		$126,071,759
Net assets consist of:
Paid-in capital		$106,901,482
Total distributable earnings (losses)		19,170,277
Net assets, at value		$126,071,759
Class 1:
Net assets, at value		$       856,056
Shares outstanding		67,040
Net asset value and maximum offering price per share		$12.77
Class 2:
Net assets, at value		$125,215,703
Shares outstanding		10,107,838
Net asset value and maximum offering price per share		$12.39
+Includes securities loaned		$      336,818

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FGR-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Global Real Estate VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers	$	1,744,187
Interest:
Unaffiliated issuers		3,159
Income from securities loaned:
Unaffiliated entities (net of fees and rebates)		2,205
Non-controlled affiliates (Note 3e)		53
Total investment income		1,749,604
Expenses:
Management fees (Note 3a)		708,351
Distribution fees: (Note 3c)
Class 2		167,844
Custodian fees (Note 4)		5,872
Reports to shareholders		19,153
Professional fees		40,605
Trustees’ fees and expenses		492
Other		5,637
Total expenses		947,954
Expenses waived/paid by affiliates (Note 3e)		(105,261	)
Net expenses		842,693
Net investment income		906,911
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		4,333,400
Realized gain distributions from REITs		283,127
Foreign currency transactions		(43,334	)
Net realized gain (loss)		4,573,193
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(33,315,236	)
Translation of other assets and liabilities denominated in foreign currencies		(2,008	)
Net change in unrealized appreciation (depreciation)		(33,317,244	)
Net realized and unrealized gain (loss)		(28,744,051	)
Net increase (decrease) in net assets resulting from operations	$	(27,837,140	)
*Foreign taxes withheld on dividends	$	70,994

FGR-14         Semiannual Report  |  The accompanying notes are an integral part of these  financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Franklin Global Real Estate VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income		$        906,911			$    2,258,113
Net realized gain (loss)		4,573,193			14,467,280
Net change in unrealized appreciation (depreciation)		(33,317,244	)		15,008,279
Net increase (decrease) in net assets resulting from operations		(27,837,140	)		31,733,672
Distributions to shareholders:
Class 1		(122,580	)		(48,761	)
Class 2		(18,130,602	)		(7,479,667	)
Total distributions to shareholders		(18,253,182	)		(7,528,428	)
Capital share transactions: (Note 2)
Class 1		108,102			29,075
Class 2		11,844,266			(11,311,091	)
Total capital share transactions		11,952,368			(11,282,016	)
Net increase (decrease) in net assets		(34,137,954	)		12,923,228
Net assets:
Beginning of period		160,209,713			147,286,485
End of period		$126,071,759			$160,209,713

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FGR-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin Global Real Estate VIP Fund

1. Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Global Real Estate VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. At December 31, 2019, 83.6% of the Fund’s shares were held through one insurance company. Investment activities of these insurance company separate accounts could have a material impact on the Fund. The Fund offers two classes of shares: Class 1 and Class 2. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a. Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter

securities (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Investments in open-end mutual funds are valued at the closing NAV. Investments in repurchase agreements are valued at cost, which approximates fair value.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time . At June 30, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in

FGR-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Global Real Estate VIP Fund (continued)

differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b. Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c. Joint Repurchase Agreement

The Fund enters into a joint repurchase agreement whereby its uninvested cash balance is deposited into a joint cash account with other funds managed by the investment manager or an affiliate of the investment manager and is used to invest in one or more repurchase agreements. The

value and face amount of the joint repurchase agreement are allocated to the funds based on their pro-rata interest. A repurchase agreement is accounted for as a loan by the Fund to the seller, collateralized by securities which are delivered to the Fund’s custodian. The fair value, including accrued interest, of the initial collateralization is required to be at least 102% of the dollar amount invested by the funds, with the value of the underlying securities marked to market daily to maintain coverage of at least 100%. Repurchase agreements are subject to the terms of Master Repurchase Agreements (MRAs) with approved counterparties (sellers). The MRAs contain various provisions, including but not limited to events of default and maintenance of collateral for repurchase agreements. In the event of default by either the seller or the Fund, certain MRAs may permit the non-defaulting party to net and close-out all transactions, if any, traded under such agreements. The Fund may sell securities it holds as collateral and apply the proceeds towards the repurchase price and any other amounts owed by the seller to the Fund in the event of default by the seller. This could involve costs or delays in addition to a loss on the securities if their value falls below the repurchase price owed by the seller. The joint repurchase agreement held by the Fund at period end, as indicated in the Statement of Investments, had been entered into on June 30, 2020.

d. Securities Lending

The Fund participates in an agency based securities lending program to earn additional income. The Fund receives cash collateral against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. The collateral is deposited into a joint cash account with other funds and is used to invest in a money market fund managed by Franklin Advisers, Inc., an affiliate of the Fund. The Fund may receive income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third-party vendor, is reported separately in the Statement of Operations. The Fund bears the market risk with respect to the collateral investment, securities loaned, and the risk that the agent may default on its obligations to the Fund. If the borrower defaults on its obligation to return the securities loaned, the Fund has the

Semiannual Report         FGR-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Global Real Estate VIP Fund (continued)

1. Organization and Significant Accounting Policies (continued)

d. Securities Lending (continued)

right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower.

e. Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

As a result of several court cases, in certain countries across the European Union, the Fund filed additional tax reclaims for previously withheld taxes on dividends earned in those countries (EU reclaims). These additional filings are subject to various administrative proceedings by the local jurisdictions’ tax authorities within the European Union, as well as a number of related judicial proceedings. Income recognized, if any, for EU reclaims is reflected as other income in the Statement of Operations and any related receivable, if any, is reflected as European Union tax reclaims in the Statement of Assets and Liabilities. When uncertainty exists as to the ultimate resolution of these proceedings, the likelihood of receipt of these EU reclaims, and the potential timing of payment, no amounts are reflected in the financial statements. For U.S. income tax purposes, when EU reclaims are received by the Fund and the Fund previously passed foreign tax credit on to its shareholders, the Fund must either amend historic tax reporting to shareholders or enter into a

closing agreement with the Internal Revenue Service (IRS) in order to pay the associated tax liability on behalf of the Fund’s shareholders.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

f. Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Dividend income and realized gain distributions are recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Global Real Estate VIP Fund (continued)

net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

Distributions received by the Fund from certain securities may be a return of capital (ROC). Such distributions reduce the cost basis of the securities, and any distributions in excess of the cost basis are recognized as capital gains. For U.S. Real Estate Investment Trust (REIT) securities, the Fund records ROC estimates, if any, on the ex-dividend date and are adjusted once actual tax designations are known.

g. Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and

liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

h. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		532		$	7,364			1,935		$	34,241
Shares issued in reinvestment of distributions		9,436			122,580			2,856			48,761
Shares redeemed		(1,667	)		(21,842	)		(3,061	)		(53,927	)
Net increase (decrease)		8,301		$	108,102			1,730		$	29,075
Class 2 Shares:
Shares sold		131,672		$	1,955,896			244,773		$	4,187,098
Shares issued in reinvestment of distributions		1,438,937			18,130,602			449,770			7,479,667
Shares redeemed		(556,110	)		(8,242,232	)		(1,360,628	)		(22,977,856	)
Net increase (decrease)		1,014,499		$	11,844,266			(666,085	)	$	(11,311,091	)

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Templeton Institutional, LLC (FT Institutional)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Global Real Estate VIP Fund (continued)

3. Transactions with Affiliates (continued)

a. Management Fees

The Fund pays an investment management fee to FT Institutional based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
1.050%	Up to and including $500 million
0.950%	Over $500 million, up to and including $1 billion
0.900%	Over $1 billion, up to and including $1.5 billion
0.850%	Over $1.5 billion, up to and including $6.5 billion
0.830%	Over $6.5 billion, up to and including $11.5 billion
0.810%	Over $11.5 billion, up to and including $16.5 billion
0.790%	Over $16.5 billion, up to and including $19 billion
0.780%	Over $19 billion, up to and including $21.5 billion
0.770%	In excess of $21.5 billion

b. Administrative Fees

Under an agreement with FT Institutional, FT Services provides administrative services to the Fund. The fee is paid by FT Institutional based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

c. Distribution Fees

The Board has adopted a distribution plan for Class 2 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plan, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Global Real Estate VIP Fund (continued)

e.  Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Income from securities loaned
Non-Controlled Affiliates
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		$    —		$2,858,000		$(2,500,000	)		$  —		$    —		$358,000		358,000		$53

f.  Waiver and Expense Reimbursements    

FT Institutional has contractually agreed in advance to waive or limit its fees and to assume as its own expense certain expenses otherwise payable by the Fund so that the operating expenses (excluding distribution fees and acquired fund fees and expenses and certain non-routine expenses or costs, including those relating to litigation, indemnification, reorganizations, and liquidations) for each class of the Fund do not exceed 1.00% based on the average net assets of each class until April 30, 2021. Total expenses waived or paid are not subject to recapture subsequent to the Fund’s fiscal year end.

4.  Expense Offset Arrangement

The Funds have entered into an arrangement with their custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Funds’ custodian expenses. During the period ended June 30, 2020, there were no credits earned.

5.  Income Taxes

At June 30, 2020, the cost of investments, net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$	112,628,547
Unrealized appreciation	$	32,286,290
Unrealized depreciation		(18,695,123)
Net unrealized appreciation (depreciation)	$	13,591,167

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatment of passive foreign investment company shares.

6.  Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $23,487,897 and $29,062,947, respectively.

Semiannual Report         FGR-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Global Real Estate VIP Fund (continued)

6.  Investment Transactions (continued)

At June 30, 2020, in connection with securities lending transactions, the Fund loaned equity investments and received $448,501 of cash collateral. The gross amount of recognized liability for such transactions is included in payable upon return of securities loaned in the Statement of Assets and Liabilities. The agreements can be terminated at any time.

7.  Concentration of Risk

The Fund invests a large percentage of its total assets in REIT securities. Such concentration may subject the Fund to special risks associated with real estate securities. These securities may be more sensitive to economic or regulatory developments due to a variety of factors such as local, regional, national and global economic conditions, interest rates and tax considerations.

8.  Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

9.  Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

10.  Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Global Real Estate VIP Fund (continued)

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets carried at fair value, is as follows:

	Level 1		Level 2		Level 3		Total
Assets:
Investments in Securities:a
Equity Investments:
Diversified Real Estate Activities	$	1,136,313	$	10,234,194	$	—	$	11,370,507
Diversified REITs		1,923,631		5,774,661		—		7,698,292
Industrial REITs		13,870,278		9,737,419		—		23,607,697
Integrated Telecommunication Services		—		764,015		—		764,015
Office REITs		9,085,419		6,429,165		—		15,514,584
Real Estate Development		—		2,013,739		—		2,013,739
Real Estate Operating Companies		—		11,879,215		—		11,879,215
Residential REITs		15,879,211		1,429,932		—		17,309,143
Retail REITs		10,713,369		2,803,562		—		13,516,931
All Other Equity Investments		21,150,844		—		—		21,150,844
Short Term Investments		358,000		1,036,747		—		1,394,747
Total Investments in Securities	$	74,117,065	$	52,102,649	$	—	$	126,219,714
aFor detailed categories, see the accompanying Statement of Investments.

11.  New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of LIBOR and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

12.  Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Selected Portfolio
REIT	Real Estate Investment Trust

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Franklin Growth and Income VIP Fund

This semiannual report for Franklin Growth and Income VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -11.88% total return* for the six-month period ended June 30, 2020.

*The Fund has an expense reduction contractually guaranteed through 4/30/21. Fund investment results reflect the expense reduction; without this reduction, the results would have been lower.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         FGI-1

FRANKLIN GROWTH AND INCOME VIP FUND

Fund Goal and Main Investments

The Fund seeks capital appreciation with current income as a secondary goal. Under normal market conditions, the Fund invests predominantly in equity securities, including common stock, preferred stock and securities convertible into common stocks, with the remainder in other equity-related instruments such as convertible securities and equity-linked notes (ELNs). The Fund may invest up to 25% of its net assets in foreign securities, including developing or emerging markets.

Portfolio Composition

Based on Total Net Assets as of 6/30/20

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as

the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Value securities may not increase in price as anticipated or may decline further if other investors fail to recognize the company’s value or favor investing in faster growing companies. Growth stock prices reflect projections of future earnings or revenues, and can, therefore, fall dramatically if the company fails to meet those projections. Because the Fund can only distribute what it earns, the Fund’s distributions to shareholders may decline when prevailing interest rates fall, when dividend income from investments in stocks decline, or when the Fund experiences defaults on debt securities it holds. To the extent the Fund focuses on particular countries, regions, industries, sectors or types of investment from time to time, it may be subject to greater risks of adverse developments in such areas of focus than a fund that invests in a wider variety of countries, regions, industries, sectors or investments. Special risks are associated with foreign investing, including currency exchange rates and policies, country or government specific issues, less favorable trading practices or regulation and greater price volatility; investments in emerging markets typically involve heightened risks related to the same factors. Common stocks with higher dividend yields can be sensitive to interest-rate movements. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Fund’s new primary benchmark, the Russell 1000^® Value Index, posted a -16.26% total return.¹ Also for comparison, the Fund’s former primary and new secondary benchmark, the Standard & Poor’s^® 500 Index (S&P 500^®) posted a -3.08% total return.¹ The Russell 1000^® Value Index is replacing the S&P 500 as the Fund’s primary benchmark. The investment manager

1. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

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FRANKLIN GROWTH AND INCOME VIP FUND

believed that the Russell 1000^® Value Index more accurately reflects the Fund’s investment strategy.

Economic and Market Overview

U.S. equities, as measured by the S&P 500, nearly reversed earlier losses but declined modestly during the six-month period. A sharp selloff began in late February 2020 amid investor fears of a global economic slowdown due to the novel coronavirus (COVID-19) pandemic.

Government-issued restrictions to mitigate the pandemic severely curtailed U.S. economic activity beginning in March 2020. As a result, the unemployment rate surged to 14.7% in April as many businesses, particularly in hospitality, retail and travel, announced mass layoffs.² Within just two months, the unemployment rate went from a 50-year low to an

80-year high.² The longest U.S. economic expansion in history ended in February, according to the National Bureau of Economic Research, and the country slipped into a deep recession.

In an effort to buffer the sharp drop in economic activity, the Fed implemented two emergency rate cuts in March 2020, lowering the federal funds target rate to a range of 0.00%–0.25%. Additionally, the Fed announced broad quantitative easing measures aimed at ensuring the flow of credit to borrowers and supporting credit markets with unlimited amounts of bond purchasing. Meanwhile, Congress passed the Coronavirus Aid, Relief and Economic Security Act to provide economic relief for individuals and businesses and additional funding for small businesses.

Benefiting from these fiscal and monetary measures, equities began to advance at the end of March 2020. As states gradually reopened, economic activity resumed, leading to declining initial jobless claims and record-high increases in job additions and existing home sales. Optimism about potential COVID-19 vaccines and treatments and rising retail sales further supported equities, which rebounded from multi-year lows to post the strongest second-quarter returns in more than 20 years. Nevertheless, surging infection rates in several states near the end of June led to concerns that economic recovery could be hindered if reopening measures are paused or rolled back.

Investment Strategy

We seek to invest in a broadly diversified portfolio of equity securities that we consider to be financially strong, with a focus on blue chip companies. We apply a bottom-up

Top 10 Holdings

6/30/20

Company Sector/Industry	% of Total Net Assets
JPMorgan Chase & Co.	3.8%
Financials
Microsoft Corp.	3.7%
Information Technology
Johnson & Johnson	3.0%
Health Care
Bank of America Corp.	3.0%
Financials
Morgan Stanley	2.9%
Financials
Procter & Gamble Co.	2.9%
Consumer Staples
NextEra Energy Inc.	2.6%
Utilities
Medtronic PLC	2.5%
Health Care
Chevron Corp.	2.4%
Energy
Verizon Communications Inc.	2.4%
Communication Services

approach to investing in individual securities. We will assess the market price of a company’s securities relative to our evaluation of the company’s long-term earnings, cash flow potential and balance sheet strength. We also consider a company’s price/earnings ratio, return on capital, profit margins and asset value. We consider dividend yield and the opportunity for dividend growth in selecting stocks for the Fund because we believe that, over time, dividend Income can contribute significantly to total return and can be a more consistent source of investment return than capital appreciation. We seek to take advantage of price dislocations that result from the market’s short-term focus and choose to invest in those companies that, in our opinion, offer the best trade-off between growth opportunity, business and financial risk, and valuation.

Manager’s Discussion

During the period under review, the financials, energy and industrials sectors detracted most from performance.

Financials sector holdings, led by banks JPMorgan Chase and Bank of America and bank holding company Truist Financial, struggled with lower earnings given declining

2. Source: Bureau of Labor Statistics.

Semiannual Report         FGI-3

FRANKLIN GROWTH AND INCOME VIP FUND

interest rates, fears of elevated credit losses, and the need to build reserves as recessionary conditions took hold due to the COVID-19 pandemic.

In the energy sector, integrated energy company and oil sands developer Suncor Energy and oil and natural gas producer Royal Dutch Shell were detractors. In the industrials sector, aerospace and defense company Raytheon merged with United Technologies on April 3, 2020, to form Raytheon Technologies. Despite the negative impact of recently declining aviation demand, the newly combined company expects to introduce breakthrough technologies at an accelerated pace across high-value areas of commercial aerospace and defense. In other sectors, Coca-Cola also detracted from performance.

In contrast, the information technology (IT) and consumer discretionary sectors contributed to performance.

Within IT, shares of software and services firm Microsoft rose during the period based on strong earnings reports for the last two quarters, with its Intelligent Cloud line of products performing particularly well. Nearly every major business became more relevant as a result of the COVID-19 pandemic and the broader digital transformation opportunity. Personal computing device manufacturer and service provider Apple also boosted performance. Apple reported strong first-quarter and better-than-expected second-quarter fiscal year 2020 results and anticipated some ongoing headwinds related to the COVID-19 pandemic. Apple’s supply chain has remained intact, as evidenced by new product launches and continued demand for the company’s products and services, particularly wearable technology.

In consumer discretionary, online marketplace and web services operator Amazon.com contributed to results as shares of the company rose during the COVID-19 pandemic. Consumers increasingly turned to the online retailer for basic goods as they spent growing amounts of time at home, boosting sales. The company also benefited from the increase in remote working, which has made more companies reliant on technology infrastructure provided by Amazon Web Services. Home improvement retailer Lowe’s and farm and ranch products retailer Tractor Supply were also key contributors to performance. In other sectors, investment management and consultancy services provider Ares Management and life sciences, diagnostic and environmental products company Danaher aided results.

Thank you for your participation in Franklin Growth and Income VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

FGI-4         Semiannual Report

FRANKLIN GROWTH AND INCOME VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual   (actual return after expenses)		Hypothetical   (5% annual return before expenses)
Share  Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$881.20	$2.76	$1,021.93	$2.97	0.59%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

Semiannual Report         FGI-5

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin Growth and Income VIP Fund

	Six Months Ended
	June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 1
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period		$17.20			$14.80			$16.32			$15.97			$15.94			$17.02
Income from investment operationsa:
Net investment incomeb		0.17			0.41			0.31			0.35			0.40			0.45
Net realized and unrealized gains (losses)		(2.21)			3.28			(0.97)			2.04			1.33			(0.54)
Total from investment operations		(2.04)			3.69			(0.66)			2.39			1.73			(0.09)
Less distributions from:
Net investment income		(0.63)			(0.41)			(0.43)			(1.03)			(0.46)			(0.61)
Net realized gains		(3.42)			(0.88)			(0.43)			(1.01)			(1.24)			(0.38)
Total distributions		(4.05)			(1.29)			(0.86)			(2.04)			(1.70)			(0.99)
Net asset value, end of period		$11.11			$17.20			$14.80			$16.32			$15.97			$15.94
Total returnc		(11.88)%			26.05%			(4.37)%			16.15%			11.86%			(0.62)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		0.80%			0.72%			0.73%			0.72%			0.59%			0.58%
Expenses net of waiver and payments by affiliates		0.59%	e		0.59%	e		0.59%	e		0.59%	e		0.59%	e,f		0.58%
Net investment income		2.36%			2.07%			1.96%			2.21%			2.38%			2.74%
Supplemental data
Net assets, end of period (000’s)		$2,713			$3,539			$31,479			$35,865			$29,829			$144,663
Portfolio turnover rate		20.63%			25.20%			24.29%			33.91%			40.59%	g		48.81%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^gExcludes the value of portfolio securities delivered as a result of a redemption in-kind.

FGI-6         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Growth and Income VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$16.84			$14.51			$16.02			$15.69			$15.68			$16.76
Income from investment operationsa:
Net investment incomeb		0.15			0.25			0.27			0.31			0.30			0.40
Net realized and unrealized gains (losses)		(2.17	)		3.33			(0.96	)		2.00			1.37			(0.54	)
Total from investment operations		(2.02	)		3.58			(0.69	)		2.31			1.67			(0.14	)
Less distributions from:
Net investment income		(0.58	)		(0.37	)		(0.39	)		(0.97	)		(0.42	)		(0.56	)
Net realized gains		(3.42	)		(0.88	)		(0.43	)		(1.01	)		(1.24	)		(0.38	)
Total distributions		(4.00	)		(1.25	)		(0.82	)		(1.98	)		(1.66	)		(0.94	)
Net asset value, end of period		$10.82			$16.84			$14.51			$16.02			$15.69			$15.68
Total returnc		(11.97)%			25.66%			(4.58)%			15.85%			11.62%			(0.91)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		1.05%			0.97%			0.98%			0.97%			0.84%			0.83%
Expenses net of waiver and payments by affiliates		0.84%	e		0.84%	e		0.84%	e		0.84%	e		0.84%	e,f		0.83%
Net investment income		2.11%			1.82%			1.71%			1.96%			2.13%			2.49%
Supplemental data
Net assets, end of period (000’s)		$57,887			$69,635			$61,855			$74,105			$69,474			$124,691
Portfolio turnover rate		20.63%			25.20%			24.29%			33.91%			40.59%	g		48.81%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^gExcludes the value of portfolio securities delivered as a result of a redemption in-kind.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FGI-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin Growth and Income VIP Fund

	Country		Shares		Value
Common Stocks 83.3%
Communication Services 5.0%
Comcast Corp., A		United States		26,830	$    1,045,833
Rogers Communications Inc., B		Canada		6,450	259,226
TELUS Corp.		Canada		16,900	283,461
Verizon Communications Inc.		United States		25,900	1,427,867
					3,016,387
Consumer Discretionary 4.8%
Lowe’s Cos. Inc.		United States		4,920	664,790
McDonald’s Corp.		United States		5,450	1,005,362
Target Corp.		United States		10,430	1,250,870
					2,921,022
Consumer Staples 11.5%
The Coca-Cola Co.		United States		31,000	1,385,080
Nestle SA		Switzerland		5,185	574,864
PepsiCo Inc.		United States		10,768	1,424,176
The Procter & Gamble Co.		United States		14,545	1,739,146
Unilever NV, N.Y. shs		United Kingdom		10,500	559,335
Walmart Inc.		United States		10,640	1,274,459
					6,957,060
Energy 4.8%
Canadian Natural Resources Ltd.		Canada		17,000	296,310
Chevron Corp.		United States		16,013	1,428,840
Exxon Mobil Corp.		United States		5,950	266,084
aRoyal Dutch Shell PLC, A, ADR		United Kingdom		20,413	667,301
Suncor Energy Inc.		Canada		16,000	269,760
					2,928,295
Financials 16.6%
Apollo Global Management Inc., A		United States		11,900	594,048
Ares Management Corp., A		United States		14,300	567,710
Arthur J. Gallagher & Co.		United States		5,116	498,759
Bank of America Corp.		United States		53,411	1,268,511
BlackRock Inc.		United States		1,280	696,435
Citigroup Inc.		United States		24,170	1,235,087
JPMorgan Chase & Co.		United States		24,195	2,275,782
Morgan Stanley		United States		36,100	1,743,630
Truist Financial Corp.		United States		30,600	1,149,030
					10,028,992
Health Care 11.5%
Baxter International Inc.		United States		5,100	439,110
HCA Healthcare Inc.		United States		3,535	343,107
Johnson & Johnson		United States		12,915	1,816,237
Medtronic PLC		United States		16,200	1,485,540
Merck & Co. Inc.		United States		11,040	853,723
Pfizer Inc.		United States		30,750	1,005,525
UnitedHealth Group Inc.		United States		3,500	1,032,325
					6,975,567

FGI-8         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Growth and Income VIP Fund (continued)

	Country		Shares		Value
Common Stocks (continued)
Industrials 9.2%
Emerson Electric Co.		United States		8,025	$        497,791
Fastenal Co.		United States		5,700	244,188
Illinois Tool Works Inc.		United States		1,211	211,743
Lockheed Martin Corp.		United States		2,164	789,687
Norfolk Southern Corp.		United States		6,700	1,176,319
Otis Worldwide Corp.		United States		2,140	121,680
Raytheon Technologies Corp.		United States		21,700	1,337,154
Republic Services Inc.		United States		12,625	1,035,881
Stanley Black & Decker Inc.		United States		1,360	189,557
					5,604,000
Information Technology 8.9%
Analog Devices Inc.		United States		4,350	533,484
Apple Inc.		United States		2,460	897,408
Broadcom Inc.		United States		1,050	331,391
Cisco Systems Inc.		United States		11,500	536,360
Intel Corp.		United States		6,950	415,819
Microsoft Corp.		United States		8,781	1,787,021
Oracle Corp.		United States		2,979	164,649
Texas Instruments Inc.		United States		5,600	711,032
					5,377,164
Materials 0.7%
BASF SE		Germany		7,860	441,451
Real Estate 2.4%
Equity Residential		United States		10,640	625,845
Prologis Inc.		United States		6,350	592,645
Public Storage		United States		1,290	247,538
					1,466,028
Utilities 7.9%
Duke Energy Corp.		United States		17,040	1,361,325
Entergy Corp.		United States		7,200	675,432
NextEra Energy Inc.		United States		6,500	1,561,105
Xcel Energy Inc.		United States		18,846	1,177,875
					4,775,737
Total Common Stocks (Cost $35,631,045)					50,491,703
bEquity-Linked Securities 9.7%
Consumer Discretionary 3.8%
cJPMorgan Chase Bank NA into The TJX Cos. Inc., 5.50%, 144A		United States		9,000	461,023
cRoyal Bank of Canada into Lowe’s Cos. Inc., 7.00%, 144A		United States		3,100	379,558
cRoyal Bank of Canada into Tractor Supply Co., 6.00%, 144A		United States		5,700	623,048
cWells Fargo Bank NA into Amazon.com Inc., 6.00%, 144A		United States		380	868,187
					2,331,816
Financials 0.9%
cCredit Suisse AG into Bank of America Corp., 7.00%, 144A		United States		22,000	542,571

Semiannual Report         FGI-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Growth and Income VIP Fund (continued)

	Country		Shares		Value
bEquity-Linked Securities (continued)
Health Care 1.2%
cCitigroup Global Markets Holdings Inc. into Becton, Dickinson and Co., 7.50%, 144A		United States		1,600	$        388,199
cGoldman Sachs International into HCA Holdings Inc., 6.00%, 144A		United States		3,500	352,571
					740,770
Industrials 1.2%
cCitigroup Global Markets Holdings Inc. into Fastenal Co., 7.00%, 144A		United States		8,000	315,076
cGoldman Sachs International into Stanley Black & Decker Inc., 7.00%, 144A		United States		3,000	420,745
					735,821
Information Technology 1.8%
cBarclays Bank PLC into Microsoft Corp., 6.50%, 144A		United States		3,000	472,781
cBarclays Bank PLC into Oracle Corp., 6.50%, 144A		United States		11,500	623,365
					1,096,146
Materials 0.8%
cCitigroup Global Markets Inc. into Sherwin Williams Co., 6.50%, 144A		United States		800	455,961
Total Equity-Linked Securities (Cost $5,905,457)					5,903,085
Convertible Preferred Stocks 6.8%
Health Care 3.2%
Becton Dickinson and Co., 6.00%, cvt. pfd.		United States		12,800	680,960
Boston Scientific Corp, 5.50%, cvt. pfd.		United States		2,900	303,601
Danaher Corp, 5.00%, cvt. pfd.		United States		121	129,909
Danaher Corp., 4.75%, cvt. pfd., A		United States		650	810,466
					1,924,936
Industrials 1.4%
Fortive Corp., 5.00%, cvt. pfd., A		United States		970	835,373
Information Technology 1.1%
Broadcom Inc., 8.00%, cvt. pfd., A		United States		600	668,610
Utilities 1.1%
Essential Utilities Inc., 6.00%, cvt. pfd.		United States		12,000	678,480
Total Convertible Preferred Stocks (Cost $3,976,477)					4,107,399
Total Investments before Short Term Investments (Cost $45,512,979)					60,502,187
			Principal Amount
Short Term Investments 1.7%
Repurchase Agreements (Cost $546,505) 0.9%
dJoint Repurchase Agreement, 0.065%, 7/01/20 (Maturity Value $546,506)
BNP Paribas Securities Corp. (Maturity Value $379,160)
Deutsche Bank Securities Inc. (Maturity Value $104,153)
HSBC Securities (USA) Inc. (Maturity Value $63,193)
Collateralized by U.S. Government Agency Securities, 4.00%, 3/20/44; U.S. Government Agency Strips, 8/15/39; and U.S. Treasury Notes, 1.75% - 2.25%, 4/15/22 - 7/31/24 (valued at $558,049)		United States	$	546,505	546,505

FGI-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Growth and Income VIP Fund (continued)

	Country		Shares			Value
Short Term Investments (continued)
eInvestments from Cash Collateral Received for Loaned Securities 0.8%
Money Market Funds (Cost $358,000) 0.6%
f,gInstitutional Fiduciary Trust Money Market Portfolio, 0.00%		United States			358,000		$	358,000
			Principal Amount
Repurchase Agreements (Cost $90,680) 0.2%
dJoint Repurchase Agreement, 0.07%, 7/01/20 ($90,680)
BNP Paribas Securities Corp.
Collateralized by U.S. Treasury Bonds, 7.875%, 2/5/21; U.S. Treasury Notes, 0.125% - 2.875%, 12/31/20 - 1/31/24; U.S. Treasury Strips, 8/15/20 - 11/15/22 (valued at $92,494)		United States		$	90,680			90,680
Total Investments from Cash Collateral Received for Loaned Securities (Cost $448,680)								448,680
Total Investments (Cost $46,508,164) 101.5%								61,497,372
Other Assets, less Liabilities (1.5)%								(896,855	)
Net Assets 100.0%							$	60,600,517

See Abbreviations on page FGI-22.

^aA portion or all of the security is on loan at June 30, 2020. See Note 1(e).

^bSee Note 1(d) regarding equity-linked securities.

^cSecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in a public offering registered under the Securities Act of 1933. At June 30, 2020, the aggregate value of these securities was $5,903,085, representing 9.7% of net assets.

^dSee Note 1(c) regarding joint repurchase agreement.

^eSee Note 1(e) regarding securities on loan.

^fSee Note 3(e) regarding investments in affiliated management investment companies.

^gThe rate shown is the annualized seven-day effective yield at period end.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report          FGI-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Growth and Income VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$45,512,979
Cost - Non-controlled affiliates (Note 3e)		358,000
Cost - Unaffiliated repurchase agreements		637,185
Value - Unaffiliated issuers+		$60,502,187
Value - Non-controlled affiliates (Note 3e)		358,000
Value - Unaffiliated repurchase agreements		637,185
Receivables:
Capital shares sold		27,661
Dividends and interest		98,768
Other assets		58
Total assets		61,623,859
Liabilities:
Payables:
Investment securities purchased.		486,005
Capital shares redeemed		4,183
Management fees		20,275
Distribution fees		12,043
Trustees’ fees and expenses		114
Payable upon return of securities loaned		448,680
Accrued expenses and other liabilities		52,042
Total liabilities		1,023,342
Net assets, at value		$60,600,517
Net assets consist of:
Paid-in capital		$43,051,170
Total distributable earnings (losses)		17,549,347
Net assets, at value		$60,600,517
Class 1:
Net assets, at value		$ 2,713,252
Shares outstanding		244,263
Net asset value and maximum offering price per share		$11.11
Class 2:
Net assets, at value		$57,887,265
Shares outstanding		5,351,601
Net asset value and maximum offering price per share		$10.82
+Includes securities loaned		$    428,239

FGI-12         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Growth and Income VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers		$        927,069
Interest:
Unaffiliated issuers		1,319
Income from securities loaned:
Unaffiliated entities (net of fees and rebates)		1,006
Non-controlled affiliates (Note 3e)		182
Total investment income		929,576
Expenses:
Management fees (Note 3a)		197,181
Distribution fees: (Note 3c)
Class 2		75,548
Custodian fees (Note 4)		512
Reports to shareholders		20,792
Professional fees		27,711
Trustees’ fees and expenses		303
Other		6,668
Total expenses		328,715
Expense reductions (Note 4)		(888	)
Expenses waived/paid by affiliates (Note 3e and 3f)		(66,649	)
Net expenses		261,178
Net investment income		668,398
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		1,921,720
Foreign currency transactions		417
Net realized gain (loss)		1,922,137
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(11,046,200	)
Translation of other assets and liabilities denominated in foreign currencies		35
Net change in unrealized appreciation (depreciation)		(11,046,165	)
Net realized and unrealized gain (loss)		(9,124,028	)
Net increase (decrease) in net assets resulting from operations		$    (8,455,630	)
*Foreign taxes withheld on dividends		$          17,893

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FGI-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Franklin Growth and Income VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income	$	668,398		$	1,871,636
Net realized gain (loss)		1,922,137			14,692,471
Net change in unrealized appreciation (depreciation)		(11,046,165	)		5,405,338
Net increase (decrease) in net assets resulting from operations		(8,455,630	)		21,969,445
Distributions to shareholders:
Class 1		(726,968	)		(2,665,418	)
Class 2		(15,849,541	)		(5,148,061	)
Total distributions to shareholders		(16,576,509	)		(7,813,479	)
Capital share transactions: (Note 2)
Class 1		281,057			(32,096,096	)
Class 2		12,177,649			(2,220,352	)
Total capital share transactions		12,458,706			(34,316,448	)
Net increase (decrease) in net assets		(12,573,433	)		(20,160,482	)
Net assets:
Beginning of period		73,173,950			93,334,432
End of period	$	60,600,517		$	73,173,950

FGI-14         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin Growth and Income VIP Fund

1. Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Growth and Income VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. The Fund offers two classes of shares: Class 1 and Class 2. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a. Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued

according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Investments in open-end mutual funds are valued at the closing NAV. Investments in repurchase agreements are valued at cost, which approximates fair value.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time. At June 30, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day

Semiannual Report         FGI-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Growth and Income VIP Fund (continued)

1. Organization and Significant Accounting Policies (continued)

a. Financial Instrument Valuation (continued)

of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b. Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c. Joint Repurchase Agreement

The Fund enters into a joint repurchase agreement whereby its uninvested cash balance is deposited into a joint cash account with other funds managed by the investment

manager or an affiliate of the investment manager and is used to invest in one or more repurchase agreements. The value and face amount of the joint repurchase agreement are allocated to the funds based on their pro-rata interest. A repurchase agreement is accounted for as a loan by the Fund to the seller, collateralized by securities which are delivered to the Fund’s custodian. The fair value, including accrued interest, of the initial collateralization is required to be at least 102% of the dollar amount invested by the funds, with the value of the underlying securities marked to market daily to maintain coverage of at least 100%. Repurchase agreements are subject to the terms of Master Repurchase Agreements (MRAs) with approved counterparties (sellers). The MRAs contain various provisions, including but not limited to events of default and maintenance of collateral for repurchase agreements. In the event of default by either the seller or the Fund, certain MRAs may permit the non-defaulting party to net and close-out all transactions, if any, traded under such agreements. The Fund may sell securities it holds as collateral and apply the proceeds towards the repurchase price and any other amounts owed by the seller to the Fund in the event of default by the seller. This could involve costs or delays in addition to a loss on the securities if their value falls below the repurchase price owed by the seller. The joint repurchase agreement held by the Fund at period end, as indicated in the Statement of Investments, had been entered into on June 30, 2020.

d. Equity-Linked Securities

The Fund invests in equity-linked securities. Equity-linked securities are hybrid financial instruments that generally combine both debt and equity characteristics into a single note form. Income received from equity-linked securities is recorded as realized gains in the Statement of Operations and may be based on the performance of an underlying equity security, an equity index, or an option position. The risks of investing in equity-linked securities include unfavorable price movements in the underlying security and the credit risk of the issuing financial institution. There may be no guarantee of a return of principal with equity-linked securities and the appreciation potential may be limited. Equity-linked securities may be more volatile and less liquid than other investments held by the Fund.

FGI-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Growth and Income VIP Fund (continued)

e. Securities Lending

The Fund participates in an agency based securities lending program to earn additional income. The Fund receives cash collateral against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. The collateral is deposited into a joint cash account with other funds and is used to invest in a money market fund managed by Franklin Advisers, Inc., an affiliate of the Fund, and/or a joint repurchase agreement. The Fund may receive income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third-party vendor, is reported separately in the Statement of Operations. The Fund bears the market risk with respect to the collateral investment, securities loaned, and the risk that the agent may default on its obligations to the Fund. If the borrower defaults on its obligation to return the securities loaned, the Fund has the right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower.

f. Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

g. Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Dividend income and capital gain distributions are recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

Semiannual Report         FGI-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Growth and Income VIP Fund (continued)

1. Organization and Significant Accounting Policies (continued)

h. Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

i. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust.

Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020				Year Ended December 31, 2019
	Shares		Amount		Shares		Amount
Class 1 Shares:
Shares sold		6,349		$      89,453		75,104		$     1,198,235
Shares issued in reinvestment of distributions.		65,434		726,968		172,296		2,665,418
Shares redeemed		(33,299)		(535,364)		(2,169,192)		(35,959,749)
Net increase (decrease)		38,484		$    281,057		(1,921,792)		$(32,096,096)
Class 2 Shares:
Shares sold		192,033		$ 2,643,363		202,473		$     3,223,711
Shares issued in reinvestment of distributions.		1,464,837		15,849,541		339,358		5,148,061
Shares redeemed		(440,791)		(6,315,255)		(669,637)		(10,592,124)
Net increase (decrease)		1,216,079		$12,177,649		(127,806)		$ (2,220,352)

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Advisers, Inc. (Advisers)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

FGI-18         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Growth and Income VIP Fund (continued)

a. Management Fees

The Fund pay an investment management fee to Advisers based on the average daily net assets of each of the Fund as follows:

Annualized Fee Rate	Net Assets
0.625%	Up to and including $100 million
0.500%	Over $100 million, up to and including $250 million
0.450%	Over $250 million, up to and including $7.5 billion
0.440%	Over $7.5 billion, up to and including $10 billion
0.430%	Over $10 billion, up to and including $12.5 billion
0.420%	Over $12.5 billion, up to and including $15 billion
0.400%	In excess of $15 billion

b. Administrative Fees

Under an agreement with Advisers, FT Services provides administrative services to the Fund. The fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

c. Distribution Fees

The Board has adopted a distribution plan for Class 2 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plan, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rate, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

e. Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales		Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Income from securities loaned
Non-Controlled Affiliates
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		$    —		$2,444,000		$(2,086,000)		$    —		$    —		$358,000		358,000		$182

Semiannual Report         FGI-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Growth and Income VIP Fund (continued)

3. Transactions with Affiliates (continued)

f. Waiver and Expense Reimbursements

Advisers has contractually agreed in advance to waive or limit its fees and to assume as its own expense certain expenses otherwise payable by the Fund so that the operating expenses (excluding distribution fees, acquired fund fees and expenses, and certain non-routine expenses or costs, including those relating to litigation, indemnification, reorganizations, and liquidations) for each class of the Fund do not exceed 0.59% based on the average net assets of each class until April 30, 2021. Total expenses waived or paid are not subject to recapture subsequent to the Fund’s fiscal year end.

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

5. Income Taxes

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$46,499,692
Unrealized appreciation	$17,020,233
Unrealized depreciation	(2,022,553)
Net unrealized appreciation (depreciation)	$14,997,680

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of treatments of equity-linked securities and bond discounts and premiums.

6. Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $13,072,584 and $15,010,456, respectively.

At June 30, 2020, in connection with securities lending transactions, the Fund loaned equity investments and received $448,680 of cash collateral. The gross amount of recognized liability for such transactions is included in payable upon return of securities loaned in the Statement of Assets and Liabilities. The agreements can be terminated at any time.

7. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

FGI-20         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Growth and Income VIP Fund (continued)

8. Credit Facility

The Funds, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

9. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets carried at fair value, is as follows:

	Level 1		Level 2		Level 3		Total
Assets:
Investments in Securities:a
Equity Investments:b
Food, Beverage & Tobacco	$	2,809,256	$	574,864	$	—	$	3,384,120
Materials		—		441,451		—		441,451
All Other Equity Investments		50,773,531		—		—		50,773,531
Equity-Linked Securities		—		5,903,085		—		5,903,085
Short Term Investments		358,000		637,185		—		995,185
Total Investments in Securities	$	53,940,787	$	7,556,585	$	—	$	61,497,372

^aFor detailed categories, see the accompanying Statement of Investments.

^bIncludes common and convertible preferred stocks.

Semiannual Report         FGI-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Growth and Income VIP Fund (continued)

10. New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

11. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Counterparty
ADR	American Depositary Receipt

FGI-22         Semiannual Report

Franklin Income VIP Fund

This semiannual report for Franklin Income VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -11.22% total return* for the six-month period ended June 30, 2020.

*The Fund has a fee waiver associated with any investment it makes in a Franklin Templeton money fund and/or other Franklin Templeton fund, contractually guaranteed through 4/30/21. Fund investment results reflect the fee waiver; without this waiver, the results would have been lower.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         FI-1

FRANKLIN INCOME VIP FUND

Fund Goal and Main Investments

The Fund seeks to maximize income, while maintaining prospects for capital appreciation. Under normal market conditions, the Fund invests in a diversified portfolio of debt and equity securities.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. The Fund’s portfolio includes a substantial portion of higher yielding, lower rated corporate bonds because of the relatively higher yields they offer. The Fund’s share price and yield will be affected by interest rate movements. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in the Fund adjust to a rise in interest rates, the Fund’s share price may decline. Changes in the financial strength of a bond issuer or in a bond’s credit rating may affect its value. Foreign investing carries additional risks such as currency and market volatility and political or social instability, risks that are heightened in developing countries. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Fund’s primary benchmark, the Standard & Poor’s^® 500 Index (S&P 500^®) posted a -3.08% total return.¹ The Fund’s secondary benchmark, the Blended Benchmark, posted a -5.20% total return.²

Portfolio Composition

6/30/20

	% of Total Net Assets
Equity	52.1%
Information Technology	10.4%
Health Care	7.9%
Financials	7.9%
Utilities	6.7%
Consumer Staples	3.8%
Industrials	3.7%
Energy	3.6%
Communication Services	3.4%
Materials	2.2%
Consumer Discretionary	2.2%
Real Estate	0.3%
Fixed Income*	42.1%
Health Care	13.6%
Financials	12.4%
Communication Services	5.5%
Energy	2.7%
Consumer Discretionary	2.7%
Industrials	1.3%
Consumer Staples	1.3%
Materials	1.3%
Real Estate	0.7%
Utilities	0.3%
Information Technology	0.3%
Short-Term Investments & Other Net Assets	5.8%

*Includes senior floating rate interests.    

Economic and Market Overview

The U.S. bond market, as measured by the Bloomberg Barclays U.S. Aggregate Bond Index, advanced during the six-month period despite significant economic disruption in the wake of the novel coronavirus (COVID-19) pandemic. In late February 2020, as more countries adopted social distancing and lockdown measures to slow the global pandemic, the U.S. bond market began pricing in the adverse impact on economic activity. Higher-quality, longer-term

1. Source: Morningstar.

2. Source: FactSet. The Fund’s Blended Benchmark was calculated internally and rebalanced monthly and was composed of 50% MSCI USA High Dividend Yield Index + 25% Bloomberg Barclays U.S. High Yield Very Liquid Index + 25% Bloomberg Barclays U.S. Aggregate Bond Index.

One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

FI-2         Semiannual Report

FRANKLIN INCOME VIP FUND

bonds rallied, while riskier, lower-rated corporate bonds declined sharply, reflecting a reversal in many investors’ risk appetite. During the last quarter of the reporting period, however, as generally slowing infection rates and phased business reopenings by states drove hopes for an economic rebound, corporate bond valuations advanced significantly. Nevertheless, an increase in infection rates toward period-end prompted concern among investors, hindering lower-rated bonds.

The U.S. Federal Reserve (Fed) enacted two emergency rate cuts in response to the COVID-19 pandemic in March 2020, lowering the federal funds target rate to a range of 0.00%–0.25%. In addition, the Fed announced unlimited, open-ended purchasing of government-backed and corporate bonds to help keep markets functioning, significantly expanding its balance sheet.

U.S. Treasury bonds, as measured by the Bloomberg Barclays U.S. Treasury Index, rose significantly during the reporting period. Bond purchasing by the Fed and robust demand for investments perceived as safe drove the U.S. Treasury market higher despite the widening U.S. federal budget deficit and the massive increase in issuance. Mortgage-backed securities (MBS), as measured by the Bloomberg Barclays MBS Index, also posted positive returns, aided by declining Treasury rates and the Fed’s decision to purchase agency MBS.

U.S. corporate bond performance varied significantly based on credit rating, as investors became concerned about the pandemic-related economic disruption and the potential credit downgrades of many companies. Investment-grade corporate bonds, as represented by the Bloomberg Barclays U.S. Corporate Bond Index, rebounded significantly after mid-March 2020 to post positive overall returns for the reporting period. In contrast, high-yield corporate bonds, as represented by the Bloomberg Barclays U.S. Corporate High Yield Bond Index, declined due to investor concerns about a potential increase in credit defaults.

Investment Strategy

In analyzing debt and equity securities, we consider such factors as a company’s experience and managerial strength; responsiveness to changes in interest rates and business conditions; debt maturity schedules and borrowing requirements; changing financial condition and market recognition of the change; and a security’s relative value based on such factors as anticipated cash flow, interest or dividend coverage, asset coverage and earnings. When choosing investments for the Fund, we apply a bottom-up, value oriented, long-term approach, focusing on the market

Top Five Equity Holdings

6/30/20

Company Sector/Industry	% of Total Net Assets
JPMorgan Chase & Co. Financials	2.8%
The Southern Co. Electric Utilities	1.8%
Dominion Energy Inc. Utilities	1.8%
Verizon Communications Inc. Financials	1.6%
Procter & Gamble Co. Communication Services	1.5%

price of a company’s securities relative to the investment manager’s evaluation of the company’s long-term earnings, asset value and cash flow potential.

Manager’s Discussion

The Fund underperformed its benchmark during the six-month period due to weak performance across both equity and fixed income holdings. Asset allocation for equities was relatively stable, ending at 52.1% relative to 51.4% at the beginning of the period. The Fund’s fixed income positioning decreased as we modestly reduced our allocation to high-yield and investment-grade corporate bonds, ending at 42.1% of assets relative to 46.4% at the beginning of the period. Cash made up 5.8% of Fund assets at period-end.

On the equity side, overweightings and stock selection in the energy and financials sectors hurt relative performance. Notable detractors in energy included Weatherford International and Royal Dutch Shell, which were negatively impacted by weak commodity prices. In financials, Wells Fargo and JPMorgan Chase hurt results as lower interest rates impacted profitability and broader credit concerns increased as the economy moved into recession.

Turning to relative contributors in equity, an overweighting and stock selection in information technology helped results. Contributors in the sector included semiconductor companies Intel and Texas Instruments. S&P 500 put options also contributed and have been a regular part of our strategy over the last two years as we look to protect the Fund during significant drawdowns, as occurred in the period. Additionally, underweightings in the industrials and consumer staples sectors benefited performance relative to the benchmark.

Semiannual Report         FI-3

FRANKLIN INCOME VIP FUND

Top Five Fixed Income Holdings

and Senior Floating Rate Interests

6/30/20

Company Sector/Industry	% of Total Net Assets
CHS/Community Health Systems Inc. Health Care	5.4%
U.S. Treasury Note Financials	4.6%
GNMA II SF 30 Year Financials	3.4%
Tenet Healthcare Corp. Health Care	3.0%
Bausch Health Cos. Inc. Health Care	1.7%

Fixed income holdings benefited from the sharp decline in interest rates during the period, but were hurt when credit spread widened materially in response to the global pandemic. This was most acute in the sub-investment grade segment of the market.

Selection and an overweighting in energy sector corporate bond holdings hurt relative performance. Chesapeake Energy and HighPoint Resources were notable detractors, impacted by global commodity oversupply and weak demand as a result of the pandemic. Elsewhere, bonds of Community Health Systems hurt performance due to the pressure COVID-19 placed on hospitals, which delayed profitable elective procedures while operators focused resources toward the public health crisis.

While treasury and securitized holdings benefited performance during periods of elevated market volatility, the generally shorter duration of our positioning lagged the broader market move amid a sharp decline in longer-term interest rates.

In contrast, communication services bonds contributed to relative results, especially T-Mobile/Sprint bonds which benefitted from the consummation of their corporate combination. Strong individual contributors included intermediate and longer duration investment-grade holdings in CVS Health, Bristol Meyers Squibb, British American Tobacco, Citigroup and HSBC Holdings, which benefited from the decline in interest rates. Additionally, our underweighting in the industrials sector benefited relative results given the sector’s negative performance.

Thank you for your participation in Franklin Income VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

FI-4         Semiannual Report

FRANKLIN INCOME VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual (actual return after expenses)		Hypothetical (5% annual return before expenses)
Share    Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201,2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201,2	Net Annualized Expense Ratio2
Class 1	$1,000	$887.80	$2.16	$1,022.58	$2.31	0.46%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

Semiannual Report         FI-5

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin Income VIP Fund

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$16.52			$15.26			$16.72			$15.87			$14.64			$16.48
Income from investment operationsa:
Net investment incomeb		0.30			0.75			0.71			0.69			0.67			0.71
Net realized and unrealized gains (losses)		(2.15	)		1.68			(1.35	)		0.87			1.34			(1.78	)
Total from investment operations		(1.85	)		2.43			(0.64	)		1.56			2.01			(1.07	)
Less distributions from:
Net investment income		(0.90	)		(0.91	)		(0.82	)		(0.71	)		(0.78	)		(0.77	)
Net realized gains		(0.01	)		(0.26	)		—			—			—			—
Total distributions		(0.91	)		(1.17	)		(0.82	)		(0.71	)		(0.78	)		(0.77	)
Net asset value, end of period		$13.76			$16.52			$15.26			$16.72			$15.87			$14.64
Total returnc		(11.22)%			16.42%			(4.09)%			9.94%			14.33%			(6.84)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		0.47%			0.46%			0.47%			0.47%			0.47%			0.46%
Expenses net of waiver and payments by affiliatese		0.46%			0.45%			0.45%			0.45%			0.44%			0.46%	f
Net investment income		4.08%			4.38%			4.33%			4.22%			4.47%			4.47%
Supplemental data
Net assets, end of period (000’s)		$269,045			$309,330			$612,657			$735,149			$696,227			$604,228
Portfolio turnover rate		20.53%			25.16%			43.22%			20.96%			39.03%			31.53%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

FI-6         Semiannual Report   |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Income VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$15.91			$14.74			$16.17			$15.38			$14.20			$16.00
Income from investment operationsa:
Net investment incomeb		0.28			0.64			0.65			0.63			0.61			0.65
Net realized and unrealized gains (losses)		(2.08	)		1.66			(1.30	)		0.83			1.31			(1.73	)
Total from investment operations		(1.80	)		2.30			(0.65	)		1.46			1.92			(1.08	)
Less distributions from:
Net investment income		(0.86	)		(0.87	)		(0.78	)		(0.67	)		(0.74	)		(0.72	)
Net realized gains		(0.01	)		(0.26	)		—			—			—			—
Total distributions		(0.87	)		(1.13	)		(0.78	)		(0.67	)		(0.74	)		(0.72	)
Net asset value, end of period		$13.24			$15.91			$14.74			$16.17			$15.38			$14.20
Total returnc		(11.36)%			16.06%			(4.30)%			9.67%			14.02%			(7.05)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		0.72%			0.71%			0.72%			0.72%			0.72%			0.71%
Expenses net of waiver and payments by affiliatese		0.71%			0.70%			0.70%			0.70%			0.69%			0.71%	f
Net investment income		3.83%			4.13%			4.08%			3.97%			4.22%			4.22%
Supplemental data
Net assets, end of period (000’s)		$3,527,837			$4,318,156			$4,086,652			$5,041,498			$5,088,556			$4,907,599
Portfolio turnover rate		20.53%			25.16%			43.22%			20.96%			39.03%			31.53%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FI-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Income VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$16.32			$15.08			$16.53			$15.71			$14.49			$16.31
Income from investment operationsa:
Net investment incomeb		0.27			0.64			0.64			0.62			0.61			0.65
Net realized and unrealized gains (losses)		(2.12	)		1.71			(1.33	)		0.85			1.33			(1.76	)
Total from investment operations		(1.85	)		2.35			(0.69	)		1.47			1.94			(1.11	)
Less distributions from:
Net investment income		(0.85	)		(0.85	)		(0.76	)		(0.65	)		(0.72	)		(0.71	)
Net realized gains		(0.01	)		(0.26	)		—			—			—			—
Total distributions		(0.86	)		(1.11	)		(0.76	)		(0.65	)		(0.72	)		(0.71	)
Net asset value, end of period		$13.61			$16.32			$15.08			$16.53			$15.71			$14.49
Total returnc		(11.40)%			16.05%			(4.42)%			9.55%			13.87%			(7.15)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		0.82%			0.81%			0.82%			0.82%			0.82%			0.81%
Expenses net of waiver and payments by affiliatese		0.81%			0.80%			0.80%			0.80%			0.79%			0.81%	f
Net investment income		3.73%			4.03%			3.98%			3.87%			4.12%			4.12%
Supplemental data
Net assets, end of period (000’s)		$278,008			$323,582			$294,700			$335,217			$309,935			$306,023
Portfolio turnover rate		20.53%			25.16%			43.22%			20.96%			39.03%			31.53%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

FI-8         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin Income VIP Fund

	Country		Shares		Value
Common Stocks 36.6%
Communication Services 2.9%
aAlphabet Inc., A		United States		10,000	$	14,180,500
BCE Inc.		Canada		466,000		19,435,689
Comcast Corp., A		United States		500,000		19,490,000
Verizon Communications Inc.		United States		1,200,000		66,156,000
						119,262,189
Consumer Discretionary 0.6%
General Motors Co.		United States		1,000,000		25,300,000
Consumer Staples 3.8%
The Coca-Cola Co.		United States		675,000		30,159,000
PepsiCo Inc.		United States		300,000		39,678,000
Philip Morris International Inc.		United States		350,000		24,521,000
The Procter & Gamble Co.		United States		500,000		59,785,000
						154,143,000
Energy 3.4%
BP PLC, ADR		United Kingdom		850,000		19,822,000
Chevron Corp.		United States		500,000		44,615,000
Exxon Mobil Corp.		United States		1,000,000		44,720,000
Royal Dutch Shell PLC, A, ADR		United Kingdom		900,000		29,421,000
aWeatherford International PLC		United States		931,735		1,835,518
						140,413,518
Financials 5.3%
Bank of America Corp.		United States		365,000		8,668,750
Barclays PLC		United Kingdom		12,500,000		17,634,270
Citigroup Inc.		United States		200,000		10,220,000
JPMorgan Chase & Co.		United States		600,000		56,436,000
MetLife Inc.		United States		535,108		19,542,144
Morgan Stanley		United States		435,000		21,010,500
Truist Financial Corp.		United States		500,000		18,775,000
U.S. Bancorp		United States		550,000		20,251,000
Wells Fargo & Co.		United States		1,665,000		42,624,000
						215,161,664
Health Care 7.3%
AbbVie Inc.		United States		250,000		24,545,000
AstraZeneca PLC		United Kingdom		455,000		47,351,924
Bayer AG		Germany		311,750		23,105,946
Bristol-Myers Squibb Co.		United States		1,000,000		58,800,000
CVS Health Corp.		United States		520,000		33,784,400
Johnson & Johnson		United States		300,000		42,189,000
Merck & Co. Inc.		United States		400,000		30,932,000
Pfizer Inc.		United States		1,100,000		35,970,000
						296,678,270
Industrials 2.6%
Cummins Inc.		United States		100,000		17,326,000
Honeywell International Inc.		United States		275,000		39,762,250
Union Pacific Corp.		United States		150,000		25,360,500

Semiannual Report         FI-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

	Country		Shares		Value
Common Stocks (continued)
Industrials (continued)
United Parcel Service Inc., B		United States		217,700	$	24,203,886
						106,652,636
Information Technology 2.7%
Analog Devices Inc.		United States		260,045		31,891,919
Intel Corp.		United States		414,307		24,787,988
Oracle Corp.		United States		38,400		2,122,368
Texas Instruments Inc.		United States		400,000		50,788,000
						109,590,275
Materials 2.2%
Air Products and Chemicals Inc.		United States		46,700		11,276,182
BASF SE		Germany		600,000		33,698,578
Rio Tinto PLC, ADR		Australia		800,000		44,944,000
						89,918,760
Real Estate 0.3%
Host Hotels & Resorts Inc.		United States		1,000,000		10,790,000
Utilities 5.5%
Dominion Energy Inc.		United States		906,638		73,600,873
DTE Energy Co.		United States		100,000		10,750,000
Duke Energy Corp.		United States		577,500		46,136,475
Sempra Energy		United States		275,000		32,238,250
The Southern Co.		United States		1,200,000		62,220,000
						224,945,598
Total Common Stocks (Cost $1,324,967,991)						1,492,855,910
bEquity-Linked Securities 11.5%
Communication Services 0.4%
cBarclays Bank PLC into Comcast Corp., 9.00%, 144A		United States		408,000		16,182,873
Consumer Discretionary 1.6%
cJPMorgan Chase Bank NA into Target Corp., 9.00%, 144A		United States		250,000		28,653,767
cRoyal Bank of Canada into The Home Depot Inc., 8.50%, 144A		United States		151,500		34,828,237
						63,482,004
Energy 0.2%
cSociete Generale SA into Schlumberger Ltd., 9.00%, 144A		United States		429,000		8,893,806
Financials 1.6%
cBarclays Bank PLC into Bank of America Corp., 8.50%, 144A		United States		600,000		14,837,176
cMerrill Lynch International & Co. CV into Wells Fargo & Co., 8.00%, 144A		United States		775,000		21,165,026
cUBS AG London into MetLife Inc., 7.50%, 144A		United States		800,000		30,256,089
						66,258,291
Health Care 0.6%
cUBS AG London into CVS Health Corp., 8.50%, 144A		United States		400,000		25,627,569
Industrials 0.8%
cSociete Generale SA into Raytheon Technologies Corp., 8.00%, 144A		United States		548,000		33,642,740

FI-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

	Country		Shares		Value
bEquity-Linked Securities (continued)
Information Technology 6.3%
cCredit Suisse AG/London into International Business Machines Corp., 7.50%, 144A		United States		160,000	$	19,849,631
cCredit Suisse AG/London into Cisco Systems Inc., 10.00%, 144A		United States		508,000		23,604,731
cJPMorgan Chase Bank NA into Apple Inc., 7.00%, 144A		United States		450,000		101,792,321
cRoyal Bank of Canada into Intel Corp., 8.00%, 144A		United States		1,100,000		59,115,202
cUBS AG London into Texas Instruments Inc., 8.50%, 144A		United States		400,000		50,958,735
						255,320,620
Total Equity-Linked Securities (Cost $481,232,090)						469,407,903
Convertible Preferred Stocks 3.1%
Communication Services 0.1%
a,c2020 Cash Mandatory Exchangeable Trust, 5.25%, cvt. pfd., 144A		United States		5,000		5,112,750
Financials 0.4%
Bank of America Corp., 7.25%, cvt. pfd., L		United States		4,666		6,262,705
aFNMA, 5.375%, cvt. pfd.		United States		475		11,162,500
						17,425,205
Information Technology 1.4%
Broadcom Inc., 8.00%, cvt. pfd., A		United States		50,000		55,717,500
Utilities 1.2%
NextEra Energy Inc., 5.279%, cvt. pfd.		United States		400,000		16,980,000
Sempra Energy, 6.75%, cvt. pfd., B		United States		200,000		19,652,000
The Southern Co., 6.75%, cvt. pfd.		United States		280,000		12,336,800
						48,968,800
Total Convertible Preferred Stocks (Cost $146,617,041)						127,224,255
Preferred Stocks (Cost $9,900,000) 0.3%
Financials 0.3%
dJPMorgan Chase & Co., 6.00%, pfd., EE		United States		396,000		10,850,400
			Principal  Amount*
Convertible Bonds (Cost $7,887,235) 0.3%
Industrials 0.3%
Southwest Airlines Co., cvt., senior note, 1.25%, 5/01/25		United States	$	8,500,000		10,251,264
Corporate Bonds 32.9%
Communication Services 5.5%
AT&T Inc., senior bond, 4.125%, 2/17/26		United States		12,000,000		13,685,241
cCCO Holdings LLC/CCO Holdings Capital Corp., senior bond, 144A, 5.50%, 5/01/26		United States		10,000,000		10,385,950
cDiamond Sports Group LLC/Diamond Sports Finance Co., first lien, 144A, 5.375%, 8/15/26		United States		11,000,000		8,029,120
DISH DBS Corp.,
senior bond, 5.875%, 7/15/22		United States		27,000,000		27,513,675
senior bond, 5.00%, 3/15/23		United States		21,000,000		20,979,315
senior note, 5.875%, 11/15/24		United States		9,400,000		9,360,379

Semiannual Report         FI-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

	Country		Principal  Amount*		Value
Corporate Bonds (continued)
Communication Services (continued)
Netflix Inc., senior bond, 4.875%, 4/15/28		United States	$	22,000,000	$	23,559,800
Sprint Communications Inc.,
senior bond, 11.50%, 11/15/21		United States		30,000,000		33,293,250
senior note, 7.00%, 8/15/20		United States		7,500,000		7,542,975
senior note, 6.00%, 11/15/22		United States		6,300,000		6,653,525
Sprint Corp.,
senior bond, 7.875%, 9/15/23		United States		12,500,000		14,093,687
senior bond, 7.125%, 6/15/24		United States		8,200,000		9,273,708
senior note, 7.625%, 3/01/26		United States		7,500,000		8,870,137
cUnivision Communications Inc.,
senior note, 144A, 6.625%, 6/01/27		United States		8,500,000		8,149,375
senior secured note, first lien, 144A, 5.125%, 5/15/23		United States		15,000,000		15,182,775
senior secured note, first lien, 144A, 5.125%, 2/15/25		United States		7,140,000		6,747,336
						223,320,248
Consumer Discretionary 2.5%
c,eColt Merger Sub Inc., senior secured note, 144A, 6.25%, 7/01/25		United States		18,000,000		17,904,600
Ford Motor Co., senior note, 4.346%, 12/08/26		United States		13,500,000		12,633,840
Ford Motor Credit Co. LLC, senior note, 5.125%, 6/16/25		United States		20,000,000		20,095,600
General Motors Co.,
senior bond, 5.15%, 4/01/38		United States		16,000,000		15,348,908
senior note, 6.125%, 10/01/25		United States		2,100,000		2,362,630
cGolden Nugget Inc., senior note, 144A, 6.75%, 10/15/24		United States		5,000,000		3,600,000
cShea Homes LP/Shea Homes Funding Corp., senior bond, 144A, 6.125%, 4/01/25		United States		9,580,000		9,662,819
cWynn Las Vegas LLC/Wynn Las Vegas Capital Corp.,
senior bond, 144A, 5.50%, 3/01/25		United States		13,200,000		12,120,174
senior bond, 144A, 5.25%, 5/15/27		United States		10,000,000		8,666,300
						102,394,871
Consumer Staples 1.3%
BAT Capital Corp.,
senior note, 3.222%, 8/15/24		United Kingdom		10,000,000		10,721,391
senior note, 3.557%, 8/15/27		United Kingdom		20,000,000		21,653,390
Kraft Heinz Foods Co., senior bond, 4.625%, 1/30/29		United States		10,600,000		11,432,478
cPost Holdings Inc.,
senior bond, 144A, 5.00%, 8/15/26		United States		7,500,000		7,542,562
senior bond, 144A, 5.625%, 1/15/28		United States		2,500,000		2,593,288
						53,943,109
Energy 2.7%
Calumet Specialty Products Partners LP/Calumet Finance Corp.,
senior note, 7.625%, 1/15/22		United States		8,000,000		7,668,120
senior note, 7.75%, 4/15/23		United States		2,000,000		1,867,290
csenior note, 144A, 11.00%, 4/15/25		United States		30,000,000		29,174,700
HighPoint Operating Corp.,
senior bond, 7.00%, 10/15/22		United States		17,937,000		4,367,928
senior note, 8.75%, 6/15/25		United States		26,600,000		6,517,000

FI-12         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

	Country		Principal  Amount*		Value
Corporate Bonds (continued)
Energy (continued)
Kinder Morgan Inc., senior bond, 7.75%, 1/15/32		United States	$	21,000,000	$	29,376,920
eOccidental Petroleum Corp., senior note, 8.00%, 7/15/25		United States		5,000,000		5,031,250
cWeatherford International Ltd., senior note, 144A, 11.00%, 12/01/24		United States		39,344,000		27,540,800
						111,544,008
Financials 3.4%
Bank of America Corp.,
fjunior sub. bond, AA, 6.10% to 3/17/25, FRN thereafter, Perpetual		United States		8,000,000		8,445,560
fjunior sub. bond, X, 6.25% to 9/05/24, FRN thereafter, Perpetual		United States		6,000,000		6,222,462
senior bond, 3.419% to 12/20/27, FRN thereafter, 12/20/28		United States		10,000,000		11,143,800
Capital One Financial Corp., senior sub. note, 4.20%, 10/29/25		United States		15,500,000		17,220,496
Citigroup Inc., sub. bond, 4.125%, 7/25/28		United States		18,500,000		20,923,152
The Goldman Sachs Group Inc., senior note, 3.272% to 9/29/24, FRN thereafter, 9/29/25		United States		15,500,000		16,719,883
HSBC Holdings PLC, senior note, 4.292% to 9/12/25, FRN thereafter, 9/12/26		United Kingdom		18,500,000		20,603,178
fJPMorgan Chase & Co.,
gjunior sub. bond, FRN, 4.23%, (3-month USD LIBOR + 3.47%), Perpetual		United States		19,559,000		17,842,480
junior sub. bond, R, 6.00% to 8/01/23, FRN thereafter, Perpetual		United States		3,200,000		3,234,133
fMorgan Stanley, junior sub. bond, 5.55% to 7/15/20, FRN thereafter, Perpetual		United States		2,064,000		1,897,233
Prudential Financial Inc., junior sub. bond, 5.70% to 9/15/28, FRN thereafter, 9/15/48		United States		5,000,000		5,620,538
fWells Fargo & Co., junior sub. bond, S, 5.90% to 6/15/24, FRN thereafter, Perpetual		United States		6,600,000		6,553,943
						136,426,858
Health Care 13.6%
cAbbVie Inc., senior bond, 144A, 3.80%, 3/15/25		United States		17,000,000		18,975,228
cBausch Health Cos. Inc.,
senior bond, 144A, 6.125%, 4/15/25		United States		9,400,000		9,547,392
senior note, 144A, 5.50%, 3/01/23		United States		11,270,000		11,243,008
senior note, 144A, 5.875%, 5/15/23		United States		1,950,000		1,946,646
senior note, 144A, 9.00%, 12/15/25		United States		5,000,000		5,392,050
senior note, first lien, 144A, 7.00%, 3/15/24		United States		4,500,000		4,678,065
senior secured note, first lien, 144A, 5.50%, 11/01/25		United States		35,000,000		35,807,100
cBayer U.S. Finance II LLC, senior note, 144A, 4.25%, 12/15/25		Germany		15,000,000		17,246,445
cBristol-Myers Squibb Co., senior bond, 144A, 3.40%, 7/26/29		United States		8,000,000		9,331,230
cCHS/Community Health Systems Inc.,
senior note, 144A, 9.875%, 6/30/23		United States		94,701,000		74,017,828
senior note, 144A, 8.125%, 6/30/24		United States		49,344,000		33,214,187
senior note, 144A, 8.00%, 12/15/27		United States		32,000,000		30,666,720
senior note, 144A, 6.875%, 4/01/28		United States		91,000,000		34,068,125
senior secured note, 144A, 6.625%, 2/15/25		United States		39,000,000		36,757,500
senior secured note, 144A, 8.00%, 3/15/26		United States		12,500,000		11,827,500
Cigna Corp., senior note, 3.75%, 7/15/23		United States		13,292,000		14,438,833
CVS Health Corp.,
senior bond, 4.30%, 3/25/28		United States		8,000,000		9,358,823
senior bond, 5.05%, 3/25/48		United States		3,900,000		5,081,297
senior note, 4.10%, 3/25/25		United States		5,100,000		5,768,787

Semiannual Report         FI-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

	Country		Principal  Amount*		Value
Corporate Bonds (continued)
Health Care (continued)
DaVita Inc.,
senior bond, 5.125%, 7/15/24		United States	$	5,000,000	$	5,092,500
senior bond, 5.00%, 5/01/25		United States		4,000,000		4,094,000
cEndo Dac/Endo Finance LLC/Endo Finco Inc.,
secured note, second lien, 144A, 9.50%, 7/31/27		United States		5,273,000		5,603,617
senior note, 144A, 6.00%, 6/30/28		United States		7,094,000		4,611,100
HCA Inc.,
senior bond, 5.875%, 5/01/23		United States		7,500,000		8,129,850
senior secured note, first lien, 5.00%, 3/15/24		United States		10,400,000		11,571,452
cMallinckrodt International Finance SA, first lien, senior note, 144A, 10.00%, 4/15/25		United States		2,500,000		2,118,750
cMallinckrodt International Finance SA/Mallinckrodt CB LLC,
senior note, 144A, 5.75%, 8/01/22		United States		12,100,000		3,055,250
senior note, 144A, 5.50%, 4/15/25		United States		7,600,000		1,277,750
Mylan NV, senior note, 3.95%, 6/15/26		United States		10,000,000		11,189,159
cPar Pharmaceutical Inc., senior secured note, 144A, 7.50%, 4/01/27		United States		8,429,000		8,678,035
Tenet Healthcare Corp.,
secured note, second lien, 5.125%, 5/01/25		United States		2,500,000		2,415,525
senior note, 8.125%, 4/01/22		United States		30,000,000		31,554,000
senior note, 6.75%, 6/15/23		United States		58,200,000		57,821,700
csenior note, second lien, 144A, 6.25%, 2/01/27		United States		29,000,000		28,872,980
						555,452,432
Industrials 1.3%
cAshtead Capital Inc., second lien, 144A, 4.25%, 11/01/29		United Kingdom		4,500,000		4,511,250
Raytheon Technologies Corp., senior note, 3.95%, 8/16/25		United States		15,000,000		17,138,389
United Rentals North America Inc., senior bond, 4.875%, 1/15/28		United States		18,000,000		18,478,170
cWESCO Distribution Inc., senior note, 144A, 7.125%, 6/15/25		United States		14,000,000		14,800,800
						54,928,609
Information Technology 0.3%
cCommScope Inc., senior bond, 144A, 5.50%, 6/15/24		United States		10,000,000		10,183,300
Materials 1.3%
cCemex Finance LLC, senior secured note, first lien, 144A, 6.00%, 4/01/24		Mexico		9,665,000		9,595,509
cCleveland-Cliffs Inc., senior secured note, 144A, 6.75%, 3/15/26		United States		5,000,000		4,837,500
cFMG Resources (August 2006) Pty. Ltd., senior note, 144A, 5.125%, 5/15/24		Australia		6,700,000		6,918,453
cMauser Packaging Solutions Holding Co.,
secured note, 144A, 5.50%, 4/15/24		United States		10,000,000		9,843,625
senior note, 144A, 7.25%, 4/15/25		United States		23,000,000		20,924,020
						52,119,107
Real Estate 0.7%
Equinix Inc., senior bond, 5.375%, 5/15/27		United States		11,000,000		12,026,465
Iron Mountain Inc., senior sub. bond, 5.75%, 8/15/24		United States		16,000,000		16,203,440
						28,229,905
Utilities 0.3%
Calpine Corp., senior note, 5.50%, 2/01/24		United States		11,375,000		11,410,433
Total Corporate Bonds (Cost $1,392,803,100)						1,339,952,880

FI-14         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

	Country		Principal  Amount*		Value
g,hSenior Floating Rate Interests (Cost $16,539,326) 0.2%
Consumer Discretionary 0.2%
Belk Inc., Term Loans, 7.75%, (3-month USD LIBOR + 6.75%), 7/31/25		United States	$	17,575,134	$	6,406,136
U.S. Government and Agency Securities 4.5%
U.S. Treasury Note,
2.375%, 3/15/21		United States		75,000,000		76,168,945
2.75%, 4/30/23		United States		25,000,000		26,817,871
2.75%, 5/31/23		United States		50,000,000		53,742,188
2.875%, 5/31/25		United States		25,000,000		28,154,785
Total U.S. Government and Agency Securities (Cost $174,892,363)						184,883,789
Mortgage-Backed Securities 4.5%
Federal Home Loan Mortgage Corp. (FHLMC) Fixed Rate 0.2%
FHLMC 30 Year, 4.00%, 5/01/49 - 10/01/49		United States		7,169,412		7,648,238
Federal National Mortgage Association (FNMA) Fixed Rate 0.8%
FNMA 30 Year, 3.00%, 7/01/50		United States		4,980,000		5,251,842
FNMA 30 Year, 4.00%, 10/01/47 - 2/01/50		United States		28,016,940		29,837,235
					35,089,077
Government National Mortgage Association (GNMA) Fixed Rate 3.5%
GNMA II SF 30 Year, 3.50%, 1/20/50		United States		23,888,979		25,268,036
GNMA II SF 30 Year, 3.50%, 6/20/50		United States		66,530,000		70,677,437
GNMA II SF 30 Year, 4.00%, 9/20/49 - 12/20/49		United States		32,169,715		34,116,030
GNMA II SF 30 Year, 4.00%, 1/20/50		United States		11,693,863		12,415,067
					142,476,570
Total Mortgage-Backed Securities (Cost $184,095,753)						185,213,885
			Shares
Escrows and Litigation Trusts (Cost $62,603) 0.0%
a,iMotors Liquidation Co., Escrow Account, cvt. pfd., C		United States		1,400,000		—
	Number of Contracts		Notional  Amount#
Options Purchased (Cost $19,402,038) 0.3%
Puts - Exchange-Traded
S&P 500 Index, September Strike Price $3,000.00, Expires 9/18/20		1,000		100,000		12,037,000
Total Investments before Short Term Investments (Cost $3,758,399,540)						3,839,083,422
	Country		Shares
Short Term Investments 6.1%
Money Market Funds (Cost $249,194,489) 6.1%
j,k Institutional Fiduciary Trust Money Market Portfolio, 0.00%		United States		249,194,489		249,194,489

Semiannual Report         FI-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

	Country		Shares		Value
Short Term Investments (continued)
lInvestments from Cash Collateral Received for Loaned Securities 0.0%†
Money Market Funds (Cost $114,000) 0.0%†
j,kInstitutional Fiduciary Trust Money Market Portfolio, 0.00%		United States		114,000	$	114,000
			Principal  Amount*
Repurchase Agreements (Cost $29,677) 0.0%†
mJoint Repurchase Agreement, 0.07%, 7/01/20 (Maturity Value $29,677)
BNP Paribas Securities Corp.
Collateralized by U.S. Treasury Bonds, 7.875%, 2/15/21; U.S. Treasury Notes, 0.125% - 2.875%, 12/31/20 - 1/31/24; and U.S. Treasury Strips, 8/15/20 - 11/15/22 (valued at $30,271)		United States	$	29,677		29,677
Total Investments from Cash Collateral Received for Loaned Securities (Cost $143,677)						143,677
Total Investments (Cost $4,007,737,706) 100.3%						4,088,421,588
Options Written (0.1)%						(3,991,000	)
Other Assets, less Liabilities (0.2)%						(9,539,878	)
Net Assets 100.0%					$	4,074,890,710
	Number of Contracts		Notional  Amount#
nOptions Written (Premiums received $6,297,961) (0.1)%
Puts - Exchange-Traded
S&P 500 Index, September Strike Price $2,600.00, Expires 9/18/20		1,000		100,000		(3,991,000	)

FI-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

See Abbreviations on page FI-31.

^†Rounds to less than 0.1% of net assets.

*The principal amount is stated in U.S. dollars unless otherwise indicated.

^#Notional amount is the number of units specified in the contract, and can include currency units, bushels, shares, pounds, barrels or other units. Currency units are stated in U.S. dollars unless otherwise indicated.

^aNon-income producing.

^bSee Note 1(f) regarding equity-linked securities.

^cSecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in a public offering registered under the Securities Act of 1933. At June 30, 2020, the aggregate value of these securities was $1,112,371,415, representing 27.3% of net assets.

^dA portion or all of the security is on loan at June 30, 2020. See Note 1(g).

^eSecurity purchased on a when-issued basis. See Note 1(d).

^fPerpetual security with no stated maturity date.

^gThe coupon rate shown represents the rate at period end.

^hSee Note 1(h) regarding senior floating rate interests.

ⁱFair valued using significant unobservable inputs. See Note 11 regarding fair value measurements.

^jSee Note 3(e) regarding investments in affiliated management investment companies.

^kThe rate shown is the annualized seven-day effective yield at period end.

^lSee Note 1(g) regarding securities on loan.

^mSee Note 1(c) regarding joint repurchase agreement.

ⁿSee Note 1(e) regarding written options.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FI-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Income VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers	$	3,758,399,540
Cost - Non-controlled affiliates (Note 3e)		249,308,489
Cost - Unaffiliated repurchase agreements		29,677
Value - Unaffiliated issuers+	$	3,839,083,422
Value - Non-controlled affiliates (Note 3e)		249,308,489
Value - Unaffiliated repurchase agreements		29,677
Cash		4,675,862
Receivables:
Investment securities sold		213,058
Capital shares sold		1,515,795
Dividends and interest		21,945,631
Other assets		3,878
Total assets		4,116,775,812
Liabilities:
Payables:
Investment securities purchased		33,547,935
Capital shares redeemed		1,425,480
Management fees		1,497,626
Distribution fees		819,511
Trustees’ fees and expenses		2,324
Options written, at value (premiums received $6,297,961)		3,991,000
Payable upon return of securities loaned		143,677
Accrued expenses and other liabilities.		457,549
Total liabilities		41,885,102
Net assets, at value	$	4,074,890,710
Net assets consist of:
Paid-in capital	$	4,254,277,890
Total distributable earnings (losses)		(179,387,180	)
Net assets, at value	$	4,074,890,710
Class 1:
Net assets, at value	$	269,045,044
Shares outstanding		19,555,215
Net asset value and maximum offering price per share		$13.76
Class 2:
Net assets, at value	$	3,527,837,470
Shares outstanding		266,422,343
Net asset value and maximum offering price per share		$13.24
Class 4:
Net assets, at value	$	278,008,196
Shares outstanding		20,433,394
Net asset value and maximum offering price per share		$13.61
+Includes securities loaned	$	139,740

FI-18         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Income VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers	$	36,052,149
Non-controlled affiliates (Note 3e)		359,942
Interest:
Unaffiliated issuers		61,535,391
Income from securities loaned:
Unaffiliated entities (net of fees and rebates)		26,259
Non-controlled affiliates (Note 3e)		11,050
Total investment income		97,984,791
Expenses:
Management fees (Note 3a)		9,857,734
Distribution fees: (Note 3c)
Class 2		4,705,187
Class 4		506,943
Custodian fees (Note 4)		23,359
Reports to shareholders		218,614
Professional fees		28,283
Trustees’ fees and expenses		15,124
Other		37,961
Total expenses		15,393,205
Expense reductions (Note 4)		(34,169	)
Expenses waived/paid by affiliates (Note 3e)		(309,781	)
Net expenses		15,049,255
Net investment income		82,935,536
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		(339,468,856	)
Written options		368,220
Foreign currency transactions		48,604
Net realized gain (loss)		(339,052,032	)
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(304,789,908	)
Translation of other assets and liabilities denominated in foreign currencies		(3,134	)
Written options		2,306,961
Net change in unrealized appreciation (depreciation)		(302,486,081	)
Net realized and unrealized gain (loss)		(641,538,113	)
Net increase (decrease) in net assets resulting from operations	$	(558,602,577	)
*Foreign taxes withheld on dividends	$	732,781

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FI-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Statements of Changes in Net Assets

	Franklin Income VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended     December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income	$	82,935,536			$    211,417,673
Net realized gain (loss)		(339,052,032	)		40,047,821
Net change in unrealized appreciation (depreciation)		(302,486,081	)		514,968,839
Net increase (decrease) in net assets resulting from operations		(558,602,577	)		766,434,333
Distributions to shareholders:
Class 1		(16,535,949	)		(26,604,329	)
Class 2		(219,850,517	)		(301,656,285	)
Class 4		(16,548,919	)		(21,101,452	)
Total distributions to shareholders		(252,935,385	)		(349,362,066	)
Capital share transactions: (Note 2)
Class 1		11,324,652			(360,324,820	)
Class 2		(84,014,489	)		(103,843,936	)
Class 4		8,051,378			4,153,985
Total capital share transactions		(64,638,459	)		(460,014,771	)
Net increase (decrease) in net assets		(876,176,421	)		(42,942,504	)
Net assets:
Beginning of period		4,951,067,131			4,994,009,635
End of period	$	4,074,890,710			$4,951,067,131

FI-20         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin Income VIP Fund

1.  Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Income VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. The Fund offers three classes of shares: Class 1, Class 2 and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a.  Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities and derivative financial instruments listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple

exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Debt securities generally trade in the OTC market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value. Securities denominated in a foreign currency are converted into their U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the date that the values of the foreign debt securities are determined.

Investments in open-end mutual funds are valued at the closing NAV. Investments in repurchase agreements are valued at cost, which approximates fair value.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur

Semiannual Report         FI-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

1.  Organization and Significant Accounting Policies (continued)

a.  Financial Instrument Valuation (continued)

between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time. At June 30, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b.  Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c.  Joint Repurchase Agreement

The Fund enters into a joint repurchase agreement whereby its uninvested cash balance is deposited into a joint cash account with other funds managed by the investment manager or an affiliate of the investment manager and is used to invest in one or more repurchase agreements. The value and face amount of the joint repurchase agreement are allocated to the funds based on their pro-rata interest. A repurchase agreement is accounted for as a loan by the Fund to the seller, collateralized by securities which are delivered to the Fund’s custodian. The fair value, including accrued interest, of the initial collateralization is required to be at least 102% of the dollar amount invested by the funds, with the value of the underlying securities marked to market daily to maintain coverage of at least 100%. Repurchase agreements are subject to the terms of Master Repurchase Agreements (MRAs) with approved counterparties (sellers). The MRAs contain various provisions, including but not limited to events of default and maintenance of collateral for repurchase agreements. In the event of default by either the seller or the Fund, certain MRAs may permit the non-defaulting party to net and close-out all transactions, if any, traded under such agreements. The Fund may sell securities it holds as collateral and apply the proceeds towards the repurchase price and any other amounts owed by the seller to the Fund in the event of default by the seller. This could involve costs or delays in addition to a loss on the securities if their value falls below the repurchase price owed by the seller. The joint repurchase agreement held by the Fund at period end, as indicated in the Statement of Investments, had been entered into on June 30, 2020.

FI-22         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

d.  Securities Purchased on a When-Issued Basis

The Fund purchases securities on a when-issued basis, with payment and delivery scheduled for a future date. These transactions are subject to market fluctuations and are subject to the risk that the value at delivery may be more or less than the trade date purchase price. Although the Fund will generally purchase these securities with the intention of holding the securities, it may sell the securities before the settlement date. Sufficient assets have been segregated for these securities.

e.  Derivative Financial Instruments

The Fund invested in derivative financial instruments in order to manage risk or gain exposure to various other investments or markets. Derivatives are financial contracts based on an underlying or notional amount, require no initial investment or an initial net investment that is smaller than would normally be required to have a similar response to changes in market factors, and require or permit net settlement. Derivatives contain various risks including the potential inability of the counterparty to fulfill their obligations under the terms of the contract, the potential for an illiquid secondary market, and/or the potential for market movements which expose the Fund to gains or losses in excess of the amounts shown in the Statement of Assets and Liabilities. Realized gain and loss and unrealized appreciation and depreciation on these contracts for the period are included in the Statement of Operations.

Collateral requirements differ by type of derivative. Collateral or initial margin requirements are set by the broker or exchange clearing house for exchange traded and centrally cleared derivatives. Initial margin deposited is held at the exchange and can be in the form of cash and/or securities.

The Fund purchased or wrote exchange traded option contracts primarily to gain exposure to equity price risk. An option is a contract entitling the holder to purchase or sell a specific amount of shares or units of an asset or notional amount of a swap (swaption), at a specified price. When an option is purchased or written, an amount equal to the premium paid or received is recorded as an asset or liability, respectively. Upon exercise of an option, the acquisition cost or sales proceeds of the underlying investment is adjusted by any premium received or paid. Upon expiration of an option, any premium received or paid is recorded as a realized gain or loss. Upon closing an option other than through expiration

or exercise, the difference between the premium received or paid and the cost to close the position is recorded as a realized gain or loss.

See Note 9 regarding other derivative information.

f.  Equity-Linked Securities

The Fund invests in equity-linked securities. Equity-linked securities are hybrid financial instruments that generally combine both debt and equity characteristics into a single note form. Income received from equity-linked securities is recorded as realized gains in the Statement of Operations and may be based on the performance of an underlying equity security, an equity index, or an option position. The risks of investing in equity-linked securities include unfavorable price movements in the underlying security and the credit risk of the issuing financial institution. There may be no guarantee of a return of principal with equity-linked securities and the appreciation potential may be limited. Equity-linked securities may be more volatile and less liquid than other investments held by the Fund.

g.  Securities Lending

The Fund participates in an agency based securities lending program to earn additional income. The Fund receives cash collateral against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. The collateral is deposited into a joint cash account with other funds and is used to invest in a money market fund managed by Franklin Advisers, Inc., an affiliate of the Fund, and/or a joint repurchase agreement. The Fund may receive income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third-party vendor, is reported separately in the Statement of Operations. The Fund bears the market risk with respect to the collateral investment, securities loaned, and the risk that the agent may default on its obligations to the Fund. If the borrower defaults on its obligation to return the securities loaned, the Fund has the right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower.

Semiannual Report         FI-23

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

1. Organization and Significant Accounting Policies (continued)

h.  Senior Floating Rate Interests

The Fund invests in senior secured corporate loans that pay interest at rates which are periodically reset by reference to a base lending rate plus a spread. These base lending rates are generally the prime rate offered by a designated U.S. bank or the London InterBank Offered Rate (LIBOR). Senior secured corporate loans often require prepayment of principal from excess cash flows or at the discretion of the borrower. As a result, actual maturity may be substantially less than the stated maturity. Senior secured corporate loans in which the Fund invests are generally readily marketable, but may be subject to certain restrictions on resale. On July 27, 2017, the United Kingdom’s Financial Conduct Authority announced its intention to cease sustaining LIBOR after 2021. There remains uncertainty regarding the future utilization of LIBOR and the nature of any replacement rate. As such, the potential effect of a transition away from LIBOR on the Fund or the Fund’s investments that use or may use a floating rate based on LIBOR cannot yet be determined.

i.  Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial

statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

j.  Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Amortization of premium and accretion of discount on debt securities are included in interest income. Facility fees are recognized as income over the expected term of the loan. Dividend income is recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

k.  Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and

FI-24         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

l. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust.

Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020				Year Ended December 31, 2019
	Shares		Amount		Shares		Amount
Class 1 Shares:
Shares sold		1,059,465		$    15,551,192		1,872,752		$    30,211,199
Shares issued in reinvestment of distributions		1,187,927		16,535,949		1,709,790		26,604,329
Shares redeemed		(1,412,137)		(20,762,489)		(25,004,206)		(417,140,348)
Net increase (decrease)		835,255		$    11,324,652		(21,421,664)		$ (360,324,820)
Class 2 Shares:
Shares sold		8,367,886		$  119,310,211		16,435,568		$  256,969,286
Shares issued in reinvestment of distributions		16,406,755		219,850,517		20,097,021		301,656,285
Shares redeemed		(29,700,434)		(423,175,217)		(42,487,994)		(662,469,507)
Net increase (decrease)		(4,925,793)		$  (84,014,489)		(5,955,405)		$(103,843,936)
Class 4 Shares:
Shares sold		1,086,206		$    16,185,257		2,582,430		$    41,387,759
Shares issued in reinvestment of distributions		1,201,810		16,548,919		1,370,224		21,101,452
Shares redeemed		(1,686,095)		(24,682,798)		(3,658,374)		(58,335,226)
Net increase (decrease)		601,921		$      8,051,378		294,280		$      4,153,985

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Advisers, Inc. (Advisers)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

Semiannual Report         FI-25

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

3. Transactions with Affiliates (continued)

a. Management Fees

The Fund pays an investment management fee to Advisers based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.625%	Up to and including $100 million
0.500%	Over $100 million, up to and including $250 million
0.450%	Over $250 million, up to and including $7.5 billion
0.440%	Over $7.5 billion, up to and including $10 billion
0.430%	Over $10 billion, up to and including $12.5 billion
0.420%	Over $12.5 billion, up to and including $15 billion
0.400%	In excess of $15 billion

For the period ended June 30, 2020, the annualized gross effective investment management fee rate was 0.456% of the Fund’s average daily net assets.

b. Administrative Fees

Under an agreement with Advisers, FT Services provides administrative services to the Fund. The fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

c. Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets of each class. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

FI-26         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

e. Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Investment Income
Non-Controlled Affiliates
																	Dividends
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		$83,971,136		$736,334,414		$(571,111,061)			$  —		$  —		$249,194,489		249,194,489		$359,942
																	Income from securities loaned
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		747,000		95,007,000		(95,640,000	)		—		—		114,000		114,000		11,050
Total Affiliated Securities		$84,718,136		$831,341,414		$(666,751,061)			$  —		$  —		$249,308,489				$370,992

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

5. Income Taxes

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$	4,000,093,993
Unrealized appreciation	$	470,838,273
Unrealized depreciation		(386,501,678)
Net unrealized appreciation (depreciation)	$	84,336,595

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of equity-linked securities, foreign currency transactions and wash sales.

6. Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $852,555,912 and $1,186,554,240, respectively.

Semiannual Report         FI-27

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

6. Investment Transactions (continued)

At June 30, 2020, in connection with securities lending transactions, the Fund loaned equity investments and received $143,677 of cash collateral. The gross amount of recognized liability for such transactions is included in payable upon return of securities loaned in the Statement of Assets and Liabilities. The agreements can be terminated at any time.

7. Credit Risk

At June 30, 2020, the Fund had 24.0% of its portfolio invested in high yield, senior secured floating rate loans, or other securities rated below investment grade and unrated securities, if any. These securities may be more sensitive to economic conditions causing greater price volatility and are potentially subject to a greater risk of loss due to default than higher rated securities.

8. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

9. Other Derivative Information

At June 30, 2020, investments in derivative contracts are reflected in the Statement of Assets and Liabilities as follows:

	Asset Derivatives				Liability Derivatives
Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Assets and Liabilities Location	Fair Value			Statement of Assets and Liabilities Location	Fair Value
Equity contracts	Investments in securities, at value	$	12,037,000	a	Options written, at value	$	3,991,000

^aPurchased option contracts are included in investments in securities, at value in the Statement of Assets and Liabilities.

For the period ended June 30, 2020, the effect of derivative contracts in the Statement of Operations was as follows:

Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Operations Location	Net Realized Gain (Loss) for the Period			Statement of Operations Location	Net Change in Unrealized Appreciation (Depreciation) for the Period
	Net realized gain (loss) from:				Net change in unrealized appreciation (depreciation) on:
Equity contracts	Investments		$(10,604,077)	a	Investments		$15,369,038a
	Written options		368,220		Written options		2,306,961
Totals			$(10,235,857)				$17,675,999

^aPurchased option contracts are included in net realized gain (loss) from investments and net change in unrealized appreciation (depreciation) on investments in the Statement of Operations.

For the period ended June 30, 2020, the average month end notional amount of options represented 307,143 shares.

See Note 1(e) regarding derivative financial instruments.

FI-28         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

10. Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

11. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

Semiannual Report         FI-29

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

11. Fair Value Measurements (continued)

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets and liabilities carried at fair value, is as follows:

	Level 1		Level 2		Level 3			Total
Assets:
Investments in Securities:a
Equity Investments:b
Communication Services	$	119,262,189	$	5,112,750	$	—		$	124,374,939
Financials		214,640,499		28,796,770		—			243,437,269
Health Care		226,220,400		70,457,870		—			296,678,270
Materials		56,220,182		33,698,578		—			89,918,760
All Other Equity Investments		876,521,327		—		—			876,521,327
Equity-Linked Securities		—		469,407,903		—			469,407,903
Convertible Bonds		—		10,251,264		—			10,251,264
Corporate Bonds		—		1,339,952,880		—			1,339,952,880
Senior Floating Rate Interests		—		6,406,136		—			6,406,136
U.S. Government and Agency Securities		—		184,883,789		—			184,883,789
Mortgage-Backed Securities		—		185,213,885		—			185,213,885
Escrows and Litigation Trusts		—		—		—	c		—
Options Purchased		12,037,000		—		—			12,037,000
Short Term Investments		249,194,489		143,677		—			249,338,166
Total Investments in Securities	$	1,754,096,086	$	2,334,325,502	$	—		$	4,088,421,588
Liabilities:
Other Financial Instruments:
Options Written	$	3,991,000	$	—	$	—		$	3,991,000

^aFor detailed categories, see the accompanying Statement of Investments.

^bIncludes common, preferred and convertible preferred stocks.

^cIncludes securities determined to have no value at June 30, 2020.

A reconciliation in which Level 3 inputs are used in determining fair value is presented when there are significant Level 3 assets and/or liabilities at the beginning and/or end of the period.

12. New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the LIBOR and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

13. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

FI-30         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Income VIP Fund (continued)

Abbreviations

Currency		Selected Portfolio
USD	United States Dollar	ADR	American Depositary Receipt
		FRN	Floating Rate Note
		LIBOR	London InterBank Offered Rate

Semiannual Report         FI-31

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Franklin Large Cap Growth VIP Fund

This semiannual report for Franklin Large Cap Growth VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a +15.43% total return for the six-month period ended June 30, 2020.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         FLG-1

FRANKLIN LARGE CAP GROWTH VIP FUND

Fund Goal and Main Investments

The Fund seeks capital appreciation. Under normal market conditions, the Fund invests at least 80% of its net assets in investments of large-capitalization companies. For this Fund, large-capitalization companies are those with market capitalization values within those of the top 50% of companies in the Russell 1000^® Index at the time of purchase.¹

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Growth stock prices reflect projections of future earnings or revenues, and can, therefore, fall dramatically if the company fails to meet those projections. The Fund may focus on particular sectors of the market from time to time, which can carry greater risks of adverse developments in such sectors. Investments in foreign securities may involve special risks including currency fluctuations and economic and political uncertainty. Smaller or midsized companies can be particularly sensitive to changing economic conditions, and their prospects for growth are less certain than those of larger, more established companies. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Fund’s benchmark, the Standard & Poor’s^® 500 Index (S&P 500^®), posted a -3.08% total return.²

Portfolio Composition

Based on Total Net Assets as of 6/30/20

Economic and Market Overview

U.S. equities, as measured by the S&P 500, nearly reversed earlier losses but declined modestly during the six-month period. A sharp selloff began in late February 2020 amid investor fears of a global economic slowdown due to the novel coronavirus (COVID-19) pandemic.

Government-issued restrictions to mitigate the pandemic severely curtailed U.S. economic activity beginning in March 2020. As a result, the unemployment rate surged to 14.7% in April as many businesses, particularly in hospitality, retail and travel, announced mass layoffs.³ Within just two months, the unemployment rate went from a 50-year low to an 80-year high.³ The longest U.S. economic expansion in history ended in February, according to the National Bureau of Economic Research, and the country slipped into a deep recession.

1. Please see Index Descriptions following the Fund Summaries.

2. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

3. Source: Bureau of Labor Statistics.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

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FRANKLIN LARGE CAP GROWTH VIP FUND

In an effort to buffer the sharp drop in economic activity, the Fed implemented two emergency rate cuts in March 2020, lowering the federal funds target rate to a range of 0.00%–0.25%. Additionally, the Fed announced broad quantitative easing measures aimed at ensuring the flow of credit to borrowers and supporting credit markets with unlimited amounts of bond purchasing. Meanwhile, Congress passed the Coronavirus Aid, Relief and Economic Security Act to provide economic relief for individuals and businesses and additional funding for small businesses.

Benefiting from these fiscal and monetary measures, equities began to advance at the end of March 2020. As states gradually reopened, economic activity resumed, leading to declining initial jobless claims and record-high increases in job additions and existing home sales. Optimism about potential COVID-19 vaccines and treatments and rising retail sales further supported equities, which rebounded from multi-year lows to post the strongest second-quarter returns in more than 20 years. Nevertheless, surging infection rates in several states near the end of June led to concerns that economic recovery could be hindered if reopening measures are paused or rolled back.

Investment Strategy

We are a research driven, fundamental investor, pursuing a growth strategy. As a bottom-up investor focusing primarily on individual securities, we seek companies that have identifiable drivers of future earnings growth and that present, in our opinion, the best trade-off between that potential earnings growth, business and financial risk, and valuation.

Manager’s Discussion

Looking back on the key factors affecting the Fund’s returns during the six months under review, we would like to remind shareholders that our investment strategy is primarily bottom-up and driven by individual stock selection. However, we recognize that a sector-based discussion can be a helpful way to organize a portfolio review of key performance drivers. We employed our long-held strategy: bottom-up, individual company, fundamental research aimed at opportunistically finding what we believed to be outstanding large-capitalization companies across all sectors, at valuations we believed understated their fair worth, with future growth potential being a key driver of estimated worth.

During the period under review, an overweighting and stock selection in the information technology (IT) sector contributed to relative results, as did stock selection and an

Top 10 Holdings

6/30/20

Company Sector/Industry	% of Total Net Assets
Amazon.com Inc. Consumer Discretionary	9.4%
Microsoft Corp. Information Technology	7.5%
Mastercard Inc. Information Technology	4.7%
Visa Inc. Information Technology	4.4%
Apple Inc. Information Technology	3.5%
SBA Communications Corp. Real Estate	3.3%
ServiceNow Inc. Information Technology	3.2%
Alphabet Inc. Communication Services	3.0%
Adobe Inc. Information Technology	2.7%
CoStar Group Inc. Industrials	2.5%

underweight in financials. Stock selection in the consumer discretionary sector also contributed.

In IT, enterprise workflow management provider ServiceNow contributed to relative results. Shares rose after the company raised subscription revenue guidance in its fourth quarter 2019 earnings report. Investors were further impressed when first quarter 2020 earnings came in line with expectations despite many businesses reducing activity in March due to COVID-19. Cloud communications services provider Twilio and computer software and hardware company Microsoft also helped results.

In financials, financial information and analytics companies MSCI and S&P Global helped relative performance.

In consumer discretionary, online marketplace and web services operator Amazon.com contributed to relative results as shares of the company rose during the COVID-19 pandemic. Consumers increasingly turned to the online retailer for basic goods as they spent growing amounts of time at home, boosting sales. The company also benefited from the increase in remote working, which has made more companies reliant on technology infrastructure provided by Amazon Web Services. Exercise equipment and media company Peloton Interactive boosted performance as well.

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FRANKLIN LARGE CAP GROWTH VIP FUND

Elsewhere, cloud software provider Veeva Systems helped relative performance. Shares of the company, which focuses on the life sciences industry, rose after revenue for its April quarter beat expectations. We believe the company is navigating the current environment quite well, and remain encouraged by the velocity of new offerings coming from the product team, which should enable sustained growth for years.

In contrast, stock selection in the materials and consumer staples sectors detracted from relative results. In materials, specialty chemicals manufacturer Ingevity (not held at period-end) hurt performance. In consumer staples, potato producer and processor Lamb Weston Holdings detracted.

Elsewhere, an underweighting in personal computing device manufacturer and service provider Apple detracted from relative performance. Apple reported strong first quarter and better-than-expected second-quarter fiscal year 2020 results and anticipated some ongoing headwinds related to the COVID-19 pandemic. Apple’s supply chain has remained intact, as evidenced by new product launches, and continued demand for the company’s products and services, particularly wearable technology.

Relative performance was also hurt by positions in biopharmaceutical firm Heron Therapeutics and oil exploration and production company Diamondback Energy. Investor sentiment in Heron Therapeutics soured in June after the Food and Drug Administration delayed approval of one of their anesthesia products, though we believe the drug could be approved by the end of the year. Diamondback Energy was hurt by the collapse of oil prices brought on by the global economic shutdown and Russia-Saudi price war. We liquidated our position due to uncertainty about when oil prices will recover to the level needed for the company to be profitable.

Thank you for your participation in Franklin Large Cap Growth VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

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FRANKLIN LARGE CAP GROWTH VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual (actual return after expenses)		Hypothetical (5% annual return before expenses)
Share    Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$1,154.30	$4.50	$1,020.69	$4.22	0.84%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

Semiannual Report         FLG-5

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin Large Cap Growth VIP Fund

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$22.73			$19.19			$20.93			$17.85			$18.42			$23.26
Income from investment operationsa:
Net investment income (loss)b		(0.03	)		(0.06	)		(0.04	)		(0.03	)		(0.04	)		(0.06	)
Net realized and unrealized gains (losses)		3.41			6.51			0.03			4.91			(0.26	)		1.56
Total from investment operations		3.38			6.45			(0.01	)		4.88			(0.30	)		1.50
Less distributions from:
Net investment income		—			—			—			(0.20	)		—			(0.13	)
Net realized gains		(2.40	)		(2.91	)		(1.73	)		(1.60	)		(0.27	)		(6.21	)
Total distributions		(2.40	)		(2.91	)		(1.73	)		(1.80	)		(0.27	)		(6.34	)
Net asset value, end of period		$23.71			$22.73			$19.19			$20.93			$17.85			$18.42
Total returnc		15.43%			34.98%			(1.24)%			28.38%			(1.49)%			5.89%
Ratios to average net assetsd
Expenses		0.84%	e,f		0.84%	e,f		0.85%	e		0.87%	e		0.80%	e		0.78%
Net investment income (loss)		(0.22)%			(0.25)%			(0.17)%			(0.14)%			(0.19)%			(0.27)%
Supplemental data
Net assets, end of period (000’s)		$3,491			$1,350			$1,040			$1,092			$883			$47,864
Portfolio turnover rate		7.99%			17.01%			21.93%			24.96%			36.26%	g		23.23%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^gExcludes the value of portfolio securities delivered as a result of redemption in-kind.

FLG-6         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Large Cap Growth VIP Fund (continued)

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$22.00			$18.70			$20.48			$17.48			$18.09			$22.94
Income from investment operationsa:
Net investment income (loss)b		(0.05	)		(0.11	)		(0.09	)		(0.08	)		(0.08	)		(0.11	)
Net realized and unrealized gains (losses)		3.29			6.32			0.04			4.81			(0.26	)		1.54
Total from investment operations		3.24			6.21			(0.05	)		4.73			(0.34	)		1.43
Less distributions from:
Net investment income		—			—			—			(0.13	)		—			(0.07	)
Net realized gains		(2.40	)		(2.91	)		(1.73	)		(1.60	)		(0.27	)		(6.21	)
Total distributions		(2.40	)		(2.91	)		(1.73	)		(1.73	)		(0.27	)		(6.28	)
Net asset value, end of period		$22.84			$22.00			$18.70			$20.48			$17.48			$18.09
Total returnc		15.30%			34.58%			(1.47)%			28.11%			(1.79)%			5.62%
Ratios to average net assetsd
Expenses		1.09%	e,f		1.09%	e,f		1.10%	e		1.12%	e		1.05%	e		1.03%
Net investment income (loss)		(0.47)%			(0.50)%			(0.42)%			(0.39)%			(0.44)%			(0.52)%
Supplemental data
Net assets, end of period (000’s)		$117,039			$114,170			$100,435			$118,875			$113,028			$223,807
Portfolio turnover rate		7.99%			17.01%			21.93%			24.96%			36.26%	g		23.23%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^gExcludes the value of portfolio securities delivered as a result of redemption in-kind.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FLG-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin Large Cap Growth VIP Fund

	Shares/ Rights		Value
Common Stocks and Other Equity Interests 100.2%
Communication Services 7.0%
aAlphabet Inc., A		2,582	$	3,661,405
aFacebook Inc., A		5,930		1,346,525
aLiberty Broadband Corp., C		8,450		1,047,462
aT-Mobile U.S. Inc.		15,667		1,631,718
aT-Mobile U.S. Inc., rts., 7/28/20		3,067		516
The Walt Disney Co.		6,949		774,883
				8,462,509
Consumer Discretionary 12.8%
aAmazon.com Inc.		4,120		11,366,338
Aptiv PLC		7,653		596,322
aBurlington Stores Inc.		1,434		282,398
aChipotle Mexican Grill Inc.		937		986,061
NIKE Inc., B		7,496		734,983
aPeloton Interactive Inc., A		15,735		909,011
aTesla Inc.		456		492,393
				15,367,506
Consumer Staples 2.2%
Constellation Brands Inc., A		5,435		950,853
Lamb Weston Holdings Inc.		8,805		562,904
aMonster Beverage Corp.		9,692		671,850
aNomad Foods Ltd. (United Kingdom)		22,994		493,221
				2,678,828
Financials 6.5%
The Charles Schwab Corp.		15,982		539,233
Intercontinental Exchange Inc.		16,759		1,535,124
MarketAxess Holdings Inc.		2,851		1,428,123
MSCI Inc.		6,261		2,090,047
S&P Global Inc.		6,890		2,270,117
				7,862,644
Health Care 16.1%
AstraZeneca PLC, ADR (United Kingdom)		16,104		851,741
Danaher Corp.		4,767		842,949
aEdwards Lifesciences Corp.		19,753		1,365,130
aGuardant Health Inc.		4,712		382,285
aGW Pharmaceuticals PLC, ADR (United Kingdom)		5,361		657,902
aHeron Therapeutics Inc.		66,419		977,024
aIDEXX Laboratories Inc.		3,276		1,081,604
aIllumina Inc.		2,184		808,844
aIntuitive Surgical Inc.		1,922		1,095,213
aNevro Corp.		8,979		1,072,721
a,bNovavax Inc.		11,504		958,858
aPTC Therapeutics Inc.		5,995		304,186
aReata Pharmaceuticals Inc.		3,788		591,004
aRoyalty Pharma PLC		11,100		538,905

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Large Cap Growth VIP Fund (continued)

	Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Health Care (continued)
UnitedHealth Group Inc.		10,145	$	2,992,268
aVeeva Systems Inc.		10,964		2,570,181
West Pharmaceutical Services Inc.		10,438		2,371,200
				19,462,015
Industrials 8.7%
aCoStar Group Inc.		4,254		3,023,190
Honeywell International Inc.		6,992		1,010,974
IHS Markit Ltd.		11,298		852,999
Raytheon Technologies Corp.		9,672		595,989
Republic Services Inc.		4,414		362,169
Roper Technologies Inc.		3,767		1,462,575
TransUnion		6,713		584,299
Union Pacific Corp.		4,556		770,283
Verisk Analytics Inc.		10,849		1,846,500
				10,508,978
Information Technology 41.8%
aAdobe Inc.		7,527		3,276,578
Analog Devices Inc.		7,163		878,470
Apple Inc.		11,525		4,204,320
aAtlassian Corp. PLC		2,283		411,556
aAutodesk Inc.		2,384		570,229
aBill.Com Holdings Inc.		11,169		1,007,556
aBlack Knight Inc.		9,366		679,597
aDocuSign Inc.		4,356		750,147
aFiserv Inc.		7,818		763,193
Intuit Inc.		2,110		624,961
Mastercard Inc., A		19,108		5,650,236
Microsoft Corp.		44,422		9,040,321
Monolithic Power Systems		5,425		1,285,725
NVIDIA Corp.		5,684		2,159,409
aOkta Inc., A		2,697		540,020
aPayPal Holdings Inc.		14,279		2,487,830
aPTC Inc.		11,195		870,859
asalesforce.com Inc.		6,700		1,255,111
aServiceNow Inc.		9,538		3,863,462
aShopify Inc., A (Canada)		726		689,119
aSynopsys Inc.		2,061		401,895
aTwilio Inc., A		8,887		1,949,986
Visa Inc., A		27,490		5,310,243
aWorkday Inc., A		3,334		624,658
aZendesk Inc.		7,074		626,261
aZoom Video Communications Inc., A		1,723		436,850
				50,358,592

Semiannual Report         FLG-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Large Cap Growth VIP Fund (continued)

	Shares/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Materials 0.9%
Ecolab Inc.		2,957	$	588,295
Linde PLC (United Kingdom)		2,346		497,610
				1,085,905
Real Estate 4.2%
American Tower Corp.		4,221		1,091,297
SBA Communications Corp., A		13,138		3,914,073
				5,005,370
Total Common Stocks and Other Equity Interests (Cost $45,695,913)				120,792,347
	Principal Amount
Short Term Investments 1.4%
Repurchase Agreements (Cost $794,915) 0.7%
cJoint Repurchase Agreement, 0.065%, 7/01/20 (Maturity Value $794,917)
BNP Paribas Securities Corp. (Maturity Value $551,506)
Deutsche Bank Securities Inc. (Maturity Value $151,495)
HSBC Securities (USA) Inc. (Maturity Value $91,916)
Collateralized by U.S. Government Agency Securities, 4.00%, 3/20/44; U.S. Government Agency Strips, 8/15/39; and U.S. Treasury Notes, 1.75% - 2.25%, 4/15/22 - 7/31/24 (valued at $811,706)	$	794,915		794,915
	Shares
dInvestments from Cash Collateral Received for Loaned Securities 0.7%
Money Market Funds (Cost $708,000) 0.6%
e,fInstitutional Fiduciary Trust Money Market Portfolio,0.00%		708,000		708,000
	Principal Amount
Repurchase Agreements 0.1%
cJoint Repurchase Agreement, 0.07%, 7/01/20 (Maturity Value $177,181)
BNP Paribas Securities Corp.
Collateralized by U.S. Treasury Bonds, 7.875%, 2/15/21; U.S. Treasury Notes, 0.125% - 2.875%, 12/31/20 - 1/31/24; U.S. Treasury Strips, 8/15/20 - 11/15/22 (valued at $180,725)	$	177,181		177,181
Total Investments from Cash Collateral Received for Loaned Securities (Cost $885,181)				885,181
Total Investments (Cost $47,376,009) 101.6%.				122,472,443
Other Assets, less Liabilities (1.6)%				(1,942,677	)
Net Assets 100.0%			$	120,529,766

FLG-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Large Cap Growth VIP Fund (continued)

See Abbreviations on page FLG-21.

^aNon-income producing.

^bA portion or all of the security is on loan at June 30, 2020. See Note 1(d).

^cSee Note 1(c) regarding joint repurchase agreement.

^dSee Note 1(d) regarding securities on loan.

^eSee Note 3(e) regarding investments in affiliated management investment companies.

^fThe rate shown is the annualized seven-day effective yield at period end.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FLG-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Large Cap Growth VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers	$	45,695,913
Cost - Non-controlled affiliates (Note 3e)		708,000
Cost - Unaffiliated repurchase agreements		972,096
Value - Unaffiliated issuers+	$	120,792,347
Value - Non-controlled affiliates (Note 3e)		708,000
Value - Unaffiliated repurchase agreements		972,096
Receivables:
Investment securities sold (includes securities loaned in the amount of $2,181)		371,900
Capital shares sold		20,591
Dividends		13,269
Other assets		95
Total assets		122,878,298
Liabilities:
Payables:
Capital shares redeemed		1,308,178
Management fees		72,984
Distribution fees		23,866
Trustees’ fees and expenses		47
Payable upon return of securities loaned		885,181
Accrued expenses and other liabilities		58,276
Total liabilities		2,348,532
Net assets, at value	$	120,529,766
Net assets consist of:
Paid-in capital	$	42,360,849
Total distributable earnings (losses)		78,168,917
Net assets, at value	$	120,529,766
Class 1:
Net assets, at value	$	3,490,990
Shares outstanding		147,223
Net asset value and maximum offering price per share		$23.71
Class 2:
Net assets, at value	$	117,038,776
Shares outstanding		5,123,304
Net asset value and maximum offering price per share		$22.84
+Includes securities loaned	$	862,923

FLG-12             Semiannual Report  |   The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Large Cap Growth VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers	$	308,252
Interest:
Unaffiliated issuers		1,547
Income from securities loaned:
Unaffiliated entities (net of fees and rebates)		33,629
Non-controlled affiliates (Note 3e)		1,039
Total investment income		344,467
Expenses:
Management fees (Note 3a)		417,541
Distribution fees: (Note 3c)
Class 2		136,330
Custodian fees (Note 4)		721
Reports to shareholders		17,646
Professional fees		28,175
Trustees’ fees and expenses		354
Other		5,205
Total expenses		605,972
Expense reductions (Note 4)		(320	)
Expenses waived/paid by affiliates (Note 3e)		(671	)
Net expenses		604,981
Net investment income (loss)		(260,514	)
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		3,376,961
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		12,746,633
Net realized and unrealized gain (loss)		16,123,594
Net increase (decrease) in net assets resulting from operations	$	15,863,080
*Foreign taxes withheld on dividends	$	178

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FLG-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Franklin Large Cap Growth VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income (loss)	$	(260,514	)	$	(573,122	)
Net realized gain (loss)		3,376,961			11,677,580
Net change in unrealized appreciation (depreciation)		12,746,633			22,617,082
Net increase (decrease) in net assets resulting from operations		15,863,080			33,721,540
Distributions to shareholders:
Class 1		(319,951	)		(156,170	)
Class 2		(11,348,356	)		(14,406,046	)
Total distributions to shareholders		(11,668,307	)		(14,562,216	)
Capital share transactions: (Note 2)
Class 1		1,976,277			107,346
Class 2		(1,161,759	)		(5,221,870	)
Total capital share transactions		814,518			(5,114,524	)
Net increase (decrease) in net assets		5,009,291			14,044,800
Net assets:
Beginning of period		115,520,475			101,475,675
End of period	$	120,529,766		$	115,520,475

FLG-14         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin Large Cap Growth VIP Fund

1. Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Large Cap Growth VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. At June 30, 2020, 69.2% of the Fund’s shares were held through one insurance company. Investment activities of these insurance company separate accounts could have a material impact on the Fund. The Fund offers two classes of shares: Class 1 and Class 2. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a. Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter

(OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Investments in open-end mutual funds are valued at the closing NAV. Investments in repurchase agreements are valued at cost, which approximates fair value.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day

Semiannual Report         FLG-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Large Cap Growth VIP Fund (continued)

1. Organization and Significant Accounting Policies (continued)

a. Financial Instrument Valuation (continued)

of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b. Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c. Joint Repurchase Agreement

The Fund enters into a joint repurchase agreement whereby its uninvested cash balance is deposited into a joint cash account with other funds managed by the investment

manager or an affiliate of the investment manager and is used to invest in one or more repurchase agreements. The value and face amount of the joint repurchase agreement are allocated to the funds based on their pro-rata interest. A repurchase agreement is accounted for as a loan by the Fund to the seller, collateralized by securities which are delivered to the Fund’s custodian. The fair value, including accrued interest, of the initial collateralization is required to be at least 102% of the dollar amount invested by the funds, with the value of the underlying securities marked to market daily to maintain coverage of at least 100%. Repurchase agreements are subject to the terms of Master Repurchase Agreements (MRAs) with approved counterparties (sellers). The MRAs contain various provisions, including but not limited to events of default and maintenance of collateral for repurchase agreements. In the event of default by either the seller or the Fund, certain MRAs may permit the non-defaulting party to net and close-out all transactions, if any, traded under such agreements. The Fund may sell securities it holds as collateral and apply the proceeds towards the repurchase price and any other amounts owed by the seller to the Fund in the event of default by the seller. This could involve costs or delays in addition to a loss on the securities if their value falls below the repurchase price owed by the seller. The joint repurchase agreement held by the Fund at period end, as indicated in the Statement of Investments, had been entered into on June 30, 2020.

d. Securities Lending

The Fund participates in an agency based securities lending program to earn additional income. The Fund receives cash collateral against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. The collateral is deposited into a joint cash account with other funds and is used to invest in a money market fund managed by Franklin Advisers, Inc., an affiliate of the Fund, and/or a joint repurchase agreement. The Fund may receive income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third-party vendor, is reported separately in the Statement of Operations. The Fund bears the market risk with respect to the collateral investment, securities loaned, and the risk that

FLG-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Large Cap Growth VIP Fund (continued)

the agent may default on its obligations to the Fund. If the borrower defaults on its obligation to return the securities loaned, the Fund has the right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower.

e. Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

f. Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Dividend income is recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as

the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

g. Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

h. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

Semiannual Report         FLG-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Large Cap Growth VIP Fund (continued)

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		83,153		$	1,865,488			—		$	—
Shares issued in reinvestment of distributions		14,182			319,951			7,497			156,170
Shares redeemed		(9,523	)		(209,162	)		(2,288	)		(48,824	)
Net increase (decrease)		87,812		$	1,976,277			5,209		$	107,346
Class 2 Shares:
Shares sold		174,829		$	3,837,628			338,704		$	6,860,065
Shares issued in reinvestment of distributions		522,004			11,348,356			713,171			14,406,046
Shares redeemed		(762,248	)		(16,347,743	)		(1,234,745	)		(26,487,981	)
Net increase (decrease)		(65,415	)	$	(1,161,759	)		(182,870	)	$	(5,221,870	)

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Advisers, Inc. (Advisers)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a. Management Fees

The Fund pays an investment management fee to Advisers based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.750%	Up to and including $500 million
0.625%	Over $500 million, up to and including $1 billion
0.500%	In excess of $1 billion

b. Administrative Fees

Under an agreement with Advisers, FT Services provides administrative services to the Fund. The fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

FLG-18             Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Large Cap Growth VIP Fund (continued)

c. Distribution Fees

The Board has adopted a distribution plan for Class 2 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plan, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rate, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

e. Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Income from securities loaned
Non-Controlled Affiliates
Institutional Fiduciary Trust Money Market Portfolio,0.00%		$411,000		$6,275,000		$(5,978,000	)		$    —		$    —		$708,000		708,000		$1,039

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

5. Income Taxes

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$47,419,590
Unrealized appreciation	$75,709,374
Unrealized depreciation	(656,521)
Net unrealized appreciation (depreciation)	$75,052,853

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatment of wash sales.

Semiannual Report         FLG-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Large Cap Growth VIP Fund (continued)

6. Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $8,973,946 and $18,893,483, respectively.

At June 30, 2020, in connection with securities lending transactions, the Fund loaned equity investments and received $885,181 of cash collateral. The gross amount of recognized liability for such transactions is included in payable upon return of securities loaned in the Statement of Assets and Liabilities. The agreements can be terminated at any time.

7. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

8. Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

9. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

FLG-20             Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Large Cap Growth VIP Fund (continued)

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets carried at fair value, is as follows:

	Level 1		Level 2		Level 3		Total
Assets:
Investments in Securities:a
Equity Investments	$	120,792,347	$	—	$	—	$	120,792,347
Short Term Investments		708,000		972,096		—		1,680,096
Total Investments in Securities	$	121,500,347	$	972,096	$	—	$	122,472,443

^aFor detailed categories, see the accompanying Statement of Investments.

10. New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

11. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Selected Portfolio

ADR     American Depositary Receipt

Semiannual Report         FLG-21

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Franklin Mutual Global Discovery VIP Fund

This semiannual report for Franklin Mutual Global Discovery VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -21.13% total return for the six-month period ended June 30, 2020.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         MGD-1

FRANKLIN MUTUAL GLOBAL DISCOVERY VIP FUND

Fund Goal and Main Investments

The Fund’s investment goal is capital appreciation. Under normal market conditions, the Fund invests primarily in U.S. and foreign equity securities that we believe are available at market prices less than their intrinsic value. The equity securities in which the Fund invests are primarily common stock, with a current focus on mid- and large cap companies. To a lesser extent, the Fund also invests in merger arbitrage securities and the debt and equity of distressed companies. The Fund may invest substantially and potentially up to 100% of its assets in foreign securities, which may include sovereign debt and participations in foreign government debt.

Geographic Composition*

Based on Total Net Assets as of 6/30/20

*Figures are stated as a percentage of total and may not equal 100% or may be negative due to rounding, use of any derivatives, unsettled trades or other factors.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Value securities may not increase in price as anticipated, or may decline further in value. The Fund’s investments in foreign securities involve more risks than U.S. securities, including political and economic developments, trading practices, availability of information, limited markets, and currency exchange fluctuations and policies. Because the Fund may invest at least a significant portion of its assets in companies in a specific region, including Europe, the Fund is subject to greater risks of adverse developments in that region and/or the surrounding regions than a fund that is more broadly diversified geographically. Securities issued by smaller and midsize companies may be more volatile in price than those of larger companies, involve substantial risks and should be considered speculative. Derivatives involve costs and can create economic leverage in the Fund’s portfolio which may result in significant volatility and cause the Fund to participate in losses (as well as gains) in an amount that exceeds the Fund’s initial investment. The Fund’s investments in companies engaged in mergers, reorganizations or liquidations also involve special risks as pending deals may not be completed on time or on favorable terms, as well as lower-rated bonds, which entail higher credit risk. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Fund’s benchmark, the MSCI World Index posted a -5.48% total return for the same period.¹

1. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

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Economic and Market Overview

Global developed and emerging market equities, as measured by the MSCI All Country World Index, posted a -5.99% total return during the six months under review.¹ Stocks fell sharply in early 2020 as countries around the world implemented lockdown measures in an effort to slow the spread of the novel coronavirus (COVID-19). Global supply chain disruptions, business and personal restrictions, and subdued consumer spending drove many investors to sell equity holdings in favor of perceived safe investments such as government bonds and cash. While global equities, notably in the U.S., rebounded in April and May amid optimism about easing lockdown restrictions, concerns about a second wave of infections hindered equities in June, as investors weighed the possibility of renewed restrictions.

In the U.S., government mandates to mitigate the COVID-19 pandemic severely impacted the economy beginning in March 2020. As a result, the unemployment rate surged to 14.7% in April, as many businesses, particularly those involved in hospitality, retail and travel, announced mass layoffs.² According to the National Bureau of Economic Research, the longest U.S. economic expansion in history ended in February 2020 as the country slipped into a severe recession. Nonetheless, near period-end, there were signs that a recovery was underway, as jobless claims fell considerably from their peak in early April, retail sales rose sharply in May, and the unemployment rate fell to 11.1% in June.² Along with optimism about improved treatments and potential vaccines for COVID-19, the positive economic signals contributed to a significant equity rebound in April and May. However, an increase in COVID-19 infections in many states throughout June pressured U.S. stocks.

The U.S. Federal Reserve (Fed) made significant efforts to support the U.S. economy. In March 2020, as the pandemic began to severely impact the economy and financial markets, the Fed implemented two emergency rate cuts, lowering the federal funds target rate to a range of 0.00%–0.25%, and announced sweeping quantitative easing measures aimed at ensuring credit flow to borrowers and supporting credit markets with unlimited amounts of bond purchasing.

In the eurozone, some analysts forecasted a significant contraction in 2020, particularly in southern European countries, as the magnitude of the economic disruption caused by the pandemic became apparent. European developed market equities, as measured by the MSCI

Europe Index, posted a -12.43% total return for the period.¹ To stimulate growth, the European Central Bank implemented a broad bond-buying program, and many countries passed fiscal stimulus measures.

Asian developed and emerging market equities, as measured by the MSCI All Country Asia Index, posted a -5.51% total return during the six-month period.¹ The onset of the pandemic brought dramatically slower economic activity in Asia, as businesses halted operations and manufacturing and export activity declined sharply in the region’s major economies. Asian markets generally advanced toward period-end, bolstered by fiscal stimulus measures and economies reopening throughout the region.

Emerging market stocks, as measured by the MSCI Emerging Markets Index, posted a -9.67% total return due primarily to the COVID-19 pandemic.¹ A sharp decrease in prices for oil and other natural resources also hurt emerging market economies reliant on these exports. In the last quarter of the reporting period, however, investor optimism led to a stock rally, particularly in emerging market countries that had successfully lowered infection rates.

Investment Strategy

At Franklin Mutual Advisors, we are committed to our distinctive value approach to investing. Our major investment strategy is investing in undervalued stocks. When selecting undervalued equities, we are attracted to what we believe are fundamentally strong companies with healthy balance sheets, high-quality assets, substantial free cash flow and shareholder-oriented management teams and whose stocks are trading at discounts to our assessment of the companies’ intrinsic or business value. We also look for asset-rich companies whose shares may be trading at depressed levels due to concerns over short-term earnings disappointments, litigation, management strategy or other perceived negatives. While the vast majority of our undervalued equity investments are made in publicly traded companies globally, we may invest occasionally in privately held companies as well. Our portfolio selection process generally includes an assessment of the potential impacts of any material environmental, social and governance (ESG) factors on the long-term risk and return profile of a company.

We complement this more traditional investment strategy with two others. One is distressed investing, which is complex and can take many forms. The most common distressed investment the Fund undertakes is the purchase

2. Source: U.S. Bureau of Labor Statistics.

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FRANKLIN MUTUAL GLOBAL DISCOVERY VIP FUND

of financially troubled or bankrupt companies’ debt at a substantial discount to face value. After the financially distressed company is reorganized, often in bankruptcy court, the old debt is typically replaced with new securities issued by the financially stronger company.

The other piece of our investment strategy is participating in arbitrage situations, another highly specialized field. When companies announce proposed mergers or takeovers, commonly referred to as “deals,” the target company may trade at a discount to the bid it ultimately accepts. One form of arbitrage involves purchasing the target company’s stock when it is trading below the value we believe it would receive in a deal. In keeping with our commitment to a relatively conservative investment approach, we typically focus our arbitrage efforts on announced deals, and eschew rumored deals or other situations we consider relatively risky.

In addition, it is our practice to hedge the Fund’s currency exposure when we deem it advantageous for our shareholders.

Manager’s Discussion

The novel coronavirus (COVID-19) pandemic has significantly altered our way of life, although the market indexes would suggest that it is business as usual. Stocks have rallied off the March 23 market bottom and are within range of the pre-pandemic, all-time highs achieved earlier in the year. While the economy has reopened, the recovery is likely to be uneven. The question that we wrestle with daily is what does this scenario mean for equities in general and value stocks in particular?

As markets rose sharply in April, investors moved back into the growth stocks that propelled the market to the all-time highs of January. In late May, however, there was a turn in market sentiment resulting in value briefly outperforming growth. Undervalued stocks often benefit in periods of improving economic activity or stabilization as business prospects improve. Increasing demand across the economy, especially in cyclical sectors, can provide a tailwind for these companies and drive shareholder value. This is a scenario that often occurs off an economic bottom, and we are positioning our portfolios to capitalize on this trend.

The second-quarter earnings reporting season (occurring in July and August) marks the first period with the full impact of the economic lockdowns and will provide a more complete view into the pandemic’s impact on corporate statements. Many financial officers withdrew full-year 2020 guidance, as they reported first-quarter results, due to limited revenue

Top 10 Sectors/Industries

6/30/20

	% of Total Net Assets
Pharmaceuticals	11.8%
Oil, Gas & Consumable Fuels	9.0%
Banks	7.2%
Insurance	6.8%
Technology Hardware, Storage & Peripherals	4.8%
Software	4.1%
Tobacco	3.9%
Health Care Providers & Services	3.8%
Automobiles	3.3%
Diversified Financial Services	3.2%

visibility. As a result, the path ahead for stocks is less clear. We remain cautious amid these elevated risks.

Our traditional value equity investment approach is complemented with two other strategies: distressed investing and merger arbitrage.

Within our distressed credit strategy, we targeted companies and industries directly impacted by the coronavirus pandemic. The robust government fiscal and monetary intervention have limited the number of attractive options, but we have found opportunities in the energy sector and the retail and travel industries. Although each situation is unique, these securities have strong collateral packages and covenant protections or other features that we believe make them substantially more attractive than the broad array of available distressed debt.

Within merger arbitrage, which involves trading the stocks of companies involved in a merger or acquisition (M&A), activity has slowed significantly since the onset of the pandemic. Deal terms agreed to before the virus emerged have become unbalanced and are now more favorable for sellers than they are for buyers. Not surprisingly, some of these proposals have become embroiled in litigation. Also, M&A activity has slowed as the economic realities of the coronavirus get priced into the market, and bankers are challenged to conduct due diligence remotely. As the period ended, we began to see signs that transactions activity might resume, but we would expect the second half of the year to be focused on resolving pending deals, rather than significant growth in new ones.

Fund Performance

Turning to Fund performance, investments that detracted included U.S.-based companies Wells Fargo, American

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International Group (AIG; not held at period-end) and Hartford Financial Services Group.

The shares of diversified financial services company Wells Fargo were pulled down by negative investor sentiment for financials, which have trailed the broader market rally from the March 23 bottom. Concerns about a possible dividend cut as bank earnings have come under pressure, and speculation about the Fed moving to negative interest rates—subsequently refuted by Fed Chairman Jerome Powell—contributed to the selloff. Earlier in the period, management reported year-end 2019 earnings that fell well short of consensus estimates.

Shares of insurer AIG retreated as COVID-19 concerns and a lack of clarity on forward guidance related to expenses and investment income contributed to negative investor sentiment. The stock initially rallied following the company’s first-quarter earnings call at which management revealed that the majority of its property policies—which include coverage for business interruption—contained exclusions for losses related to viruses.

Shares of insurance products provider Hartford Financial Services Group trended down on investor concerns about COVID-19 exposure within the company’s various insurance lines. Management asserted that significant losses on business interruption coverages are unlikely because of existing policy language containing virus exclusions in most policies. Nevertheless, there has been a surge in property claims attributable to the pandemic, and management acknowledged there could be higher loss costs, litigation activity and legal expenses. Share repurchases totaled $150 million in 2020’s first quarter, but like most companies, stock buybacks have been suspended pending greater clarity on earnings. There is $650 million remaining under the authorization, which expires in December. Earlier in the period, Hartford’s stock price rallied after the insurer reported fourth-quarter 2019 financial results that surpassed consensus estimates for operating earnings and revenue, driven by underwriting results in property and casualty, a lower group disability loss ratio in group benefits and improved net investment income.

During the period under review, Fund investments that contributed positively to performance included U.S.-based companies Eli Lilly, Kraft Heinz and NortonLifeLock (not held at period-end).

Shares of pharmaceutical products company Eli Lilly were volatile but climbed during the period. Investor sentiment improved as the market came to the realization that the company’s business may not be meaningfully impacted by

Top 10 Holdings

6/30/20

Company Sector/Industry, Country	% of Total Net Assets
GlaxoSmithKline PLC Pharmaceuticals, U.K.	3.4%
Samsung Electronics Co. Ltd. Technology Hardware, Storage & Peripherals, South Korea	3.1%
Novartis AG Pharmaceuticals, Switzerland	3.0%
Merck & Co. Inc. Pharmaceuticals, U.S.	3.0%
Medtronic PLC Health Care Equipment & Supplies, U.S.	3.0%
British American Tobacco PLC Tobacco, U.K.	2.9%
Volkswagen AG Automobiles, Germany	2.6%
NN Group NV Insurance, Netherlands	2.5%
CVS Health Corp. Health Care Providers & Services, U.S.	2.5%
Charter Communications Inc. Media, U.S.	2.5%

the disruption caused by the COVID-19 pandemic. First-quarter financial results exceeded consensus sales and earnings expectations, with revenues benefiting from customers stocking up amid COVID-19, which is likely to reverse later in the year. Management raised 2020 guidance for earnings per share and reiterated the outlook for revenue and operating margin. In our view, Eli Lilly has a strong drug pipeline with several important compounds that positions the company well for continued growth over time.

Investors bid up shares of food products producer Kraft Heinz as surging demand for its products led to better-than-expected sales growth. Management raised its sales guidance in a business update early in the period, and financial results in the subsequent quarterly earnings report exceeded consensus estimates. The company reaffirmed the dividend payment, which also contributed to positive investor sentiment, and several analysts upgraded Kraft Heinz stock.

Shares of cybersecurity solutions provider NortonLifeLock outperformed during the period as work-from-home requirements attributable to the COVID-19 pandemic led to increased consumer purchases of the company’s cybersecurity subscriptions, generating solid fiscal fourth-quarter earnings that were in line with consensus

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expectations. NortonLifeLock’s stock rallied entering the year and surged after management announced in early January the payment of a one-time, $12 per share cash dividend funded by the 2019 sale of the enterprise security business to Broadcom. Symantec, the precursor to NortonLifeLock, sold the business as part of its transition to a pure-play consumer-focused cybersecurity company, and management subsequently adopted the NortonLifeLock brand.

During the period, the Fund held currency forwards and futures seeking to hedge most of the currency risk of the portfolio’s non-U.S. dollar investments. The hedges had a positive overall impact on the Fund’s performance.

Thank you for your participation in Franklin Mutual Global Discovery VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

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Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual (actual return after expenses)		Hypothetical (5% annual return before expenses)
Share   Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$788.70	$4.27	$1,020.09	$4.82	0.96%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin Mutual Global Discovery VIP Fund

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$19.17			$17.47			$20.38			$20.22			$19.85			$22.61
Income from investment operationsa:
Net investment incomeb		0.31	c		0.43			0.36			0.47			0.41			0.37
Net realized and unrealized gains (losses)		(4.36	)		3.64			(2.50	)		1.29			1.92			(1.17	)
Total from investment operations		(4.05	)		4.07			(2.14	)		1.76			2.33			(0.80	)
Less distributions from:
Net investment income		—			(0.37	)		(0.52	)		(0.42	)		(0.39	)		(0.69	)
Net realized gains		—			(2.00	)		(0.25	)		(1.18	)		(1.57	)		(1.27	)
Total distributions		—			(2.37	)		(0.77	)		(1.60	)		(1.96	)		(1.96	)
Net asset value, end of period		$15.12			$19.17			$17.47			$20.38			$20.22			$19.85
Total returnd		(21.13)%			24.71%			(11.01)%			8.99%			12.32%			(3.39)%
Ratios to average net assetse
Expensesf,g		0.96%			0.94%			0.96%			1.01%			1.01%			1.02%
Expenses incurred in connection with securities sold short		0.02%			0.02%			0.01%			—%			0.01%			0.02%
Net investment income		3.92%	c		2.22%			1.81%			2.29%			2.10%			1.71%
Supplemental data
Net assets, end of period (000’s)		$3,065			$3,878			$3,282			$3,189			$3,084			$2,632
Portfolio turnover rate		19.48%			21.82%			29.84%			17.49%			17.54%			21.88%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.14 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 2.05%.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(e).

^gBenefit of waiver and payments by affiliates and expense reduction rounds to less than 0.01%.

MGD-8         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Mutual Global Discovery VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$18.54			$16.96			$19.80			$19.69			$19.37			$22.11
Income from investment operationsa:
Net investment incomeb		0.28	c		0.37			0.30			0.41			0.35			0.32
Net realized and unrealized gains (losses)		(4.21	)		3.53			(2.42	)		1.25			1.87			(1.16	)
Total from investment operations		(3.93	)		3.90			(2.12	)		1.66			2.22			(0.84	)
Less distributions from:
Net investment income		—			(0.32	)		(0.47	)		(0.37	)		(0.33	)		(0.63	)
Net realized gains		—			(2.00	)		(0.25	)		(1.18	)		(1.57	)		(1.27	)
Total distributions		—			(2.32	)		(0.72	)		(1.55	)		(1.90	)		(1.90	)
Net asset value, end of period		$14.61			$18.54			$16.96			$19.80			$19.69			$19.37
Total returnd		(21.20)%			24.37%			(11.22)%			8.71%			12.06%			(3.65)%
Ratios to average net assetse
Expensesf,g		1.21%			1.19%			1.21%			1.26%			1.26%			1.27%
Expenses incurred in connection with securities sold short		0.02%			0.02%			0.01%			—%			0.01%			0.02%
Net investment income		3.67%	c		1.97%			1.56%			2.04%			1.85%			1.46%
Supplemental data
Net assets, end of period (000’s)		$412,641			$539,759			$500,607			$631,179			$630,397			$629,366
Portfolio turnover rate		19.48%			21.82%			29.84%			17.49%			17.54%			21.88%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.14 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 1.80%.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(e).

^gBenefit of waiver and payments by affiliates and expense reduction rounds to less than 0.01%.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Mutual Global Discovery VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$18.98			$17.30			$20.17			$20.02			$19.66			$22.39
Income from investment operationsa:
Net investment incomeb		0.29	c		0.36			0.29			0.40			0.34			0.30
Net realized and unrealized gains (losses)		(4.33	)		3.61			(2.47	)		1.27			1.89			(1.17	)
Total from investment operations		(4.04	)		3.97			(2.18	)		1.67			2.23			(0.87	)
Less distributions from:
Net investment income		—			(0.29	)		(0.44	)		(0.34	)		(0.30	)		(0.59	)
Net realized gains		—			(2.00	)		(0.25	)		(1.18	)		(1.57	)		(1.27	)
Total distributions		—			(2.29	)		(0.69	)		(1.52	)		(1.87	)		(1.86	)
Net asset value, end of period		$14.94			$18.98			$17.30			$20.17			$20.02			$19.66
Total returnd		(21.29)%			24.28%			(11.31)%			8.61%			11.91%			(3.74)%
Ratios to average net assetse
Expensesf,g		1.31%			1.29%			1.31%			1.36%			1.36%			1.37%
Expenses incurred in connection with securities sold short		0.02%			0.02%			0.01%			—%			0.01%			0.02%
Net investment income		3.57%	c		1.87%			1.46%			1.94%			1.75%			1.36%
Supplemental data
Net assets, end of period (000’s)		$24,116			$30,865			$30,094			$41,713			$45,262			$49,054
Portfolio turnover rate		19.48%			21.82%			29.84%			17.49%			17.54%			21.88%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.14 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 1.70%.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(e).

^gBenefit of waiver and payments by affiliates and expense reduction rounds to less than 0.01%.

MGD-10         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin Mutual Global Discovery VIP Fund

	Country		Shares/ Warrants		Value
Common Stocks and Other Equity Interests 89.1%
Aerospace & Defense 1.2%
BAE Systems PLC		United Kingdom		914,196	$	5,466,177
Auto Components 0.0%†
a,b,cInternational Automotive Components Group Brazil LLC		Brazil		424,073		7,974
Automobiles 0.7%
General Motors Co.		United States		119,200		3,015,760
Banks 7.2%
Citigroup Inc.		United States		87,450		4,468,695
First Horizon National Corp.		United States		353,473		3,520,591
ING Groep NV		Netherlands		803,522		5,600,776
JPMorgan Chase & Co.		United States		68,686		6,460,605
Standard Chartered PLC		United Kingdom		892,332		4,836,953
Wells Fargo & Co.		United States		257,820		6,600,192
						31,487,812
Beverages 0.9%
Heineken NV		Netherlands		41,100		3,788,853
Building Products 2.1%
Johnson Controls International PLC		United States		266,700		9,105,138
Capital Markets 3.0%
Credit Suisse Group AG		Switzerland		722,165		7,514,031
aDeutsche Bank AG		Germany		433,542		4,135,664
Guotai Junan Securities Co. Ltd.		China		1,275,797		1,774,230
						13,423,925
Chemicals 2.8%
BASF SE		Germany		130,518		7,330,452
Covestro AG		Germany		134,621		5,127,021
						12,457,473
Communications Equipment 1.3%
Cisco Systems Inc.		United States		120,380		5,614,523
Construction Materials 1.3%
aLafargeHolcim Ltd., B		Switzerland		126,515		5,573,748
Consumer Finance 1.1%
Capital One Financial Corp.		United States		79,688		4,987,672
Containers & Packaging 1.3%
International Paper Co.		United States		160,200		5,640,642
Diversified Financial Services 3.2%
aBerkshire Hathaway Inc., B		United States		30,300		5,408,853
M&G PLC		United Kingdom		998,386		2,073,009
Voya Financial Inc.		United States		143,950		6,715,268
						14,197,130
Entertainment 2.2%
The Walt Disney Co.		United States		85,691		9,555,403

Semiannual Report         MGD-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Global Discovery VIP Fund (continued)

	Country		Shares/ Warrants		Value
Common Stocks and Other Equity Interests (continued)
Food & Staples Retailing 1.0%
Walgreens Boots Alliance Inc.		United States		102,504	$	4,345,145
Food Products 2.1%
The Kraft Heinz Co.		United States		292,300		9,321,447
Health Care Equipment & Supplies 3.0%
Medtronic PLC		United States		142,613		13,077,612
Health Care Providers & Services 3.8%
Anthem Inc.		United States		21,532		5,662,486
CVS Health Corp.		United States		168,591		10,953,357
						16,615,843
Hotels, Restaurants & Leisure 1.1%
aAccor SA		France		180,200		4,917,513
Industrial Conglomerates 0.8%
General Electric Co.		United States		544,250		3,717,228
Insurance 6.8%
Alleghany Corp.		United States		2,730		1,335,352
China Pacific Insurance Group Co. Ltd., H		China		1,931,308		5,190,715
Everest Re Group Ltd.		United States		10,778		2,222,423
The Hartford Financial Services Group Inc.		United States		259,596		10,007,426
NN Group NV		Netherlands		333,803		11,217,375
						29,973,291
IT Services 1.9%
Cognizant Technology Solutions Corp., A		United States		146,460		8,321,857
Machinery 0.9%
aCNH Industrial NV		United Kingdom		536,078		3,765,939
Media 2.6%
aCharter Communications Inc., A		United States		21,286		10,856,711
aiHeartMedia Inc., A		United States		95,199		794,912
a,biHeartMedia Inc., B		United States		1,606		11,399
						11,663,022
Oil, Gas & Consumable Fuels 9.0%
Ampol Ltd.		Australia		17,886		364,398
BP PLC		United Kingdom		2,011,862		7,707,214
Canadian Natural Resources Ltd.		Canada		279,600		4,850,341
ENEOS Holdings Inc.		Japan		1,015,239		3,618,884
Kinder Morgan Inc.		United States		441,470		6,697,100
Royal Dutch Shell PLC, A (EUR Traded)		United Kingdom		127,534		2,087,464
Royal Dutch Shell PLC, A (GBP Traded)		United Kingdom		226,238		3,622,210
The Williams Cos. Inc.		United States		553,901		10,535,197
						39,482,808
Pharmaceuticals 11.8%
aElanco Animal Health Inc.		United States		60,998		1,308,407
Eli Lilly and Co.		United States		55,735		9,150,572
GlaxoSmithKline PLC		United Kingdom		735,340		14,853,032

MGD-12         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Global Discovery VIP Fund (continued)

	Country		Shares/ Warrants		Value
Common Stocks and Other Equity Interests (continued)
Pharmaceuticals (continued)
Merck & Co. Inc.		United States		171,045	$	13,226,910
Novartis AG, ADR		Switzerland		153,897		13,441,364
						51,980,285
Semiconductors & Semiconductor Equipment 1.3%
aRenesas Electronics Corp.		Japan		1,102,140		5,665,443
Software 4.1%
aAvaya Holdings Corp.		United States		4		49
aAvaya Holdings Corp., wts., 12/15/22		United States		5,179		6,474
aCheck Point Software Technologies Ltd.		Israel		100,267		10,771,684
Oracle Corp.		United States		128,100		7,080,087
						17,858,294
Specialty Retail 0.3%
aDufry AG		Switzerland		49,991		1,497,406
Technology Hardware, Storage & Peripherals 4.8%
Hewlett Packard Enterprise Co.		United States		125,444		1,220,570
Samsung Electronics Co. Ltd.		South Korea		308,280		13,683,342
Western Digital Corp.		United States		138,906		6,132,700
						21,036,612
Textiles, Apparel & Luxury Goods 0.8%
Cie Financiere Richemont SA		Switzerland		56,843		3,666,391
Tobacco 3.9%
Altria Group Inc.		United States		107,584		4,222,672
British American Tobacco PLC		United Kingdom		252,780		9,694,430
British American Tobacco PLC, ADR		United Kingdom		83,985		3,260,298
						17,177,400
Wireless Telecommunication Services 0.8%
Vodafone Group PLC		United Kingdom		2,268,154		3,605,672
Total Common Stocks and Other Equity Interests (Cost $387,991,944)						392,011,438
Preferred Stocks (Cost $12,585,173) 2.6%
Automobiles 2.6%
a,dVolkswagen AG, pfd.		Germany		74,193		11,276,333
			Principal Amount
Corporate Bonds, Notes and Senior Floating Rate Interests 1.9%
eAmerican Airlines Inc., senior secured note, 144A, 11.75%, 7/15/25		United States	$	4,710,000		4,438,186
eMacy’s Inc., senior secured note, first lien, 144A, 8.375%, 6/15/25		United States		829,000		826,409
f,g,hMileage Plus Holdings LLC, Term Loan B, TBD, 6/25/27		United States		533,000		529,955
e,iMileage Plus Holdings LLC/Mileage Plus Intellectual Property Assets Ltd., senior secured note, first lien, 144A, 6.50%, 6/20/27		United States		2,060,000		2,070,300

Semiannual Report         MGD-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Global Discovery VIP Fund (continued)

	Country		Principal Amount		Value
Corporate Bonds, Notes and Senior Floating Rate Interests (continued)
Occidental Petroleum Corp.,
senior note, 4.85%, 3/15/21		United States	$	173,000	$	172,459
h,jsenior note, FRN, 1.842%, (3-month USD LIBOR + 1.45%), 8/15/22		United States		553,000		508,972
Total Corporate Bonds, Notes and Senior Floating Rate Interests (Cost $8,625,850)						8,546,281
Corporate Notes in Reorganization 0.6%
kFrontier Communications Corp.,
senior note, 10.50%, 9/15/22		United States		3,610,000		1,258,139
senior note, 11.00%, 9/15/25		United States		4,065,000		1,418,563
Total Corporate Notes in Reorganization (Cost $7,152,596)						2,676,702
			Shares
Companies in Liquidation 0.0%†
a,b,lTribune Media Co., Litigation Trust, Contingent Distribution		United States		57,340		—
a,b,lVistra Energy Corp., Litigation Trust, Contingent Distribution		United States		5,912,264		3,252
a,b,lWalter Energy Inc., Litigation Trust, Contingent Distribution		United States		966,000		—
Total Companies in Liquidation (Cost $185,800)						3,252
Total Investments before Short Term Investments (Cost $416,541,363)						414,514,006
			Principal Amount
Short Term Investments 5.3%
U.S. Government and Agency Securities 5.3%
mFHLB, 7/01/20		United States	$	3,700,000		3,700,000
mU.S. Treasury Bill,
7/02/20		United States		13,000,000		12,999,969
n7/23/20 - 11/27/20		United States		6,500,000		6,498,304
Total U.S. Government and Agency Securities (Cost $23,195,830)						23,198,273
Total Investments (Cost $439,737,193) 99.5%						437,712,279
Other Assets, less Liabilities 0.5%						2,109,646
Net Assets 100.0%					$	439,821,925

MGD-14         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Global Discovery VIP Fund (continued)

^†Rounds to less than 0.1% of net assets.

^aNon-income producing.

^bFair valued using significant unobservable inputs. See Note 13 regarding fair value measurements.

^cSee Note 10 regarding restricted securities.

^dVariable rate security. The rate shown represents the yield at period end.

^eSecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in a public offering registered under the Securities Act of 1933. At June 30, 2020, the aggregate value of these securities was $7,334,895, representing 1.7% of net assets.

^fSecurity purchased on a delayed delivery basis. See Note 1(c).

^gA portion or all of the security represents an unsettled loan commitment. The coupon rate is to-be determined (TBD) at the time of settlement and will be based upon a reference index/floor plus a spread.

^hSee Note 1(g) regarding senior floating rate interests.

ⁱSecurity purchased on a when-issued basis. See Note 1(c).

^jThe coupon rate shown represents the rate at period end.

^kSee Note 7 regarding credit risk and defaulted securities.

^lContingent distributions represent the right to receive additional distributions, if any, during the reorganization of the underlying company. Shares represent total underlying principal of debt securities.

^mThe security was issued on a discount basis with no stated coupon rate.

ⁿA portion or all of the security has been segregated as collateral for open forward exchange contracts. At June 30, 2020, the aggregate value of these securities pledged amounted to $910,870, representing 0.2% of net assets.

At June 30, 2020, the Fund had the following futures contracts outstanding. See Note 1(d).

Futures Contracts

Description	Type	Number of Contracts	Notional Amount	*	Expiration Date	Value/ Unrealized Appreciation (Depreciation)
Currency Contracts
EUR/USD	Short	167	$23,491,681		9/14/20	$154,589
GBP/USD	Short	128	9,917,600		9/14/20	272,278
Total Futures Contracts						$426,867

*As of period end.

Semiannual Report         MGD-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Global Discovery VIP Fund (continued)

At June 30, 2020, the Fund had the following forward exchange contracts outstanding. See Note 1(d).

Forward Exchange Contracts

Currency	Counterparty	a	Type	Quantity		Contract Amount	Settlement Date	Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts
Australian Dollar	HSBK		Buy	35,532	$	24,376	7/15/20	$         145	$	—
Australian Dollar	UBSW		Buy	73,602		51,056	7/15/20	—		(262	)
Australian Dollar	UBSW		Buy	2,986,417		2,054,149	7/15/20	6,814		—
Australian Dollar	UBSW		Sell	3,619,790		2,499,186	7/15/20	1,126		—
Euro	BOFA		Sell	665,303		736,468	7/15/20	—		(11,208	)
Euro	BONY		Sell	480,594		540,818	7/15/20	720		—
Euro	HSBK		Buy	67,940		76,216	7/15/20	136		—
Euro	HSBK		Buy	1,303,998		1,467,772	7/15/20	—		(2,321	)
Euro	HSBK		Sell	1,235,751		1,400,423	7/15/20	11,668		—
Euro	HSBK		Sell	1,498,320		1,670,080	7/15/20	—		(13,752	)
Euro	SSBT		Sell	918,276		1,018,389	7/15/20	—		(13,584	)
Euro	SSBT		Sell	961,741		1,084,091	7/15/20	3,273		—
Euro	UBSW		Sell	1,592,124		1,798,978	7/15/20	9,724		—
Euro	UBSW		Sell	29,083,618		31,880,595	7/15/20	—		(804,000	)
South Korean Won	HSBK		Buy	595,344,910		493,029	7/17/20	3,332		—
South Korean Won	HSBK		Sell	661,260,600		555,112	7/17/20	3,795		—
South Korean Won	HSBK		Sell	15,855,081,459		12,966,962	7/17/20	—		(252,006	)
South Korean Won	UBSW		Sell	356,186,851		291,264	7/17/20	—		(5,702	)
British Pound	HSBK		Buy	13,155		16,358	8/14/20	—		(54	)
British Pound	UBSW		Sell	8,878,011		11,135,645	8/14/20	132,626		—
Swiss Franc	UBSW		Sell	6,823,321		7,260,938	8/17/20	48,626		—
Total Forward Exchange Contracts								$  221,985	$	(1,102,889	)
Net unrealized appreciation (depreciation)									$	(880,904	)

^aMay be comprised of multiple contracts with the same counterparty, currency and settlement date.

See Note 11 regarding other derivative information.

See Abbreviations on page MGD-32.

MGD-16         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Mutual Global Discovery VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$439,737,193
Value - Unaffiliated issuers		$437,712,279
Cash		159,574
Receivables:
Investment securities sold		3,500,602
Capital shares sold		328,635
Dividends and interest		1,512,037
European Union tax reclaims		323,586
Deposits with brokers for:
Futures contracts		766,705
Unrealized appreciation on OTC forward exchange contracts		221,985
Other assets		436
Total assets		444,525,839
Liabilities:
Payables:
Investment securities purchased		2,556,590
Capital shares redeemed		376,998
Management fees		324,159
Distribution fees		93,946
Trustees’ fees and expenses		266
Variation margin on futures contracts		84,556
Unrealized depreciation on OTC forward exchange contracts		1,102,889
Accrued expenses and other liabilities		164,510
Total liabilities		4,703,914
Net assets, at value		$439,821,925
Net assets consist of:
Paid-in capital		$429,236,675
Total distributable earnings (losses)		10,585,250
Net assets, at value		$439,821,925
Class 1:
Net assets, at value		$    3,065,102
Shares outstanding		202,754
Net asset value and maximum offering price per share		$15.12
Class 2:
Net assets, at value		$412,640,974
Shares outstanding		28,252,674
Net asset value and maximum offering price per share		$14.61
Class 4:
Net assets, at value		$  24,115,849
Shares outstanding		1,614,021
Net asset value and maximum offering price per share		$14.94

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         MGD-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Mutual Global Discovery VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers		$   11,415,997
Interest:
Unaffiliated issuers		382,971
Adjustment for uncollectible interest (Note 7)		(404,250	)
Income from securities loaned:
Non-controlled affiliates (Note 3e)		1,064
Total investment income		11,395,782
Expenses:
Management fees (Note 3a)		2,048,477
Distribution fees: (Note 3c)
Class 2		549,594
Class 4		44,168
Custodian fees (Note 4)		12,054
Reports to shareholders		49,719
Professional fees		57,177
Trustees’ fees and expenses		1,691
Dividends on securities sold short		55,552
Other		15,373
Total expenses		2,833,805
Expense reductions (Note 4)		(2,438	)
Expenses waived/paid by affiliates (Note 3e)		(392	)
Net expenses		2,830,975
Net investment income		8,564,807
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		(16,150,154	)
Foreign currency transactions		22,651
Forward exchange contracts		936,222
Futures contracts		219,169
Securities sold short		(293,748	)
Net realized gain (loss)		(15,265,860	)
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(112,740,294	)
Translation of other assets and liabilities denominated in foreign currencies		(10,093	)
Forward exchange contracts		493,454
Futures contracts		761,318
Securities sold short		374,951
Net change in unrealized appreciation (depreciation)		(111,120,664	)
Net realized and unrealized gain (loss)		(126,386,524	)
Net increase (decrease) in net assets resulting from operations		$(117,821,717	)
*Foreign taxes withheld on dividends		$             301,515

MGD-18         Semiannual Report  |  The accompanying notes are an integral part of these  financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Franklin Mutual Global Discovery VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income		$      8,564,807			$  11,110,516
Net realized gain (loss)		(15,265,860	)		10,200,575
Net change in unrealized appreciation (depreciation)		(111,120,664	)		100,899,252
Net increase (decrease) in net assets resulting from operations		(117,821,717	)		122,210,343
Distributions to shareholders:
Class 1		—			(427,555	)
Class 2		—			(61,286,007	)
Class 4		—			(3,431,154	)
Total distributions to shareholders		—			(65,144,716	)
Capital share transactions: (Note 2)
Class 1		(24,744	)		231,219
Class 2		(16,256,228	)		(14,266,368	)
Class 4		(578,181	)		(2,510,695	)
Total capital share transactions		(16,859,153	)		(16,545,844	)
Net increase (decrease) in net assets		(134,680,870	)		40,519,783
Net assets:
Beginning of period		574,502,795			533,983,012
End of period		$  439,821,925			$574,502,795

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         MGD-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin Mutual Global Discovery VIP Fund

1.  Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Mutual Global Discovery VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. At June 30, 2020, 43.5% of the Fund’s shares were held through one insurance company. Investment activities of these insurance company separate accounts could have a material impact on the Fund. The Fund offers three classes of shares: Class 1, Class 2, and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a.  Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities and derivative financial instruments listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is

determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Debt securities generally trade in the OTC market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value.

Investments in open-end mutual funds are valued at the closing NAV. Investments in repurchase agreements are valued at cost, which approximates fair value.

Certain derivative financial instruments trade in the OTC market. The Fund’s pricing services use various techniques including industry standard option pricing models and proprietary discounted cash flow models to determine the fair value of those instruments. The Fund’s net benefit or obligation under the derivative contract, as measured by the fair value of the contract, is included in net assets.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the

MGD-20         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time. At June 30, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b.   Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent

value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c.   Securities Purchased on a When-Issued or Delayed Delivery Basis

The Fund purchases securities on a when-issued or delayed delivery basis, with payment and delivery scheduled for a future date. These transactions are subject to market fluctuations and are subject to the risk that the value at delivery may be more or less than the trade date purchase price. Although the Fund will generally purchase these securities with the intention of holding the securities, it may sell the securities before the settlement date. Sufficient assets have been segregated for these securities.

d.   Derivative Financial Instruments

The Fund invested in derivative financial instruments in order to manage risk or gain exposure to various other investments or markets. Derivatives are financial contracts based on an underlying or notional amount, require no initial investment or an initial net investment that is smaller than would normally be required to have a similar response to changes in market factors, and require or permit net settlement. Derivatives contain various risks including the potential inability of the counterparty to fulfill their obligations under the terms of the contract, the potential for an illiquid secondary market, and/or the potential for market movements which expose the Fund to gains or losses in excess of the amounts shown in the Statement of Assets and Liabilities. Realized gain and loss

Semiannual Report         MGD-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

1.   Organization and Significant Accounting Policies (continued)

d.   Derivative Financial Instruments (continued)

and unrealized appreciation and depreciation on these contracts for the period are included in the Statement of Operations.

Derivative counterparty credit risk is managed through a formal evaluation of the creditworthiness of all potential counterparties. The Fund attempts to reduce its exposure to counterparty credit risk on OTC derivatives, whenever possible, by entering into International Swaps and Derivatives Association (ISDA) master agreements with certain counterparties. These agreements contain various provisions, including but not limited to collateral requirements, events of default, or early termination. Termination events applicable to the counterparty include certain deteriorations in the credit quality of the counterparty. Termination events applicable to the Fund include failure of the Fund to maintain certain net asset levels and/or limit the decline in net assets over various periods of time. In the event of default or early termination, the ISDA master agreement gives the non-defaulting party the right to net and close-out all transactions traded, whether or not arising under the ISDA agreement, to one net amount payable by one counterparty to the other. However, absent an event of default or early termination, OTC derivative assets and liabilities are presented gross and not offset in the Statement of Assets and Liabilities. Early termination by the counterparty may result in an immediate payment by the Fund of any net liability owed to that counterparty under the ISDA agreement. At June 30, 2020, the Fund had OTC derivatives in a net liability position of $881,624 and the aggregate value of collateral pledged for such contracts was $910,870.

Collateral requirements differ by type of derivative. Collateral or initial margin requirements are set by the broker or exchange clearing house for exchange traded and centrally cleared derivatives. Initial margin deposited is held at the exchange and can be in the form of cash and/or securities. For OTC derivatives traded under an ISDA master agreement, posting of collateral is required by either the Fund or the applicable counterparty if the total net exposure of all OTC derivatives with the applicable counterparty exceeds the minimum transfer amount, which typically ranges from $100,000 to $250,000, and can vary depending on the counterparty and the type of the agreement. Generally, collateral is determined at the close of Fund business each

day and any additional collateral required due to changes in derivative values may be delivered by the Fund or the counterparty the next business day, or within a few business days. Collateral pledged and/or received by the Fund for OTC derivatives, if any, is held in segregated accounts with the Fund’s custodian/counterparty broker and can be in the form of cash and/or securities. Unrestricted cash may be invested according to the Fund’s investment objectives. To the extent that the amounts due to the Fund from its counterparties are not subject to collateralization or are not fully collateralized, the Fund bears the risk of loss from counterparty non-performance.

The Fund entered into exchange traded futures contracts primarily to manage exposure to certain foreign currencies. A futures contract is an agreement between the Fund and a counterparty to buy or sell an asset at a specified price on a future date. Required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or receivable in the Statement of Assets and Liabilities.

The Fund entered into OTC forward exchange contracts primarily to manage exposure to certain foreign currencies. A forward exchange contract is an agreement between the Fund and a counterparty to buy or sell a foreign currency at a specific exchange rate on a future date.

See Note 11 regarding other derivative information.

e.   Securities Sold Short

The Fund is engaged in selling securities short, which obligates the Fund to replace a borrowed security with the same security at current fair value. The Fund incurs a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund realizes a gain if the price of the security declines between those dates. Gains are limited to the price at which the Fund sold the security short, while losses are potentially unlimited in size.

The Fund is required to establish a margin account with the broker lending the security sold short. While the short sale is outstanding, the broker retains the proceeds of the short sale to the extent necessary to meet margin requirements until the short position is closed out. A deposit must also be maintained with the Fund’s custodian/counterparty broker consisting of cash and/or securities having a value equal to a specified percentage of the value of the securities sold short.

MGD-22          Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

The Fund is obligated to pay fees for borrowing the securities sold short and is required to pay the counterparty any dividends and/or interest due on securities sold short. Such dividends and/or interest and any security borrowing fees are recorded as an expense to the Fund. At June 30, 2020, the Fund had no securities sold short.

f.   Securities Lending

The Fund participates in an agency based securities lending program to earn additional income. The Fund receives cash collateral against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. The collateral is deposited into a joint cash account with other funds and is used to invest in a money market fund managed by Franklin Advisers, Inc., an affiliate of the Fund. The Fund may receive income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third-party vendor, is reported separately in the Statement of Operations. The Fund bears the market risk with respect to the collateral investment, securities loaned, and the risk that the agent may default on its obligations to the Fund. If the borrower defaults on its obligation to return the securities loaned, the Fund has the right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower. At June 30, 2020, the Fund had no securities on loan.

g.   Senior Floating Rate Interests

The Fund invests in senior secured corporate loans that pay interest at rates which are periodically reset by reference to a base lending rate plus a spread. These base lending rates are generally the prime rate offered by a designated U.S. bank or the London InterBank Offered Rate (LIBOR). Senior secured corporate loans often require prepayment of principal from excess cash flows or at the discretion of the borrower. As a result, actual maturity may be substantially less than the stated maturity. Senior secured corporate loans in which the Fund invests are generally readily marketable, but may be subject to certain restrictions on resale. On

July 27, 2017, the United Kingdom’s Financial Conduct Authority announced its intention to cease sustaining LIBOR after 2021. There remains uncertainty regarding the future utilization of LIBOR and the nature of any replacement rate. As such, the potential effect of a transition away from LIBOR on the Fund or the Fund’s investments that use or may use a floating rate based on LIBOR cannot yet be determined.

h.   Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

As a result of several court cases, in certain countries across the European Union, the Fund filed additional tax reclaims for previously withheld taxes on dividends earned in those countries (EU reclaims). These additional filings are subject to various administrative proceedings by the local jurisdictions’ tax authorities within the European Union, as well as a number of related judicial proceedings. Income recognized, if any, for EU reclaims is reflected as other income in the Statement of Operations and any related receivable, if any, is reflected as European Union tax reclaims in the Statement of Assets and Liabilities. When uncertainty exists as to the ultimate resolution of these proceedings, the likelihood of receipt of these EU reclaims, and the potential timing of payment, no amounts are reflected in the financial statements. For U.S. income tax purposes, when EU reclaims are received by the Fund and the Fund previously passed foreign tax credit on to its shareholders, the Fund must either amend historic tax reporting to shareholders or enter into a closing agreement with the Internal Revenue Service (IRS) in order to pay the associated tax liability on behalf of the Fund’s shareholders.

Semiannual Report         MGD-23

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

1.   Organization and Significant Accounting Policies (continued)

h.   Income and Deferred Taxes (continued)

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

i.   Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Amortization of premium and accretion of discount on debt securities are included in interest income. Dividend income and dividends declared on securities sold short are recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

j.   Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

k.   Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

MGD-24          Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

2.   Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		18,126		$	275,922			24,462		$	464,734
Shares issued in reinvestment of distributions		—			—			24,488			427,555
Shares redeemed		(17,724	)		(300,666	)		(34,522	)		(661,070	)
Net increase (decrease)		402		$	(24,744	)		14,428		$	231,219
Class 2 Shares:
Shares sold		1,459,013		$	20,082,823			753,358		$	13,863,507
Shares issued in reinvestment of distributions		—			—			3,626,391			61,286,007
Shares redeemed		(2,320,626	)		(36,339,051	)		(4,790,566	)		(89,415,882	)
Net increase (decrease)		(861,613	)	$	(16,256,228	)		(410,817	)	$	(14,266,368	)
Class 4 Shares:
Shares sold		131,469		$	1,791,616			22,659		$	428,560
Shares issued in reinvestment of distributions		—			—			198,332			3,431,154
Shares redeemed		(144,056	)		(2,369,797	)		(334,363	)		(6,370,409	)
Net increase (decrease)		(12,587	)	$	(578,181	)		(113,372	)	$	(2,510,695	)

3.   Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Mutual Advisers, LLC (Franklin Mutual)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

Semiannual Report         MGD-25

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

3.   Transactions with Affiliates (continued)

a.   Management Fees

The Fund pays an investment management fee to Franklin Mutual based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.875%	Up to and including $4 billion
0.845%	Over $4 billion, up to and including $7 billion
0.825%	Over $7 billion, up to and including $10 billion
0.805%	Over $10 billion, up to and including $13 billion
0.785%	Over $13 billion, up to and including $16 billion
0.765%	Over $16 billion, up to and including $19 billion
0.745%	Over $19 billion, up to and including $22 billion
0.725%	Over $22 billion, up to and including $25 billion
0.705%	Over $25 billion, up to and including $28 billion
0.685%	In excess of $28 billion

b.   Administrative Fees

Under an agreement with Franklin Mutual, FT Services provides administrative services to the Fund. The fee is paid by Franklin Mutual based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

c.   Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets of each class. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d.   Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

MGD-26          Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

e.   Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Income from securities loaned
Non-Controlled Affiliates
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		$   —		$5,503,000		$(5,503,000	)		$   —		$   —		$   —		—		$1,064

4.   Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

5.   Income Taxes

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$439,767,840
Unrealized appreciation	$  60,106,053
Unrealized depreciation	(62,614,923)
Net unrealized appreciation (depreciation)	$  (2,508,870)

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of foreign currency transactions and pass-through entity income.

6.   Investment Transactions

Purchases and sales of investments (excluding short term securities and securities sold short) for the period ended June 30, 2020, aggregated $87,351,219 and $97,603,018, respectively.

7.   Credit Risk and Defaulted Securities

The Fund may purchase the pre-default or defaulted debt of distressed companies. Distressed companies are financially troubled and could be or are already involved in financial restructuring or bankruptcy. Risks associated with purchasing these securities include the possibility that the bankruptcy or other restructuring process takes longer than expected, or that distributions in restructuring are less than anticipated, either or both of which may result in unfavorable consequences to the

Semiannual Report         MGD-27

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

7.   Credit Risk and Defaulted Securities (continued)

Fund. If it becomes probable that the income on debt securities, including those of distressed companies, will not be collected, the Fund discontinues accruing income and recognizes an adjustment for uncollectible interest. For the period ended June 30, 2020, the Fund recorded an adjustment for uncollectible interest of $404,250 as noted in the Statement of Operations.

At June 30, 2020, the aggregate long value of distressed company securities for which interest recognition has been discontinued was $2,676,702, representing 0.6% of the Fund’s net assets. For information as to specific securities, see the accompanying Statement of Investments.

8.   Concentration of Risk

Investing in foreign securities may include certain risks and considerations not typically associated with investing in U.S. securities, such as fluctuating currency values and changing local, regional and global economic, political and social conditions, which may result in greater market volatility. Current political and financial uncertainty surrounding the European Union may increase market volatility and the economic risk of investing in securities in Europe. In addition, certain foreign securities may not be as liquid as U.S. securities.

9.   Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

10.   Restricted Securities

The Fund invests in securities that are restricted under the Securities Act of 1933 (1933 Act). Restricted securities are often purchased in private placement transactions, and cannot be sold without prior registration unless the sale is pursuant to an exemption under the 1933 Act. Disposal of these securities may require greater effort and expense, and prompt sale at an acceptable price may be difficult. The Fund may have registration rights for restricted securities. The issuer generally incurs all registration costs.

At June 30, 2020, investments in restricted securities, excluding securities exempt from registration under the 1933 Act, were as follows:

Shares		Issuer	Acquisition   Date	Cost		Value
	424,073	International Automotive Components Group Brazil LLC (Value is 0.0%† of Net Assets)	4/13/06 - 12/26/08	$	281,629	$	7,974

^†Rounds to less than 0.1% of net assets.

MGD-28          Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

11.   Other Derivative Information

At June 30, 2020, investments in derivative contracts are reflected in the Statement of Assets and Liabilities as follows:

	Asset Derivatives				Liability Derivatives
Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Assets and Liabilities Location	Fair Value			Statement of Assets and Liabilities Location	Fair Value
Foreign exchange contracts	Variation margin on futures contracts		$426,867	a	Variation margin on futures contracts		$            —
	Unrealized appreciation on OTC forward exchange contracts		221,985		Unrealized depreciation on OTC forward exchange contracts		1,102,889
Totals			$648,852				$1,102,889

^aThis amount reflects the cumulative appreciation (depreciation) of futures contracts as reported in the Statement of Investments. Only the variation margin receivable/ payable at period end is separately reported within the Statement of Assets and Liabilities. Prior variation margin movements were recorded to cash upon receipt or payment.

For the period ended June 30, 2020, the effect of derivative contracts in the Statement of Operations was as follows:

Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Operations Location	Net Realized Gain (Loss) for the Period		Statement of Operations Location	Net Change in Unrealized Appreciation (Depreciation) for the Period
	Net realized gain (loss) from:			Net change in unrealized appreciation (depreciation) on:
Foreign exchange contracts	Forward exchange contracts		$   936,222	Forward exchange contracts		$   493,454
	Futures contracts		219,169	Futures contracts		761,318
Totals			$1,155,391			$1,254,772

For the period ended June 30, 2020, the average month end notional amount of futures contracts represented $34,606,397. The average month end contract value of forward exchange contracts was $86,068,276.

See Note 1(d) regarding derivative financial instruments.

12.   Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

Semiannual Report         MGD-29

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

13.   Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

MGD-30          Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets and liabilities carried at fair value, is as follows:

	Level 1		Level 2		Level 3			Total
Assets:
Investments in Securities:a
Equity Investments:b
Aerospace & Defense	$	—	$	5,466,177	$	—		$	5,466,177
Auto Components		—		—		7,974			7,974
Automobiles		3,015,760		11,276,333		—			14,292,093
Banks		21,050,083		10,437,729		—			31,487,812
Capital Markets		—		13,423,925		—			13,423,925
Chemicals		—		12,457,473		—			12,457,473
Construction Materials		—		5,573,748		—			5,573,748
Diversified Financial Services		12,124,121		2,073,009		—			14,197,130
Hotels, Restaurants & Leisure		—		4,917,513		—			4,917,513
Insurance		13,565,201		16,408,090		—			29,973,291
Machinery		—		3,765,939		—			3,765,939
Media		11,651,623		—		11,399			11,663,022
Oil, Gas & Consumable Fuels		22,082,638		17,400,170		—			39,482,808
Pharmaceuticals		37,127,253		14,853,032		—			51,980,285
Semiconductors & Semiconductor Equipment		—		5,665,443		—			5,665,443
Software		17,851,820		6,474		—			17,858,294
Specialty Retail		—		1,497,406		—			1,497,406
Technology Hardware, Storage & Peripherals		7,353,270		13,683,342		—			21,036,612
Textiles, Apparel & Luxury Goods		—		3,666,391		—			3,666,391
Tobacco		7,482,970		9,694,430		—			17,177,400
Wireless Telecommunication Services		—		3,605,672		—			3,605,672
All Other Equity Investments		94,091,363		—		—			94,091,363
Corporate Bonds, Notes and Senior Floating Rate Interests		—		8,546,281		—			8,546,281
Corporate Notes in Reorganization		—		2,676,702		—			2,676,702
Companies in Liquidation		—		—		3,252	c		3,252
Short Term Investments		19,498,273		3,700,000		—			23,198,273
Total Investments in Securities	$	266,894,375	$	170,795,279	$	22,625		$	437,712,279
Other Financial Instruments:
Futures Contracts	$	426,867	$	—	$	—		$	426,867
Forward Exchange Contracts		—		221,985		—			221,985
Total Other Financial Instruments	$	426,867	$	221,985	$	—		$	648,852
Liabilities:
Other Financial Instruments:
Forward Exchange Contracts	$	—	$	1,102,889	$	—		$	1,102,889

^aFor detailed categories, see the accompanying Statement of Investments.

^bIncludes common and preferred stocks as well as other equity interests.

^cIncludes securities determined to have no value at June 30, 2020.

A reconciliation in which Level 3 inputs are used in determining fair value is presented when there are significant Level 3 assets and liabilities at the beginning and/or end of the period.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Franklin Mutual Global Discovery VIP Fund (continued)

14.   New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of LIBOR and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

15.   Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Counterparty		Currency		Selected Portfolio
BOFA	Bank of America Corp.	EUR	Euro	ADR	American Depositary Receipt
BONY	Bank of New York	GBP	British Pound	FHLB	Federal Home Loan Bank
HSBK	HSBC Bank PLC	USD	United States Dollar
SSBT	State Street Bank and Trust Co., N.A.
UBSW	UBS AG

MGD-32          Semiannual Report

Franklin Mutual Shares VIP Fund

This semiannual report for Franklin Mutual Shares VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -21.10% total return for the six-month period ended June 30, 2020.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

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FRANKLIN MUTUAL SHARES VIP FUND

Fund Goal and Main Investments

The Fund’s principal investment goal is capital appreciation. Its secondary goal is income. Under normal market conditions, the Fund invests primarily in U.S. and foreign equity securities that we believe are available at market prices less than their intrinsic value. The equity securities in which the Fund invests are primarily common stock, with a current focus on companies with market capitalizations greater than $5 billion. To a lesser extent, the Fund also invests in merger arbitrage securities and the debt and equity of distressed companies. The Fund may invest up to 35% of its assets in foreign securities, which may include sovereign debt and participations in foreign government debt.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Value securities may not increase in price as anticipated or may decline further in value. The Fund’s investments in foreign securities involve more risks than investing in U.S. securities, including currency exchange rates and policies, country or government specific issues, less favorable trading practices regulation and greater price volatility. Securities issued by smaller and midsize companies may be more volatile in price than those of larger companies, involve substantial risks and should be considered speculative. Derivatives involve costs and can create economic leverage in the Fund’s portfolio which may result in significant volatility and cause the Fund to participate in losses (as well as gains) in an amount that exceeds the Fund’s initial investment. The Fund may also invest in companies engaged in mergers, reorganizations or liquidations, which involve special risks as pending deals may not be completed on time or on favorable terms, as well as lower-rated bonds, which entail higher credit risk. To the extent that the Fund focuses on particular countries, regions, industries, sectors or types of investment from time to time, the Fund may be subject to greater risks of adverse developments in such areas of focus than a fund that invests

Geographic Composition*

Based on Total Net Assets as of 6/30/20

*Figures are stated as a percentage of total and may not equal 100% or may be negative due to rounding, use of any derivatives, unsettled trades or other factors.

in a wider variety of countries, regions, industries, sectors or investments. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Fund’s benchmark, the Standard & Poor’s^® 500 Index (S&P 500^®) posted a -3.08% total return for the period under review.¹

Economic and Market Overview

Global developed and emerging market equities, as measured by the MSCI All Country World Index, posted a -5.99% total return during the six months under review.¹ Stocks fell sharply in early 2020 as countries around the world implemented lockdown measures in an effort to slow the spread of the novel coronavirus (COVID-19). Global supply chain disruptions, business and personal restrictions, and subdued consumer spending drove many investors to sell equity holdings in favor of perceived safe investments such as government bonds and cash. While global equities, notably in the U.S., rebounded in April and May amid optimism about easing lockdown restrictions, concerns about

1. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

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a second wave of infections hindered equities in June, as investors weighed the possibility of renewed restrictions.

In the U.S., government mandates to mitigate the COVID-19 pandemic severely impacted the economy beginning in March 2020. As a result, the unemployment rate surged to 14.7% in April, as many businesses, particularly those involved in hospitality, retail and travel, announced mass layoffs.² According to the National Bureau of Economic Research, the longest U.S. economic expansion in history ended in February 2020 as the country slipped into a severe recession. Nonetheless, near period-end, there were signs that a recovery was underway, as jobless claims fell considerably from their peak in early April, retail sales rose sharply in May, and the unemployment rate fell to 11.1% in June.² Along with optimism about improved treatments and potential vaccines for COVID-19, the positive economic signals contributed to a significant equity rebound in April and May. However, an increase in COVID-19 infections in many states throughout June pressured U.S. stocks.

The U.S. Federal Reserve (Fed) made significant efforts to support the U.S. economy. In March 2020, as the pandemic began to severely impact the economy and financial markets, the Fed implemented two emergency rate cuts, lowering the federal funds target rate to a range of 0.00%–0.25%, and announced sweeping quantitative easing measures aimed at ensuring credit flow to borrowers and supporting credit markets with unlimited amounts of bond purchasing.

In the eurozone, some analysts forecasted a significant contraction in 2020, particularly in southern European countries, as the magnitude of the economic disruption caused by the pandemic became apparent. European developed market equities, as measured by the MSCI Europe Index, posted a -12.43% total return for the period.¹ To stimulate growth, the European Central Bank implemented a broad bond-buying program, and many countries passed fiscal stimulus measures.

Asian developed and emerging market equities, as measured by the MSCI All Country Asia Index, posted a -5.51% total return during the six-month period.¹ The onset of the pandemic brought dramatically slower economic activity in Asia, as businesses halted operations and manufacturing and export activity declined sharply in the region’s major economies. Asian markets generally advanced toward period-end, bolstered by fiscal stimulus measures and economies reopening throughout the region.

Top 10 Sectors/Industries

6/30/20

	% of Total Net Assets
Pharmaceuticals		10.7%
Banks		6.7%
Media		6.2%
Oil, Gas & Consumable Fuels		5.8%
Insurance		5.4%
Technology Hardware, Storage & Peripherals		4.3%
Food Products		4.2%
Software		3.4%
Tobacco		3.3%
Food & Staples Retailing		3.3%

Emerging market stocks, as measured by the MSCI Emerging Markets Index, posted a -9.67% total return due primarily to the COVID-19 pandemic.¹ A sharp decrease in prices for oil and other natural resources also hurt emerging market economies reliant on these exports. In the last quarter of the reporting period, however, investor optimism led to a stock rally, particularly in emerging market countries that had successfully lowered infection rates.

Investment Strategy

At Franklin Mutual Advisors, we are committed to our distinctive value approach to investing. Our major investment strategy is investing in undervalued stocks. When selecting undervalued equities, we are attracted to what we believe are fundamentally strong companies with healthy balance sheets, high-quality assets, substantial free cash flow and shareholder-oriented management teams and whose stocks are trading at discounts to our assessment of the companies’ intrinsic or business value. We also look for asset-rich companies whose shares may be trading at depressed levels due to concerns over short-term earnings disappointments, litigation, management strategy or other perceived negatives. While the vast majority of our undervalued equity investments are made in publicly traded companies globally, we may invest occasionally in privately held companies as well. Our portfolio selection process generally includes an assessment of the potential impacts of any material environmental, social and governance (ESG) factors on the long-term risk and return profile of a company.

We complement this more traditional investment strategy with two others. One is distressed investing, which is complex and can take many forms. The most common

2. Source: U.S. Bureau of Labor Statistics.

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FRANKLIN MUTUAL SHARES VIP FUND

distressed investment the Fund undertakes is the purchase of financially troubled or bankrupt companies’ debt at a substantial discount to face value. After the financially distressed company is reorganized, often in bankruptcy court, the old debt is typically replaced with new securities issued by the financially stronger company.

The other piece of our investment strategy is participating in arbitrage situations, another highly specialized field. When companies announce proposed mergers or takeovers, commonly referred to as “deals,” the target company may trade at a discount to the bid it ultimately accepts. One form of arbitrage involves purchasing the target company’s stock when it is trading below the value we believe it would receive in a deal. In keeping with our commitment to a relatively conservative investment approach, we typically focus our arbitrage efforts on announced deals, and eschew rumored deals or other situations we consider relatively risky.

In addition, it is our practice to hedge the Fund’s currency exposure when we deem it advantageous for our shareholders.

Manager’s Discussion

The novel coronavirus (COVID-19) pandemic has significantly altered our way of life, although the market indexes would suggest that it is business as usual. Stocks have rallied off the March 23 market bottom and are within range of the pre-pandemic, all-time highs achieved earlier in the year. While the economy has reopened, the recovery is likely to be uneven. The question that we wrestle with daily is what does this scenario mean for equities in general and value stocks in particular?

As markets rose sharply in April, investors moved back into the growth stocks that propelled the market to the all-time highs of January. In late May, however, there was a turn in market sentiment resulting in value briefly outperforming growth. Undervalued stocks often benefit in periods of improving economic activity or stabilization as business prospects improve. Increasing demand across the economy, especially in cyclical sectors, can provide a tailwind for these companies and drive shareholder value. This is a scenario that often occurs off an economic bottom, and we are positioning our portfolios to capitalize on this trend.

The second-quarter earnings reporting season (occurring in July and August) marks the first period with the full impact of the economic lockdowns and will provide a more complete view into the pandemic’s impact on corporate statements. Many financial officers withdrew full-year 2020 guidance, as they reported first- quarter results, due to limited revenue

visibility. As a result, the path ahead for stocks is less clear. We remain cautious amid these elevated risks.

Our traditional value equity investment approach is complemented with two other strategies: distressed investing and merger arbitrage.

Within our distressed credit strategy, we targeted companies and industries directly impacted by the coronavirus pandemic. The robust government fiscal and monetary intervention have limited the number of attractive options, but we have found opportunities in the energy sector and the retail and travel industries. Although each situation is unique, these securities have strong collateral packages and covenant protections or other features that we believe make them substantially more attractive than the broad array of available distressed debt.

Within merger arbitrage, which involves trading the stocks of companies involved in a merger or acquisition (M&A), activity has slowed significantly since the onset of the pandemic. Deal terms agreed to before the virus emerged have become unbalanced and are now more favorable for sellers than they are for buyers. Not surprisingly, some of these proposals have become embroiled in litigation. Also, M&A activity has slowed as the economic realities of the coronavirus get priced into the market, and bankers are challenged to conduct due diligence remotely. As the period ended, we began to see signs that transactions activity might resume, but we would expect the second half of the year to be focused on resolving pending deals, rather than significant growth in new ones.

Fund Performance

Turning to Fund performance, investments that detracted included U.S.-based companies American International Group (AIG; not held at period-end), Wells Fargo and Citigroup.

Shares of insurer AIG retreated as COVID-19 concerns and a lack of clarity on forward guidance related to expenses and investment income contributed to negative investor sentiment. The stock initially rallied following the company’s first-quarter earnings call at which management revealed that the majority of its property policies—which include coverage for business interruption—contained exclusions for losses related to viruses.

The shares of diversified financial services company Wells Fargo were pulled down by negative investor sentiment for financials, which have trailed the broader market rally from the March 23 bottom. Concerns about a possible dividend cut as bank earnings have come under pressure, and

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speculation about the Fed moving to negative interest rates—subsequently refuted by Fed Chairman Jerome Powell—contributed to the selloff. Earlier in the period, management reported year-end 2019 earnings that fell well short of consensus estimates.

The stocks of a number of U.S. banks, including Citigroup, sold off during the period as concern about the economic effects of COVID-19 and Fed interest-rate cuts led to negative sentiment for financials. The Fed’s decision in late June to cap bank dividends and curtail stock buybacks—as part of its stress test review of large banks—also contributed to the bearish outlook. During the period, Citigroup reported a sharp drop in first-quarter profit, although earnings per share was relatively in line with expectations. A year-over-year increase in revenue was driven by strong capital markets revenue but was offset by a significant rise in loan loss provision. Earlier in the period, management reported fourth-quarter 2019 earnings that surpassed consensus forecasts.

During the period under review, Fund investments that contributed positively to performance included U.S.-based companies Eli Lilly, NortonLifeLock and Kraft Heinz.

Shares of pharmaceutical products company Eli Lilly were volatile but climbed during the period. Investor sentiment improved as the market came to the realization that the company’s business may not be meaningfully impacted by the disruption caused by the COVID-19 pandemic. First-quarter financial results exceeded consensus sales and earnings expectations, with revenues benefiting from customers stocking up amid COVID-19, which is likely to reverse later in the year. Management raised 2020 guidance for earnings per share and reiterated the outlook for revenue and operating margin. In our view, Eli Lilly has a strong drug pipeline with several important compounds that positions the company well for continued growth over time.

Shares of cybersecurity solutions provider NortonLifeLock outperformed during the period as work-from-home requirements attributable to the COVID-19 pandemic led to increased consumer purchases of the company’s cybersecurity subscriptions, generating solid fiscal fourth-quarter earnings that were in line with consensus expectations. NortonLifeLock’s stock rallied entering the year and surged after management announced in early January the payment of a one-time, $12 per share cash dividend funded by the 2019 sale of the enterprise security business to Broadcom. Symantec, the precursor to NortonLifeLock, sold the business as part of its transition to a pure-play consumer-focused cybersecurity company, and management subsequently adopted the NortonLifeLock brand.

Top 10 Holdings

6/30/20

Company Sector/Industry, Country	% of Total Net Assets
Charter Communications Inc. Media, U.S.		2.9%
Medtronic PLC Health Care Equipment & Supplies, U.S.		2.8%
Merck & Co. Inc. Pharmaceuticals, U.S.		2.6%
Samsung Electronics Co. Ltd. Technology Hardware, Storage & Peripherals, South Korea		2.5%
British American Tobacco PLC Tobacco, U.K.		2.4%
GlaxoSmithKline PLC Pharmaceuticals, U.K.		2.4%
The Kraft Heinz Co. Food Products, U.S.		2.3%
Novartis AG Pharmaceuticals, Switzerland		2.2%
The Kroger Co. Food & Staples Retailing, U.S.		2.2%
Oracle Corp. Software, U.S.		2.2%

Investors bid up shares of food products producer Kraft Heinz as surging demand for its products led to better-than-expected sales growth. Management raised its sales guidance in a business update early in the period, and financial results in the subsequent quarterly earnings report exceeded consensus estimates. The company reaffirmed the dividend payment, which also contributed to positive investor sentiment, and several analysts upgraded Kraft Heinz stock.

During the period, the Fund held currency forwards and futures seeking to hedge most of the currency risk of the portfolio’s non-U.S. dollar investments. The hedges had a positive overall impact on the Fund’s performance.

Thank you for your participation in Franklin Mutual Shares VIP Fund. We look forward to serving your future investment needs.

Semiannual Report         MS-5

FRANKLIN MUTUAL SHARES VIP FUND

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

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FRANKLIN MUTUAL SHARES VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual (actual return after expenses)		Hypothetical (5% annual return before expenses)
Share   Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201,  2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201,  2	Net Annualized Expense Ratio2
Class 1	$1,000	$789.00	$3.29	$1,021.18	$3.72	0.74%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin Mutual Shares VIP Fund

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$19.19			$17.71			$20.71			$20.40			$19.48			$22.91
Income from investment operationsa:
Net investment incomeb		0.35	c		0.46			0.36			0.49			0.50			0.44
Net realized and unrealized gains (losses)		(4.40	)		3.39			(2.04	)		1.22			2.56			(1.54	)
Total from investment operations		(4.05	)		3.85			(1.68	)		1.71			3.06			(1.10	)
Less distributions from:
Net investment income		—			(0.42	)		(0.55	)		(0.53	)		(0.46	)		(0.77	)
Net realized gains		—			(1.95	)		(0.77	)		(0.87	)		(1.68	)		(1.56	)
Total distributions		—			(2.37	)		(1.32	)		(1.40	)		(2.14	)		(2.33	)
Net asset value, end of period		$15.14			$19.19			$17.71			$20.71			$20.40			$19.48
Total returnd		(21.10)%			22.92%			(8.86)%			8.64%			16.35%			(4.69)%
Ratios to average net assetse
Expensesf,g		0.74%			0.71%			0.71%			0.72%			0.72%			0.73%
Expenses incurred in connection with securities sold short		0.03%			0.02%			0.01%			—%			0.01%			0.02%
Net investment income		4.48%	c		2.35%			1.77%			2.34%			2.57%			2.00%
Supplemental data
Net assets, end of period (000’s)		$130,207			$158,431			$537,324			$653,700			$610,395			$643,438
Portfolio turnover rate		19.67%			38.50%			24.67%			18.32%			24.45%			19.88%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.18 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 2.23%.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(f).

^gBenefit of waiver and payments by affiliates and expense reduction rounds to less than 0.01%.

MS-8         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Mutual Shares VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$18.81			$17.40			$20.36			$20.08			$19.20			$22.60
Income from investment operationsa:
Net investment incomeb		0.33	c		0.40			0.31			0.43			0.45			0.38
Net realized and unrealized gains (losses)		(4.32	)		3.32			(2.00	)		1.20			2.52			(1.51	)
Total from investment operations		(3.99	)		3.72			(1.69	)		1.63			2.97			(1.13	)
Less distributions from:
Net investment income		—			(0.36	)		(0.50	)		(0.48	)		(0.41	)		(0.71	)
Net realized gains		—			(1.95	)		(0.77	)		(0.87	)		(1.68	)		(1.56	)
Total distributions		—			(2.31	)		(1.27	)		(1.35	)		(2.09	)		(2.27	)
Net asset value, end of period		$14.82			$18.81			$17.40			$20.36			$20.08			$19.20
Total returnd		(21.21)%			22.57%			(9.07)%			8.35%			16.06%			(4.94)%
Ratios to average net assetse
Expensesf,g		0.99%			0.96%			0.96%			0.97%			0.97%			0.98%
Expenses incurred in connection with securities sold short		0.03%			0.02%			0.01%			—%			0.01%			0.02%
Net investment income		4.23%	c		2.10%			1.52%			2.09%			2.32%			1.75%
Supplemental data
Net assets, end of period (000’s)		$2,138,640			$2,931,753			$2,516,834			$3,476,913			$3,621,358			$3,353,505
Portfolio turnover rate		19.67%			38.50%			24.67%			18.32%			24.45%			19.88%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.18 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 1.98%.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(f).

^gBenefit of waiver and payments by affiliates and expense reduction rounds to less than 0.01%.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         MS-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Mutual Shares VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$18.99			$17.55			$20.53			$20.23			$19.32			$22.72
Income from investment operationsa:
Net investment incomeb		0.31	c		0.38			0.29			0.41			0.44			0.36
Net realized and unrealized gains (losses)		(4.34	)		3.36			(2.02	)		1.21			2.53			(1.52	)
Total from investment operations		(4.03	)		3.74			(1.73	)		1.62			2.97			(1.16	)
Less distributions from:
Net investment income		—			(0.35	)		(0.48	)		(0.45	)		(0.38	)		(0.68	)
Net realized gains		—			(1.95	)		(0.77	)		(0.87	)		(1.68	)		(1.56	)
Total distributions		—			(2.30	)		(1.25	)		(1.32	)		(2.06	)		(2.24	)
Net asset value, end of period		$14.96			$18.99			$17.55			$20.53			$20.23			$19.32
Total returnd		(21.22)%			22.44%			(9.16)%			8.25%			15.94%			(5.05)%
Ratios to average net assetse
Expensesf,g		1.09%			1.06%			1.06%			1.07%			1.07%			1.08%
Expenses incurred in connection with securities sold short		0.03%			0.02%			0.01%			—%			0.01%			0.02%
Net investment income		4.13%	c		2.00%			1.42%			1.99%			2.22%			1.65%
Supplemental data
Net assets, end of period (000’s)		$101,013			$120,345			$105,047			$122,942			$122,476			$130,978
Portfolio turnover rate		19.67%			38.50%			24.67%			18.32%			24.45%			19.88%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.18 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 1.88%.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(f).

^gBenefit of waiver and payments by affiliates and expense reduction rounds to less than 0.01%.

MS-10         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin Mutual Shares VIP Fund

	Country		Shares/ Warrants		Value
Common Stocks and Other Equity Interests 90.2%
Aerospace & Defense 2.4%
BAE Systems PLC.		United Kingdom		4,310,599	$	25,774,011
Huntington Ingalls Industries Inc.		United States		175,130		30,558,434
						56,332,445
Auto Components 0.0%†
a,b,cInternational Automotive Components Group Brazil LLC		Brazil		1,730,515		32,541
Automobiles 0.6%
General Motors Co.		United States		514,345		13,012,928
Banks 6.7%
Bank of America Corp.		United States		1,045,618		24,833,428
Citigroup Inc.		United States		861,639		44,029,753
JPMorgan Chase & Co.		United States		458,954		43,169,214
Synovus Financial Corp.		United States		802,733		16,480,108
Wells Fargo & Co.		United States		1,187,539		30,400,998
						158,913,501
Beverages 0.5%
Heineken NV		Netherlands		129,934		11,978,122
Building Products 1.3%
Johnson Controls International PLC		United States		908,430		31,013,800
Capital Markets 1.1%
Credit Suisse Group AG		Switzerland		2,373,162		24,692,435
Communications Equipment 1.1%
Cisco Systems Inc.		United States		576,119		26,870,190
Consumer Finance 1.3%
Capital One Financial Corp.		United States		478,537		29,951,631
Containers & Packaging 1.8%
International Paper Co.		United States		1,235,477		43,501,145
Diversified Financial Services 2.9%
aBerkshire Hathaway Inc., B		United States		186,373		33,269,444
Voya Financial Inc.		United States		758,210		35,370,497
						68,639,941
Electric Utilities 1.0%
Pinnacle West Capital Corp.		United States		315,200		23,101,008
Electrical Equipment 1.7%
aSensata Technologies Holding PLC		United States		1,045,059		38,907,547
Electronic Equipment, Instruments & Components 1.2%
Corning Inc.		United States		1,133,402		29,355,112
Energy Equipment & Services 1.1%
Baker Hughes Co., A		United States		663,295		10,208,110
Schlumberger Ltd.		United States		893,500		16,431,465
						26,639,575
Entertainment 2.0%
The Walt Disney Co.		United States		419,567		46,785,916

Semiannual Report         MS-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

	Country		Shares/ Warrants		Value
Common Stocks and Other Equity Interests (continued)
Equity Real Estate Investment Trusts (REITs) 1.1%
Alexander’s Inc.		United States		31,168	$	7,508,371
Vornado Realty Trust		United States		496,497		18,971,151
						26,479,522
Food & Staples Retailing 3.3%
The Kroger Co.		United States		1,566,436		53,023,859
Walgreens Boots Alliance Inc.		United States		586,960		24,881,234
						77,905,093
Food Products 4.2%
Archer-Daniels-Midland Co.		United States		682,506		27,231,989
Conagra Brands Inc.		United States		530,565		18,659,971
The Kraft Heinz Co.		United States		1,704,590		54,359,375
						100,251,335
Health Care Equipment & Supplies 2.8%
Medtronic PLC		United States		720,205		66,042,798
Health Care Providers & Services 3.2%
Anthem Inc.		United States		107,617		28,301,119
CVS Health Corp.		United States		723,969		47,036,266
						75,337,385
Household Durables 2.8%
Lennar Corp., A.		United States		573,137		35,316,702
Newell Brands Inc.		United States		1,923,718		30,548,642
						65,865,344
Household Products 0.9%
Energizer Holdings Inc.		United States		427,547		20,304,207
Industrial Conglomerates 1.0%
General Electric Co.		United States		3,340,001		22,812,207
Insurance 5.4%
Alleghany Corp.		United States		92,702		45,344,256
Everest Re Group Ltd.		United States		122,329		25,224,240
The Hartford Financial Services Group Inc.		United States		904,853		34,882,083
MetLife Inc.		United States		624,803		22,817,806
						128,268,385
IT Services 1.9%
Cognizant Technology Solutions Corp., A		United States		796,201		45,240,141
Machinery 0.7%
aCNH Industrial NV		United Kingdom		605,230		4,251,730
aCNH Industrial NV, special voting		United Kingdom		1,844,814		12,959,787
						17,211,517
Media 6.2%
aCharter Communications Inc., A		United States		136,923		69,836,207
Comcast Corp., A		United States		1,245,578		48,552,630
aDiscovery Inc., C		United States		1,157,710		22,297,495

MS-12         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

	Country		Shares/ Warrants		Value
Common Stocks and Other Equity Interests (continued)
Media (continued)
a,diHeartMedia Inc., A		United States		717,645	$	5,992,336
a,biHeartMedia Inc., B		United States		12,783		90,727
						146,769,395
Oil, Gas & Consumable Fuels 5.8%
BP PLC		United Kingdom		7,407,845		28,378,611
Kinder Morgan Inc.		United States		1,612,768		24,465,690
Marathon Oil Corp.		United States		2,662,301		16,293,282
Royal Dutch Shell PLC, A (EUR Traded)		United Kingdom		450,591		7,375,230
Royal Dutch Shell PLC, A (GBP Traded)		United Kingdom		611,623		9,792,461
The Williams Cos. Inc.		United States		2,738,781		52,091,615
						138,396,889
Pharmaceuticals 10.7%
aElanco Animal Health Inc.		United States		283,578		6,082,748
Eli Lilly and Co.		United States		317,463		52,121,075
GlaxoSmithKline PLC		United Kingdom		2,773,828		56,028,172
Merck & Co. Inc.		United States		783,295		60,572,202
Novartis AG, ADR		Switzerland		607,663		53,073,287
Perrigo Co. PLC		United States		469,260		25,936,000
						253,813,484
Software 3.4%
aAvaya Holdings Corp.		United States		116		1,434
aAvaya Holdings Corp., wts., 12/15/22		United States		91,551		114,439
NortonLifeLock Inc.		United States		1,432,555		28,407,565
Oracle Corp.		United States		954,596		52,760,521
						81,283,959
Specialty Retail 1.2%
Tiffany & Co.		United States		179,400		21,876,036
a,bTRU Kids Parent LLC		United States		2,040		6,571,584
a,bWayne Services Legacy Inc.		United States		2,039		—
						28,447,620
Technology Hardware, Storage & Peripherals 4.3%
Hewlett Packard Enterprise Co.		United States		1,292,621		12,577,202
Samsung Electronics Co. Ltd.		South Korea		1,321,135		58,640,009
Western Digital Corp.		United States		701,884		30,988,179
						102,205,390
Textiles, Apparel & Luxury Goods 0.7%
PVH Corp.		United States		363,421		17,462,379
Tobacco 3.3%
Altria Group Inc.		United States		571,600		22,435,300
British American Tobacco PLC		United Kingdom		1,095,258		42,004,520
British American Tobacco PLC, ADR		United Kingdom		372,933		14,477,259
						78,917,079

Semiannual Report         MS-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

	Country		Shares/ Warrants		Value
Common Stocks and Other Equity Interests (continued)
Wireless Telecommunication Services 0.6%
Vodafone Group PLC		United Kingdom		8,420,931	$	13,386,708
Total Common Stocks and Other Equity Interests (Cost $1,929,798,525)						2,136,128,674
			Principal     Amount
Corporate Bonds, Notes and Senior Floating Rate Interests 5.8%
eAmerican Airlines Inc., senior secured note, 144A, 11.75%, 7/15/25		United States	$	21,072,000		19,855,935
eBanff Merger Sub Inc., senior note, 144A, 9.75%, 9/01/26		United States		18,444,000		18,601,881
eBoxer Parent Co. Inc., senior secured note, first lien, 144A, 7.125%, 10/02/25		United States		4,027,500		4,237,635
eDelta Air Lines Inc., senior note, first lien, 144A, 7.00%, 5/01/25		United States		1,198,000		1,237,916
eFrontier Communications Corp., senior secured note, first lien, 144A, 8.00%, 4/01/27		United States		6,148,000		6,250,549
eMacy’s Inc., senior secured note, first lien, 144A, 8.375%, 6/15/25		United States		4,438,000		4,424,131
f,g,hMileage Plus Holdings LLC, Term Loan B, TBD, 6/25/27		United States		2,866,000		2,849,624
e,iMileage Plus Holdings LLC/Mileage Plus Intellectual Property Assets Ltd., senior secured note, first lien, 144A, 6.50%, 6/20/27		United States		11,070,000		11,125,350
eNavistar International Corp., senior secured note, 144A, 9.50%, 5/01/25		United States		4,878,200		5,247,114
Occidental Petroleum Corp.,
senior note, 4.85%, 3/15/21		United States		917,000		914,134
h,jsenior note, FRN, 1.842%, (3-month USD LIBOR + 1.45%), 8/15/22		United States		2,933,600		2,700,036
hVeritas U.S. Inc., Term Loan B1, 5.50%, (3-month USD LIBOR + 4.50%), 1/27/23		United States		17,234,903		15,985,372
eVeritas U.S. Inc./Veritas Bermuda Ltd.,
senior note, 144A, 7.50%, 2/01/23		United States		2,856,000		2,823,570
senior note, 144A, 10.50%, 2/01/24		United States		23,445,000		21,068,732
hWindstream Services LLC,
PSA Holder Revolving Commitment, 6.25%, (Prime + 3.00%), 2/20/49		United States		26,279,371		16,161,813
PSA Holder Term Loan B6, 8.25%, (Prime + 5.00%), 3/30/21		United States		6,671,000		4,202,730
Total Corporate Bonds, Notes and Senior Floating Rate Interests (Cost $149,686,671)						137,686,522
Corporate Notes in Reorganization 0.7%
kFrontier Communications Corp.,
senior note, 10.50%, 9/15/22		United States		22,633,000		7,887,940
senior note, 11.00%, 9/15/25		United States		25,535,000		8,910,949
Total Corporate Notes in Reorganization (Cost $44,895,501)						16,798,889
			Shares
Companies in Liquidation 0.0%†
a,b,lBosgen Liquidating Trust c/o Verdolino and Lowey P.C., Contingent Distribution		United States		347,093		—
a,b,lTribune Media Co., Litigation Trust, Contingent Distribution.		United States		396,923		—
a,b,lVistra Energy Corp., Litigation Trust, Contingent Distribution		United States		90,618,405		49,840

MS-14         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

	Country		Shares		Value
Companies in Liquidation (continued)
a,b,lWalter Energy Inc., Litigation Trust, Contingent Distribution		United States		6,301,000	$	—
Total Companies in Liquidation (Cost $2,834,275)						49,840
Total Investments before Short Term Investments (Cost $2,127,214,972)						2,290,663,925
			Principal     Amount
Short Term Investments 3.5%
U.S. Government and Agency Securities 3.4%
mFHLB, 7/01/20		United States	$	14,300,000		14,300,000
mU.S. Treasury Bill,
7/02/20		United States		40,500,000		40,499,904
n7/16/20 - 11/27/20		United States		27,000,000		26,995,005
Total U.S. Government and Agency Securities (Cost $81,782,086)						81,794,909
Investments from Cash Collateral Received for Loaned Securities 0.1%
			Shares
Money Market Funds (Cost $1,077,000) 0.1%
o,p Institutional Fiduciary Trust Money Market Portfolio, 0.00%		United States		1,077,000		1,077,000
			Principal     Amount
Repurchase Agreements (Cost $219,396) 0.0%†
qJoint Repurchase Agreement, 0.07%, 7/01/20 (Maturity Value $219,396) BNP Paribas Securities Corp.
Collateralized by U.S. Treasury Bonds, 7.875%, 2/15/21; U.S. Treasury Notes, 0.125% - 2.875%, 12/31/20 - 1/31/24; U.S. Treasury Strips, 8/15/20 - 11/15/22 (Valued at $223,784)		United States	$	219,396		219,396
Total Investments from Cash Collateral Received for Loaned Securities (Cost $1,296,396)						1,296,396
Total Investments (Cost $2,210,293,454) 100.2%						2,373,755,230
Other Assets, less Liabilities (0.2)%						(3,894,943	)
Net Assets 100.0%					$	2,369,860,287

Semiannual Report         MS-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

^†Rounds to less than 0.1% of net assets.

^aNon-income producing.

^bFair valued using significant unobservable inputs. See Note 12 regarding fair value measurements.

^cSee Note 9 regarding restricted securities.

^dA portion or all of the security is on loan at June 30, 2020. See Note 1(g).

^eSecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in a public offering registered under the Securities Act of 1933. At June 30, 2020, the aggregate value of these securities was $94,872,813, representing 4.0% of net assets.

^fSecurity purchased on a delayed delivery basis. See Note 1(d).

^gA portion or all of the security represents an unsettled loan commitment. The coupon rate is to-be determined (TBD) at the time of settlement and will be based upon a reference index/floor plus a spread.

^hSee Note 1(h) regarding senior floating rate interests.

ⁱSecurity purchased on a when-issued basis. See Note 1(d).

^jThe coupon rate shown represents the rate at period end.

^kSee Note 7 regarding credit risk and defaulted securities.

^lContingent distributions represent the right to receive additional distributions, if any, during the reorganization of the underlying company. Shares represent total underlying principal of debt securities.

^mThe security was issued on a discount basis with no stated coupon rate.

ⁿA portion or all of the security has been segregated as collateral for open forward exchange contracts. At June 30, 2020, the aggregate value of these securities pledged amounted to $779,948, representing less than 0.1% of net assets.

^oSee Note 3(e) regarding investments in affiliated management investment companies.

^pThe rate shown is the annualized seven-day effective yield at period end.

^qSee Note 1(c) regarding joint repurchase agreement.

At June 30, 2020, the Fund had the following futures contracts outstanding. See Note 1(e).

Futures Contracts

Description	Type		Number of Contracts		Notional  Amount*		Expiration Date		Value/ Unrealized Appreciation (Depreciation)
Currency Contracts
EUR/USD		Short		104	$	14,629,550		9/14/20		$     94,640
GBP/USD		Short		498		38,585,663		9/14/20		1,058,539
Total Futures Contracts										$1,153,179

*As of period end.

MS-16          Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

At June 30, 2020, the Fund had the following forward exchange contracts outstanding. See Note 1(e).

Forward Exchange Contracts

Currency	Counterpartya		Type		Quantity		Contract Amount		Settlement Date		Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts
Euro		BOFA		Sell		52,781	$	59,024		7/15/20	$	—	$	(292	)
Euro		BONY		Sell		240,119		270,209		7/15/20		360		—
Euro		HSBK		Buy		117,981		132,353		7/15/20		236		—
Euro		HSBK		Sell		975,093		1,087,692		7/15/20		—		(8,134	)
Euro		HSBK		Sell		988,764		1,120,263		7/15/20		9,076		—
Euro		SSBT		Buy		368,000		414,326		7/15/20		—		(763	)
Euro		SSBT		Sell		251,842		279,091		7/15/20		—		(3,931	)
Euro		SSBT		Sell		416,849		469,687		7/15/20		1,227		—
Euro		UBSW		Sell		1,073,915		1,214,198		7/15/20		7,319		—
Euro		UBSW		Sell		10,885,583		11,930,557		7/15/20		—		(302,822	)
South Korean Won		HSBK		Buy		4,117,458,251		3,385,044		7/17/20		47,832		—
South Korean Won		HSBK		Sell		2,833,834,575		2,378,935		7/17/20		16,262		—
South Korean Won		HSBK		Sell		52,977,559,922		43,329,740		7/17/20		—		(839,612	)
South Korean Won		UBSW		Sell		18,061,991,754		14,769,803		7/17/20		—		(289,148	)
British Pound		HSBK		Buy		1,060,036		1,318,112		8/14/20		—		(4,350	)
British Pound		UBSW		Sell		21,659,195		27,176,006		8/14/20		332,547		—
Swiss Franc		UBSW		Sell		22,420,635		23,858,592		8/17/20		159,781		—
Total Forward Exchange Contracts											$	574,640	$	(1,449,052	)
Net unrealized appreciation (depreciation)													$	(874,412	)

^aMay be comprised of multiple contracts with the same counterparty, currency and settlement date.

See Note 10 regarding other derivative information.

See Abbreviations on page MS-34.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         MS-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Mutual Shares VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$2,208,997,058
Cost - Non-controlled affiliates (Note 3e)		1,077,000
Cost - Unaffiliated repurchase agreements		219,396
Value - Unaffiliated issuers+		$2,372,458,834
Value - Non-controlled affiliates (Note 3e)		1,077,000
Value - Unaffiliated repurchase agreements		219,396
Cash		1,082,196
Receivables:
Investment securities sold		1,873,122
Capital shares sold		2,055,434
Dividends and interest		7,354,382
European Union tax reclaims		1,585,281
Deposits with brokers for:
Futures contracts		1,681,639
Unrealized appreciation on OTC forward exchange contracts		574,640
Other assets		2,461
Total assets		2,389,964,385
Liabilities:
Payables:
Investment securities purchased		13,740,305
Capital shares redeemed		978,819
Management fees		1,340,273
Distribution fees		478,767
Trustees’ fees and expenses		1,877
Variation margin on futures contracts		332,388
Payable upon return of securities loaned		1,296,396
Unrealized depreciation on OTC forward exchange contracts		1,449,052
Accrued expenses and other liabilities		486,221
Total liabilities		20,104,098
Net assets, at value		$2,369,860,287
Net assets consist of:
Paid-in capital		$2,079,928,651
Total distributable earnings (losses)		289,931,636
Net assets, at value		$2,369,860,287

⁺Includes securities loaned $       1,228,285

MS-18         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities (continued)

June 30, 2020 (unaudited)

	Franklin Mutual Shares VIP Fund
Class 1:
Net assets, at value		$   130,207,182
Shares outstanding		8,600,638
Net asset value and maximum offering price per share		$15.14
Class 2:
Net assets, at value		$2,138,639,758
Shares outstanding		144,299,487
Net asset value and maximum offering price per share		$14.82
Class 4:
Net assets, at value		$   101,013,347
Shares outstanding		6,753,463
Net asset value and maximum offering price per share		$14.96

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         MS-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Mutual Shares VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers		$  61,592,792
Interest:
Unaffiliated issuers		7,480,408
Adjustment for uncollectible interest (Note 7)		(2,537,110	)
Income from securities loaned:
Unaffiliated entities (net of fees and rebates)		23
Non-controlled affiliates (Note 3e)		3,234
Total investment income		66,539,347
Expenses:
Management fees (Note 3a)		8,624,596
Distribution fees: (Note 3c)
Class 2		2,901,106
Class 4		178,823
Custodian fees (Note 4)		22,082
Reports to shareholders		240,415
Professional fees		62,309
Trustees’ fees and expenses		9,809
Dividends on securities sold short		389,896
Other		42,199
Total expenses		12,471,235
Expense reductions (Note 4)		(12,520	)
Expenses waived/paid by affiliates (Note 3e)		(1,232	)
Net expenses		12,457,483
Net investment income		54,081,864
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		(74,533,904	)
Written options		(262,792	)
Realized gain distributions from REITs		866,978
Foreign currency transactions		(168,235	)
Forward exchange contracts		2,269,806
Futures contracts		1,796,871
Securities sold short		(1,409,935	)
Net realized gain (loss)		(71,441,211	)
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(647,502,878	)
Translation of other assets and liabilities denominated in foreign currencies		(58,450	)
Forward exchange contracts		1,511,444
Futures contracts		1,873,446
Securities sold short		1,972,704

MS-20         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations (continued)

for the six months ended June 30, 2020 (unaudited)

	Franklin Mutual Shares VIP Fund
Net change in unrealized appreciation (depreciation)		$(642,203,734	)
Net realized and unrealized gain (loss)		(713,644,945	)
Net increase (decrease) in net assets resulting from operations		$(659,563,081	)

*Foreign taxes withheld on dividends         $        601,911

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         MS-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Franklin Mutual Shares VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income		$     54,081,864			$     70,482,893
Net realized gain (loss)		(71,441,211	)		95,516,825
Net change in unrealized appreciation (depreciation)		(642,203,734	)		497,609,167
Net increase (decrease) in net assets resulting from operations		(659,563,081	)		663,608,885
Distributions to shareholders:
Class 1		—			(35,828,591	)
Class 2		—			(330,340,832	)
Class 4		—			(13,089,406	)
Total distributions to shareholders		—			(379,258,829	)
Capital share transactions: (Note 2)
Class 1		4,852,965			(436,530,771	)
Class 2		(190,863,192	)		198,182,849
Class 4		4,904,214			5,322,730
Total capital share transactions		(181,106,013	)		(233,025,192	)
Net increase (decrease) in net assets		(840,669,094	)		51,324,864
Net assets:
Beginning of period		3,210,529,381			3,159,204,517
End of period		$2,369,860,287			$3,210,529,381

MS-22         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin Mutual Shares VIP Fund

1.  Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Mutual Shares VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. The Fund offers three classes of shares: Class 1, Class 2 and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a.  Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities and derivative financial instruments listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple

exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Debt securities generally trade in the OTC market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value.

Investments in open-end mutual funds are valued at the closing NAV. Investments in repurchase agreements are valued at cost, which approximates fair value.

Certain derivative financial instruments trade in the OTC market. The Fund’s pricing services use various techniques including industry standard option pricing models and proprietary discounted cash flow models to determine the fair value of those instruments. The Fund’s net benefit or obligation under the derivative contract, as measured by the fair value of the contract, is included in net assets.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Semiannual Report         MS-23

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

1.  Organization and Significant Accounting Policies (continued)

a.  Financial Instrument Valuation (continued)

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time. At June 30, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b.  Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent

value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c.  Repurchase Agreements

The Fund enters into repurchase agreements, which are accounted for as a loan by the Fund to the seller, collateralized by securities which are delivered to the Fund’s custodian. The fair value, including accrued interest, of the initial collateralization is required to be at least 102% of the dollar amount invested by the Fund, with the value of the underlying securities marked to market daily to maintain coverage of at least 100%. Repurchase agreements are subject to the terms of Master Repurchase Agreements (MRAs) with approved counterparties (sellers). The MRAs contain various provisions, including but not limited to events of default and maintenance of collateral for repurchase agreements. In the event of default by either the seller or the Fund, certain MRAs may permit the non-defaulting party to net and close-out all transactions, if any, traded under such agreements. The Fund may sell securities it holds as collateral and apply the proceeds towards the repurchase price and any other amounts owed by the seller to the Fund in the event of default by the seller. This could involve costs or delays in addition to a loss on the securities if their value falls below the repurchase price owed by the seller. All repurchase agreements held by the Fund at period end, as indicated in the Statement of Investments, had been entered into on June 30, 2020.

MS-24         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

d.  Securities Purchased on a When-Issued or Delayed Delivery Basis

The Fund purchases securities on a when-issued or delayed delivery basis, with payment and delivery scheduled for a future date. These transactions are subject to market fluctuations and are subject to the risk that the value at delivery may be more or less than the trade date purchase price. Although the Fund will generally purchase these securities with the intention of holding the securities, it may sell the securities before the settlement date. Sufficient assets have been segregated for these securities.

e.  Derivative Financial Instruments

The Fund invested in derivative financial instruments in order to manage risk or gain exposure to various other investments or markets. Derivatives are financial contracts based on an underlying or notional amount, require no initial investment or an initial net investment that is smaller than would normally be required to have a similar response to changes in market factors, and require or permit net settlement. Derivatives contain various risks including the potential inability of the counterparty to fulfill their obligations under the terms of the contract, the potential for an illiquid secondary market, and/or the potential for market movements which expose the Fund to gains or losses in excess of the amounts shown in the Statement of Assets and Liabilities. Realized gain and loss and unrealized appreciation and depreciation on these contracts for the period are included in the Statement of Operations.

Derivative counterparty credit risk is managed through a formal evaluation of the creditworthiness of all potential counterparties. The Fund attempts to reduce its exposure to counterparty credit risk on OTC derivatives, whenever possible, by entering into International Swaps and Derivatives Association (ISDA) master agreements with certain counterparties. These agreements contain various provisions, including but not limited to collateral requirements, events of default, or early termination. Termination events applicable to the counterparty include certain deteriorations in the credit quality of the counterparty. Termination events applicable to the Fund include failure of the Fund to maintain certain net asset levels and/or limit the decline in net assets over various periods of time. In the event of default or early termination, the ISDA master agreement gives the non-defaulting party the right to net and close-out all transactions traded, whether or not arising under the ISDA agreement, to one net amount payable by one counterparty to the other. However, absent an

event of default or early termination, OTC derivative assets and liabilities are presented gross and not offset in the Statement of Assets and Liabilities. Early termination by the counterparty may result in an immediate payment by the Fund of any net liability owed to that counterparty under the ISDA agreement. At June 30, 2020, the Fund had OTC derivatives in a net liability position of $874,772 and the aggregate value of collateral pledged for such contracts was $779,948.

Collateral requirements differ by type of derivative. Collateral or initial margin requirements are set by the broker or exchange clearing house for exchange traded and centrally cleared derivatives. Initial margin deposited is held at the exchange and can be in the form of cash and/or securities. For OTC derivatives traded under an ISDA master agreement, posting of collateral is required by either the Fund or the applicable counterparty if the total net exposure of all OTC derivatives with the applicable counterparty exceeds the minimum transfer amount, which typically ranges from $100,000 to $250,000, and can vary depending on the counterparty and the type of the agreement. Generally, collateral is determined at the close of Fund business each day and any additional collateral required due to changes in derivative values may be delivered by the Fund or the counterparty the next business day, or within a few business days. Collateral pledged and/or received by the Fund for OTC derivatives, if any, is held in segregated accounts with the Fund’s custodian/counterparty broker and can be in the form of cash and/or securities. Unrestricted cash may be invested according to the Fund’s investment objectives. To the extent that the amounts due to the Fund from its counterparties are not subject to collateralization or are not fully collateralized, the Fund bears the risk of loss from counterparty non-performance.

The Fund entered into exchange traded futures contracts primarily to manage exposure to certain foreign currencies. A futures contract is an agreement between the Fund and a counterparty to buy or sell an asset at a specified price on a future date. Required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or receivable in the Statement of Assets and Liabilities.

Semiannual Report         MS-25

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

1.  Organization and Significant Accounting Policies (continued)

e.  Derivative Financial Instruments (continued)

The Fund entered into OTC forward exchange contracts primarily to manage exposure to certain foreign currencies. A forward exchange contract is an agreement between the Fund and a counterparty to buy or sell a foreign currency at a specific exchange rate on a future date.

The Fund purchased or wrote exchange traded option contracts primarily to manage and/or gain exposure to equity price risk. An option is a contract entitling the holder to purchase or sell a specific amount of shares or units of an asset or notional amount of a swap (swaption), at a specified price. When an option is purchased or written, an amount equal to the premium paid or received is recorded as an asset or liability, respectively. Upon exercise of an option, the acquisition cost or sales proceeds of the underlying investment is adjusted by any premium received or paid. Upon expiration of an option, any premium received or paid is recorded as a realized gain or loss. Upon closing an option other than through expiration or exercise, the difference between the premium received or paid and the cost to close the position is recorded as a realized gain or loss. The Fund did not hold any option contracts at period end.

See Note 10 regarding other derivative information.

f.  Securities Sold Short

The Fund is engaged in selling securities short, which obligates the Fund to replace a borrowed security with the same security at current fair value. The Fund incurs a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund realizes a gain if the price of the security declines between those dates. Gains are limited to the price at which the Fund sold the security short, while losses are potentially unlimited in size.

The Fund is required to establish a margin account with the broker lending the security sold short. While the short sale is outstanding, the broker retains the proceeds of the short sale to the extent necessary to meet margin requirements until the short position is closed out. A deposit must also be maintained with the Fund’s custodian/counterparty broker consisting of cash and/or securities having a value equal to a specified percentage of the value of the securities sold short. The Fund is obligated to pay fees for borrowing the securities

sold short and is required to pay the counterparty any dividends and/or interest due on securities sold short. Such dividends and/or interest and any security borrowing fees are recorded as an expense to the Fund. At June 30, 2020, the Fund had no securities sold short.

g.  Securities Lending

The Fund participates in an agency based securities lending program to earn additional income. The Fund receives cash collateral against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. The collateral is deposited into a joint cash account with other funds and is used to invest in a money market fund managed by Franklin Advisers, Inc., an affiliate of the Fund and a joint repurchase agreement. The Fund may receive income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third-party vendor, is reported separately in the Statement of Operations. The Fund bears the market risk with respect to the collateral investment, securities loaned, and the risk that the agent may default on its obligations to the Fund. If the borrower defaults on its obligation to return the securities loaned, the Fund has the right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower.

h.  Senior Floating Rate Interests

The Fund invests in senior secured corporate loans that pay interest at rates which are periodically reset by reference to a base lending rate plus a spread. These base lending rates are generally the prime rate offered by a designated U.S. bank or the London InterBank Offered Rate (LIBOR). Senior secured corporate loans often require prepayment of principal from excess cash flows or at the discretion of the borrower. As a result, actual maturity may be substantially less than the stated maturity. Senior secured corporate loans in which the Fund invests are generally readily marketable, but may be subject to certain restrictions on resale. On July 27, 2017, the United Kingdom’s Financial Conduct Authority announced its intention to cease sustaining LIBOR

MS-26          Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

after 2021. There remains uncertainty regarding the future utilization of LIBOR and the nature of any replacement rate. As such, the potential effect of a transition away from LIBOR on the Fund or the Fund’s investments that use or may use a floating rate based on LIBOR cannot yet be determined.

i.  Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

As a result of several court cases, in certain countries across the European Union, the Fund filed additional tax reclaims for previously withheld taxes on dividends earned in those countries (EU reclaims). These additional filings are subject to various administrative proceedings by the local jurisdictions’ tax authorities within the European Union, as well as a number of related judicial proceedings. Income recognized, if any, for EU reclaims is reflected as other income in the Statement of Operations and any related receivable, if any, is reflected as European Union tax reclaims in the Statement of Assets and Liabilities. When uncertainty exists as to the ultimate resolution of these proceedings, the likelihood of receipt of these EU reclaims, and the potential timing of payment, no amounts are reflected in the financial statements. For U.S. income tax purposes, when EU reclaims are received by the Fund and the Fund previously passed foreign tax credit on to its shareholders, the Fund must either amend historic tax reporting to shareholders or enter into a closing agreement with the Internal Revenue Service (IRS) in order to pay the associated tax liability on behalf of the Fund’s shareholders.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

j.  Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Amortization of premium and accretion of discount on debt securities are included in interest income. Dividend income and dividends declared on securities sold short are recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

Semiannual Report         MS-27

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

1.  Organization and Significant Accounting Policies (continued)

k.  Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

l.  Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust.

Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2.  Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		641,139		$	9,529,737			765,653		$	14,772,259
Shares issued in reinvestment of distributions		—			—			2,031,099			35,828,591
Shares redeemed		(297,471	)		(4,676,772	)		(24,880,289	)		(487,131,621	)
Net increase (decrease)		343,668		$	4,852,965			(22,083,537	)	$	(436,530,771	)
Class 2 Shares:
Shares sold		9,774,365		$	135,425,822			29,854,091		$	583,466,693
Shares issued in reinvestment of distributions		—			—			19,094,846			330,340,832
Shares redeemed		(21,356,959	)		(326,289,014	)		(37,705,675	)		(715,624,676	)
Net increase (decrease)		(11,582,594	)	$	(190,863,192	)		11,243,262		$	198,182,849
Class 4 Shares:
Shares sold		893,404		$	12,663,468			625,179		$	11,842,479
Shares issued in reinvestment of distributions		—			—			749,250			13,089,406
Shares redeemed		(477,331	)		(7,759,254	)		(1,022,438	)		(19,609,155	)
Net increase (decrease)		416,073		$	4,904,214			351,991		$	5,322,730

MS-28         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

3.  Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Mutual Advisers, LLC (Franklin Mutual)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a.  Management Fees

The Fund pays an investment management fee to Franklin Mutual based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.675%	Up to and including $5 billion
0.645%	Over $5 billion, up to and including $10 billion
0.625%	Over $10 billion, up to and including $15 billion
0.595%	Over $15 billion, up to and including $20 billion
0.585%	Over $20 billion, up to and including $25 billion
0.565%	Over $25 billion, up to and including $30 billion
0.555%	Over $30 billion, up to and including $35 billion
0.545%	In excess of $35 billion

b.  Administrative Fees

Under an agreement with Franklin Mutual, FT Services provides administrative services to the Fund. The fee is paid by Franklin Mutual based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

c.  Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets of each class. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d.  Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

Semiannual Report         MS-29

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

3. Transactions with Affiliates (continued)

e.  Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Income from securities loaned
Non-Controlled Affiliates
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		$      —	$	19,467,000	$	(18,390,000	)		$      —		$      —	$	1,077,000		1,077,000		$3,234

f.  Interfund Transactions

The Fund engaged in purchases and sales of investments with funds or other accounts that have common investment managers (or affiliated investment managers), directors, trustees or officers. During the period ended June 30, 2020, these purchase and sale transactions aggregated $0 and $1,702,055, respectively.

4.  Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

5.  Income Taxes

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$	2,238,998,309
Unrealized appreciation	$	441,530,157
Unrealized depreciation		(306,492,983)
Net unrealized appreciation (depreciation)	$	135,037,174

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of foreign currency transactions and wash sales.

6.  Investment Transactions

Purchases and sales of investments (excluding short term securities and securities sold short) for the period ended June 30, 2020, aggregated $485,118,984 and $484,261,996, respectively.

MS-30         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

At June 30, 2020, in connection with securities lending transactions, the Fund loaned equity investments and received $1,296,396 of cash collateral. The gross amount of recognized liability for such transactions is included in payable upon return of securities loaned in the Statement of Assets and Liabilities. The agreements can be terminated at any time.

7.  Credit Risk and Defaulted Securities

The Fund may purchase the pre-default or defaulted debt of distressed companies. Distressed companies are financially troubled and could be or are already involved in financial restructuring or bankruptcy. Risks associated with purchasing these securities include the possibility that the bankruptcy or other restructuring process takes longer than expected, or that distributions in restructuring are less than anticipated, either or both of which may result in unfavorable consequences to the Fund. If it becomes probable that the income on debt securities, including those of distressed companies, will not be collected, the Fund discontinues accruing income and recognizes an adjustment for uncollectible interest. For the period ended June 30, 2020, the Fund recorded an adjustment for uncollectible interest of $2,537,110 as noted in the Statement of Operations.

At June 30, 2020, the aggregate long value of distressed company securities for which interest recognition has been discontinued was $16,798,889, representing 0.7% of the Fund’s net assets. For information as to specific securities, see the accompanying Statement of Investments.

8.  Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

9.  Restricted Securities

The Fund invests in securities that are restricted under the Securities Act of 1933 (1933 Act). Restricted securities are often purchased in private placement transactions, and cannot be sold without prior registration unless the sale is pursuant to an exemption under the 1933 Act. Disposal of these securities may require greater effort and expense, and prompt sale at an acceptable price may be difficult. The Fund may have registration rights for restricted securities. The issuer generally incurs all registration costs.

At June 30, 2020, investments in restricted securities, excluding securities exempt from registration under the 1933 Act, were as follows:

Shares	Issuer	Acquisition Date		Cost		Value
1,730,515	International Automotive Components Group Brazil LLC (Value is 0.0%† of Net Assets)		4/13/06 -12/26/08	$	1,149,241	$	32,541

^†Rounds to less than 0.1% of net assets.

Semiannual Report         MS-31

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

10.  Other Derivative Information

At June 30, 2020, investments in derivative contracts are reflected in the Statement of Assets and Liabilities as follows:

	Asset Derivatives				Liability Derivatives
Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Assets and Liabilities Location	Fair Value			Statement of Assets and Liabilities Location	Fair Value
Foreign exchange contracts	Variation margin on futures contracts	$	1,153,179	a	Variation margin on futures contracts	$	—
	Unrealized appreciation on OTC forward exchange contracts		574,640		Unrealized depreciation on OTC forward exchange contracts		1,449,052
Totals		$	1,727,819			$	1,449,052

^aThis amount reflects the cumulative appreciation (depreciation) of futures contracts as reported in the Statement of Investments. Only the variation margin receivable/ payable at period end is separately reported within the Statement of Assets and Liabilities. Prior variation margin movements were recorded to cash upon receipt or payment.

For the period ended June 30, 2020, the effect of derivative contracts in the Statement of Operations was as follows:

Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Operations Location	Net Realized Gain (Loss) for the Period			Statement of Operations Location	Net Change in Unrealized Appreciation (Depreciation) for the Period
	Net realized gain (loss) from:				Net change in unrealized appreciation (depreciation) on:
Foreign exchange contracts	Forward exchange contracts		$2,269,806		Forward exchange contracts		$1,511,444
	Futures contracts		1,796,871		Futures contracts		1,873,446
Equity contracts	Written options		(262,792	)	Written options		—
Totals			$3,803,885				$3,384,890

For the period ended June 30, 2020, the average month end notional amount of futures contracts and options represented $64,725,121 and 1,643 shares, respectively. The average month end contract value of forward exchange contracts was $145,753,358.

See Note 1(e) regarding derivative financial instruments.

11.  Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

MS-32         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

12.  Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets and liabilities carried at fair value, is as follows:

	Level 1		Level 2		Level 3			Total
Assets:
Investments in Securities:a
Equity Investments:b
Aerospace & Defense	$	30,558,434	$	25,774,011	$	—		$	56,332,445
Auto Components		—		—		32,541			32,541
Capital Markets		—		24,692,435		—			24,692,435
Machinery		—		17,211,517		—			17,211,517
Media		146,678,668		—		90,727			146,769,395
Oil, Gas & Consumable Fuels		92,850,587		45,546,302		—			138,396,889
Pharmaceuticals		197,785,312		56,028,172		—			253,813,484
Software		81,169,520		114,439		—			81,283,959
Specialty Retail		21,876,036		—		6,571,584	c		28,447,620
Technology Hardware, Storage & Peripherals		43,565,381		58,640,009		—			102,205,390
Tobacco		36,912,559		42,004,520		—			78,917,079
Wireless Telecommunication Services		—		13,386,708		—			13,386,708
All Other Equity Investments		1,194,639,212		—		—			1,194,639,212
Corporate Bonds, Notes and Senior Floating Rate Interests		—		137,686,522		—			137,686,522
Corporate Notes in Reorganization		—		16,798,889		—			16,798,889
Companies in Liquidation		—		—		49,840	c		49,840
Short Term Investments		68,571,909		14,519,396		—			83,091,305
Total Investments in Securities	$	1,914,607,618	$	452,402,920	$	6,744,692		$	2,373,755,230
Other Financial Instruments:
Futures Contracts	$	1,153,179	$	—	$	—		$	1,153,179
Forward Exchange Contracts		—		574,640		—			574,640
Total Other Financial Instruments	$	1,153,179	$	574,640	$	—		$	1,727,819

Semiannual Report         MS-33

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Mutual Shares VIP Fund (continued)

12.  Fair Value Measurements (continued)

	Level 1		Level 2		Level 3		Total
Liabilities:
Other Financial Instruments:
Forward Exchange Contracts	$	—	$	1,449,052	$	—	$	1,449,052

^aFor detailed categories, see the accompanying Statement of Investments.

^bIncludes common stocks as well as other equity interests.

^cIncludes securities determined to have no value at June 30, 2020.

A reconciliation in which Level 3 inputs are used in determining fair value is presented when there are significant Level 3 assets and liabilities at the beginning and/or end of the period.

13.  New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of LIBOR and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

14.  Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Counterparty		Currency		Selected Portfolio
BOFA	Bank of America Corp.	EUR	Euro	ADR	American Depositary Receipt
BONY	Bank of New York	GBP	British Pound	FHLB	Federal Home Loan Bank
HSBK	HSBC Bank PLC	USD	United States Dollar	LIBOR	London InterBank Offered Rate
SSBT	State Street Bank and Trust Co., N.A.
UBSW	UBS AG

MS-34         Semiannual Report

Franklin Rising Dividends VIP Fund

This semiannual report for Franklin Rising Dividends VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -4.77% total return for the six-month period ended June 30, 2020.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         FRD-1

FRANKLIN RISING DIVIDENDS VIP FUND

Fund Goal and Main Investments

The Fund seeks long-term capital appreciation, with preservation of capital as an important consideration. Under normal market conditions, the Fund invests at least 80% of its net assets in equity securities of financially sound companies that have paid consistently rising dividends.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Value securities may not increase in price as anticipated or may decline further in value. For stocks paying dividends, dividends are not guaranteed, and can increase, decrease or be totally eliminated without notice. Securities issued by smaller and midsize companies may be more volatile in price than those of larger companies, involve substantial risks and should be considered relatively more speculative. To the extent that the Fund focuses on particular countries, regions, industries, sectors or types of investment from time to time, the Fund may be subject to greater risks of adverse developments in such areas of focus than a fund that invests in a wider variety of countries, regions, industries, sectors or investments. Foreign investing carries additional risks such as currency and market volatility and political or social instability, risks that are heightened in developing countries. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Standard & Poor’s^® 500 Index (S&P 500^®) posted a -3.08% total return for the same period.¹ Please note the Fund employs a bottom-up stock selection process, and the managers invest in securities without regard to benchmark comparisons.

Economic and Market Overview

U.S. equities, as measured by the S&P 500, nearly reversed earlier losses but declined modestly during the six-month period. A sharp selloff began in late February 2020 amid investor fears of a global economic slowdown due to the novel coronavirus (COVID-19) pandemic.

Government-issued restrictions to mitigate the pandemic severely curtailed U.S. economic activity beginning in March 2020. As a result, the unemployment rate surged to 14.7% in April as many businesses, particularly in hospitality, retail and travel, announced mass layoffs.² Within just two months, the unemployment rate went from a 50-year low to an 80-year high.² The longest U.S. economic expansion in history ended in February, according to the National Bureau of Economic Research, and the country slipped into a deep recession.

In an effort to buffer the sharp drop in economic activity, the Fed implemented two emergency rate cuts in March 2020, lowering the federal funds target rate to a range of 0.00%–0.25%. Additionally, the Fed announced broad quantitative easing measures aimed at ensuring the flow of credit to borrowers and supporting credit markets with unlimited amounts of bond purchasing. Meanwhile, Congress passed the Coronavirus Aid, Relief and Economic Security Act to provide economic relief for individuals and businesses and additional funding for small businesses.

Benefiting from these fiscal and monetary measures, equities began to advance at the end of March 2020. As states gradually reopened, economic activity resumed, leading to declining initial jobless claims and record-high increases in job additions and existing home sales. Optimism about potential COVID-19 vaccines and treatments and rising retail sales further supported equities, which rebounded from multi-year lows to post the strongest second-quarter returns in more than 20 years. Nevertheless, surging infection rates in several states near the end of June led to concerns that economic recovery could be hindered if reopening measures are paused or rolled back.

Investment Strategy

We are a research-driven, fundamental investment adviser, pursuing a disciplined value-oriented strategy. As bottom-up

1. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

2. Source: Bureau of Labor Statistics.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

FRD-2         Semiannual Report

FRANKLIN RISING DIVIDENDS VIP FUND

investors concentrating primarily on individual securities, we seek fundamentally sound companies that we believe meet our screening criteria, which include consistent, substantial dividend increases; reinvested earnings; and strong balance sheets. We attempt to acquire such stocks at attractive prices, often when they are out of favor with other investors. In following these criteria, we do not necessarily focus on companies whose securities pay a high dividend but rather on companies that consistently raise their dividends.

Manager’s Discussion

During the six-month period ended June 30, 2020, some companies that contributed to absolute performance included Microsoft, West Pharmaceutical Services and Lowe’s.

Enterprise software firm Microsoft boosted performance following a strong earnings report and based on investor optimism its cloud-based services could realize additional benefits as more people work from home going forward. Its workflow collaboration product, Teams, has seen excellent results. The company has seen strength in its commercial cloud services and in sales of Windows as customers migrated away from Windows 7 in recent quarters. We believe that the trends of helping business customers move to the cloud and providing workers with productivity tools could support attractive growth over the medium to longer term.

West Pharmaceutical Services, which makes packaging for pharmaceuticals and health care products, supported fund performance after reporting robust quarterly financial results due to continued strong demand for its products. The company is also marketing products for COVID-19 diagnostics and anti-viral therapies and vaccines that could provide an additional lift to growth over the coming quarters.

Home improvement retailer Lowe’s contributed following a strong first-quarter financial report which highlighted excellent demand for its products. During the pandemic, with people spending more time at home, consumers have looked to complete more do-it-yourself home renovation projects. Lowe’s is also seeing benefits from changes aimed at improving its operational performance through increased sales productivity, new technology systems and supply chain improvements. We see significant opportunity for Lowe’s to improve sales in stores and online while increasing its operating margin.

In contrast, some companies that detracted from absolute performance included Raytheon Technologies, Honeywell International and Occidental Petroleum.

Portfolio Composition

Based on Total Net Assets as of 6/30/20

In industrials, aerospace and defense companies United Technologies and Raytheon merged in April to create Raytheon Technologies. These businesses detracted due to concerns about the weakness in the commercial aviation market following the global lockdowns aimed at stemming the spread of COVID-19. We continue to like the prospects for Raytheon, particularly for its leading defense business.

Honeywell International curbed performance as cyclical stocks struggled amid the global economic downturn and based on concerns about its exposure to aerospace and oil and gas markets that could remain weak over the next few quarters. We recognize that some of these markets may take time to recover, but we continue to believe Honeywell is a quality company with strong positions in attractive markets.

Semiannual Report         FRD-3

FRANKLIN RISING DIVIDENDS VIP FUND

Top 10 Holdings

6/30/20

Company Sector/Industry	% of Total Net Assets
Microsoft Corp. Software & Services		8.7%
Roper Technologies Inc. Industrial Conglomerates		5.3%
Accenture PLC Software & Services		3.8%
Linde PLC (United Kingdom) Materials		3.5%
Stryker Corp. Health Care Equipment & Services		3.4%
Air Products and Chemicals Inc. Materials		3.3%
Becton Dickinson and Co. Health Care Equipment & Services		3.2%
Texas Instruments Inc. Semiconductors & Semiconductor Equipment		3.1%
Analog Devices Inc. Semiconductors & Semiconductor Equipment		3.1%
West Pharmaceutical Services Inc. Health Care Equipment & Services		2.8%

Steps taken to cut costs and realign its business should also be helpful.

Energy company Occidental Petroleum weighed on Fund performance due to falling oil prices. The company significantly increased its debt to finance its recent purchase of Anadarko Petroleum, which has led to investor concerns about its ability to meet its debt obligations. We exited the position during the review period.

Thank you for your participation in Franklin Rising Dividends VIP Fund. We look forward to continuing to serve your investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund.

Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

FRD-4         Semiannual Report

FRANKLIN RISING DIVIDENDS VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual       (actual return after expenses)		Hypothetical       (5% annual return before expenses)
Share Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$952.30	$3.20	$1,021.58	$3.32	0.66%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

Semiannual Report         FRD-5

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin Rising Dividends VIP Fund

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$27.90			$25.75			$29.21			$25.51			$25.26			$29.63
Income from investment operationsa:
Net investment incomeb		0.16			0.37			0.39			0.40			0.42			0.45
Net realized and unrealized gains (losses)		(1.52	)		6.77			(1.65	)		4.76			3.45			(1.33	)
Total from investment operations		(1.36	)		7.14			(1.26	)		5.16			3.87			(0.88	)
Less distributions from:
Net investment income		(0.41	)		(0.45	)		(0.44	)		(0.48	)		(0.44	)		(0.48	)
Net realized gains		(1.41	)		(4.54	)		(1.76	)		(0.98	)		(3.18	)		(3.01	)
Total distributions		(1.82	)		(4.99	)		(2.20	)		(1.46	)		(3.62	)		(3.49	)
Net asset value, end of period		$24.72			$27.90			$25.75			$29.21			$25.51			$25.26
Total returnc		(4.77)%			29.58%			(4.84)%			20.85%			16.33%			(3.42)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		0.66%			0.63%			0.62%			0.62%			0.63%			0.63%
Expenses net of waiver and payments by affiliates		0.66%	e,f		0.63%	e,f		0.62%	e,f		0.62%	e,f		0.62%	e		0.63%	f
Net investment income		1.30%			1.34%			1.38%			1.49%			1.67%			1.65%
Supplemental data
Net assets, end of period (000’s)		$136,120			$150,864			$157,838			$216,015			$181,072			$143,376
Portfolio turnover rate		9.21%			7.26%	g		3.09%	g		3.36%			6.66%			4.74%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^gExcludes the value of portfolio securities delivered as a result of redemptions in-kind. See Note 9.

FRD-6         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Rising Dividends VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$26.99			$25.04			$28.46			$24.89			$24.72			$29.06
Income from investment operationsa:
Net investment incomeb		0.13			0.29			0.31			0.33			0.35			0.37
Net realized and unrealized gains (losses)		(1.47	)		6.57			(1.61	)		4.63			3.37			(1.29	)
Total from investment operations		(1.34	)		6.86			(1.30	)		4.96			3.72			(0.92	)
Less distributions from:
Net investment income		(0.33	)		(0.37	)		(0.36	)		(0.41	)		(0.37	)		(0.41	)
Net realized gains		(1.41	)		(4.54	)		(1.76	)		(0.98	)		(3.18	)		(3.01	)
Total distributions		(1.74	)		(4.91	)		(2.12	)		(1.39	)		(3.55	)		(3.42	)
Net asset value, end of period		$23.91			$26.99			$25.04			$28.46			$24.89			$24.72
Total returnc		(4.84)%			29.23%			(5.07)%			20.56%			16.04%			(3.65)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		0.91%			0.88%			0.87%			0.87%			0.88%			0.88%
Expenses net of waiver and payments by affiliates		0.91%	e,f		0.88%	e,f		0.87%	e,f		0.87%	e,f		0.87%	e		0.88%f
Net investment income		1.05%			1.09%			1.13%			1.24%			1.42%			1.40%
Supplemental data
Net assets, end of period (000’s)		$1,174,601			$1,387,688			$1,106,334			$1,640,883			$1,530,374			$1,310,783
Portfolio turnover rate		9.21%			7.26%g			3.09%g			3.36%			6.66%			4.74%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^gExcludes the value of portfolio securities delivered as a result of redemptions in-kind. See Note 9.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FRD-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Rising Dividends VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$27.08			$25.11			$28.54			$24.98			$24.81			$29.19
Income from investment operationsa:
Net investment incomeb		0.12			0.26			0.29			0.30			0.32			0.35
Net realized and unrealized gains (losses)		(1.49	)		6.60			(1.62	)		4.65			3.39			(1.31	)
Total from investment operations		(1.37	)		6.86			(1.33	)		4.95			3.71			(0.96	)
Less distributions from:
Net investment income		(0.32	)		(0.35	)		(0.34	)		(0.41	)		(0.36	)		(0.41	)
Net realized gains		(1.41	)		(4.54	)		(1.76	)		(0.98	)		(3.18	)		(3.01	)
Total distributions		(1.73	)		(4.89	)		(2.10	)		(1.39	)		(3.54	)		(3.42	)
Net asset value, end of period		$23.98			$27.08			$25.11			$28.54			$24.98			$24.81
Total returnc		(4.93)%			29.16%			(5.16)%			20.40%			15.93%			(3.75)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		1.01%			0.98%			0.97%			0.97%			0.98%			0.98%
Expenses net of waiver and payments by affiliates		1.01%	e,f		0.98%	e,f		0.97%	e,f		0.97%	e,f		0.97%	e		0.98%	f
Net investment income		0.95%			0.99%			1.03%			1.14%			1.32%			1.30%
Supplemental data
Net assets, end of period (000’s)		$42,892			$46,539			$32,825			$36,407			$28,579			$20,453
Portfolio turnover rate		9.21%			7.26%g			3.09%g			3.36%			6.66%			4.74%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^gExcludes the value of portfolio securities delivered as a result of redemptions in-kind. See Note 9.

FRD-8         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin Rising Dividends VIP Fund

	Shares		Value
Common Stocks 96.0%
Aerospace & Defense 3.5%
General Dynamics Corp.		139,852	$	20,902,280
Raytheon Technologies Corp.		428,746		26,419,329
				47,321,609
Building Products 1.2%
Johnson Controls International PLC		486,910		16,623,107
Commercial & Professional Services 1.8%
Cintas Corp.		84,272		22,446,690
Matthews International Corp., A		124,917		2,385,915
				24,832,605
Consumer Durables & Apparel 2.0%
NIKE Inc., B		280,384		27,491,651
Consumer Services 1.7%
McDonald’s Corp.		125,099		23,077,013
Diversified Financials 0.7%
Nasdaq Inc.		45,140		5,392,876
State Street Corp.		57,541		3,656,730
				9,049,606
Electrical Equipment 0.5%
nVent Electric PLC		346,626		6,492,305
Energy 1.9%
Chevron Corp.		141,294		12,607,664
EOG Resources Inc.		142,861		7,237,338
Exxon Mobil Corp.		143,861		6,433,464
				26,278,466
Food & Staples Retailing 1.6%
Walmart Inc.		176,908		21,190,040
Food, Beverage & Tobacco 3.5%
McCormick & Co. Inc.		124,447		22,327,036
PepsiCo Inc.		186,030		24,604,328
				46,931,364
Health Care Equipment & Services 16.5%
Abbott Laboratories		278,695		25,481,084
Becton Dickinson and Co.		181,815		43,502,875
CVS Health Corp.		160,793		10,446,721
Dentsply Sirona Inc.		124,192		5,471,899
Medtronic PLC		399,554		36,639,102
Stryker Corp.		256,745		46,262,882
UnitedHealth Group Inc.		59,400		17,520,030
West Pharmaceutical Services Inc.		166,901		37,914,900
				223,239,493

Semiannual Report         FRD-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Rising Dividends VIP Fund (continued)

	Shares		Value
Common Stocks (continued)
Household & Personal Products 3.1%
Colgate-Palmolive Co.		248,540	$	18,208,040
The Procter & Gamble Co.		202,094		24,164,380
				42,372,420
Industrial Conglomerates 8.6%
Carlisle Cos. Inc.		74,202		8,879,753
Honeywell International Inc.		248,075		35,869,164
Roper Technologies Inc.		183,883		71,394,414
				116,143,331
Insurance 1.4%
Aflac Inc.		192,904		6,950,331
Erie Indemnity Co., A		62,670		12,026,373
				18,976,704
Machinery 3.3%
Donaldson Co. Inc.		190,497		8,861,921
Dover Corp.		191,888		18,528,705
Otis Worldwide Corp.		98,553		5,603,723
Pentair PLC		308,694		11,727,285
				44,721,634
Materials 10.6%
Air Products and Chemicals Inc.		188,467		45,507,242
Albemarle Corp.		345,610		26,684,548
Ecolab Inc.		120,309		23,935,476
Linde PLC (United Kingdom)		222,432		47,180,051
				143,307,317
Pharmaceuticals, Biotechnology & Life Sciences 4.5%
AbbVie Inc.		152,236		14,946,530
Johnson & Johnson		195,929		27,553,495
Perrigo Co. PLC		108,863		6,016,858
Pfizer Inc.		379,815		12,419,951
				60,936,834
Retailing 5.4%
Lowe’s Cos. Inc.		195,372		26,398,665
Ross Stores Inc.		234,930		20,025,433
Target Corp.		223,737		26,832,778
				73,256,876
Semiconductors & Semiconductor Equipment 6.2%
Analog Devices Inc.		338,519		41,515,970
Texas Instruments Inc.		332,168		42,175,371
				83,691,341

FRD-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Rising Dividends VIP Fund (continued)

	Shares		Value
Common Stocks (continued)
Software & Services 14.4%
Accenture PLC, A		243,078	$	52,193,708
Microsoft Corp.		576,928		117,410,617
Visa Inc., A		134,562		25,993,342
				195,597,667
Trading Companies & Distributors 1.0%
W.W. Grainger Inc.		40,993		12,878,361
Transportation 2.6%
Norfolk Southern Corp.		95,647		16,792,744
United Parcel Service Inc., B		161,367		17,940,783
				34,733,527
Total Common Stocks (Cost $643,793,684)				1,299,143,271
Short Term Investments (Cost $52,452,937) 3.9%
Money Market Funds 3.9%
a,bInstitutional Fiduciary Trust Money Market Portfolio, 0.00%		52,452,937		52,452,937
Total Investments (Cost $696,246,621) 99.9%				1,351,596,208
Other Assets, less Liabilities 0.1%				2,017,259
Net Assets 100.0%			$	1,353,613,467

^aSee Note 3(e) regarding investments in affiliated management investment companies.

^bThe rate shown is the annualized seven-day effective yield at period end.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FRD-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Rising Dividends VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers	$	643,793,684
Cost - Non-controlled affiliates (Note 3e)		52,452,937
Value - Unaffiliated issuers	$	1,299,143,271
Value - Non-controlled affiliates (Note 3e)		52,452,937
Receivables:
Investment securities sold		22,915
Capital shares sold.		2,289,977
Dividends		1,048,381
Other assets		1,245
Total assets		1,354,958,726
Liabilities:
Payables:
Capital shares redeemed		251,866
Management fees		680,573
Distribution fees		247,101
Trustees’ fees and expenses		540
Reports to shareholders		115,164
Accrued expenses and other liabilities		50,015
Total liabilities		1,345,259
Net assets, at value	$	1,353,613,467
Net assets consist of:
Paid-in capital	$	654,522,169
Total distributable earnings (losses)		699,091,298
Net assets, at value	$	1,353,613,467
Class 1:
Net assets, at value	$	136,120,264
Shares outstanding		5,505,798
Net asset value and maximum offering price per share		$24.72
Class 2:
Net assets, at value	$	1,174,600,707
Shares outstanding		49,131,938
Net asset value and maximum offering price per share		$23.91
Class 4:
Net assets, at value	$	42,892,496
Shares outstanding		1,788,598
Net asset value and maximum offering price per share		$23.98

FRD-12         Semiannual Report  |  The accompanying notes are an integral part of these  financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Rising Dividends VIP Fund
Investment income:
Dividends:
Unaffiliated issuers	$	12,933,421
Non-controlled affiliates (Note 3e)		38,590
Total investment income		12,972,011
Expenses:
Management fees (Note 3a)		4,258,919
Distribution fees: (Note 3c)
Class 2		1,445,175
Class 4		73,767
Custodian fees (Note 4)		5,353
Reports to shareholders		80,050
Professional fees		32,063
Trustees’ fees and expenses		4,541
Other		17,054
Total expenses.		5,916,922
Expense reductions (Note 4)		(2,984	)
Expenses waived/paid by affiliates (Note 3e)		(32,299	)
Net expenses.		5,881,639
Net investment income		7,090,372
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		39,470,417
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(149,518,047	)
Net realized and unrealized gain (loss)		(110,047,630	)
Net increase (decrease) in net assets resulting from operations.	$	(102,957,258	)

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FRD-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Franklin Rising Dividends VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income	$	7,090,372		$	17,322,041
Net realized gain (loss)		39,470,417			82,812,044
Net change in unrealized appreciation (depreciation)		(149,518,047	)		279,796,675
Net increase (decrease) in net assets resulting from operations		(102,957,258	)		379,930,760
Distributions to shareholders:
Class 1		(9,363,148	)		(28,799,833	)
Class 2		(76,921,978	)		(227,983,493	)
Class 4		(2,888,655	)		(6,300,776	)
Total distributions to shareholders		(89,173,781	)		(263,084,102	)
Capital share transactions: (Note 2)
Class 1		1,777,365			(21,678,109	)
Class 2		(42,629,500	)		182,626,753
Class 4		1,505,341			10,299,225
Total capital share transactions		(39,346,794	)		171,247,869
Net increase (decrease) in net assets		(231,477,833	)		288,094,527
Net assets:
Beginning of period		1,585,091,300			1,296,996,773
End of period	$	1,353,613,467		$	1,585,091,300

FRD-14         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin Rising Dividends VIP Fund

1.   Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Rising Dividends VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. The Fund offers three classes of shares: Class 1, Class 2 and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a.   Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued

according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Investments in open-end mutual funds are valued at the closing NAV.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m Eastern time.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

Semiannual Report         FRD-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Rising Dividends VIP Fund (continued)

1.   Organization and Significant Accounting Policies (continued)

b.   Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c.   Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

d.   Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Estimated expenses are accrued daily. Dividend income is recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of

FRD-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Rising Dividends VIP Fund (continued)

number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

e.   Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

f.   Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2.   Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold.		91,477		$	2,138,662			238,379		$	6,420,546
Shares issued in reinvestment of distributions		386,747			9,363,148			1,132,514			28,799,833
Shares redeemed		(380,059	)		(9,724,445	)		(2,092,688	)		(56,898,488	)
Net increase (decrease)		98,165		$	1,777,365			(721,795	)	$	(21,678,109	)
Class 2 Shares:
Shares sold.		5,031,301		$	123,392,526			7,298,801		$	200,248,939
Shares issued in reinvestment of distributions		3,284,457			76,921,978			9,252,577			227,983,493
Shares redeemed in-kind (Note 9)		—			—			(897,175	)		(22,646,135	)
Shares redeemed		(10,591,496	)		(242,944,004	)		(8,430,854	)		(222,959,544	)
Net increase (decrease)		(2,275,738	)	$	(42,629,500	)		7,223,349		$	182,626,753
Class 4 Shares:
Shares sold.		144,348		$	3,435,582			415,831		$	10,934,186
Shares issued in reinvestment of distributions		122,974			2,888,655			254,783			6,300,776
Shares redeemed		(197,420	)		(4,818,896	)		(258,933	)		(6,935,737	)
Net increase (decrease)		69,902		$	1,505,341			411,681		$	10,299,225

Semiannual Report         FRD-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Rising Dividends VIP Fund (continued)

3.   Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Advisers, Inc. (Advisers)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a.   Management Fees

The Fund pays an investment management fee to Advisers based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.750%	Up to and including $500 million
0.625%	Over $500 million, up to and including $1 billion
0.500%	Over $1 billion, up to and including $5 billion
0.490%	In excess of $5 billion

For the period ended June 30, 2020, the annualized gross effective investment management fee rate was 0.641% of the Fund’s average daily net assets.

b.   Administrative Fees

Under an agreement with Advisers, FT Services provides administrative services to the Fund. The fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

c.   Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets of each class. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d.   Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

FRD-18         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Rising Dividends VIP Fund (continued)

e.   Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Dividend Income
Non-Controlled Affiliates
Institutional Fiduciary Trust Money Market Portfolio, 0.00%	$	17,735,928	$	166,499,752	$	(131,782,743	)		$      —		$      —	$	52,452,937		52,452,937	$	38,590

4.   Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

5.   Income Taxes

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$	699,061,403
Unrealized appreciation	$	686,228,892
Unrealized depreciation		(33,694,087	)
Net unrealized appreciation (depreciation)	$	652,534,805

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatment of gains realized on in-kind shareholder redemptions.

6.   Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $122,274,094 and $276,995,819, respectively.

7.   Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

Semiannual Report         FRD-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Rising Dividends VIP Fund (continued)

8.   Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

9.   Redemption In-Kind

During the year ended December 31, 2019, the Fund realized $10,655,992 of net gains resulting from redemptions in-kind in which a shareholder redeemed fund shares for cash and securities held by the Fund. Because such gains are not taxable to the Fund and are not distributed to remaining shareholders, they are reclassified from accumulated net realized gains to paid-in capital.

10.   Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

At June 30, 2020, all of the Fund’s investments in financial instruments carried at fair value were valued using Level 1 inputs. For detailed categories, see the accompanying Statement of Investments.

11.   New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

FRD-20         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Rising Dividends VIP Fund (continued)

12.   Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Semiannual Report         FRD-21

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Franklin Small Cap Value VIP Fund

This semiannual report for Franklin Small Cap Value VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -18.31% total return for the six-month period ended June 30, 2020.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         FSV-1

FRANKLIN SMALL CAP VALUE VIP FUND

Fund Goal and Main Investments

The Fund seeks long-term total return. Under normal market conditions, the Fund invests at least 80% of its net assets in investments of small capitalization companies. For this Fund, small capitalization companies are those with market capitalizations not exceeding either the highest market capitalization in the Russell 2000^® Index or the 12-month average of the highest market capitalization in the Russell 2000^® Index, whichever is greater, at the time of purchase. The Fund generally invests in equity securities of companies that the manager believes are undervalued at the time of purchase and have the potential for capital appreciation.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. The Fund’s investments in smaller company stocks carry special risks as such stocks have historically exhibited greater price volatility than large-company stocks, particularly over the short term. Additionally, smaller companies often have relatively small revenues, limited product lines and a small market share. Value securities may not increase in price as anticipated, or may decline further in value. In addition, the Fund may invest up to 25% of its total assets in foreign securities, which involve special risks, including currency fluctuations and economic and political uncertainty. The Fund also may invest in equity real estate investment trusts (REITs). The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Russell 2000^® Value Index posted a -23.50% total return for the same period.¹ Please note the Fund employs a bottom-up stock

selection process, and the managers invest in securities without regard to benchmark comparisons.

Economic and Market Overview

U.S. equities, as measured by the Standard & Poor’s^® 500 Index, nearly reversed earlier losses but declined modestly during the six-month period. A sharp selloff began in late February 2020 amid investor fears of a global economic slowdown due to the novel coronavirus (COVID-19) pandemic.

Government-issued restrictions to mitigate the pandemic severely curtailed U.S. economic activity beginning in March 2020. As a result, the unemployment rate surged to 14.7% in April as many businesses, particularly in hospitality, retail and travel, announced mass layoffs.² Within just two months, the unemployment rate went from a 50-year low to an 80-year high.² The longest U.S. economic expansion in history ended in February, according to the National Bureau of Economic Research, and the country slipped into a deep recession.

In an effort to buffer the sharp drop in economic activity, the Fed implemented two emergency rate cuts in March 2020, lowering the federal funds target rate to a range of 0.00%–0.25%. Additionally, the Fed announced broad quantitative easing measures aimed at ensuring the flow of credit to borrowers and supporting credit markets with unlimited amounts of bond purchasing. Meanwhile, Congress passed the Coronavirus Aid, Relief and Economic Security Act to provide economic relief for individuals and businesses and additional funding for small businesses.

Benefiting from these fiscal and monetary measures, equities began to advance at the end of March 2020. As states gradually reopened, economic activity resumed, leading to declining initial jobless claims and record-high increases in job additions and existing home sales. Optimism about potential COVID-19 vaccines and treatments and rising retail sales further supported equities, which rebounded from multi-year lows to post the strongest second-quarter returns in more than 20 years. Nevertheless, surging infection rates in several states near the end of June led to concerns that economic recovery could be hindered if reopening measures are paused or rolled back.

1. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

2. Source: Bureau of Labor Statistics.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

FSV-2         Semiannual Report

FRANKLIN SMALL CAP VALUE VIP FUND

Investment Strategy

Our strategy is to invest in small-cap companies that we believe are undervalued at the time of purchase and have the potential for capital appreciation. A stock is undervalued, or is a “value,” when it trades at less than the price at which the investment manager believes it would trade if the market reflected all factors relating to the company’s worth. Following this strategy, the Fund invests in companies that the investment manager believes have, for example: stock prices that are low relative to current, or historical or future earnings, book value, cash flow or sales; recent sharp price declines but the potential for good long-term earnings prospects; and valuable intangibles not reflected in the stock price. The Fund also may invest in equity real estate investment trusts (REITs).

The Fund may invest up to 25% of its total assets in foreign securities.

Manager’s Discussion

For the six months ended June 30, 2020, detractors from performance included Retail Properties of America, First Horizon National and Toll Brothers.

Retail Properties of America, a shopping center operator, underperformed as stay-at-home and closure guidelines issued to prevent the spread of COVID-19 exacerbated a challenging environment for the company’s brick-and-mortar retail tenants. During the first-quarter 2020 earnings call, management reported that it had collected just 52% of April rent as many non-essential retailers were shuttered. Although mandatory closure orders were being rescinded at period-end, some watch-list tenants were not expected to reopen. Also, previously stable sectors, such as fitness and casual dining, may face new pressures as consumer behavior shifts in response to new social distancing and spacing regulations. We exited the position.

Shares of First Horizon, a regional bank with a southeastern U.S. footprint, retreated as expectations for lower spread income and rising credit losses, attributable to the economic effect of the spread of COVID-19, contributed to negative sentiment. Rate cuts by the Fed to mitigate economic uncertainty could lead to a decline in spread income, the difference between interest received from interest-earning assets and interest paid on interest-bearing liabilities. Also, many sectors of the economy appear challenged to us, which may result in higher credit losses.

Shares of Toll Brothers, a builder of luxury homes, declined as the spread of COVID-19 contributed to a deterioration in the near-term outlook for the housing market. Unemployment

Portfolio Composition

Based on Total Net Assets as of 6/30/20

increased as businesses quickly responded to lockdown and social distancing directives. We believe that housing demand may shift toward single family homes in lower density markets because of these directives and the potential longer-lasting shift to working from home versus commuting. Consequently, Toll Brothers, which is a luxury builder with longer construction timelines and an urban infill segment focused on multifamily housing, may be less favorably positioned relative to peers. We exited our position before period-end.

Semiannual Report         FSV-3

FRANKLIN SMALL CAP VALUE VIP FUND

Top 10 Holdings

6/30/20

Company Sector/Industry	% of Total Net Assets
Old Republic International Corp. Insurance		3.3%
The Hanover Insurance Group Inc. Insurance		3.2%
Regal Beloit Corp. Electrical Equipment		3.2%
Horace Mann Educators Corp. Insurance		3.0%
First Horizon National Corp. Banks		2.9%
Rexnord Corp. Machinery		2.7%
Jack in the Box Inc. Consumer Services		2.6%
Columbia Banking System Inc. Banks		2.5%
Oshkosh Corp. Machinery		2.4%
Carter’s Inc. Consumer Durables & Apparel		2.4%

Contributors to Fund performance included BJ’s Wholesale Club, Thor Industries and II-IV.

BJ’s Wholesale Club, a warehouse club retailer, benefited from accelerated purchases of consumer staples as the economy shut down in response to the COVID-19 pandemic. Longer term, we believe the company’s membership model may provide it with a longer benefit and an earnings advantage, if shoppers continue to sign up.

Shares of Thor Industries, a manufacturer of recreational vehicles, were bid up on investor expectations of increased consumer spending on domestic travel. International tourism has declined significantly as countries have closed borders to limit the spread of COVID-19. Thor also benefited from an anticipated acceleration in consumer discretionary spending tied to Congress passing the fiscal stimulus package.

Shares of II-VI, a provider of engineered materials and optoelectronic components, rose during the period, due to stronger-than-expected quarterly earnings in its fiscal third quarter in May and an improved outlook for the subsequent period. Results were driven by strong revenue growth in all end markets and the benefit of synergies from an acquisition occurring ahead of schedule. Furthermore, the company recorded a record backlog of orders, and its facility in

Sherman, TX, was qualified by a customer as an authorized provider of compound semiconductors.

Thank you for your participation in Franklin Small Cap Value VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

FSV-4         Semiannual Report

FRANKLIN SMALL CAP VALUE VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual     (actual return after expenses)		Hypothetical   (5% annual return before expenses)
Share   Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$816.90	$3.07	$1,021.48	$3.42	0.68%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

Semiannual Report         FSV-5

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin Small Cap Value VIP Fund

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$15.73			$15.14			$20.43			$19.93			$18.12			$22.81
Income from investment operationsa:
Net investment incomeb		0.10			0.24	c		0.21			0.21	d		0.15			0.21
Net realized and unrealized gains (losses)		(3.01	)		3.35			(2.29	)		1.82			4.79			(1.53	)
Total from investment operations		(2.91	)		3.59			(2.08	)		2.03			4.94			(1.32	)
Less distributions from:
Net investment income		(0.23	)		(0.22	)		(0.23	)		(0.15	)		(0.21	)		(0.20	)
Net realized gains		(0.81	)		(2.78	)		(2.98	)		(1.38	)		(2.92	)		(3.17	)
Total distributions		(1.04	)		(3.00	)		(3.21	)		(1.53	)		(3.13	)		(3.37	)
Net asset value, end of period		$11.78			$15.73			$15.14			$20.43			$19.93			$18.12
Total returne		(18.31)%			26.72%			(12.69)%			10.92%			30.54%			(7.18)%
Ratios to average net assetsf
Expenses before waiver and payments by affiliates and expense reduction		0.68%			0.67%			0.66%			0.66%			0.66%			0.65%
Expenses net of waiver and payments by affiliates and expense reductiong		0.68%	h		0.67%	h		0.65%			0.65%			0.64%			0.64%
Net investment income		1.50%			1.58%	c		1.13%			1.06%	d		0.84%			1.04%
Supplemental data
Net assets, end of period (000’s)		$38,887			$46,980			$40,644			$51,245			$47,831			$45,897
Portfolio turnover rate		33.77%			54.36%			47.82%			33.36%			34.60%			27.05%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.05 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 1.23%.

^dNet investment income per share includes approximately $0.06 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 0.75%.

^eTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^fRatios are annualized for periods less than one year.

^gBenefit of expense reduction rounds to less than 0.01%.

^hBenefit of waiver and payments by affiliates rounds to less than 0.01%.

FSV-6         Semiannual Report  |  The accompanying notes are an integral part of these  financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Small Cap Value VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$15.05			$14.60			$19.80			$19.36			$17.68			$22.32
Income from investment operationsa:
Net investment incomeb		0.08			0.20	c		0.16			0.15	d		0.10			0.16
Net realized and unrealized gains (losses)		(2.88	)		3.20			(2.20	)		1.77			4.66			(1.49	)
Total from investment operations		(2.80	)		3.40			(2.04	)		1.92			4.76			(1.33	)
Less distributions from:
Net investment income		(0.19	)		(0.17	)		(0.18	)		(0.10	)		(0.16	)		(0.14	)
Net realized gains		(0.81	)		(2.78	)		(2.98	)		(1.38	)		(2.92	)		(3.17	)
Total distributions		(1.00	)		(2.95	)		(3.16	)		(1.48	)		(3.08	)		(3.31	)
Net asset value, end of period		$11.25			$15.05			$14.60			$19.80			$19.36			$17.68
Total returne		(18.39)%			26.35%			(12.88)%			10.65%			30.19%			(7.39)%
Ratios to average net assetsf
Expenses before waiver and payments by affiliates and expense reduction		0.93%			0.92%			0.91%			0.91%			0.91%			0.90%
Expenses net of waiver and payments by affiliates and expense reductiong		0.93%	h		0.92%	h		0.90%			0.90%			0.89%			0.89%
Net investment income		1.25%			1.33%	c		0.88%			0.81%	d		0.59%			0.79%
Supplemental data
Net assets, end of period (000’s)		$904,935			$1,123,093			$978,675			$1,302,055			$1,366,807			$1,172,173
Portfolio turnover rate		33.77%			54.36%			47.82%			33.36%			34.60%			27.05%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.05 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 0.98%.

^dNet investment income per share includes approximately $0.06 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 0.50%.

^eTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^fRatios are annualized for periods less than one year.

^gBenefit of expense reduction rounds to less than 0.01%.

^hBenefit of waiver and payments by affiliates rounds to less than 0.01%.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FSV-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Small Cap Value VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$15.51			$14.96			$20.22			$19.74			$17.96			$22.63
Income from investment operationsa:
Net investment incomeb		0.07			0.19	c		0.15			0.14	d		0.09			0.14
Net realized and unrealized gains (losses)		(2.96	)		3.30			(2.28	)		1.81			4.75			(1.52	)
Total from investment operations		(2.89	)		3.49			(2.13	)		1.95			4.84			(1.38	)
Less distributions from:
Net investment income		(0.18	)		(0.16	)		(0.15	)		(0.09	)		(0.14	)		(0.12	)
Net realized gains		(0.81	)		(2.78	)		(2.98	)		(1.38	)		(2.92	)		(3.17	)
Total distributions		(0.99	)		(2.94	)		(3.13	)		(1.47	)		(3.06	)		(3.29	)
Net asset value, end of period		$11.63			$15.51			$14.96			$20.22			$19.74			$17.96
Total returne		(18.43)%			26.23%			(13.01)%			10.56%			30.12%			(7.52)%
Ratios to average net assetsf
Expenses before waiver and payments by affiliates and expense reduction		1.03%			1.02%			1.01%			1.01%			1.01%			1.00%
Expenses net of waiver and payments by affiliates and expense reductiong		1.03%	h		1.02%	h		1.00%			1.00%			0.99%			0.99%
Net investment income		1.15%			1.23%	c		0.78%			0.71%	d		0.49%			0.69%
Supplemental data
Net assets, end of period (000’s)		$24,866			$29,238			$24,592			$32,053			$32,751			$26,128
Portfolio turnover rate		33.77%			54.36%			47.82%			33.36%			34.60%			27.05%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.05 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 0.88%.

^dNet investment income per share includes approximately $0.06 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been 0.40%.

^eTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^fRatios are annualized for periods less than one year.

^gBenefit of expense reduction rounds to less than 0.01%.

^hBenefit of waiver and payments by affiliates rounds to less than 0.01%.

FSV-8         Semiannual Report  |   The accompanying notes are an integral part of these  financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin Small Cap Value VIP Fund

	Shares		Value
Common Stocks 98.9%
Automobiles & Components 2.6%
Gentex Corp.		36,000	$	927,720
LCI Industries		17,908		2,059,062
Thor Industries Inc.		205,121		21,851,540
				24,838,322
Banks 15.3%
Atlantic Union Bankshares Corp.		309,748		7,173,764
Bryn Mawr Bank Corp.		484,783		13,409,098
Columbia Banking System Inc.		858,758		24,341,496
First Horizon National Corp.		2,777,349		27,662,396
First of Long Island Corp.		614,355		10,038,561
German American Bancorp Inc.		196,123		6,099,425
Glacier Bancorp Inc.		162,950		5,750,506
Lakeland Financial Corp.		438,031		20,407,864
Peoples Bancorp Inc.		289,712		6,165,071
South State Corp.		254,073		12,109,119
TCF Financial Corp.		29,642		872,068
TriCo Bancshares		53,403		1,626,121
TrustCo Bank Corp. NY		782,700		4,954,491
Washington Trust Bancorp Inc.		221,091		7,240,730
				147,850,710
Building Products 5.3%
Fortune Brands Home & Security Inc.		63,010		4,028,229
aGibraltar Industries Inc.		277,522		13,323,831
Insteel Industries Inc.		390,746		7,451,526
aMasonite International Corp.		100,048		7,781,734
UFP Industries Inc.		389,687		19,293,403
				51,878,723
Commercial & Professional Services 1.7%
aHuron Consulting Group Inc.		34,036		1,506,093
McGrath RentCorp.		277,667		14,996,795
				16,502,888
Consumer Durables & Apparel 6.4%
BRP Inc.		87,879		3,748,071
Brunswick Corp.		327,234		20,946,248
Callaway Golf Co.		358,465		6,276,722
Carter’s Inc.		287,654		23,213,678
aM/I Homes Inc.		173,900		5,989,116
aUnifi Inc.		171,800		2,212,784
				62,386,619
Consumer Services 4.9%
Jack in the Box Inc.		337,791		25,026,935
Wyndham Hotels and Resorts Inc.		518,769		22,109,935
				47,136,870

Semiannual Report         FSV-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Small Cap Value VIP Fund (continued)

	Shares		Value
Common Stocks (continued)
Diversified Financials 1.6%
Houlihan Lokey Inc.		276,700	$	15,395,588
Electrical Equipment 3.5%
Encore Wire Corp.		75,262		3,674,291
Regal Beloit Corp.		350,500		30,605,660
				34,279,951
Energy 1.3%
Crescent Point Energy Corp. (Canada)		5,117,200		8,292,763
Hunting PLC (United Kingdom)		1,227,096		3,210,134
aNatural Gas Services Group Inc.		173,987		1,090,898
				12,593,795
Food & Staples Retailing 1.9%
aBJ’s Wholesale Club Holdings Inc.		487,266		18,160,404
Food, Beverage & Tobacco 2.2%
Glanbia PLC (Ireland)		1,420,461		16,140,483
Maple Leaf Foods Inc. (Canada)		237,357		4,984,751
				21,125,234
Health Care Equipment & Services 2.6%
Envista Holdings Corp.		684,217		14,430,137
aInteger Holdings Corp.		148,924		10,878,898
				25,309,035
Insurance 13.1%
CNO Financial Group Inc.		1,471,114		22,905,245
The Hanover Insurance Group Inc.		306,850		31,093,111
Horace Mann Educators Corp.		786,717		28,896,115
Old Republic International Corp.		1,964,216		32,036,363
Selective Insurance Group Inc.		235,011		12,394,480
				127,325,314
Machinery 14.2%
Astec Industries Inc.		235,808		10,920,269
Columbus McKinnon Corp.		211,441		7,072,701
Federal Signal Corp.		55,397		1,646,953
The Greenbrier Cos. Inc.		396,647		9,023,719
Hillenbrand Inc.		250,434		6,779,248
John Bean Technologies Corp.		52,500		4,516,050
Mueller Industries Inc.		266,662		7,087,876
Mueller Water Products Inc., A		2,103,549		19,836,467
Oshkosh Corp.		326,000		23,348,120
Rexnord Corp.		914,800		26,666,420
aSPX Flow Inc.		367,522		13,760,024
Wabash National Corp.		617,341		6,556,161
				137,214,008

FSV-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Small Cap Value VIP Fund (continued)

	Shares		Value
Common Stocks (continued)
Materials 11.5%
Cabot Corp.		311,530	$	11,542,186
Carpenter Technology Corp.		57,324		1,391,827
Eagle Materials Inc.		144,100		10,118,702
aLivent Corp. (Argentina)		139,604		859,961
Louisiana-Pacific Corp.		320,477		8,220,235
Minerals Technologies Inc.		370,641		17,394,182
aOceanaGold Corp. (Australia)		5,901,906		13,738,001
P H Glatfelter Co.		943,594		15,144,684
PolyOne Corp.		706,207		18,523,809
Reliance Steel & Aluminum Co.		151,900		14,419,867
				111,353,454
Real Estate 2.5%
Healthcare Realty Trust Inc.		284,773		8,341,001
Highwoods Properties Inc.		307,215		11,468,336
Sunstone Hotel Investors Inc.		532,949		4,343,534
				24,152,871
Retailing 1.3%
aBoot Barn Holdings Inc.		293,875		6,335,945
Group 1 Automotive Inc.		97,679		6,443,884
				12,779,829
Semiconductors & Semiconductor Equipment 1.3%
aAdvanced Energy Industries Inc.		111,064		7,529,029
MKS Instruments Inc.		22,414		2,538,161
aSynaptics Inc.		42,067		2,529,068
				12,596,258
Technology Hardware & Equipment 3.3%
aCoherent Inc.		5,067		663,676
aFARO Technologies Inc.		3,667		196,551
aII-VI Inc.		72,442		3,420,711
aNetScout Systems Inc.		565,600		14,456,736
aPlexus Corp.		186,573		13,164,591
				31,902,265
Transportation 0.1%
Heartland Express Inc.		30,600		637,092
Utilities 2.3%
Black Hills Corp.		152,161		8,621,442
IDACORP Inc.		130,145		11,370,769
Spire Inc.		39,355		2,586,017
				22,578,228
Total Common Stocks (Cost $941,805,010)				957,997,458

Semiannual Report         FSV-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Small Cap Value VIP Fund (continued)

	Principal Amount		Value
Corporate Bonds (Cost $2,378,000) 0.2%
Machinery 0.2%
Mueller Industries Inc., sub. bond, 6.00%, 3/01/27	$	2,378,000	$	2,332,961
Total Investments before Short Term Investments (Cost $944,183,010)				960,330,419
	Shares
Short Term Investments (Cost $10,387,607) 1.1%
Money Market Funds 1.1%
b,cInstitutional Fiduciary Trust Money Market Portfolio, 0.00%		10,387,607		10,387,607
Total Investments (Cost $954,570,617) 100.2%				970,718,026
Other Assets, less Liabilities (0.2)%				(2,030,223	)
Net Assets 100.0%			$	968,687,803

^aNon-income producing.

^bSee Note 3(e) regarding investments in affiliated management investment companies.

^cThe rate shown is the annualized seven-day effective yield at period end.

FSV-12         Semiannual Report  |  The accompanying notes are an integral part of these  financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Small Cap Value VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers	$	944,183,010
Cost - Non-controlled affiliates (Note 3e)		10,387,607
Value - Unaffiliated issuers	$	960,330,419
Value - Non-controlled affiliates (Note 3e)		10,387,607
Receivables:
Capital shares sold		27,255
Dividends and interest		1,037,160
Other assets		906
Total assets		971,783,347
Liabilities:
Payables:
Investment securities purchased		1,674,124
Capital shares redeemed		494,359
Management fees		512,287
Distribution fees		193,714
Trustees’ fees and expenses		148
Reports to shareholders		168,665
Accrued expenses and other liabilities		52,247
Total liabilities		3,095,544
Net assets, at value	$	968,687,803
Net assets consist of:
Paid-in capital	$	981,796,626
Total distributable earnings (losses)		(13,108,823	)
Net assets, at value	$	968,687,803
Class 1:
Net assets, at value	$	38,886,656
Shares outstanding		3,300,848
Net asset value and maximum offering price per share		$11.78
Class 2:
Net assets, at value	$	904,935,168
Shares outstanding		80,432,315
Net asset value and maximum offering price per share		$11.25
Class 4:
Net assets, at value	$	24,865,979
Shares outstanding		2,137,335
Net asset value and maximum offering price per share		$11.63

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FSV-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Small Cap Value VIP Fund
Investment income:
Dividends: (net of foreign taxes)*
Unaffiliated issuers	$	10,379,635
Non-controlled affiliates (Note 3e)		53,323
Interest:
Unaffiliated issuers		71,340
Total investment income		10,504,298
Expenses:
Management fees (Note 3a)		3,131,539
Distribution fees: (Note 3c)
Class 2		1,130,350
Class 4		42,561
Custodian fees (Note 4)		6,533
Reports to shareholders		120,955
Professional fees		31,308
Trustees’ fees and expenses.		3,081
Other		12,150
Total expenses		4,478,477
Expense reductions (Note 4)		(879	)
Expenses waived/paid by affiliates (Note 3e)		(29,040	)
Net expenses		4,448,558
Net investment income		6,055,740
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		(31,006,545	)
Realized gain distributions from REITs		237,639
Foreign currency transactions		(14,667	)
Net realized gain (loss)		(30,783,573	)
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(187,775,796	)
Translation of other assets and liabilities denominated in foreign currencies		(192	)
Net change in unrealized appreciation (depreciation)		(187,775,988	)
Net realized and unrealized gain (loss)		(218,559,561	)
Net increase (decrease) in net assets resulting from operations	$	(212,503,821	)
*Foreign taxes withheld on dividends	$	15,244

FSV-14         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Franklin Small Cap Value VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income	$	6,055,740		$	15,229,928
Net realized gain (loss)		(30,783,573	)		61,068,326
Net change in unrealized appreciation (depreciation)		(187,775,988	)		187,554,772
Net increase (decrease) in net assets resulting from operations		(212,503,821	)		263,853,026
Distributions to shareholders:
Class 1		(3,163,057	)		(7,896,338	)
Class 2		(74,826,607	)		(189,976,242	)
Class 4		(1,993,247	)		(4,683,798	)
Total distributions to shareholders		(79,982,911	)		(202,556,378	)
Capital share transactions: (Note 2)
Class 1		3,506,280			3,898,876
Class 2		55,901,879			87,139,038
Class 4		2,454,945			3,066,346
Total capital share transactions		61,863,104			94,104,260
Net increase (decrease) in net assets		(230,623,628	)		155,400,908
Net assets:
Beginning of period		1,199,311,431			1,043,910,523
End of period	$	968,687,803		$	1,199,311,431

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FSV-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin Small Cap Value VIP Fund

1.   Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Small Cap Value VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. The Fund offers three classes of shares: Class 1, Class 2 and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a.   Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued

according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Debt securities generally trade in the OTC market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value.

Investments in open-end mutual funds are valued at the closing NAV.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at

FSV-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small Cap Value VIP Fund (continued)

4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time. At June 30, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b.   Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net

unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c.   Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

d.   Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Amortization of premium and accretion of discount on debt securities are included in interest income. Dividend income and capital gain distributions are recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to

Semiannual Report         FSV-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small Cap Value VIP Fund (continued)

1.   Organization and Significant Accounting Policies (continued)

d.   Security Transactions, Investment Income, Expenses and Distributions (continued)

shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of

net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

e.   Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

f.   Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2.   Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		232,220		$	2,871,963			262,210		$	4,085,267
Shares issued in reinvestment of distributions		275,768			3,163,057			578,063			7,896,338
Shares redeemed		(194,542	)		(2,528,740	)		(537,480	)		(8,082,729	)
Net increase (decrease)		313,446		$	3,506,280			302,793		$	3,898,876
Class 2 Shares:
Shares sold		6,101,838		$	66,834,784			5,696,678		$	84,262,242
Shares issued in reinvestment of distributions		6,827,245			74,826,607			14,513,082			189,976,242
Shares redeemed		(7,116,902	)		(85,759,512	)		(12,637,486)			(187,099,446	)
Net increase (decrease)		5,812,181		$	55,901,879			7,572,274		$	87,139,038

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small Cap Value VIP Fund (continued)

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 4 Shares:
Shares sold		324,826		$	3,527,819			279,692		$	4,200,102
Shares issued in reinvestment of distributions		175,926			1,993,247			346,948			4,683,798
Shares redeemed		(248,204	)		(3,066,121	)		(385,667	)		(5,817,554	)
Net increase (decrease)		252,548		$	2,454,945			240,973		$	3,066,346

3.   Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Mutual Advisers, LLC (Franklin Mutual)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a.   Management Fees

The Fund pays an investment management fee to Franklin Mutual based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.750%	Up to and including $200 million
0.635%	Over $200 million, up to and including $700 million
0.600%	Over $700 million, up to and including $1.2 billion
0.575%	Over $1.2 billion, up to and including $1.3 billion
0.475%	In excess of $1.3 billion

For the period ended June 30, 2020, the annualized gross effective investment management fee rate was 0.650% of the Fund’s average daily net assets.

b.   Administrative Fees

Under an agreement with Franklin Mutual, FT Services provides administrative services to the Fund. The fee is paid by Franklin Mutual based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

c.   Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets of each class. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small Cap Value VIP Fund (continued)

3.   Transactions with Affiliates (continued)

d.   Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

e.   Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales		Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Dividend Income
Non-Controlled Affiliates
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		$24,977,897		$121,447,762		$(136,038,052)		$   —		$   —		$10,387,607		10,387,607		$53,323

4.   Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

5.   Income Taxes

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$958,675,749
Unrealized appreciation	$110,184,176
Unrealized depreciation	(98,141,899)
Net unrealized appreciation (depreciation)	$   12,042,277

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatment of wash sales.

6.   Investment Transactions

Purchases and sales (excluding short term securities) for the period ended June 30, 2020, aggregated $333,217,768 and $327,659,566, respectively.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small Cap Value VIP Fund (continued)

7.   Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

8.   Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

9.   Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small Cap Value VIP Fund (continued)

9.   Fair Value Measurements (continued)

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets carried at fair value, is as follows:

	Level 1		Level 2		Level 3		Total
Assets:
Investments in Securities:a
Equity Investments:
Energy	$	9,383,661	$	3,210,134	$	—	$	12,593,795
Food, Beverage & Tobacco		4,984,751		16,140,483		—		21,125,234
All Other Equity Investments		924,278,429		—		—		924,278,429
Corporate Bonds		—		2,332,961		—		2,332,961
Short Term Investments		10,387,607		—		—		10,387,607
Total Investments in Securities	$	949,034,448	$	21,683,578	$	—	$	970,718,026

^aFor detailed categories, see the accompanying Statement of Investments.

10.   New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

11.   Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure other than those already disclosed in the financial statements.

FSV-22         Semiannual Report

Franklin Small-Mid Cap Growth VIP Fund

This semiannual report for Franklin Small-Mid Cap Growth VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a +17.03% total return* for the six-month period ended June 30, 2020.

*The Fund has a fee waiver associated with any investment it makes in a Franklin Templeton money fund and/or other Franklin Templeton fund, contractually guaranteed through 4/30/21. Fund investment results reflect the fee waiver; without this waiver, the results would have been lower.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

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FRANKLIN SMALL-MID CAP GROWTH VIP FUND

Fund Goal and Main Investments

The Fund seeks long-term capital growth. Under normal market conditions, the Fund invests at least 80% of its net assets in equity securities of small-capitalization and mid-capitalization companies. For this Fund, small-cap companies are those within the market capitalization range of companies in the Russell 2500^TM Index at the time of purchase, and midcap companies are those within the market capitalization range of companies in the Russell Midcap^® Index at the time of purchase.¹

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Growth stock prices reflect projections of future earnings or revenues, and can, therefore, fall dramatically if the company fails to meet those projections. Smaller, midsized and relatively new or unseasoned companies can be particularly sensitive to changing economic conditions, and their prospects for growth are less certain than those of larger, more established companies. Historically, these securities have experienced more price volatility than larger-company stocks, especially over the short term. To the extent the Fund focuses on particular countries, regions, industries, sectors or types of investment from time to time, it may be subject to greater risk of adverse developments in such areas of focus than a fund that invests in a wider variety of countries, regions, industries, sectors or investments. From time to time, the trading market for a particular security or type of security in which the Fund invests may become less liquid or even illiquid. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Portfolio Composition

Based on Total Net Assets as of 6/30/20

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Fund’s narrow benchmark, the Russell Midcap Growth^® Index, posted a +4.16% total return, and its broad benchmark, the Standard & Poor’s^® 500 Index (S&P 500^®) posted a -3.08% total return for the same period.²

Economic and Market Overview

U.S. equities, as measured by the S&P 500, nearly reversed earlier losses but declined modestly during the six-month period. A sharp selloff began in late February 2020 amid investor fears of a global economic slowdown due to the novel coronavirus (COVID-19) pandemic.

Government-issued restrictions to mitigate the pandemic severely curtailed U.S. economic activity beginning in March 2020. As a result, the unemployment rate surged to 14.7% in

1. Please see Index Descriptions following the Fund Summaries.

2. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

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FRANKLIN SMALL-MID CAP GROWTH VIP FUND

April as many businesses, particularly in hospitality, retail and travel, announced mass layoffs.³ Within just two months, the unemployment rate went from a 50-year low to an

80-year high.³ The longest U.S. economic expansion in history ended in February, according to the National Bureau of Economic Research, and the country slipped into a deep recession.

In an effort to buffer the sharp drop in economic activity, the Fed implemented two emergency rate cuts in March 2020, lowering the federal funds target rate to a range of 0.00%–0.25%. Additionally, the Fed announced broad quantitative easing measures aimed at ensuring the flow of credit to borrowers and supporting credit markets with unlimited amounts of bond purchasing. Meanwhile, Congress passed the Coronavirus Aid, Relief and Economic Security Act to provide economic relief for individuals and businesses and additional funding for small businesses.

Benefiting from these fiscal and monetary measures, equities began to advance at the end of March 2020. As states gradually reopened, economic activity resumed, leading to declining initial jobless claims and record-high increases in job additions and existing home sales. Optimism about potential COVID-19 vaccines and treatments and rising retail sales further supported equities, which rebounded from multi-year lows to post the strongest second-quarter returns in more than 20 years. Nevertheless, surging infection rates in several states near the end of June led to concerns that economic recovery could be hindered if reopening measures are paused or rolled back.

Investment Strategy

We use fundamental, bottom-up research to seek companies meeting our criteria of growth potential, quality and valuation. In seeking sustainable growth characteristics, we look for companies we believe can produce sustainable earnings and cash flow growth, evaluating the long-term market opportunity and competitive structure of an industry to target leaders and emerging leaders. We define quality companies as those with strong and improving competitive positions in attractive markets. We also believe important attributes of quality are experienced and talented management teams as well as financial strength reflected in the capital structure, gross and operating margins, free cash flow generation and returns on capital employed. In assessing value, we consider whether security prices fully reflect the balance of the sustainable growth opportunities relative to business and financial risks.

Top 10 Holdings

6/30/20

Company Sector/Industry	% of Total Net Assets
DocuSign Inc. Information Technology	2.7%
Twilio Inc. Information Technology	2.5%
CoStar Group Inc. Industrials	2.3%
Synopsys Inc. Information Technology	2.1%
SBA Communications Corp. Real Estate	2.1%
Verisk Analytics Inc. Industrials	2.0%
DexCom Inc. Health Care	1.8%
MarketAxess Holdings Inc. Financials	1.7%
DraftKings Inc. Consumer Discretionary	1.8%
IDEXX Laboratories Inc. Health Care	1.7%

Manager’s Discussion

During the period under review, nearly all sectors represented in the portfolio contributed to the Fund’s absolute returns. Relative to the Russell Midcap^® Growth Index, the Fund outperformed. Contributors included stock selection in the information technology (IT), consumer discretionary and industrials sectors. In contrast, relative detractors included materials, the only sector to significantly hurt Fund performance.

In IT, cloud-based electronic signature solutions provider DocuSign contributed to relative results. The company’s revenue and earnings were boosted by broadened product offerings after introducing the DocuSign Agreement Cloud last year and maintaining strong growth from its eSignature products. DocuSign has also benefited from the increase in work-from-home arrangements brought on by COVID-19. Cloud communications services provider Twilio also helped performance. Shares of the company rose after first-quarter earnings and guidance came in above expectations. COVID-19 related increases in its use by call centers and telehealth providers offset declines in ride-share activity. Website design platform Wix.com contributed as well.

3. Source: Bureau of Labor Statistics.

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FRANKLIN SMALL-MID CAP GROWTH VIP FUND

In consumer discretionary, digital sports entertainment and gaming company DraftKings contributed to relative results. DraftKings has generated revenue from online gambling and has created new products such as simulated sports events, though the company’s operations have been impacted by the suspension, postponement or cancelation of sports seasons and events due to the novel coronavirus (COVID-19) pandemic. Exercise equipment and media company Peloton Interactive and fast-casual restaurant operator Wingstop also boosted performance.

In industrials, an underweighted position in poorly performing defense contractor L3Harris Technologies contributed to relative results.

In materials, specialty chemicals manufacturer Ingevity and building materials provider Martin Marietta detracted from relative performance.

Elsewhere, satellite communications operator ViaSat hurt relative results as the company was negatively affected by emerging competition and the economic impact associated with the COVID-19 pandemic. Advanced materials company Hexcel detracted from performance as well. The company provides materials to the aerospace industry and has been hit hard by the collapse in air travel caused by COVID-19, which resulted in airplane production cuts at Airbus (one of its clients) and the calling off of a merger with aerospace systems company Woodward. Oil exploration and production company Diamondback Energy also hurt results due to the collapse of oil prices brought on by the global economic shutdown and Russia-Saudi price war. We liquidated our position due to uncertainty about when oil prices will recover to the level needed for the company to be profitable.

Thank you for your participation in Franklin Small-Mid Cap Growth VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

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FRANKLIN SMALL-MID CAP GROWTH VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual		Hypothetical
		(actual return after expenses)		(5% annual return before expenses)
Share       Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$1,170.30	$4.53	$1,020.69	$4.22	0.84%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin Small-Mid Cap Growth VIP Fund

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$19.74			$17.04			$19.71			$17.77			$19.09			$24.95
Income from investment operationsa:
Net investment income (loss)b		(0.03	)		(0.04	)		(0.05	)		(0.04	)		(0.03	)		—	c,d
Net realized and unrealized gains (losses)		3.24			5.31			(0.70	)		3.74			0.77			(0.03	)
Total from investment operations		3.21			5.27			(0.75	)		3.70			0.74			(0.03	)
Less distributions from:
Net realized gains		(2.64	)		(2.57	)		(1.92	)		(1.76	)		(2.06	)		(5.83	)
Net asset value, end of period		$20.31			$19.74			$17.04			$19.71			$17.77			$19.09
Total returne		17.03%			31.80%			(5.15)%			21.75%			4.40%			(2.44)%
Ratios to average net assetsf
Expenses before waiver and payments by affiliates		0.85%			0.84%			0.86%			0.85%			0.84%			0.81%
Expenses net of waiver and payments by affiliates		0.84%	g		0.83%	g		0.85%	g		0.84%	g		0.82%	g		0.81%	h
Net investment income (loss)		(0.26)%			(0.19)%			(0.24)%			(0.24)%			(0.16)%			0.01%	d
Supplemental data
Net assets, end of period (000’s)		$48,490			$43,169			$33,518			$36,864			$31,756			$87,866
Portfolio turnover rate		21.12%			59.07%			44.78%			40.49%			32.23%	i		37.85%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cAmount rounds to less than $0.01 per share.

^dNet investment income per share includes approximately $0.05 per share related to income received in the form of special dividends in connection with certain fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been (0.24)%.

^eTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^fRatios are annualized for periods less than one year.

^gBenefit of expense reduction rounds to less than 0.01%.

^hBenefit of waiver and payments by affiliates rounds to less than 0.01%.

ⁱExcludes the value of portfolio securities delivered as a result of a redemption in-kind.

FSC-6         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Small-Mid Cap Growth VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$17.29			$15.22			$17.83			$16.27			$17.69			$23.56
Income from investment operationsa:
Net investment income (loss)b		(0.04	)		(0.08	)		(0.09	)		(0.08	)		(0.07	)		(0.05	)c
Net realized and unrealized gains (losses)		2.80			4.72			(0.60	)		3.40			0.71			0.01
Total from investment operations		2.76			4.64			(0.69	)		3.32			0.64			(0.04	)
Less distributions from:
Net realized gains		(2.64	)		(2.57	)		(1.92	)		(1.76	)		(2.06	)		(5.83	)
Net asset value, end of period		$17.41			$17.29			$15.22			$17.83			$16.27			$17.69
Total returnd		16.84%			31.44%			(5.37)%			21.40%			4.17%			(2.66)%
Ratios to average net assetse
Expenses before waiver and payments by affiliates		1.10%			1.09%			1.11%			1.10%			1.09%			1.06%
Expenses net of waiver and payments by affiliates		1.09%	f		1.08%	f		1.10%	f		1.09%	f		1.07%	f		1.06%	g
Net investment income (loss)		(0.51)%			(0.44)%			(0.49)%			(0.49)%			(0.41)%			(0.24)%	c
Supplemental data
Net assets, end of period (000’s)		$405,193			$372,442			$310,300			$390,094			$392,777			$478,649
Portfolio turnover rate		21.12%			59.07%			44.78%			40.49%			32.23%	h		37.85%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.05 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been (0.49)%.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fBenefit of expense reduction rounds to less than 0.01%.

^gBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^hExcludes the value of portfolio securities delivered as a result of a redemption in-kind.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FSC-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin Small-Mid Cap Growth VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$18.04			$15.81			$18.47			$16.81			$18.23			$24.14
Income from investment operationsa:
Net investment income (loss)b		(0.05	)		(0.10	)		(0.11	)		(0.10	)		(0.09	)		(0.07	)c
Net realized and unrealized gains (losses)		2.94			4.90			(0.63	)		3.52			0.73			(0.01	)
Total from investment operations		2.89			4.80			(0.74	)		3.42			0.64			(0.08	)
Less distributions from:
Net realized gains		(2.64	)		(2.57	)		(1.92	)		(1.76	)		(2.06	)		(5.83	)
Net asset value, end of period		$18.29			$18.04			$15.81			$18.47			$16.81			$18.23
Total returnd		16.86%			31.26%			(5.46)%			21.30%			4.04%			(2.77)%
Ratios to average net assetse
Expenses before waiver and payments by affiliates		1.20%			1.19%			1.21%			1.20%			1.19%			1.16%
Expenses net of waiver and payments by affiliates		1.19%	f		1.18%	f		1.20%	f		1.19%	f		1.17%	f		1.16%	g
Net investment income (loss)		(0.61)%			(0.54)%			(0.59)%			(0.59)%			(0.51)%			(0.34)%	c
Supplemental data
Net assets, end of period (000’s)		$18,816			$17,662			$13,759			$15,829			$13,825			$15,105
Portfolio turnover rate		21.12%			59.07%			44.78%			40.49%			32.23%	h		37.85%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cNet investment income per share includes approximately $0.05 per share related to income received in the form of special dividends in connection with certain Fund holdings. Excluding this amount, the ratio of net investment income to average net assets would have been (0.59)%.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fBenefit of expense reduction rounds to less than 0.01%.

^gBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^hExcludes the value of portfolio securities delivered as a result of a redemption in-kind.

FSC-8         Semiannual Report  |  The accompanying notes are an integral part of these  financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin Small-Mid Cap Growth VIP Fund

	Shares		Value
Common Stocks 98.4%
Communication Services 4.7%
aMatch Group Inc.		17,200	$	5,562,480
aPinterest Inc., A		181,300		4,019,421
aRoku Inc.		26,856		3,129,530
aSpotify Technology SA		20,000		5,163,800
aZoomInfo Technologies Inc.		13,500		688,905
aZynga Inc.		367,500		3,505,950
				22,070,086
Consumer Discretionary 14.8%
Aptiv PLC		29,227		2,277,368
aBurlington Stores Inc.		29,400		5,789,742
aChipotle Mexican Grill Inc.		6,530		6,871,911
Domino’s Pizza Inc.		10,750		3,971,480
aDraftKings Inc., A		22,900		761,654
a,b,cDraftKings Inc., A		251,933		7,432,562
aFive Below Inc.		31,650		3,383,702
Levi Strauss & Co., A		175,000		2,345,000
Marriott International Inc., A		18,050		1,547,427
aNVR Inc.		1,282		4,177,717
aO’Reilly Automotive Inc.		12,157		5,126,242
aPeloton Interactive Inc., A		64,250		3,711,722
aRH		14,300		3,559,270
Tractor Supply Co.		37,737		4,973,359
aUlta Beauty Inc.		18,400		3,742,928
Vail Resorts Inc.		24,400		4,444,460
VF Corp.		19,900		1,212,706
Wingstop Inc.		33,700		4,683,289
				70,012,539
Consumer Staples 1.6%
aBellRing Brands Inc., A		94,100		1,876,354
Church & Dwight Co. Inc.		53,500		4,135,550
aGrocery Outlet Holding Corp.		38,200		1,558,560
				7,570,464
Financials 5.8%
Ares Management Corp., A		82,000		3,255,400
MarketAxess Holdings Inc.		16,600		8,315,272
MSCI Inc.		18,900		6,309,198
a,cSelectquote Inc.		10,900		276,097
TCF Financial Corp.		63,500		1,868,170
Tradeweb Markets Inc.		92,200		5,360,508
Western Alliance Bancorp		52,500		1,988,175
				27,372,820
Health Care 16.5%
a10X Genomics Inc., A		24,100		2,152,371
aArgenx SE, ADR (Netherlands)		9,000		2,027,070
Bio-Techne Corp.		13,340		3,522,694

Semiannual Report         FSC-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Small-Mid Cap Growth VIP Fund (continued)

	Shares		Value
Common Stocks (continued)
Health Care (continued)
aCentene Corp.		56,250	$	3,574,687
aDeciphera Pharmaceuticals Inc.		18,000		1,074,960
aDexCom Inc.		20,688		8,386,915
aGlobal Blood Therapeutics Inc.		18,000		1,136,340
aGuardant Health Inc.		44,100		3,577,833
aGW Pharmaceuticals PLC, ADR (United Kingdom)		23,300		2,859,376
aHealthEquity Inc.		41,200		2,417,204
aHeron Therapeutics Inc.		143,900		2,116,769
aHorizon Therapeutics PLC		51,000		2,834,580
aIDEXX Laboratories Inc.		24,750		8,171,460
aInari Medical Inc.		10,100		489,244
aIovance Biotherapeutics Inc.		65,000		1,784,250
aiRhythm Technologies Inc.		17,450		2,022,281
aLegend Biotech Corp., ADR		9,300		395,808
aLivongo Health Inc.		36,900		2,774,511
aMettler-Toledo International Inc.		9,780		7,878,279
aPenumbra Inc.		22,900		4,094,978
aPTC Therapeutics Inc.		44,500		2,257,930
aReata Pharmaceuticals Inc.		18,300		2,855,166
aRevance Therapeutics Inc.		74,001		1,807,104
aVeeva Systems Inc.		32,700		7,665,534
				77,877,344
Industrials 14.3%
aAxon Enterprise Inc.		12,300		1,206,999
aCoStar Group Inc.		15,135		10,755,990
Fastenal Co.		83,100		3,560,004
Fortive Corp.		74,400		5,033,904
IDEX Corp.		32,650		5,160,006
Kansas City Southern		13,200		1,970,628
aKratos Defence & Security Solutions Inc.		48,600		759,618
aLyft Inc., A		18,500		610,685
aMercury Systems Inc.		43,700		3,437,442
Old Dominion Freight Line Inc.		17,850		3,027,182
Republic Services Inc.		63,100		5,177,355
Roper Technologies Inc.		17,593		6,830,658
Southwest Airlines Co.		50,500		1,726,090
Stanley Black & Decker Inc.		29,346		4,090,246
TransUnion		57,300		4,987,392
Verisk Analytics Inc.		54,961		9,354,362
				67,688,561
Information Technology 36.1%
aAdyen NV (Netherlands)		2,350		3,420,107
aAgora Inc., ADR (China)		6,600		291,522
aAlteryx Inc.		35,500		5,831,940
Amphenol Corp., A		54,700		5,240,807
aANSYS Inc.		22,500		6,563,925

FSC-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Small-Mid Cap Growth VIP Fund (continued)

	Shares		Value
Common Stocks (continued)
Information Technology (continued)
aAtlassian Corp. PLC		36,150	$	6,516,760
aBill.Com Holdings Inc.		62,048		5,597,350
aBlack Knight Inc.		104,000		7,546,240
Booz Allen Hamilton Holding Corp.		14,800		1,151,292
aCloudFlare Inc., A		127,300		4,576,435
aDocuSign Inc.		73,700		12,691,877
Entegris Inc.		13,500		797,175
aEPAM Systems Inc.		19,500		4,914,195
aGoDaddy Inc., A		81,617		5,984,975
Jack Henry & Associates Inc.		19,350		3,560,981
aKeysight Technologies Inc.		48,800		4,918,064
KLA Corp.		35,737		6,950,132
aLattice Semiconductor Corp.		152,555		4,331,036
Microchip Technology Inc.		28,927		3,046,302
Monolithic Power Systems		19,750		4,680,750
NXP Semiconductors NV (Netherlands)		22,600		2,577,304
aOkta Inc., A		31,000		6,207,130
aPaylocity Holding Corp.		42,450		6,193,031
aQ2 Holdings Inc.		38,496		3,302,572
aSemtech Corp.		43,000		2,245,460
aShift4 Payments Inc.		16,500		585,750
aSiTime Corp.		60,000		2,844,600
aSquare Inc., A		46,100		4,837,734
aSynopsys Inc.		51,750		10,091,250
aTwilio Inc., A		54,775		12,018,730
aWEX Inc.		16,300		2,689,663
aWix.com Ltd. (Israel)		20,600		5,278,132
a Workday Inc., A		20,650		3,868,984
Xilinx Inc.		41,600		4,093,024
aYeahka Ltd. (China)		14,200		31,513
aZendesk Inc.		55,200		4,886,856
				170,363,598
Materials 2.4%
Ball Corp.		69,700		4,843,453
aIngevity Corp.		43,841		2,304,721
Martin Marietta Materials Inc.		20,200		4,172,714
				11,320,888
Real Estate 2.2%
SBA Communications Corp., A		32,957		9,818,550
Terreno Realty Corp.		15,550		818,552
				10,637,102
Total Common Stocks (Cost $291,738,732)				464,913,402

Semiannual Report         FSC-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Small-Mid Cap Growth VIP Fund (continued)

	Shares		Value
Short Term Investments 2.7%
Money Market Funds (Cost $11,705,249) 2.5%
d,eInstitutional Fiduciary Trust Money Market Portfolio, 0.00%		11,705,249	$	11,705,249
fInvestments from Cash Collateral Received for Loaned Securities 0.2%
Money Market Funds (Cost $1,011,025) 0.2%
d,eInstitutional Fiduciary Trust Money Market Portfolio, 0.00%		1,011,025		1,011,025
Total Investments (Cost $304,455,006) 101.1%				477,629,676
Other Assets, less Liabilities (1.1)%				(5,131,154	)
Net Assets 100.0%			$	472,498,522

See Abbreviations on page FSC-23.

^aNon-income producing.

^bFair valued using significant unobservable inputs. See regarding fair value measurements.

^cA portion or all of the security is on loan at June 30, 2020. See Note 1(c).

^dSee Note 3(e) regarding investments in affiliated management investment companies.

^eThe rate shown is the annualized seven-day effective yield at period end.

^fSee Note 1(c) regarding securities on loan.

FSC-12         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Small-Mid Cap Growth VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$291,738,732
Cost - Non-controlled affiliates (Note 3e)		12,716,274
Value - Unaffiliated issuers+		$464,913,402
Value - Non-controlled affiliates (Note 3e)		12,716,274
Receivables:
Capital shares sold		743,853
Dividends and interest		67,119
Other assets		350
Total assets		478,440,998
Liabilities:
Payables:
Investment securities purchased		4,155,466
Capital shares redeemed		275,143
Management fees		299,962
Distribution fees		87,512
Trustees’ fees and expenses		137
Payable upon return of securities loaned		1,011,025
Accrued expenses and other liabilities		113,231
Total liabilities		5,942,476
Net assets, at value		$472,498,522
Net assets consist of:
Paid-in capital		$298,120,667
Total distributable earnings (losses)		174,377,855
Net assets, at value		$472,498,522
Class 1:
Net assets, at value		$  48,489,500
Shares outstanding		2,387,538
Net asset value and maximum offering price per share		$20.31
Class 2:
Net assets, at value		$405,192,999
Shares outstanding		23,268,683
Net asset value and maximum offering price per share		$17.41
Class 4:
Net assets, at value		$  18,816,023
Shares outstanding		1,028,965
Net asset value and maximum offering price per share		$18.29
+Includes securities loaned		$       982,641

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FSC-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Small-Mid Cap Growth VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers		$    974,338
Non-controlled affiliates (Note 3e)		32,720
Income from securities loaned:
Unaffiliated entities (net of fees and rebates)		180,670
Non-controlled affiliates (Note 3e)		11,432
Total investment income		1,199,160
Expenses:
Management fees (Note 3a)		1,653,044
Distribution fees: (Note 3c)
Class 2		444,423
Class 4		29,584
Custodian fees (Note 4)		1,635
Reports to shareholders		65,461
Professional fees		29,928
Trustees’ fees and expenses		1,282
Other		8,804
Total expenses		2,234,161
Expense reductions (Note 4)		(8	)
Expenses waived/paid by affiliates (Note 3e)		(21,747	)
Net expenses		2,212,406
Net investment income (loss)		(1,013,246	)
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		2,537,546
Foreign currency transactions		(4,129	)
Net realized gain (loss)		2,533,417
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		61,958,609
Net realized and unrealized gain (loss)		64,492,026
Net increase (decrease) in net assets resulting from operations		$63,478,780
*Foreign taxes withheld on dividends		$        1,522

FSC-14         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Franklin Small-Mid Cap Growth VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income (loss)		$    (1,013,246)			$    (1,784,697)
Net realized gain (loss)		2,533,417			63,675,302
Net change in unrealized appreciation (depreciation)		61,958,609			48,782,330
Net increase (decrease) in net assets resulting from operations		63,478,780			110,672,935
Distributions to shareholders:
Class 1		(5,568,768	)		(5,113,428	)
Class 2		(53,710,860	)		(51,808,967	)
Class 4		(2,461,041	)		(2,209,122	)
Total distributions to shareholders		(61,740,669	)		(59,131,517	)
Capital share transactions: (Note 2)
Class 1		4,189,299			4,136,766
Class 2		32,464,137			18,159,781
Class 4		834,466			1,857,466
Total capital share transactions		37,487,902			24,154,013
Net increase (decrease) in net assets		39,226,013			75,695,431
Net assets:
Beginning of period		433,272,509			357,577,078
End of period		$472,498,522		$	433,272,509

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FSC-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin Small-Mid Cap Growth VIP Fund

1.   Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Small-Mid Cap Growth VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. At June 30, 2020, 42.5% of the Fund’s shares were held through one insurance company. Investment activities of these insurance company separate accounts could have a material impact on the Fund. The Fund offers three classes of shares: Class 1, Class 2 and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a.   Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter

(OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Investments in open-end mutual funds are valued at the closing NAV.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

FSC-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small-Mid Cap Growth VIP Fund (continued)

b.   Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c.   Securities Lending

The Fund participates in an agency based securities lending program to earn additional income. The Fund receives cash collateral against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. The collateral is deposited into a joint cash account with other funds and is used to invest in a money market fund managed

by Franklin Advisers, Inc., an affiliate of the Fund. The Fund may receive income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third-party vendor, is reported separately in the Statement of Operations. The Fund bears the market risk with respect to the collateral investment, securities loaned, and the risk that the agent may default on its obligations to the Fund. If the borrower defaults on its obligation to return the securities loaned, the Fund has the right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower.

d.   Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small-Mid Cap Growth VIP Fund (continued)

1.   Organization and Significant Accounting Policies (continued)

e.   Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Estimated expenses are accrued daily. Dividend income is recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

f.   Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

g.   Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2.   Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		171,421		$	3,540,721			318,754		$	6,251,939
Shares issued in reinvestment of distributions		289,889			5,568,768			273,885			5,113,428
Shares redeemed		(260,895	)		(4,920,190	)		(372,027	)		(7,228,601	)
Net increase (decrease)		200,415		$	4,189,299			220,612		$	4,136,766

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small-Mid Cap Growth VIP Fund (continued)

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 2 Shares:
Shares sold		1,620,427		$	29,073,424			1,911,894		$	33,367,659
Shares issued in reinvestment of distributions		3,261,133			53,710,860			3,162,941			51,808,967
Shares redeemed		(3,154,393	)		(50,320,147	)		(3,921,307)			(67,016,845	)
Net increase (decrease)		1,727,167		$	32,464,137			1,153,528		$	18,159,781
Class 4 Shares:
Shares sold		112,014		$	2,007,443			191,080		$	3,405,783
Shares issued in reinvestment of distributions		142,257			2,461,041			129,188			2,209,122
Shares redeemed		(204,168	)		(3,634,018	)		(211,768	)		(3,757,439	)
Net increase (decrease)		50,103		$	834,466			108,500		$	1,857,466

3.   Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Advisers, Inc. (Advisers)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a.   Management Fees

The Fund pays an investment management fee to Advisers based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.800%	Up to and including $500 million
0.700%	Over $500 million, up to and including $1 billion
0.650%	Over $1 billion, up to and including $1.5 billion
0.600%	Over $1.5 billion, up to and including $6.5 billion
0.575%	Over $6.5 billion, up to and including $11.5 billion
0.550%	Over $11.5 billion, up to and including $16.5 billion
0.540%	Over $16.5 billion, up to and including $19 billion
0.530%	Over $19 billion, up to and including $21.5 billion
0.520%	In excess of $21.5 billion

b.   Administrative Fees

Under an agreement with Advisers, FT Services provides administrative services to the Fund. The fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small-Mid Cap Growth VIP Fund (continued)

3.  Transactions with Affiliates (continued)

c.   Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets of each class. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d.   Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

e.   Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Investment Income
Non-Controlled Affiliates
																	Dividends
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		$10,406,987		$48,735,867		$(47,437,605	)		$   —		$   —		$11,705,249		11,705,249		$32,720
																	Income from securities loaned
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		4,879,541		23,457,988		(27,326,504	)		—		—		1,011,025		1,011,025		11,432
Total Affiliated Securities		$15,286,528		$72,193,855		$(74,764,109	)		$   —		$   —		$12,716,274				$44,152

f.   Interfund Transactions

The Fund engaged in purchases and sales of investments with funds or other accounts that have common investment managers (or affiliated investment managers), directors, trustees or officers. During the period ended June 30, 2020, these purchase and sale transactions aggregated $380,765 and $0, respectively.

4.   Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small-Mid Cap Growth VIP Fund (continued)

5.   Income Taxes

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$304,769,327
Unrealized appreciation	$179,898,996
Unrealized depreciation	(7,038,647)
Net unrealized appreciation (depreciation)	$172,860,349

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatment of wash sales.

6.   Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $86,528,253 and $109,489,566, respectively.

At June 30, 2020, in connection with securities lending transactions, the Fund loaned equity investments and received $1,011,025 of cash collateral. The gross amount of recognized liability for such transactions is included in payable upon return of securities loaned in the Statement of Assets and Liabilities. The agreements can be terminated at any time.

7.   Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

8.   Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small-Mid Cap Growth VIP Fund (continued)

9.   Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets carried at fair value, is as follows:

	Level 1		Level 2		Level 3		Total
Assets:
Investments in Securities:a
Equity Investments:
Consumer Discretionary	$	62,579,977	$	—	$	7,432,562	$	70,012,539
All Other Equity Investments		394,900,863		—		—		394,900,863
Short Term Investments		12,716,274		—		—		12,716,274
Total Investments in Securities	$	470,197,114	$	—	$	7,432,562	$	477,629,676

^aFor detailed categories, see the accompanying Statement of Investments.

A reconciliation in which Level 3 inputs are used in determining fair value is presented when there are significant Level 3 assets and/or liabilities at the beginning and/or end of the period. At June 30, 2020, the reconciliation is as follows:

	Balance at Beginning of Period		Purchases		Sales			Transfer Into Level 3		Transfer Out of Level 3a			Cost Basis Adjustments		Net Realized Gain (Loss)		Net Unrealized Appreciation (Depreciation)		Balance at End of Period		Net Change in Unrealized Appreciation (Depreciation) on Assets Held at Period End
Assets:
Investments in Securities:
Equity Investments:
Consumer Discretionary		$2,241,958		$—		$(494,299	)		$—		$              —			$—		$378,558		$5,306,345		$7,432,562		$5,304,762
Information Technology		1,763,456		—		—			—		(3,099,287	)		—		—		1,335,831		—		—
Total		$4,005,414		$—		$(494,299	)		$—		$(3,099,287	)		$—		$378,558		$6,642,176		$7,432,562		$5,304,762

^aThe investment was transferred out of Level 3 as a result of the availability of a quoted price in an active market for identical securities.

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin Small-Mid Cap Growth VIP Fund (continued)

Significant unobservable valuation inputs for material Level 3 assets and/or liabilities and impact to fair value as a result of changes in unobservable valuation inputs as of June 30, 2020, are as follows:

Description	Fair Value at End of Period		Valuation Technique	Unobservable Inputs	Amount			Impact to Fair Value if Input Increasesa
Assets:
Investments in Securities:
Common Stocks
Consumer Discretionary	$	7,432,562	Market comparables	Discount for lack of marketability		11.3	%		Decreaseb
All Other Investments		—
Total	$	7,432,562

^aRepresents the directional change in the fair value that would result from a significant and reasonable increase in the corresponding input. A significant and reasonable decrease in the input would have the opposite effect. Significant impacts, if any, to fair value and/or net assets have been indicated.

^bRepresents a significant impact to fair value but not net assets.

10.   New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

11.   Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Selected Portfolio                                     

ADR   American Depositary Receipt

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Franklin Strategic Income VIP Fund

This semiannual report for Franklin Strategic Income VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -2.80% total return* for the six-month period ended June 30, 2020.

*The Fund has a fee waiver associated with any investment in a Franklin Templeton money fund and/or other Franklin Templeton fund, contractually guaranteed through 4/30/21. Fund investment results reflect the fee waiver; without this waiver, the results would have been lower.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

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FRANKLIN STRATEGIC INCOME VIP FUND

Fund Goal and Main Investments

The Fund seeks a high level of current income, with capital appreciation over the long term as a secondary goal. Under normal market conditions, the Fund invests primarily to predominantly in U.S. and foreign debt securities, including those in emerging markets.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in the Fund adjust to a rise in interest rates, the Fund’s share price may decline. Changes in the financial strength of a bond issuer or in a bond’s credit rating may affect its value. High yields reflect the higher credit risks associated with certain lower rated securities held in the portfolio. Floating rate loans and high yield corporate bonds are rated below investment grade and are subject to greater risk of default, which could result in loss of principal—a risk that may be heightened in a slowing economy. The risks of foreign securities include currency fluctuations and political uncertainty. Investments in developing markets involve heightened risks related to the same factors, in addition to those associated with their relatively small size and lesser liquidity. Investing in derivative securities and the use of foreign currency techniques involve special risks as such may not achieve the anticipated benefits and/or may result in losses to the Fund. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. For comparison, the Fund’s benchmark, the Bloomberg Barclays U.S. Aggregate Bond

Index, posted a +6.14% total return for the period under review.¹ The Fund’s peers, as measured by the Lipper Multi-Sector Income Funds Classification Average, posted a -1.26% return.²

Economic and Market Overview

The U.S. bond market, as measured by the Bloomberg Barclays U.S. Aggregate Bond Index, advanced during the six-month period despite significant economic disruption in the wake of the novel coronavirus (COVID-19) pandemic. In late February 2020, as more countries adopted social distancing and lockdown measures to slow the global pandemic, the U.S. bond market began pricing in the adverse impact on economic activity. Higher-quality, longer-term bonds rallied, while riskier, lower-rated corporate bonds declined sharply, reflecting a reversal in many investors’ risk appetite. During the last quarter of the reporting period, however, as generally slowing infection rates and phased business reopenings by states drove hopes for an economic rebound, corporate bond valuations advanced significantly. Nevertheless, an increase in infection rates toward period-end prompted concern among investors, hindering lower-rated bonds.

The U.S. Federal Reserve (Fed) enacted two emergency rate cuts in response to the COVID-19 pandemic in March 2020, lowering the federal funds target rate to a range of 0.00%–0.25%. In addition, the Fed announced unlimited, open-ended purchasing of government-backed and corporate bonds to help keep markets functioning, significantly expanding its balance sheet.

U.S. Treasury bonds, as measured by the Bloomberg Barclays U.S. Treasury Index, rose significantly during the reporting period. Bond purchasing by the Fed and robust demand for investments perceived as safe drove the U.S. Treasury market higher despite the widening U.S. federal budget deficit and the massive increase in issuance. Mortgage-backed securities (MBS), as measured by the Bloomberg Barclays MBS Index, also posted positive returns, aided by declining Treasury rates and the Fed’s decision to purchase agency MBS.

U.S. corporate bond performance varied significantly based on credit rating, as investors became concerned about the

1. Source: Morningstar.

2. Source: Lipper, a Thomson Reuters Company.

One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

See.www.franklintempletondatasources.com for additional data provider information.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

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pandemic-related economic disruption and the potential credit downgrades of many companies. Investment-grade corporate bonds, as represented by the Bloomberg Barclays U.S. Corporate Bond Index, rebounded significantly after mid-March 2020 to post positive overall returns for the reporting period. In contrast, high-yield corporate bonds, as represented by the Bloomberg Barclays U.S. Corporate High Yield Bond Index, declined due to investor concerns about a potential increase in credit defaults.

Investment Strategy

We allocate our investments among the various types of debt available based on our assessment of changing economic, global market, industry and issuer conditions. We use a top-down analysis of macroeconomic trends, combined with a bottom-up fundamental analysis of market sectors, industries and issuers, seeking to take advantage of varying sector reactions to economic events. For example, we may evaluate business cycles, yield curves, country risk, and the relative interest rates among currencies, and values between and within markets. In selecting debt securities, we generally conduct our own analysis of the security’s intrinsic value rather than simply relying on the coupon rate or rating. We may also enter into various transactions involving certain currency-, interest rate- or credit-related derivative instruments.

Manager’s Discussion

The Fund allocated assets across the broad fixed income markets with an emphasis on spread sectors, both corporate and securitized. From an investment standpoint, we continued to focus on fundamentals and maintaining sufficient liquidity in the portfolio. At period end, our largest allocations were in investment-grade corporate bonds, high-yield corporate credit, non-local currency emerging market bonds and non-agency residential mortgage-backed securities (RMBS), with smaller exposures to agency mortgage-backed securities and senior secured floating-rate loans. After the significant market volatility in March 2020, we had been seeing opportunities in higher-quality sectors and added to investment-grade corporate credit, while we pared exposure to collateralized loan obligations (CLOs) and senior secured floating-rate loans. In our RMBS exposure we remain allocated to the seasoned credit risk transfer (CRTs) and have continued to stress test the portfolio under various scenarios including multiples of the global financial crisis. While the macroeconomic environment remains uncertain, we continue to believe the sector offers value. Our foreign-currency exposure was held through a basket of shorts with major positions in the Australian dollar, Singapore dollar, euro and Canadian dollar versus a basket of longs

Portfolio Composition*

Based on Consolidated Net Assets

	6/30/20
Investment-Grade Corporate Bonds	21.85%
High-Yield Corporate Bonds	18.81%
Interest-Rate Derivatives	18.45%
Non-Local Currency Emerging Market Bonds	14.04%
Residential Mortgage-Backed Securities	12.22%
Agency Mortgage-Backed Securities	7.72%
Floating-Rate Loans	7.52%
Collateralized Loan Obligations	6.72%
Treasury Inflation-Protected Securities	5.93%
Municipal Bonds	3.55%
Non-U.S. Developed Bonds	2.94%
Local Currency Emerging Market Bonds	2.36%
Other	1.82%
Marketplace Loans	1.55%
U.S. Treasuries	0.96%
Asset-Backed Securities	0.38%
Covered Bonds	0.14%
Commercial Mortgage-Backed Securities	0.08%
Short-Term Investments & Other Net Assets	-0.07%
Currency Derivatives	-0.45%

*Notional exposure figures are intended to estimate the portfolio’s exposure, including any hedged or increased exposure through certain derivatives held in the portfolio (or their underlying reference assets). Portfolio breakdown percentages may not total 100% or may be negative due to rounding, use of any derivatives, unsettled trades or other factors. Interest-rate derivatives sector consists of Treasury, interest-rate and other derivatives that are primarily used for duration management.

with major positions in the Japanese yen. Over the period, we closed out our short New Zealand dollar and long Norwegian krona positions, reduced our euro short, added to our Singapore dollar short and long Japanese yen positions.

Allocation to investment-grade corporate credit was the most significant contributor to returns. Additionally, commercial mortgage-backed securities and asset-backed securities also benefitted performance. In contrast, the Fund’s exposure to high-yield corporate credit, sovereign emerging market securities and senior secured floating-rate loans as well as RMBS and foreign currencies detracted from performance. Foreign currency gains mainly from our short New Zealand and Canadian dollar exposures were more than offset by negative returns from long Norwegian krona, South African rand and short Australian dollar positions.

The Fund utilized derivatives, including credit default swaps, currency forwards and government bond futures, primarily as a tool for efficient portfolio management and to manage

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FRANKLIN STRATEGIC INCOME VIP FUND

overall portfolio risk. These derivative transactions may provide the same, or similar, net long or short exposure to select currencies, interest rates, countries, duration or credit risks compared to holding securities.

Thank you for your participation in Franklin Strategic Income VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

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Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual (actual return after expenses)		Hypothetical (5% annual return before expenses)
Share   Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$972.00	$3.38	$1,021.43	$3.47	0.69%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

Semiannual Report         FSI-5

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Consolidated Financial Highlights

Franklin Strategic Income VIP Fund

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$10.93			$10.65			$11.15			$11.01			$10.55			$11.90
Income from investment operationsa:
Net investment incomeb		0.17			0.45			0.47			0.45			0.48			0.53
Net realized and unrealized gains (losses)		(0.48	)		0.43			(0.65	)		0.04			0.37			(0.91	)
Total from investment operations		(0.31	)		0.88			(0.18	)		0.49			0.85			(0.38	)
Less distributions from:
Net investment income and net foreign currency gains		(0.54	)		(0.60	)		(0.32	)		(0.35	)		(0.39	)		(0.77	)
Net realized gains		—			—			—			—			—			(0.20	)
Total distributions		(0.54	)		(0.60	)		(0.32	)		(0.35	)		(0.39	)		(0.97	)
Net asset value, end of period		$10.08			$10.93			$10.65			$11.15			$11.01			$10.55
Total returnc		(2.80)%			8.41%			(1.65)%			4.46%			8.25%			(3.62)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		0.71%			0.71%			0.67%			0.68%			0.67%			0.63%
Expenses net of waiver and payments by affiliatese		0.69%			0.68%			0.63%			0.63%			0.60%			0.62%
Net investment income		3.32%			4.09%			4.28%			4.00%			4.42%			4.71%
Supplemental data
Net assets, end of period (000’s)		$259,057			$285,437			$302,610			$361,465			$396,170			$441,658
Portfolio turnover rate		58.44%			114.89%	f		107.90%	g		108.73%			128.51%			85.85%
Portfolio turnover rate excluding mortgage dollar rollsh		42.77%			72.45%	f		40.38%	g		48.11%			77.93%			51.47%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Consolidated Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fExcludes the value of portfolio activity as a result of in-kind transactions.

^gExcludes the value of portfolio securities delivered as a result of a redemption in-kind.

^hSee Note 1(g) regarding mortgage dollar rolls.

FSI-6         Semiannual Report  |  The accompanying notes are an integral part of these  consolidated financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED FINANCIAL HIGHLIGHTS

Franklin Strategic Income VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$10.55			$10.28			$10.76			$10.64			$10.21			$11.55
Income from investment operationsa:
Net investment incomeb		0.15			0.40			0.42			0.40			0.43			0.49
Net realized and unrealized gains (losses)		(0.45	)		0.42			(0.61	)		0.04			0.36			(0.89	)
Total from investment operations		(0.30	)		0.82			(0.19	)		0.44			0.79			(0.40	)
Less distributions from:
Net investment income and net foreign currency gains		(0.52	)		(0.55	)		(0.29	)		(0.32	)		(0.36	)		(0.74	)
Net realized gains		—			—			—			—			—			(0.20	)
Total distributions		(0.52	)		(0.55	)		(0.29	)		(0.32	)		(0.36	)		(0.94	)
Net asset value, end of period		$9.73			$10.55			$10.28			$10.76			$10.64			$10.21
Total returnc		(2.86)%			8.05%			(1.77)%			4.17%			7.94%			(3.87)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		0.96%			0.96%			0.92%			0.93%			0.92%			0.88%
Expenses net of waiver and payments by affiliatese		0.94%			0.93%			0.88%			0.88%			0.85%			0.87%
Net investment income		3.07%			3.84%			4.03%			3.75%			4.17%			4.46%
Supplemental data
Net assets, end of period (000’s)		$92,857			$94,928			$89,264			$214,271			$203,418			$202,192
Portfolio turnover rate		58.44%			114.89%	f		107.90%	g		108.73%			128.51%			85.85%
Portfolio turnover rate excluding mortgage dollar rollsh		42.77%			72.45%f			40.38%	g		48.11%			77.93%			51.47%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Consolidated Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fExcludes the value of portfolio activity as a result of in-kind transactions.

^gExcludes the value of portfolio securities delivered as a result of a redemption in-kind.

^hSee Note 1(g) regarding mortgage dollar rolls.

The accompanying notes are an integral part of these consolidated financial statements.  |  Semiannual Report         FSI-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED FINANCIAL HIGHLIGHTS

Franklin Strategic Income VIP Fund (continued)

	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31,
				2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$10.83			$10.56			$11.04			$10.90			$10.44			$11.78
Income from investment operationsa:
Net investment incomeb		0.15			0.41			0.43			0.40			0.43			0.49
Net realized and unrealized gains (losses)		(0.47	)		0.42			(0.64	)		0.04			0.38			(0.91	)
Total from investment operations		(0.32	)		0.83			(0.21	)		0.44			0.81			(0.42	)
Less distributions from:
Net investment income and net foreign currency gains		(0.50	)		(0.56	)		(0.27	)		(0.30	)		(0.35	)		(0.72	)
Net realized gains		—			—			—			—			—			(0.20	)
Total distributions		(0.50	)		(0.56	)		(0.27	)		(0.30	)		(0.35	)		(0.92	)
Net asset value, end of period		$10.01			$10.83			$10.56			$11.04			$10.90			$10.44
Total returnc		(2.96)%			7.93%			(1.88)%			4.08%			7.86%			(3.98)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		1.06%			1.06%			1.02%			1.03%			1.02%			0.98%
Expenses net of waiver and payments by affiliatese		1.04%			1.03%			0.98%			0.98%			0.95%			0.97%
Net investment income		2.97%			3.74%			3.93%			3.65%			4.07%			4.36%
Supplemental data
Net assets, end of period (000’s)		$48,237			$54,485			$60,763			$74,013			$80,175			$92,965
Portfolio turnover rate		58.44%			114.89%	f		107.90%	g		108.73%			128.51%			85.85%
Portfolio turnover rate excluding mortgage dollar rollsh		42.77%			72.45%	f		40.38%	g		48.11%			77.93%			51.47%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Consolidated Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fExcludes the value of portfolio activity as a result of in-kind transactions.

^gExcludes the value of portfolio securities delivered as a result of a redemption in-kind.

^hSee Note 1(g) regarding mortgage dollar rolls.

FSI-8         Semiannual Report  |  The accompanying notes are an integral part of these  consolidated financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Consolidated Statement of Investments, June 30, 2020 (unaudited)

Franklin Strategic Income VIP Fund

	Country/ Organization		Shares/ Warrants		Value
Common Stocks and Other Equity Interests 0.2%
Capital Goods 0.0%
a,aa,bOnsite Rental Group Operations Pty. Ltd.		Australia		143,820	$	—
Commercial & Professional Services 0.0%†
aRemington Outdoor Co. Inc.		United States		74,576		37,288
Consumer Services 0.0%†
a,aa,cTurtle Bay Resort		United States		1,901,449		41,832
Energy 0.1%
Amplify Energy Corp.		United States		431		530
a,aaBattalion Oil Corp., wts., A, 10/08/22		United States		879		2,331
a,aaBattalion Oil Corp., wts., B, 10/08/22		United States		1,098		2,643
a,aaBattalion Oil Corp., wts., C, 10/08/22		United States		1,412		2,987
a,aaBirch Permian Holdings Inc.		United States		4,478		21,271
a,aaBirch Permian Holdings Inc.		United States		34,907		161,445
Riviera Resources Inc.		United States		6,620		11,883
aWeatherford International PLC		United States		13,794		27,174
						230,264
Materials 0.1%
a,aa,bAppvion Operations Inc.		United States		18,684		353,175
Verso Corp., A		United States		5,620		67,215
aVerso Corp., wts., 7/25/23		United States		592		607
						420,997
Media & Entertainment 0.0%†
aClear Channel Outdoor Holdings Inc.		United States		20,804		21,636
aiHeartMedia Inc., A		United States		8,384		70,006
a,aaiHeartMedia Inc., B		United States		142		1,008
						92,650
Retailing 0.0%
a,aa,bK2016470219 South Africa Ltd., A		South Africa		14,792,309		—
a,aa,bK2016470219 South Africa Ltd., B		South Africa		1,472,041		—
						—
Total Common Stocks and Other Equity Interests (Cost $4,648,529)						823,031
Management Investment Companies (Cost $11,072,145) 2.0%
Diversified Financials 2.0%
dFranklin Floating Rate Income Fund		United States		1,118,951		8,067,640
			Principal           Amount*
Convertible Bonds (Cost $4,770) 0.0%†
Telecommunication Services 0.0%†
e,fDigicel Group 0.5 Ltd., cvt., sub. bond, 144A, PIK, 7.00%, 10/01/68		Jamaica		25,758		2,189

Semiannual Report         FSI-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal   Amount*			Value
Corporate Bonds 44.0%
Automobiles & Components 0.4%
eAllison Transmission Inc., senior bond, 144A, 5.875%, 6/01/29		United States		800,000		$	834,324
Dana Inc., senior note, 5.625%, 6/15/28		United States		700,000			696,633
							1,530,957
Banks 4.8%
eAkbank T.A.S., senior note, 144A, 5.125%, 3/31/25		Turkey		1,200,000			1,135,195
Bank of America Corp.,
senior bond, 3.248%, 10/21/27		United States		647,000			713,969
senior note, 3.50%, 4/19/26		United States		2,480,000			2,793,821
gBDO Unibank Inc., senior note, Reg S, 2.95%, 3/06/23		Philippines		200,000			204,978
eBNP Paribas SA, senior note, 144A, 2.219% to 6/09/25, FRN thereafter, 6/09/26		France		500,000			511,417
gChina Construction Bank Corp., sub. note, Reg S, 4.25% to 2/26/24, FRN thereafter, 2/27/29		China		800,000			855,361
Citigroup Inc.,
senior note, 3.30%, 4/27/25		United States		243,000			267,038
senior note, 3.40%, 5/01/26		United States		1,106,000			1,227,321
hComerica Inc., junior sub. bond, 5.625% to 10/01/25, FRN thereafter, Perpetual		United States		300,000			305,190
Fifth Third Bancorp, senior note, 2.55%, 5/05/27		United States		500,000			535,360
HSBC Holdings PLC, senior bond, 2.848% to 6/04/30, FRN thereafter, 6/04/31		United Kingdom		800,000			819,847
Industrial & Commercial Bank of China Ltd., senior note, 3.538%, 11/08/27		China		900,000			991,582
JPMorgan Chase & Co.,
hjunior sub. bond, R, 6.00% to 8/01/23, FRN thereafter, Perpetual		United States		213,000			215,272
senior bond, 3.20%, 6/15/26		United States		1,213,000			1,347,437
senior bond, 2.522% to 4/22/30, FRN thereafter, 4/22/31		United States		1,000,000			1,058,410
sub. note, 3.375%, 5/01/23		United States		809,000			865,855
sub. note, 3.875%, 9/10/24		United States		809,000			897,481
Lloyds Banking Group PLC, senior note, 3.87%, 7/09/25		United Kingdom		200,000			217,832
Regions Financial Corp., senior note, 2.25%, 5/18/25		United States		500,000			523,630
SVB Financial Group, senior note, 3.125%, 6/05/30		United States		300,000			321,935
gTurkiye Vakiflar Bankasi TAO, secured note, Reg S, 2.375%, 11/04/22		Turkey		500,000	EUR		557,294
Wells Fargo & Co.,
senior note, 3.00%, 4/22/26		United States		2,021,000			2,208,711
senior note, 2.188% to 4/30/25, FRN thereafter, 4/30/26		United States		700,000			724,606
							19,299,542
Capital Goods 1.8%
eBeacon Roofing Supply Inc., senior note, 144A, 4.875%, 11/01/25		United States		1,094,000			979,316
CNH Industrial NV, senior bond, 3.85%, 11/15/27		United Kingdom		566,000			598,277
Emerson Electric Co., senior bond, 2.75%, 10/15/50		United States		200,000			200,617
eHerc Holdings Inc., senior note, 144A, 5.50%, 7/15/27		United States		1,000,000			1,004,680
Honeywell International Inc., senior bond, 1.95%, 6/01/30		United States		700,000			732,342
eNavistar International Corp., senior secured note, 144A, 9.50%, 5/01/25		United States		400,000			430,250

FSI-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal   Amount*		Value
Corporate Bonds (continued)
Capital Goods (continued)
eNCI Building Systems Inc., senior secured note, 144A, 8.00%, 4/15/26		United States		800,000	$	808,524
aa,b,fOnsite Rental Group Operations Pty. Ltd., secured note, PIK, 6.10%, 10/26/23		Australia		262,519		213,088
eResideo Funding Inc., senior note, 144A, 6.125%, 11/01/26		United States		800,000		784,524
eRutas 2 and 7 Finance Ltd., senior secured bond, first lien, 144A, zero cpn., 9/30/36		United States		200,000		131,000
eiVertical U.S. Newco Inc., senior note, 144A, 5.25%, 7/15/27		United States		400,000		400,000
eWESCO Distribution Inc.,
senior note, 144A, 7.125%, 6/15/25		United States		300,000		317,160
senior note, 144A, 7.25%, 6/15/28		United States		200,000		211,414
Westinghouse Air Brake Technologies Corp., senior note, 3.20%, 6/15/25		United States		200,000		204,403
						7,015,595
Consumer Durables & Apparel 1.0%
eHanesbrands Inc., senior bond, 144A, 4.875%, 5/15/26		United States		1,382,000		1,395,564
KB Home, senior note, 7.00%, 12/15/21		United States		570,000		598,030
Mohawk Industries Inc., senior bond, 3.625%, 5/15/30		United States		1,300,000		1,418,699
Toll Brothers Finance Corp., senior bond, 5.625%, 1/15/24		United States		689,000		739,742
						4,152,035
Consumer Services 1.2%
e1011778 BC ULC/New Red Finance Inc., secured note, second lien, 144A, 5.00%, 10/15/25		Canada		970,000		966,794
e,iColt Merger Sub Inc.,
senior note, 144A, 5.75%, 7/01/25		United States		200,000		201,500
senior secured note, 144A, 6.25%, 7/01/25		United States		400,000		397,880
eGolden Nugget Inc., senior note, 144A, 6.75%, 10/15/24		United States		1,132,000		815,040
eInternational Game Technology PLC, senior secured note, first lien, 144A, 5.25%, 1/15/29		United States		700,000		684,250
eKFC Holding Co./Pizza Hut Holdings LLC/Taco Bell of America LLC, senior note, 144A, 5.00%, 6/01/24		United States		728,000		743,546
eWynn Las Vegas LLC/Wynn Las Vegas Capital Corp.,
senior bond, 144A, 5.50%, 3/01/25		United States		670,000		615,191
senior bond, 144A, 5.25%, 5/15/27		United States		200,000		173,326
						4,597,527
Diversified Financials 2.7%
Capital One Financial Corp., senior note, 3.20%, 2/05/25		United States		1,617,000		1,732,506
The Goldman Sachs Group Inc.,
senior note, 3.50%, 1/23/25		United States		1,725,000		1,880,200
senior note, 3.75%, 2/25/26		United States		1,213,000		1,353,859
Morgan Stanley,
senior bond, 3.591% to 7/22/27, FRN thereafter, 7/22/28		United States		809,000		910,970
senior note, 3.875%, 1/27/26		United States		2,395,000		2,711,294

Semiannual Report         FSI-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal   Amount*		Value
Corporate Bonds (continued)
Diversified Financials (continued)
eMSCI Inc., senior bond, 144A, 4.00%, 11/15/29		United States		700,000	$	715,183
Springleaf Finance Corp., senior note, 6.625%, 1/15/28		United States		1,000,000		991,690
gTNB Global Ventures Capital Bhd., senior note, Reg S, 3.244%, 10/19/26		Malaysia		400,000		426,065
						10,721,767
Energy 2.5%
eAker BP ASA, senior note, 144A, 4.75%, 6/15/24		Norway		600,000		604,845
Baker Hughes a GE Co. LLC/Baker Hughes Co-Obligor Inc., senior note, 4.486%, 5/01/30		United States		50,000		57,616
Canadian Natural Resources Ltd., senior bond, 2.95%, 7/15/30		Canada		450,000		447,460
Cheniere Energy Partners LP, senior secured note, first lien, 5.25%, 10/01/25		United States		970,000		967,769
Comstock Resources Inc., senior note, 9.75%, 8/15/26		United States		200,000		187,250
CONSOL Energy Inc., senior note, 5.875%, 4/15/22		United States		167,000		164,599
Ecopetrol SA, senior bond, 4.125%, 1/16/25		Colombia		800,000		804,924
Energy Transfer Operating LP, senior bond, 4.05%, 3/15/25		United States		200,000		212,975
EnLink Midstream LLC, senior bond, 5.375%, 6/01/29		United States		300,000		225,871
e,f,gEnQuest PLC, senior note, 144A, Reg S, PIK, 7.00%, 10/15/23		United Kingdom		849,275		510,737
Enterprise Products Operating LLC, senior bond, 4.80%, 2/01/49		United States		150,000		178,162
EOG Resources Inc., senior bond, 4.375%, 4/15/30		United States		100,000		119,276
Equinor ASA, senior note, 2.375%, 5/22/30		Norway		700,000		728,506
Exxon Mobil Corp., senior bond, 2.61%, 10/15/30		United States		500,000		534,227
Martin Midstream Partners LP/Martin Midstream Finance Corp., senior note, 7.25%, 2/15/21		United States		1,617,000		1,218,612
eNabors Industries Ltd., senior note, 144A, 7.25%, 1/15/26		United States		800,000		494,000
Occidental Petroleum Corp.,
isenior bond, 8.875%, 7/15/30		United States		400,000		400,500
senior bond, 6.45%, 9/15/36		United States		500,000		430,540
eSchlumberger Holdings Corp., senior note, 144A, 3.90%, 5/17/28		United States		400,000		431,895
Sunoco LP/Sunoco Finance Corp.,
senior note, 4.875%, 1/15/23		United States		485,000		479,493
senior note, 6.00%, 4/15/27		United States		500,000		496,140
eWeatherford International Ltd., senior note, 144A, 11.00%, 12/01/24		.United States		417,000		291,900
The Williams Cos Inc., senior bond, 3.50%, 11/15/30		United States		200,000		210,832
						10,198,129
Food & Staples Retailing 0.9%
eCencosud SA, senior note, 144A, 4.375%, 7/17/27		Chile		800,000		816,550
Costco Wholesale Corp., senior bond, 1.75%, 4/20/32		United States		100,000		101,889
The Kroger Co., senior bond, 4.45%, 2/01/47		United States		150,000		182,278
Walgreens Boots Alliance Inc., senior note, 3.80%, 11/18/24		United States		2,087,000		2,300,202
						3,400,919
Food, Beverage & Tobacco 1.9%
Altria Group Inc., senior note, 3.40%, 5/06/30		United States		1,200,000		1,293,492
Anheuser-Busch InBev Worldwide Inc., senior bond, 3.50%, 6/01/30		.Belgium		1,300,000		1,464,448
B&G Foods Inc., senior note, 5.25%, 9/15/27		United States		900,000		903,096

FSI-12         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization	Principal Amount	*		Value
Corporate Bonds (continued)
Food, Beverage & Tobacco (continued)
BAT Capital Corp.,
senior bond, 4.54%, 8/15/47	United Kingdom	50,000		$	54,512
senior note, 3.557%, 8/15/27	United Kingdom	300,000			324,801
Bunge Ltd. Finance Corp., senior note, 3.25%, 8/15/26	United States	200,000			206,665
Diageo Capital PLC., senior note, 2.00%, 4/29/30	United Kingdom	800,000			828,819
eKraft Heinz Foods Co., senior note, 144A, 3.875%, 5/15/27	United States	800,000			837,071
eMHP Lux SA, senior note, 144A, 6.95%, 4/03/26	Ukraine	800,000			815,410
ePost Holdings Inc., senior bond, 144A, 4.625%, 4/15/30	United States	700,000			688,205
Reynolds American Inc., senior note, 4.45%, 6/12/25	United Kingdom	200,000			225,464
					7,641,983
Health Care Equipment & Services 1.9%
Abbott Laboratories, senior bond, 4.75%, 11/30/36	United States	1,000,000			1,346,716
Anthem Inc.,
senior bond, 2.25%, 5/15/30	United States	400,000			412,054
senior bond, 3.70%, 9/15/49	United States	150,000			171,043
Centene Corp.,
senior bond, 4.625%, 12/15/29	United States	200,000			212,254
senior bond, 3.375%, 2/15/30	United States	600,000			606,765
senior note, 4.75%, 5/15/22	United States	400,000			406,406
senior note, 4.25%, 12/15/27	United States	300,000			310,267
esenior note, 144A, 5.375%, 6/01/26	United States	324,000			337,195
CHS/Community Health Systems Inc., senior secured note, first lien, 6.25%, 3/31/23	United States	805,000			759,848
Cigna Corp., senior bond, 4.90%, 12/15/48	United States	150,000			198,603
DaVita Inc.,
senior bond, 5.125%, 7/15/24	United States	305,000			310,642
senior bond, 5.00%, 5/01/25	United States	728,000			745,108
HCA Inc., senior note, 5.375%, 9/01/26	United States	713,000			778,026
eMPH Acquisition Holdings LLC, senior note, 144A, 7.125%, 6/01/24	United States	300,000			280,120
Quest Diagnostics Inc., senior bond, 2.80%, 6/30/31	United States	200,000			210,099
Stryker Corp., senior bond, 3.50%, 3/15/26	United States	405,000			456,170
					7,541,316
Household & Personal Products 0.1%
e,iKimberly-Clark de Mexico SAB de CV, senior bond, 144A, 2.431%, 7/01/31	Mexico	300,000			302,475
eSpectrum Brands Inc., senior bond, 144A, 5.50%, 7/15/30	United States	200,000			200,750
					503,225
Insurance 1.5%
Aflac Inc., senior note, 3.60%, 4/01/30	United States	1,300,000			1,519,439
Arch Capital Group Ltd., senior bond, 3.635%, 6/30/50	United States	1,000,000			1,051,210
eFive Corners Funding Trust II, senior note, 144A, 2.85%, 5/15/30	United States	900,000			929,213
Manulife Financial Corp., senior note, 2.484%, 5/19/27	Canada	800,000			838,406
Marsh & McLennan Cos Inc., senior bond, 2.25%, 11/15/30	United States	1,200,000			1,249,561
Willis North America Inc., senior bond, 2.95%, 9/15/29	United States	400,000			424,616
					6,012,445

Semiannual Report         FSI-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization	Principal Amount	*		Value
Corporate Bonds (continued)
Materials 5.4%
Air Products and Chemicals Inc., senior bond, 2.05%, 5/15/30	United States	400,000		$	420,873
eAlpek SAB de CV, senior note, 144A, 4.25%, 9/18/29	Mexico	1,600,000			1,582,496
eArdagh Packaging Finance PLC/Ardagh Holdings USA Inc.,
senior note, 144A, 6.00%, 2/15/25	Luxembourg	248,000			254,138
senior note, 144A, 5.25%, 8/15/27	Luxembourg	300,000			294,993
Bemis Co Inc., senior note, 2.63%, 6/19/30	United States	200,000			205,270
eBraskem Netherlands Finance BV, senior bond, 144A, 4.50%, 1/31/30	Brazil	1,100,000			1,008,425
eCCL Industries Inc., senior note, 144A, 3.05%, 6/01/30	Canada	500,000			512,577
eCemex Finance LLC, senior secured note, first lien, 144A, 6.00%, 4/01/24	Mexico	299,000			296,850
eCemex SAB de CV, senior secured bond, first lien, 144A, 5.70%, 1/11/25	Mexico	1,013,000			993,358
gCNAC HK Finbridge Co. Ltd., senior note, Reg S, 4.875%, 3/14/25	China	800,000			889,441
Crown Americas LLC/Crown Americas Capital Corp. VI, senior note, 4.75%, 2/01/26	United States	1,066,000			1,090,081
EI du Pont de Nemours and Co., senior bond, 2.30%, 7/15/30	United States	1,300,000			1,354,025
eFMG Resources (August 2006) Pty. Ltd.,
senior note, 144A, 5.125%, 3/15/23	Australia	324,000			333,919
senior note, 144A, 5.125%, 5/15/24	Australia	647,000			668,095
eGates Global LLC / Gates Corp., senior note, 144A, 6.25%, 1/15/26	United States	700,000			694,456
eGlencore Funding LLC,
senior note, 144A, 4.125%, 5/30/23	Switzerland	485,000			518,908
senior note, 144A, 4.625%, 4/29/24	Switzerland	250,000			276,152
LYB International Finance BV, senior note, 4.00%, 7/15/23	United States	1,698,000			1,842,820
eMauser Packaging Solutions Holding Co., senior note, 144A, 7.25%, 4/15/25	United States	1,278,000			1,162,648
eNovelis Corp., senior bond, 144A, 5.875%, 9/30/26	United States	1,059,000			1,060,239
Olin Corp., senior note, 5.125%, 9/15/27	United States	400,000			375,162
eOwens-Brockway Glass Container Inc.,
senior note, 144A, 5.00%, 1/15/22	United States	120,000			120,267
senior note, 144A, 5.875%, 8/15/23	United States	566,000			585,869
senior note, 144A, 6.625%, 5/13/27	United States	100,000			104,188
eReynolds Group Issuer Inc./Reynolds Group Issuer LLC/Reynolds Group Issuer Luxembourg SA,
senior note, 144A, 7.00%, 7/15/24	United States	105,000			105,541
senior secured note, first lien, 144A, 5.125%, 7/15/23	United States	566,000			573,468
eSABIC Capital II BV, senior note, 144A, 4.50%, 10/10/28	Saudi Arabia	600,000			680,730
eSealed Air Corp.,
senior bond, 144A, 5.125%, 12/01/24	United States	809,000			866,136
senior bond, 144A, 5.50%, 9/15/25	United States	124,000			133,752
senior note, 144A, 4.875%, 12/01/22	United States	85,000			87,636
eSunCoke Energy Partners LP/SunCoke Energy Partners Finance Corp., senior note, 144A, 7.50%, 6/15/25	United States	1,100,000			933,146
eTPC Group Inc., secured note, 144A, 10.50%, 8/01/24	United States	900,000			807,282
Westlake Chemical Corp., senior bond, 3.375%, 6/15/30	United States	200,000			204,691
WRKCo Inc., senior bond, 3.00%, 6/15/33	United States	400,000			418,219

FSI-14         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization	Principal Amount	*		Value
Corporate Bonds (continued)
Materials (continued)
eYara International ASA, senior note, 144A, 3.148%, 6/04/30	Norway	100,000		$	104,177
					21,560,028
Media & Entertainment 3.3%
eAltice Financing SA, secured bond, 144A, 7.50%, 5/15/26	Luxembourg	600,000			631,515
AMC Entertainment Holdings Inc., senior sub. bond, 5.75%, 6/15/25	United States	800,000			258,000
eCCO Holdings LLC/CCO Holdings Capital Corp.,
senior bond, 144A, 5.375%, 5/01/25	United States	728,000			748,096
senior bond, 144A, 4.50%, 8/15/30	United States	300,000			307,247
Charter Communications Operating LLC/Charter Communications Operating Capital, senior bond, 2.80%, 4/01/31	United States	300,000			304,796
Clear Channel Worldwide Holdings Inc.,
senior note, 9.25%, 2/15/24	United States	256,000			238,140
esenior secured note, first lien, 144A, 5.125%, 8/15/27	United States	600,000			577,056
eCSC Holdings LLC, senior secured note, first lien, 144A, 5.50%, 5/15/26	United States	1,378,000			1,418,341
eDiamond Sports Group LLC/Diamond Sports Finance Co.,
first lien, 144A, 5.375%, 8/15/26	United States	400,000			291,968
senior note, 144A, 6.625%, 8/15/27	United States	300,000			161,559
DISH DBS Corp.,
senior bond, 6.75%, 6/01/21	United States	5,000			5,102
senior note, 5.875%, 11/15/24	United States	570,000			567,597
e,iDISH Network Corp., senior note, 144A, 7.375%, 7/01/28	United States	300,000			299,625
Fox Corp, senior bond, 3.50%, 4/08/30	United States	400,000			447,486
iHeartCommunications Inc., senior note, 8.375%, 5/01/27	United States	87,378			80,229
eLive Nation Entertainment Inc., senior note, 144A, 4.75%, 10/15/27	United States	800,000			690,084
Netflix Inc.,
senior bond, 5.875%, 2/15/25	United States	1,000,000			1,114,795
senior bond, 4.375%, 11/15/26	United States	300,000			312,744
eNexstar Broadcasting Inc., senior note, 144A, 5.625%, 8/01/24	United States	1,417,000			1,431,319
RELX Capital Inc., senior note, 3.00%, 5/22/30	United Kingdom	100,000			108,423
eTencent Holdings Ltd., senior note, 144A, 2.39%, 6/03/30	China	1,100,000			1,102,555
The Walt Disney Co., senior note, 2.20%, 1/13/28	United States	400,000			418,197
eUnivision Communications Inc., senior secured note, first lien, 144A, 5.125%, 2/15/25	United States	1,321,000			1,248,352
eVirgin Media Secured Finance PLC, senior secured bond, 144A, 4.50%, 8/15/30	United Kingdom	600,000			601,875
					13,365,101
Pharmaceuticals, Biotechnology & Life Sciences 1.8%
eAbbVie Inc.,
senior bond, 144A, 3.80%, 3/15/25	United States	1,778,000			1,984,586
senior note, 144A, 2.95%, 11/21/26	United States	600,000			657,093
senior note, 144A, 3.20%, 11/21/29	United States	700,000			781,587
eBausch Health Cos. Inc.,
senior bond, 144A, 6.125%, 4/15/25	United States	243,000			246,810
senior note, 144A, 8.50%, 1/31/27	United States	809,000			860,149

Semiannual Report         FSI-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization	Principal Amount	*		Value
Corporate Bonds (continued)
Pharmaceuticals, Biotechnology & Life Sciences (continued)
eBayer U.S. Finance II LLC, senior bond, 144A, 4.375%, 12/15/28	Germany	889,000		$	1,039,460
Biogen Inc., senior bond, 2.25%, 5/01/30	United States	300,000			303,395
eEndo Dac/Endo Finance LLC/Endo Finco Inc.,
secured note, second lien, 144A, 9.50%, 7/31/27	United States	452,000			480,340
senior note, 144A, 6.00%, 6/30/28	United States	659,000			428,350
ePar Pharmaceutical Inc., senior secured note, 144A, 7.50%, 4/01/27	United States	184,000			189,436
Perrigo Finance Unlimited Co., senior note, 3.15%, 6/15/30	United States	400,000			404,187
					7,375,393
Real Estate 1.3%
AvalonBay Communities Inc., senior bond, 2.45%, 1/15/31	United States	500,000			533,740
gChina Overseas Finance Cayman VI Ltd., senior note, Reg S, 5.95%, 5/08/24	China	700,000			801,287
Equinix Inc., senior bond, 5.875%, 1/15/26	United States	100,000			105,471
eFive Point Operating Co. LP/Five Point Capital Corp., senior note, 144A, 7.875%, 11/15/25	United States	800,000			758,492
MPT Operating Partnership LP/MPT Finance Corp.,
senior bond, 5.25%, 8/01/26	United States	247,000			256,980
senior bond, 5.00%, 10/15/27	United States	889,000			916,252
eSBA Communications Corp., senior note, 144A, 3.875%, 2/15/27	United States	600,000			598,323
eVICI Properties LP/VICI Note Co. Inc., senior note, 144A, 3.75%, 2/15/27	United States	1,400,000			1,318,408
					5,288,953
Retailing 0.2%
AutoNation Inc., senior bond, 4.75%, 6/01/30	United States	200,000			217,101
Dollar Tree Inc., senior bond, 4.20%, 5/15/28	United States	300,000			349,343
aa,e,fK2016470219 South Africa Ltd., senior secured note, 144A, PIK, 3.00%, 12/31/22	South Africa	976,441			—
aa,e,fK2016470260 South Africa Ltd., senior secured note, 144A, PIK, 25.00%, 12/31/22	South Africa	352,537			1,763
eParty City Holdings Inc., senior note, 144A, 6.625%, 8/01/26	United States	1,085,000			244,125
					812,332
Semiconductors & Semiconductor Equipment 0.0%†
Maxim Integrated Products Inc., senior note, 3.375%, 3/15/23	United States	100,000			103,937
Software & Services 0.5%
Fiserv Inc., senior bond, 2.65%, 6/01/30	United States	600,000			634,325
eGartner Inc., senior note, 144A, 4.50%, 7/01/28	United States	200,000			202,840
eNortonLifeLock Inc., senior note, 144A, 5.00%, 4/15/25	United States	978,000			997,560
					1,834,725
Technology Hardware & Equipment 0.8%
eBlackboard Inc., secured note, second lien, 144A, 10.375%, 11/15/24	United States	200,000			195,625
eCommScope Technologies LLC, senior bond, 144A, 5.00%, 3/15/27	United States	1,374,000			1,241,697
Flex Ltd., senior note, 3.75%, 2/01/26	United States	1,100,000			1,167,133
ePresidio Holdings Inc., senior secured note, 144A, 4.875%, 2/01/27	United States	700,000			685,454
					3,289,909

FSI-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal   Amount*		Value
Corporate Bonds (continued)
Telecommunication Services 2.2%
eAltice France Holding SA, senior note, 144A, 6.00%, 2/15/28		Luxembourg		700,000	$	665,879
eAltice France SA/France, senior secured note, 144A, 5.50%, 1/15/28		France		200,000		202,338
AT&T Inc.,
senior Bond, 4.30%, 2/15/30		United States		1,300,000		1,519,998
senior note, 2.30%, 6/01/27		United States		300,000		310,220
Bell Canada Inc., senior bond, 4.464%, 4/01/48		Canada		150,000		190,354
e,fDigicel Group 0.5 Ltd., senior note, 144A, PIK, 8.00%, 4/01/25		Jamaica		155,520		42,768
Hughes Satellite Systems Corp., senior bond, 6.625%, 8/01/26		United States		800,000		833,152
Sprint Communications Inc., senior note, 6.00%, 11/15/22		United States		405,000		427,727
Sprint Corp., senior bond, 7.875%, 9/15/23		United States		405,000		456,635
Telefonica Emisiones SA,
senior bond, 4.895%, 3/06/48		Spain		150,000		182,633
senior note, 4.103%, 3/08/27		Spain		500,000		571,202
TELUS Corp., senior bond, 4.60%, 11/16/48		Canada		150,000		183,481
T-Mobile USA Inc.,
senior bond, 6.50%, 1/15/24		United States		405,000		415,050
senior bond, 6.375%, 3/01/25		United States		1,051,000		1,080,953
senior note, 6.00%, 4/15/24		United States		200,000		204,963
esenior secured bond, 144A, 3.875%, 4/15/30		United States		1,300,000		1,451,378
						8,738,731
Transportation 3.0%
Burlington Northern Santa Fe LLC, senior bond, 4.15%, 4/01/45		United States		400,000		496,835
CSX Corp., senior bond, 4.10%, 3/15/44		United States		150,000		183,459
eDAE Funding LLC, senior note, 144A, 5.00%, 8/01/24		United Arab Emirates		1,294,000		1,217,156
FedEx Corp.,
senior bond, 4.05%, 2/15/48		United States		150,000		154,352
senior note, 3.80%, 5/15/25		United States		1,400,000		1,557,935
gICTSI Treasury BV, senior note, Reg S, 4.625%, 1/16/23		Philippines		1,200,000		1,244,718
eKazakhstan Temir Zholy Finance BV, senior bond, 144A, 6.95%, 7/10/42		Kazakhstan		1,700,000		2,265,590
eMexico City Airport Trust, senior secured bond, first lien, 144A, 5.50%, 7/31/47		Mexico		1,200,000		1,059,690
g,jRZD Capital PLC, (Russian Railways), loan participation, senior bond, Reg S, 5.70%, 4/05/22		Russia		1,700,000		1,807,734
United Parcel Service Inc., senior bond, 5.30%, 4/01/50		United States		1,300,000		1,865,342
						11,852,811
Utilities 4.8%
Calpine Corp.,
senior bond, 5.75%, 1/15/25		United States		1,170,000		1,185,110
esenior note, 144A, 5.125%, 3/15/28		United States		200,000		195,925
gCGNPC International Ltd., senior note, Reg S, 3.75%, 12/11/27		China		300,000		330,569
Clearway Energy Operating LLC, senior note, 5.75%, 10/15/25		United States		1,132,000		1,178,418
eColbun SA,
senior note, 144A, 3.95%, 10/11/27		Chile		800,000		861,884
senior note, 144A, 3.15%, 3/06/30		Chile		300,000		303,900

Semiannual Report         FSI-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal   Amount*		Value
Corporate Bonds (continued)
Utilities (continued)
Dominion Energy Inc., senior note, 3.375%, 4/01/30		United States		1,300,000	$	1,441,050
Duke Energy Corp., senior note, 2.45%, 6/01/30		United States		400,000		422,354
e,hEDF SA, junior sub. note, 144A, 5.25% to 1/29/23, FRN thereafter, Perpetual		France		2,425,000		2,480,751
Exelon Corp., senior bond, 4.05%, 4/15/30		United States		1,300,000		1,503,785
eInterGen NV, secured bond, 144A, 7.00%, 6/30/23		Netherlands		700,000		675,500
eIsrael Electric Corp. Ltd., secured bond, 144A, 4.25%, 8/14/28		Israel		1,000,000		1,134,400
Piedmont Natural Gas Co. Inc., senior bond, 3.35%, 6/01/50		United States		300,000		328,783
The Southern Co., senior bond, 3.25%, 7/01/26		United States		2,410,000		2,672,847
eState Grid Overseas Investment 2016 Ltd., senior note, 144A, 3.50%, 5/04/27		China		1,651,000		1,828,301
eTalen Energy Supply LLC, senior secured note, 144A, 7.25%, 5/15/27		United States		1,300,000		1,295,697
eThree Gorges Finance I Cayman Islands Ltd., senior note, 144A, 3.15%, 6/02/26		China		1,051,000		1,137,844
Virginia Electric and Power Co., senior bond, 6.35%, 11/30/37		United States		85,000		123,799
						19,100,917
Total Corporate Bonds (Cost $176,493,968)						175,938,277
k,lSenior Floating Rate Interests 5.2%
Automobiles & Components 0.6%
Adient US LLC,
Initial Term Loans, 4.178%, (1-month USD LIBOR + 4.00%), 5/06/24		United States		865,800		835,930
Initial Term Loans, 4.474%, (3-month USD LIBOR + 4.00%), 5/06/24		United States		292,500		282,409
Thor Industries Inc., Initial USD Term Loans, 3.94%, (1-month USD LIBOR + 3.75%), 2/01/26		United States		1,238,727		1,219,179
						2,337,518
Capital Goods 0.1%
fAlloy Finco Ltd., Term Loan B, PIK, 14.00%, 3/06/25		United States		162,595		70,729
Altra Industrial Motion Corp., Term Loan, 2.178%, (1-month USD LIBOR + 2.00%), 10/01/25		United States		272,770		260,496
aaOnsite Rental Group Operations Pty. Ltd., Term B Loan, 5.50%, (1-month USD LIBOR + 4.50%), 10/25/22		Australia		192,010		161,048
						492,273
Commercial & Professional Services 0.1%
Prime Security Services Borrower, LLC,
Term B-1 Facility, 4.25%, (1-month USD LIBOR + 3.25%), 9/12/26		United States		43,677		42,094
Term B-1 Facility, 4.25%, (1-year USD LIBOR + 3.25%), 9/12/26		United States		40,193		38,736
Term B-1 Facility, 4.25%, (3-month USD LIBOR + 3.25%), 9/12/26		United States		20,096		19,367
Term B-1 Facility, 4.25%, (6-month USD LIBOR + 3.25%), 9/12/26		United States		20,096		19,367

FSI-18         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal   Amount*		Value
k,lSenior Floating Rate Interests (continued)
Commercial & Professional Services (continued)
Harsco Corp., Term Loan B-2, 3.25%, (1-month USD LIBOR + 2.25%), 12/10/24		United States		110,062	$	108,136
Pitney Bowes Inc., Incremental Tranche Term B Loans, 5.68%, (1-month USD LIBOR + 5.50%), 1/07/25		United States		227,125		191,921
mVentia Pty. Ltd., Term B Loans, 5.00%, (3-month USD LIBOR + 4.00%), 5/21/26		Australia		157,500		154,350
						573,971
Consumer Durables & Apparel 0.0%†
Playtika Holding Corp., Term B Loans, 7.072%, (3-month USD LIBOR + 6.00%), 12/10/24		United States		78,000		78,146
Consumer Services 0.5%
Aristocrat Technologies Inc., Term B-3 Loans, 2.859%, (3-month USD LIBOR + 1.75%), 10/19/24		United States		775,372		739,511
Caesars Resort Collection LLC,
Term B Loans, 2.928%, (1-month USD LIBOR + 2.75%), 12/22/24		United States		348,214		312,039
m,nTerm Loan, TBD, 6/19/25		United States		23,499		21,992
Eldorado Resorts Inc., Initial Term Loan, 3.25%, (3-month USD LIBOR + 2.25%), 4/17/24		United States		176,290		175,602
NASCAR Holdings Inc., Initial Term Loans, 2.93%, (1-month USD LIBOR + 2.75%), 10/18/26		United States		598,411		576,269
						1,825,413
Diversified Financials 0.2%
Russell Investments U.S. Institutional Holdco Inc., Term Loan B, 3.822%, (3-month USD LIBOR + 2.75%), 6/01/23		United States		1,036,127		1,009,792
Energy 0.2%
oFieldwood Energy LLC, Closing Date Loans, 6.25%, (3-month USD LIBOR + 5.25%), 4/11/22		United States		2,507,941		509,947
Utex Industries Inc.,
Initial Term Loan (First Lien), 5.311%, (3-month USD LIBOR + 4.00%), 5/21/21		United States		514,307		147,863
Second Lien Initial Term Loan, 8.561%, (3-month USD LIBOR + 7.25%), 5/20/22		United States		53,878		7,364
						665,174
Food, Beverage & Tobacco 0.2%
B&G Foods Inc., Tranche B-4 Term Loan, 2.678%, (1-month USD LIBOR + 2.50%), 10/10/26		United States		289,479		286,494
CSM Bakery Supplies LLC, 2nd Lien Term, 11.00%, (3-month USD LIBOR + 10.00%), 2/04/22		United States		478,111		390,856
JBS USA Lux SA, New Term Loans, 3.072%, (3-month USD LIBOR + 2.00%), 5/01/26		United States		207,984		199,404
						876,754
Health Care Equipment & Services 0.1%
Catalent Pharma Solutions Inc., Dollar Term B-2 Loan, 3.25%, (1-month USD LIBOR + 2.25%), 5/17/26		United States		596,977		591,008

Semiannual Report         FSI-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal   Amount*		Value
k,lSenior Floating Rate Interests (continued)
Household & Personal Products 0.6%
aaFGI Operating Co. LLC (Freedom Group)
fTerm Loan, PIK, 12.00%, (3-month USD LIBOR + 10.00%), 5/15/22		United States		851,786	$	658,178
Term Loan FILO, 9.50%, (3-month USD LIBOR + 7.50%), 5/15/21		United States		1,616,351		1,615,501
						2,273,679
Insurance 0.1%
Alliant Holdings Intermediate LLC/Alliant Holdings Co-Issuer, Initial Term Loan, 2.928%, (1-month USD LIBOR + 2.75%), 5/10/25		United States		274,131		260,424
Materials 0.2%
Appvion Operations Inc., Term Loan, 7.00%, (3-month USD LIBOR + 6.00%), 6/15/26		United States		272,000		266,560
Axalta Coating Systems U.S. Holdings Inc., Term B-3 Dollar Loan, 2.058%, (3-month USD LIBOR + 1.75%), 6/01/24		United States		233,140		224,299
Mauser Packaging Solutions Holding Co., Initial Term Loan, 4.561%, (1-month USD LIBOR + 3.25%), 4/03/24		United States		149,614		135,102
						625,961
Media & Entertainment 1.0%
Charter Communications Operating LLC, Term A-2 Loan, 1.68%, (1-month USD LIBOR + 1.50%), 3/31/23		United States		821,994		813,774
CSC Holdings LLC, March 2017 Incremental Term Loans, 2.435%, (1-month USD LIBOR + 2.25%), 7/17/25		United States		1,197,173		1,138,512
Diamond Sports Group LLC, Term Loan, 3.43%, (1-month USD LIBOR + 3.25%), 8/24/26		United States		451,700		369,830
Gray Television Inc.,
Term B-2 Loan, 2.423%, (1-month USD LIBOR + 2.25%), 2/07/24		United States		843,033		815,634
Term C Loan, 2.673%, (1-month USD LIBOR + 2.50%), 1/02/26 .		United States		536,353		520,262
Mediacom Illinois LLC, Tranche N Term Loan, 1.86%, (1-week USD LIBOR + 1.75%), 2/15/24		United States		303,696		297,622
						3,955,634
Pharmaceuticals, Biotechnology & Life Sciences 0.0%†
eResearch Technology Inc., Initial Term Loan, 5.50%, (1-month USD LIBOR + 4.50%), 2/04/27		United States		58,182		57,309
Real Estate 0.0%†
Cushman & Wakefield U.S. Borrower LLC, Replacement Term Loan, 2.928%, (1-month USD LIBOR + 2.75%), 8/21/25		United States		99,497		94,149
Retailing 0.1%
oGeneral Nutrition Centers Inc., Tranche B-2 Term Loans, 9.50%, (2-month USD LIBOR + 8.75%), 3/04/21		United States		512,850		374,381
Harbor Freight Tools USA Inc., Refinancing Loans, 3.25%, (1-month USD LIBOR + 2.50%), 8/19/23		United States		198,979		192,064
						566,445
Semiconductors & Semiconductor Equipment 0.3%
ON Semiconductor Corp., 2019 Replacement Term B-4 Loans, 2.178%, (1-month USD LIBOR + 2.00%), 9/18/26		United States		1,131,407		1,089,451

FSI-20         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization			Principal   Amount*			Value
k,lSenior Floating Rate Interests (continued)
Software & Services 0.2%
m,nCardtronics USA Inc., Initial Term Loan, TBD, 6/29/27		United Kingdom			120,924		$	119,714
WEX Inc., Term B-3 Loan, 2.428%, (1-month USD LIBOR + 2.25%), 5/17/26		United States			636,903			611,427
								731,141
Telecommunication Services 0.3%
Aventiv Technologies LLC,
Initial Term Loan, 5.50%, (3-month USD LIBOR + 4.50%), 11/01/24		United States			246,835			206,146
Second Lien Initial Loan, 9.25%, (3-month USD LIBOR + 8.25%), 11/01/25		United States			597,127			373,205
Global Tel*Link Corp.,
First Lien Term Loan, 4.428%, (1-month USD LIBOR + 4.25%), 11/29/25		United States			394,735			344,283
Second Lien Term Loan, 8.428%, (1-month USD LIBOR + 8.25%), 11/29/26		United States			183,038			140,481
								1,064,115
Transportation 0.2%
Avis Budget Car Rental LLC, Tranche B Term, 2.43%, (1-month USD LIBOR + 2.25%), 8/06/27		United States			720,159			643,942
JetBlue Airways Corporation, Term Loan, 6.25%, (3-month USD LIBOR + 5.25%), 6/16/24		United States			35,548			34,911
								678,853
Utilities 0.2%
EFS Cogen Holdings I LLC (Linden),
Term B Advance, 4.25%, (1-month USD LIBOR + 3.25%), 6/28/23		United States			261,216			253,706
Term B Advance, 4.25%, (3-month USD LIBOR + 3.25%), 6/28/23		United States			615,499			597,803
								851,509
Total Senior Floating Rate Interests (Cost $24,844,980)								20,698,719
Marketplace Loans (Cost $1,062,845) 0.2%
Diversified Financials 0.2%
aa,pLending Club, 6.46% - 25.65%, 8/22/22 - 2/28/25		United States			1,104,592			964,121
Foreign Government and Agency Securities 12.4%
eThe African Export-Import Bank, senior bond, 144A, 3.994%, 9/21/29		Supranational	q		1,600,000			1,582,872
eAngolan Government International Bond, senior note, 144A, 8.25%, 5/09/28		Angola			2,900,000			2,400,611
gBanque Centrale de Tunisie International Bond, senior note, Reg S, 5.625%, 2/17/24		Tunisia			2,400,000	EUR		2,487,828
eBanque Ouest Africaine de Developpement, senior note, 144A, 5.00%, 7/27/27		Supranational	q		1,600,000			1,673,360
eDominican Republic, senior note, 144A, 8.90%, 2/15/23		Dominican Republic			81,500,000	DOP		1,303,363
eThe Export-Import Bank of India, senior note, 144A, 3.875%, 2/01/28		India			1,655,000			1,721,727

Semiannual Report         FSI-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal   Amount*				Value
Foreign Government and Agency Securities (continued)
eGovernment of Belarus International Bond,
senior bond, 144A, 6.20%, 2/28/30		Belarus		1,200,000			$	1,150,584
senior note, 144A, 7.625%, 6/29/27		Belarus		1,200,000				1,241,130
Government of Colombia,
senior bond, 3.875%, 4/25/27		Colombia		1,400,000				1,481,998
senior bond, 9.85%, 6/28/27		Colombia		5,315,000,000		COP		1,787,653
senior bond, 4.50%, 3/15/29		Colombia		500,000				550,060
senior bond, 5.00%, 6/15/45		Colombia		1,900,000				2,140,910
eGovernment of Gabon,
144A, 6.375%, 12/12/24		Gabon		1,037,538				988,748
senior note, 144A, 6.625%, 2/06/31		Gabon		1,600,000				1,433,546
Government of Indonesia,
esenior bond, 144A, 4.35%, 1/08/27		Indonesia		900,000				1,001,835
senior bond, FR64, 6.125%, 5/15/28		Indonesia		26,500,000,000		IDR		1,745,783
senior bond, FR70, 8.375%, 3/15/24		Indonesia		19,648,000,000		IDR		1,468,604
eGovernment of Iraq, 144A, 5.80%, 1/15/28		Iraq		2,700,000				2,439,990
eGovernment of Kazakhstan, senior bond, 144A, 4.875%, 10/14/44		Kazakhstan		1,800,000				2,292,343
Government of Mexico,
senior bond, M, 6.50%, 6/10/21		Mexico		293,000	r	MXN		1,295,915
senior note, 4.15%, 3/28/27		Mexico		3,200,000				3,430,000
Government of Peru, senior bond, 6.55%, 3/14/37		Peru		1,000,000				1,525,555
Government of Russia,
gReg S, 4.75%, 5/27/26		Russia		1,200,000				1,369,502
esenior note, 144A, 4.875%, 9/16/23		Russia		800,000				889,500
Government of South Africa, senior bond, 7.00%, 2/28/31		South Africa		36,100,000		ZAR		1,712,765
eGovernment of Ukraine,
144A, 7.75%, 9/01/22		Ukraine		200,000				208,901
144A, 7.75%, 9/01/23		Ukraine		369,000				387,975
144A, 7.75%, 9/01/24		Ukraine		369,000				386,048
a,s144A, VRI, GDP Linked Security, 5/31/40		Ukraine		978,000				908,051
senior bond, 144A, 7.375%, 9/25/32		Ukraine		500,000				503,868
Government of Uruguay,
senior bond, 4.375%, 1/23/31		Uruguay		800,000				937,260
tsenior bond, Index Linked, 4.375%, 12/15/28		Uruguay		5,036,655		UYU		126,470
tsenior bond, Index Linked, 3.70%, 6/26/37		Uruguay		84,059,266		UYU		2,001,356
eIndonesia Government International Bond, senior note, 144A, 3.85%, 7/18/27		Indonesia		2,200,000				2,387,458
ePanama Notas del Tesoro, senior note, 144A, 3.75%, 4/17/26		Panama		800,000				838,372
Total Foreign Government and Agency Securities (Cost $51,874,540)								49,801,941

FSI-22         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal   Amount*			Value
U.S. Government and Agency Securities 3.2%
U.S. Treasury Bond, 7.875%, 2/15/21		United States		728,000		$	762,907
U.S. Treasury Note,
1.50%, 11/30/21		United States		3,000,000			3,056,777
t Index Linked, 0.125%, 7/15/24		United States		3,872,739			4,050,199
t Index Linked, 0.375%, 7/15/25		United States		4,541,869			4,857,423
Total U.S. Government and Agency Securities (Cost $12,130,746)							12,727,306
Asset-Backed Securities and Commercial Mortgage-Backed Securities 20.6%
Banks 0.2%
uCommercial Mortgage Trust, 2006-GG7, AJ, FRN, 5.807%, 7/10/38		United States		392,168			323,538
uCWABS Asset-Backed Certificates Trust, 2005-11, AF4, FRN, 5.21%, 3/25/34		United States		384,392			387,442
vMerrill Lynch Mortgage Investors Trust, 2005-A6, 2A3, FRN, 0.565%, (1-month USD LIBOR + 0.38%), 8/25/35		United States		35,563			35,479
							746,459
Diversified Financials 20.4%
e,v AMMC CLO XI Ltd., 2012-11A, BR2, 144A, FRN, 2.36%, (3-month USD LIBOR + 1.60%), 4/30/31		United States		350,000			332,473
e,vAntares CLO Ltd., 2018-1A, B, 144A, FRN, 2.785%, (3-month USD LIBOR + 1.65%), 4/20/31		United States		1,455,000			1,414,803
e,uARES L CLO Ltd., 2018-50A, B, 144A, FRN, 2.919%, 1/15/32		United States		500,000			486,026
e,uARES LII CLO Ltd., 2019-52A, A2, 144A, FRN, 2.748%, 4/22/31		United States		250,000			245,236
e,uBCC Middle Market CLO LLC, 2018-1A, A2, 144A, FRN, 3.285%, 10/20/30		United States		700,000			649,617
e,uBlueMountain CLO Ltd.,
2012-2A, BR2, 144A, FRN, 1.827%, 11/20/28		United States		510,000			487,367
2012-2A, CR2, 144A, FRN, 2.377%, 11/20/28		United States		270,000			253,574
2018-1A, D, 144A, FRN, 3.81%, 7/30/30		United States		1,000,000			873,371
e,uBluemountain Fuji Eur CLO V DAC, 5A, A, 144A, FRN, 0.91%, 1/15/33		Ireland		1,900,000	EUR		2,073,866
e,uBlueMountain Fuji Eur CLO V DAC, 5A, B, 144A, FRN, 1.55%, 1/15/33		Ireland		600,000	EUR		647,373
eBRAVO Residential Funding Trust,
2019-1, A1C, 144A, 3.50%, 3/25/58		United States		782,519			808,620
u2019-2, A3, 144A, FRN, 3.50%, 10/25/44		United States		922,424			969,776
e,uBurnham Park CLO Ltd., 2016-1A, BR, 144A, FRN, 2.635%, 10/20/29		United States		460,000			443,782
e,uButtermilk Park CLO Ltd., 2018-1A, C, 144A, FRN, 3.319%, 10/15/31.		United States		1,408,860			1,348,736
e,vCarlyle Global Market Strategies CLO Ltd., 2014-4RA, C, 144A, FRN, 4.119%, (3-month USD LIBOR + 2.90%), 7/15/30		United States		300,000			257,322
e,uCarlyle GMS Finance MM CLO LLC, 2015-1A, A2R, 144A, FRN, 3.419%, 10/15/31		United States		1,213,000			1,116,654
e,vCatamaran CLO Ltd., 2014-2A, BR, 144A, FRN, 4.085%, (3-month USD LIBOR + 2.95%), 10/18/26		United States		1,253,000			1,248,059
e,uCIM Trust,
2019-INV1, A1, 144A, FRN, 3.845%, 2/25/49		United States		930,220			961,163
2019-INV2, A3, 144A, FRN, 4.00%, 5/25/49		United States		1,336,203			1,381,531

Semiannual Report         FSI-23

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal   Amount*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financials (continued)
uCitibank Credit Card Issuance Trust, 2017-A7, A7, FRN, 0.545%, 8/08/24		United States		1,494,000	$	1,500,793
e,uCole Park CLO Ltd., 2015-1A, BR, 144A, FRN, 2.735%, 10/20/28		United States		270,000		263,073
e,uConsumer Loan Underlying Bond CLUB Certificate Issuer Trust I,
2019-51, PT, 144A, FRN, 13.176%, 1/15/45		United States		889,554		741,353
2019-52, PT, 144A, FRN, 13.61%, 1/15/45		United States		930,846		785,772
2019-S8, PT, 144A, FRN, 7.955%, 1/15/45		United States		666,198		553,860
2020-2, PT, 144A, FRN, 13.87%, 3/15/45		United States		907,272		773,108
2020-7, PT, 144A, FRN, 14.48%, 4/17/45		United States		547,371		472,981
e,uDryden 38 Senior Loan Fund, 2015-38A, CR, 144A, FRN, 3.219%, 7/15/30		United States		863,000		818,102
e,vDryden 55 CLO Ltd., 2018-55A, D, 144A, FRN, 4.069%, (3-month USD LIBOR + 2.85%), 4/15/31		United States		300,000		265,058
e,uEaton Vance CLO Ltd., 2014-1RA, C, 144A, FRN, 3.319%, 7/15/30		United States		315,610		302,459
FHLMC Structured Agency Credit Risk Debt Notes,
v2013-DN2, M2, FRN, 4.435%, (1-month USD LIBOR + 4.25%), 11/25/23		United States		1,581,221		1,284,192
v2014-DN1, M2, FRN, 2.385%, (1-month USD LIBOR + 2.20%), 2/25/24		United States		380,272		381,574
v2014-DN2, M3, FRN, 3.785%, (1-month USD LIBOR + 3.60%), 4/25/24		United States		2,290,000		2,039,950
v2014-DN3, M3, FRN, 4.185%, (1-month USD LIBOR + 4.00%), 8/25/24		United States		136,225		139,350
v2014-DN4, M3, FRN, 4.735%, (1-month USD LIBOR + 4.55%), 10/25/24		United States		999,309		1,027,105
v2014-HQ1, M3, FRN, 4.285%, (1-month USD LIBOR + 4.10%), 8/25/24		United States		233,594		237,586
v2014-HQ2, M2, FRN, 2.385%, (1-month USD LIBOR + 2.20%), 9/25/24		United States		293,488		296,393
v2014-HQ3, M3, FRN, 4.935%, (1-month USD LIBOR + 4.75%), 10/25/24		United States		456,423		471,002
v2015-DNA1, M3, FRN, 3.485%, (1-month USD LIBOR + 3.30%), 10/25/27		United States		250,000		255,949
v2015-DNA3, M3, FRN, 4.885%, (1-month USD LIBOR + 4.70%), 4/25/28		United States		1,819,000		1,909,844
v2015-HQ1, M3, FRN, 3.985%, (1-month USD LIBOR + 3.80%), 3/25/25		United States		399,927		407,200
v2015-HQA1, M3, FRN, 4.885%, (1-month USD LIBOR + 4.70%), 3/25/28		United States		1,492,671		1,555,122
v2016-DNA2, M3, FRN, 4.835%, (1-month USD LIBOR + 4.65%), 10/25/28		United States		1,266,774		1,330,054
u2017-DNA1, M2, FRN, 3.435%, 7/25/29		United States		990,000		1,007,733
u2017-DNA2, M2, FRN, 3.635%, 10/25/29		United States		1,340,000		1,371,652
v2017-DNA3, M2, FRN, 2.685%, (1-month USD LIBOR + 2.50%), 3/25/30		United States		2,920,000		2,961,351
u2017-HQA1, M2, FRN, 3.735%, 8/25/29		United States		1,022,463		1,048,093
u2017-HQA2, M2, FRN, 2.835%, 12/25/29		United States		245,443		245,285

FSI-24         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization	Principal         Amount	*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financials (continued)
FNMA Connecticut Avenue Securities,
v2013-C01, M2, FRN, 5.435%, (1-month USD LIBOR + 5.25%), 10/25/23	United States	272,267		$	249,438
v2014-C01, M2, FRN, 4.585%, (1-month USD LIBOR + 4.40%), 1/25/24	United States	429,521			384,216
v2014-C02, 1M2, FRN, 2.785%, (1-month USD LIBOR + 2.60%), 5/25/24	United States	1,186,370			1,047,868
v2014-C02, 2M2, FRN, 2.785%, (1-month USD LIBOR + 2.60%), 5/25/24	United States	570,859			508,500
v2014-C03, 1M2, FRN, 3.185%, (1-month USD LIBOR + 3.00%), 7/25/24	United States	2,375,501			2,101,246
v2014-C03, 2M2, FRN, 3.085%, (1-month USD LIBOR + 2.90%), 7/25/24	United States	110,707			102,451
v2015-C01, 1M2, FRN, 4.485%, (1-month USD LIBOR + 4.30%), 2/25/25	United States	710,113			721,856
v2015-C01, 2M2, FRN, 4.735%, (1-month USD LIBOR + 4.55%), 2/25/25	United States	498,720			501,998
v2015-C02, 1M2, FRN, 4.185%, (1-month USD LIBOR + 4.00%), 5/25/25	United States	1,579,840			1,608,524
v2015-C02, 2M2, FRN, 4.185%, (1-month USD LIBOR + 4.00%), 5/25/25	United States	626,895			637,418
v2015-C03, 1M2, FRN, 5.185%, (1-month USD LIBOR + 5.00%), 7/25/25	United States	2,328,457			2,396,308
v2015-C03, 2M2, FRN, 5.185%, (1-month USD LIBOR + 5.00%), 7/25/25	United States	930,116			957,071
u2016-C02, 1M2, FRN, 6.185%, 9/25/28	United States	611,895			639,286
u2016-C04, 1M2, FRN, 4.435%, 1/25/29	United States	1,310,808			1,367,990
u2016-C05, 2M2, FRN, 4.635%, 1/25/29	United States	1,180,230			1,215,686
u2016-C06, 1M2, FRN, 4.435%, 4/25/29	United States	408,374			430,236
u2016-C07, 2M2, FRN, 4.535%, 5/25/29	United States	776,023			809,565
v2017-C01, 1M2, FRN, 3.735%, (1-month USD LIBOR + 3.55%), 7/25/29	United States	1,630,277			1,671,600
u2017-C03, 1M2, FRN, 3.185%, 10/25/29	United States	2,720,000			2,761,566
u2017-C03, 2M2, FRN, 3.035%, 11/25/29	United States	602,760			597,786
u2017-C05, 1M2, FRN, 2.385%, 1/25/30	United States	1,871,060			1,848,479
e,vGalaxy XVIII CLO Ltd., 2018-28A, C, 144A, FRN, 3.169%, (3-month USD LIBOR + 1.95%), 7/15/31	United States	250,000			233,532
e,vGalaxy XXVII CLO Ltd., 2018-27A, C, 144A, FRN, 2.186%, (3-month USD LIBOR + 1.80%), 5/16/31	United States	400,000			382,912
e,vLCM 26 Ltd., 26A, B, 144A, FRN, 2.535%, (3-month USD LIBOR + 1.40%), 1/20/31	United States	250,000			232,229
e,uLCM XVI LP, 2016A, BR2, 144A, FRN, 2.969%, 10/15/31	United States	351,320			331,219
e,uLCM XVII LP,
2017A, BRR, 144A, FRN, 2.819%, 10/15/31	United States	350,000			326,133
2017A, CRR, 144A, FRN, 3.319%, 10/15/31	United States	320,000			302,355

Semiannual Report         FSI-25

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization	Principal         Amount	*			Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financials (continued)
e,vLCM XVIII LP, 2018A, DR, 144A, FRN, 3.935%, (3-month USD LIBOR + 2.80%), 4/20/31	United States	770,000			$	643,538
e,uMadison Park Euro Funding VIII DAC, 8A, BRN, 144A, FRN, 1.70%, 4/15/32	Ireland	400,000		EUR		434,465
e,uMadison Park Euro Funding XIV DAC, 2014A, A1N, 144A, FRN, 1.12%, 7/15/32	Ireland	1,000,000		EUR		1,112,975
e,vMadison Park Funding XXIII Ltd., 2017-23A, B, 144A, FRN, 2.691%, (3-month USD LIBOR + 1.70%), 7/27/30	United States	400,000				391,551
e,uMill City Mortgage Loan Trust, 2018-4, A1B, 144A, FRN, 3.50%, 4/25/66	United States	1,423,832				1,515,161
vMortgageIT Trust, 2004-1, A2, FRN, 1.085%, (1-month USD LIBOR + 0.90%), 11/25/34	United States	102,475				101,309
e,uMountain View Funding CLO XIV Ltd., 2019-1A, C, 144A, FRN, 4.119%, 4/15/29	United States	500,000				494,009
e,vNZCG Funding Ltd., 2015-1A, A2R, 144A, FRN, 1.91%, (3-month USD LIBOR + 1.55%), 2/26/31	United States	2,182,000				2,086,762
e,uOctagon Investment Partners 28 Ltd., 2016-1A, BR, 144A, FRN, 2.82%, 10/24/30	United States	250,000				243,658
e,vOctagon Investment Partners 36 Ltd., 2018-1A, A1, 144A, FRN, 2.189%, (3-month USD LIBOR + 0.97%), 4/15/31	United States	500,000				487,213
e,vOctagon Investment Partners 37 Ltd., 2018-2A, C, 144A, FRN, 3.841%, (3-month USD LIBOR + 2.85%), 7/25/30	United States	400,000				352,427
e,uOctagon Investment Partners 38 Ltd., 2018-1A, C, 144A, FRN, 4.085%, 7/20/30	United States	1,000,000				886,795
e,vOctagon Investment Partners XVI Ltd., 2013-1A, DR, 144A, FRN, 4.135%, (3-month USD LIBOR + 3.00%), 7/17/30	United States	400,000				356,262
e,vOctagon Investment Partners XXIII Ltd., 2015-1A, BR, 144A, FRN, 2.419%, (3-month USD LIBOR + 1.20%), 7/15/27	United States	400,000				383,985
vOpteum Mortgage Acceptance Corp. Trust, 2005-4, 1APT, FRN, 0.495%, (1-month USD LIBOR + 0.31%), 11/25/35	United States	106,516				106,144
e,uProsper Pass-Thru Trust III,
2020-PT1, A, 144A, FRN, 8.796%, 3/15/26	United States	594,499				583,696
2020-PT2, A, 144A, FRN, 9.444%, 4/15/26	United States	631,131				625,756
2020-PT3, A, 144A, FRN, 7.183%, 5/15/26	United States	173,509				179,787
e,uProvident Funding Mortgage Trust,
2019-1, A2, 144A, FRN, 3.00%, 12/25/49	United States	859,166				912,455
2020-1, A3, 144A, FRN, 3.00%, 2/25/50	United States	921,757				943,262
e,uStrata CLO I Ltd., 2018-1A, B, 144A, FRN, 3.419%, 1/15/31	United States	1,300,000				1,114,423
vStructured Asset Securities Corp., 2005-2XS, 2A2, FRN, 1.673%, (1-month USD LIBOR + 1.50%), 2/25/35	United States	116,548				114,619
uThornburg Mortgage Securities Trust, 2005-1, A3, FRN, 3.647%, 4/25/45	United States	80,436				76,613
e,uUpgrade Master Pass-Thru Trust, 2019-PT2, A, 144A, FRN, 7.727%, 2/15/26	United States	513,336				490,176

FSI-26         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization	Principal           Amount	*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financials (continued)
eVoya CLO Ltd.,
v2013-2A, BR, 144A, FRN, 2.841%, (3-month USD LIBOR + 1.85%), 4/25/31	United States	780,000		$	723,794
v2014-1A, CR2, 144A, FRN, 3.935%, (3-month USD LIBOR + 2.80%), 4/18/31	United States	1,000,000			878,162
u2015-2A, BR, 144A, FRN, 2.543%, 7/23/27	United States	820,000			797,981
					81,849,789
Total Asset-Backed Securities and Commercial Mortgage-Backed Securities (Cost $88,322,543)					82,596,248
Mortgage-Backed Securities 7.7%
wFederal Home Loan Mortgage Corp. (FHLMC) Adjustable Rate 0.0%†
FHLMC, 3.848%, (US 1 Year CMT T-Note +/- MBS Margin), 1/01/33	United States	5,359			5,383
Federal Home Loan Mortgage Corp. (FHLMC) Fixed Rate 0.1%
FHLMC Gold 30 Year, 5.00%, 4/01/34 - 8/01/35	United States	181,865			208,161
FHLMC Gold 30 Year, 5.50%, 3/01/33 - 1/01/35	United States	109,112			122,682
FHLMC Gold 30 Year, 6.00%, 4/01/33 - 2/01/36	United States	80,364			91,728
FHLMC Gold 30 Year, 6.50%, 11/01/27 - 7/01/32	United States	14,542			16,254
FHLMC Gold 30 Year, 7.00%, 9/01/21 - 4/01/30	United States	3,804			4,081
FHLMC Gold 30 Year, 7.50%, 8/01/30	United States	161			193
					443,099
wFederal National Mortgage Association (FNMA) Adjustable Rate 0.0%†
FNMA, 4.042%, (US 1 Year CMT T-Note +/- MBS Margin), 12/01/34	United States	58,079			59,738
Federal National Mortgage Association (FNMA) Fixed Rate 7.5%
FNMA 15 Year, 2.50%, 7/01/22	United States	4,967			5,206
xFNMA 30 Year, 2.50%, 7/01/50	United States	4,000,000			4,168,594
FNMA 30 Year, 3.00%, 9/01/48	United States	2,940,583			3,112,446
FNMA 30 Year, 3.00%, 11/01/48	United States	1,099,909			1,165,078
xFNMA 30 Year, 3.00%, 6/01/50	United States	16,019,000			16,867,506
FNMA 30 Year, 4.50%, 5/01/48	United States	4,123,196			4,514,182
FNMA 30 Year, 5.00%, 4/01/30	United States	36,269			40,694
FNMA 30 Year, 6.50%, 6/01/28 - 10/01/37	United States	99,561			114,968
					29,988,674
Government National Mortgage Association (GNMA) Fixed Rate 0.1%
GNMA I SF 30 Year, 5.00%, 11/15/33 - 7/15/34	United States	158,805			181,588
GNMA I SF 30 Year, 7.00%, 10/15/28 - 6/15/32	United States	12,825			12,958
GNMA I SF 30 Year, 7.50%, 9/15/30	United States	1,089			1,292
GNMA II SF 30 Year, 5.00%, 9/20/33 - 11/20/33	United States	41,826			47,383
GNMA II SF 30 Year, 6.00%, 11/20/34	United States	58,354			67,756
GNMA II SF 30 Year, 6.50%, 4/20/31 - 2/20/34	United States	28,377			33,190

Semiannual Report         FSI-27

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization	Principal             Amount	*		Value
Mortgage-Backed Securities (continued)
Government National Mortgage Association (GNMA) Fixed Rate (continued)
GNMA II SF 30 Year, 7.50%, 1/20/28 - 4/20/32	United States	7,934		$	9,244
					353,411
Total Mortgage-Backed Securities (Cost $30,173,094)					30,850,305
Municipal Bonds 3.0%
Broward County Airport System Revenue, Refunding, Series C, 3.477%, 10/01/43	United States	310,000			310,175
California Health Facilities Financing Authority Revenue,
Senior, No Place Like Home Program, 2.934%, 6/01/32	United States	295,000			306,411
Senior, No Place Like Home Program, 2.984%, 6/01/33	United States	250,000			259,360
Senior, No Place Like Home Program, 3.034%, 6/01/34	United States	190,000			196,853
City of Austin Electric Utility System Revenue, Travis and Williamson Counties, Refunding, 6.262%, 11/15/32	United States	580,000			753,327
Foothill/Eastern Transportation Corridor Agency Toll Road Revenue, Refunding, Series A, 4.094%, 1/15/49	United States	150,000			154,263
Gilroy USD, GO, Santa Clara County, Refunding, 3.364%, 8/01/47	United States	630,000			647,457
Greenville City School District GO, County of Darke, School Improvement, Refunding, 3.541%, 1/01/51	United States	715,000			721,864
Honolulu City and County Wastewater System Revenue, Second Bond Resolution, Refunding, Junior Series B, 2.585%, 7/01/28	United States	115,000			122,176
Massachusetts State School Building Authority Dedicated Sales Tax Revenue, Subordinated, Refunding, Series B, 3.395%, 10/15/40	United States	285,000			291,147
Metro Wastewater Reclamation District Sewer Revenue, Refunding, Series B, 3.158%, 4/01/41	United States	475,000			498,550
Metropolitan St. Louis Sewer District Wastewater System Revenue, Refunding, Series C, 3.259%, 5/01/45	United States	1,375,000			1,416,910
New Jersey State Transportation Trust Fund Authority Revenue, Transportation System, Series B, 4.131%, 6/15/42	United States	345,000			322,199
New York State Dormitory Authority Revenues, Non State Supported Debt, State University of New York Dormitory Facilities, Series B, 3.142%, 7/01/43	United States	305,000			315,175
Ohio State Hospital Facility Revenue, Cleveland Clinic Health System Obligated Group, Refunding, Series G, 3.276%, 1/01/42	United States	190,000			201,001
Oregon State Department of Transportation Highway User Tax Revenue, senior lien, Refunding, Series B, 3.168%, 11/15/38	United States	380,000			410,632
Orlando Health Obligated Group, 3.777%, 10/01/28	United States	330,000			371,209
Pennsylvania State Turnpike Commission Turnpike Revenue, Motor License Fund-Enhanced, Subordinate, Refunding, First Series, 3.579%, 12/01/43	United States	955,000			1,002,951
Salt Lake City Sales and Excise Tax Revenue, Refunding, Series B, 3.102%, 4/01/38	United States	270,000			274,844
San Bernardino Community College District GO, San Bernadino and Riverside Counties, Election of 2018, Series A-1, 3.271%, 8/01/39	United States	210,000			228,890
San Diego County Regional Transportation Commission Sales Tax Revenue, Limited Tax, Refunding, Series A, 3.248%, 4/01/48	United States	230,000			245,297
San Francisco City and County Public Utilities Commission Water Revenue, Green Bonds, Refunding, Sub-Series A, 3.473%, 11/01/43	United States	230,000			246,503

FSI-28         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

	Country/ Organization		Principal         Amount	*		Value
Municipal Bonds (continued)
San Jose RDA Successor Agency Tax Allocation, Senior, Refunding, Series A-T, 3.25%, 8/01/29	United States		440,000		$	486,182
Texas State GO, Transportation Commission, Highway Improvement, Refunding, 3.211%, 4/01/44	United States		575,000			610,098
Texas State University System Financing Revenue,
Refunding, Series B, 2.938%, 3/15/33	United States		225,000			232,646
Refunding, Serise B, 3.289%, 3/15/40	United States		190,000			195,624
University of Pittsburgh of the Commonwealth System of Higher Education Revenue, Refunding, Series C, 3.005%, 9/15/41	United States		535,000			573,541
Utah Transit Authority Sales Tax Revenue, Refunding, Series B, 3.443%, 12/15/42	United States		380,000			394,459
Total Municipal Bonds (Cost $11,262,373)						11,789,744
		Shares/ Units
Escrows and Litigation Trusts 0.0%†
oMesquite Energy Inc., Escrow Account	United States		243,000			1,215
a,aaMillennium Corporate Claim Trust, Escrow Account	United States		950,432			—
a,aaMillennium Lender Claim Trust, Escrow Account	United States		950,432			—
a,aa,bRemington Outdoor Co. Inc., Litigation Units	United States		7,021			—
aVistra Energy Corp., Escrow Account	United States		3,000,000			6,000
Total Escrows and Litigation Trusts (Cost $325,648)						7,215
Total Investments before Short Term Investments (Cost $412,216,181)						394,266,736
			Principal Amount	*
Short Term Investments 3.7%
k,lSenior Floating Rate Interests (Cost $53,393) 0.0%†    Retailing 0.0%†
yGeneral Nutrition Centers Inc., 14.00%, (3-month USD LIBOR + 13.00%), 12/30/20	United States		59,184			60,072
Total Investments before Money Market Funds (Cost $412,269,574)						394,326,808
		Shares
Money Market Funds (Cost $14,480,530) 3.7%
d,zInstitutional Fiduciary Trust Money Market Portfolio, 0.00%	United States		14,480,530			14,480,530
Total Investments (Cost $426,750,104) 102.2%						408,807,338
Other Assets, less Liabilities (2.2)%						(8,656,727	)
Net Assets 100.0%					$	400,150,611

Semiannual Report         FSI-29

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

^†Rounds to less than 0.1% of net assets.

*The principal amount is stated in U.S. dollars unless otherwise indicated.

^aNon-income producing.

^aaFair valued using significant unobservable inputs. See Note 13 regarding fair value measurements.

^bSee Note 9 regarding restricted securities.

^cThe security is owned by FT Holdings Corporation III, a wholly-owned subsidiary of the Fund. See Note 1(f).

^dSee Note 3(e) regarding investments in affiliated management investment companies.

^eSecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in a public offering registered under the Securities Act of 1933. At June 30, 2020, the aggregate value of these securities was $140,960,840, representing 35.2% of net assets.

^fIncome may be received in additional securities and/or cash.

^gSecurity was purchased pursuant to Regulation S under the Securities Act of 1933, which exempts from registration securities offered and sold outside of the United States. Such a security cannot be sold in the United States without either an effective registration statement filed pursuant to the Securities Act of 1933, or pursuant to an exemption from registration. At June 30, 2020, the aggregate value of these securities was $11,485,514, representing 2.9% of net assets.

^hPerpetual security with no stated maturity date.

ⁱSecurity purchased on a when-issued basis. See Note 1(c).

^jSee Note 1(e) regarding loan participation notes.

^kThe coupon rate shown represents the rate at period end.

^lSee Note 1(h) regarding senior floating rate interests.

^mSecurity purchased on a delayed delivery basis. See Note 1(c).

ⁿA portion or all of the security represents an unsettled loan commitment. The coupon rate is to-be determined (TBD) at the time of settlement and will be based upon a reference index/floor plus a spread.

^oSee Note 7 regarding defaulted securities.

^pSee Note 1(i) regarding Marketplace lending.

^qA supranational organization is an entity formed by two or more central governments through international treaties.

^rPrincipal amount is stated in 100 Mexican Peso Units.

^sThe principal represents the notional amount. See Note 1(d) regarding value recovery instruments.

^tPrincipal amount of security is adjusted for inflation. See Note 1(k).

^uAdjustable rate security with an interest rate that is not based on a published reference index and spread. The rate is based on the structure of the agreement and current market conditions. The coupon rate shown represents the rate at period end.

^vThe coupon rate shown represents the rate inclusive of any caps or floors, if applicable, in effect at period end.

^wAdjustable Rate Mortgage-Backed Security (ARM); the rate shown is the effective rate at period end. ARM rates are not based on a published reference rate and spread, but instead pass-through weighted average interest income inclusive of any caps or floors, if applicable, from the underlying mortgage loans in which the majority of mortgages pay interest based on the index shown at their designated reset dates plus a spread, less the applicable servicing and guaranty fee (MBS margin).

^xSecurity purchased on a to-be-announced (TBA) basis. See Note 1(c).

^ySee Note 10 regarding unfunded loan commitments.

^zThe rate shown is the annualized seven-day effective yield at period end.

FSI-30         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

At June 30, 2020, the Fund had the following futures contracts outstanding. See Note 1(d).

Futures Contracts

Description	Type	Number of Contracts	Notional Amount	*	Expiration Date	Value/ Unrealized Appreciation (Depreciation)
Interest Rate Contracts
Australian 3 Yr. Bond	Long	114	$  9,207,922		9/15/20	$    2,440
Australian 10 Yr. Bond	Long	66	6,775,822		9/15/20	69,527
Canada 10 Yr. Bond	Long	54	6,118,581		9/21/20	15,531
Euro-OAT	Long	86	16,197,069		9/08/20	267,467
U.S. Treasury 5 Yr. Note	Long	100	12,574,219		9/30/20	26,435
U.S. Treasury 10 Yr. Note	Long	165	22,963,359		9/21/20	92,352
Total Futures Contracts						$473,752

*As of period end.

At June 30, 2020, the Fund had the following forward exchange contracts outstanding. See Note 1(d).

Forward Exchange Contracts

Currency	Counterpartya		Type		Quantity		Contract Amount		Settlement Date		Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts
Turkish Lira		JPHQ		Buy		5,800,000	$	841,861		7/14/20	$	1,261	$	—
Canadian Dollar		JPHQ		Sell		3,500,000		2,506,113		7/15/20		—		(72,224	)
Japanese Yen		CITI		Buy		558,485,200		5,200,000		7/16/20		—		(26,547	)
Euro		JPHQ		Buy		2,381,059		2,585,580		7/23/20		90,816		—
Euro		JPHQ		Buy		3,207,561		3,634,809		7/23/20		—		(29,395	)
Euro		JPHQ		Sell		5,588,621		6,217,843		7/23/20		—		(63,967	)
Norwegian Krone		JPHQ		Buy		26,200,000		2,896,972		7/23/20		—		(174,025	)
Norwegian Krone		JPHQ		Sell		26,200,000		2,570,644		7/23/20		—		(152,304	)
Australian Dollar		JPHQ		Sell		8,610,000		5,408,205		7/27/20		—		(534,431	)
Mexican Peso		JPHQ		Sell		400,000		16,136		7/27/20		—		(1,206	)
Canadian Dollar		JPHQ		Sell		2,100,000		1,479,618		7/28/20		—		(67,469	)
Euro		JPHQ		Buy		2,500,000		2,833,830		8/05/20		—		(22,894	)
Euro		JPHQ		Sell		2,500,000		2,814,875		8/05/20		3,939		—
Australian Dollar		JPHQ		Sell		2,900,000		1,752,354		8/06/20		—		(249,327	)
Australian Dollar		JPHQ		Sell		1,350,000		871,844		8/10/20		—		(59,982	)
Japanese Yen		JPHQ		Buy		1,043,000,000		9,977,375		8/13/20		—		(312,217	)
Japanese Yen		JPHQ		Sell		90,000,000		842,849		8/13/20		8,847		—
Singapore Dollar		JPHQ		Sell		11,700,000		8,390,254		8/13/20		—		(6,414	)
South African Rand		JPHQ		Buy		19,600,000		1,057,288		8/17/20		65,817		—
Chinese Yuan Renminbi		JPHQ		Buy		18,050,000		2,586,219		8/21/20		—		(40,634	)
Chinese Yuan Renminbi		JPHQ		Sell		18,050,000		2,563,702		8/21/20		18,116		—
Japanese Yen		JPHQ		Buy		430,000,000		4,113,632		9/14/20		—		(127,071	)
Canadian Dollar		JPHQ		Sell		300,000		216,638		9/15/20		—		(4,391	)
Euro		DBAB		Buy		650,000		737,022		9/15/20		—		(5,511	)
Euro		DBAB		Sell		650,000		731,341		9/15/20		—		(170	)
Euro		JPHQ		Buy		650,000		737,467		9/15/20		—		(5,957	)

Semiannual Report         FSI-31

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

Forward Exchange Contracts (continued)

Currency	Counterpartya		Type		Quantity		Contract Amount		Settlement Date		Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts (continued)
Euro		JPHQ		Sell		12,100,082		$13,611,383		9/15/20		$            —		$          (6,060	)
Norwegian Krone		JPHQ		Buy		39,200,000		3,881,265		9/15/20		193,540		—
Norwegian Krone		JPHQ		Sell		39,200,000		3,843,137		9/15/20		—		(231,668	)
Indonesian Rupiah		JPHQ		Sell		7,200,000,000		468,658		11/30/20		—		(12,985	)
Total Forward Exchange Contracts												$  382,336		$  (2,206,849	)
Net unrealized appreciation (depreciation)														$  (1,824,513	)

^aMay be comprised of multiple contracts with the same counterparty, currency and settlement date.

At June 30, 2020, the Fund had the following credit default swap contracts outstanding. See Note 1(d).

Credit Default Swap Contracts

Description	Annual Payment Rate Received (Paid)	Payment Frequency	Counter- party	Maturity Date	Notional Amount	a	Value		Unamortized Upfront Payments (Receipts)		Unrealized Appreciation (Depreciation)		Rating	b
Centrally Cleared Swap Contracts
Contracts to Sell Protectionc,d
Traded Index
CDX.EM.31	1.00%	Quarterly		6/20/24	$4,230,000		$  (122,442	)	$    (88,005	)	$    (34,437	)	Investment Grade
CDX.EM.32	1.00%	Quarterly		12/20/24	3,766,500		(134,407	)	(138,744	)	4,337		Non- Investment Grade
CDX.NA.IG.33	1.00%	Quarterly		12/20/24	4,400,000		53,914		61,415		(7,501	)	Investment Grade
Total Centrally Cleared Swap Contracts							$  (202,935	)	$  (165,334	)	$    (37,601	)
OTC Swap Contracts
Contracts to Buy Protectionc
Single Name
Ally Financial Inc.	(5.00)%	Quarterly	JPHQ	12/20/24	$1,810,000		$  (290,273	)	$  (302,696	)	$    12,423
Government of Italy	(1.00)%	Quarterly	BZWS	6/20/23	1,500,000		(346	)	9,709		(10,055	)
Contracts to Sell Protectionc,d
Single Name
Government of Italy	1.00%	Quarterly	BZWS	6/20/23	1,500,000		(15,705	)	(42,576	)	26,871		BBB
Traded Index
eBNP Paribas Bespoke Rodez2 Index, Mezzanine Tranche 5-7%	3.20%	Quarterly	BNDP	12/20/20	300,000		(25,680	)	—		(25,680	)	Investment Grade
eCitibank Bespoke Palma Index, Mezzanine Tranche 5-7%	2.30%	Quarterly	CITI	6/20/21	620,000		(63,234	)	—		(63,234	)	Non- Investment Grade

FSI-32         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

Credit Default Swap Contracts (continued)

Description	Annual Payment Rate Received (Paid)	Payment Frequency	Counter- party	Maturity Date	Notional Amount	a	Value		Unamortized Upfront Payments (Receipts)		Unrealized Appreciation (Depreciation)		Rating	b
OTC Swap Contracts (continued)
Contracts to Sell Protectionc,d (continued)
Traded Index (continued)
MCDX.NA.31	1.00%	Quarterly	CITI	12/20/23	$2,270,000		$    (10,271	)	$    15,965		$  (26,236	)	Investment Grade
eMorgan Stanley Bespoke Pecan Index, Mezzanine Tranche 5-10%	3.98%	Quarterly	MSCO	12/20/21	850,000		(353,802	)	—		(353,802	)	Non- Investment Grade
eMorgan Stanley Bespoke Pecan Index, Mezzanine Tranche 5-10%	4.10%	Quarterly	MSCO	12/20/21	850,000		(296,266	)	—		(296,266	)	Non- Investment Grade
Total OTC Swap Contracts							$(1,055,577	)	$  (319,598	)	$(735,979	)
Total Credit Default Swap Contracts							$(1,258,512	)	$  (484,932	)	$(773,580	)

^aFor contracts to sell protection, the notional amount is equal to the maximum potential amount of the future payments and no recourse provisions have been entered into in association with the contracts.

^bBased on Standard and Poor’s (S&P) Rating for single name swaps and internal ratings for index swaps. Internal ratings based on mapping into equivalent ratings from external vendors.

^cPerformance triggers for settlement of contract include default, bankruptcy or restructuring for single name swaps. and failure to pay or bankruptcy of the underlying securities for traded index swaps.

^dThe fund enters contracts to sell protection to create a long credit position.

^eRepresents a custom index comprised of a basket of underlying instruments.

At June 30, 2020, the Fund had the following cross-currency swap contracts outstanding. See Note 1(d).

Cross-Currency Swap Contracts

Description	Payment Frequency		Coun- terparty		Maturity Date		Notional Amount			Value/ Unrealized Appreciation   (Depreciation)
OTC Swap Contracts
Receive Floating 3-month USD LIBOR + 2.87%		Quarterly						464,800	USD
Pay Fixed 2.50%		Annual		CITI		5/04/21		400,000	EUR		$15,980
Receive Floating 3-month USD LIBOR + 1.334%		Quarterly						1,120,000	USD
Pay Floating 3-month EUR LIBOR + 1.12%		Quarterly		CITI		7/10/21		1,000,000	EUR		1,555
Total Cross Currency Swap Contracts											$17,535

Semiannual Report         FSI-33

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

At June 30, 2020, the Fund had the following inflation index swap contracts outstanding. See Note 1(d).

Inflation Index Swap Contracts

Description	Payment Frequency		Maturity Date		Notional Amount		Value/ Unrealized Appreciaton (Depreciation)
Centrally Cleared Swap Contracts
Receive variable change in USA-CPI-U		At maturity
Pay Fixed 1.943%		At maturity		1/15/29		$13,600,000		$(746,230	)
Total Inflation Index Swap Contracts								$(746,230	)

At June 30, 2020, the Fund had the following total return swap contracts outstanding. See Note 1(d).

Total Return Swap Contracts

Underlying Instruments

Financing Rate

Payment Frequency

Counter- party

Maturity Date

Notional Value

Value/ Unrealized Appreciation (Depreciation)

OTC Swap Contracts

Longa

Markit iBoxx USD Liquid Leveraged Loan Index

3-month USD LIBOR

Quarterly

GSCO

9/20/20

$1,300,000

$(86,648

)

^aThe Fund receives the total return on the underlying instrument and pays a variable financing rate.

See Note 11 regarding other derivative information.

See Abbreviations on page FSI-56.

FSI-34         Semiannual Report  |  The accompanying notes are an integral part of these consolidated financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin Strategic Income VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$401,197,429
Cost - Non-controlled affiliates (Note 3e)		25,552,675
Value - Unaffiliated issuers		$386,259,168
Value - Non-controlled affiliates (Note 3e)		22,548,170
Cash		6,264,935
Receivables:
Investment securities sold		2,058,553
Capital shares sold		120,417
Dividends and interest		3,438,260
Deposits with brokers for:
OTC derivative contracts		2,720,000
Futures contracts		1,015,215
Centrally cleared swap contracts		2,373,536
Variation margin on centrally cleared swap contracts		68,529
OTC swap contracts (upfront payments $38,802)		25,674
Unrealized appreciation on OTC forward exchange contracts		382,336
Unrealized appreciation on OTC swap contracts		56,829
Unrealized appreciation on unfunded loan commitments (Note 10)		16,008
FT Subsidiary deferred tax benefit (Note 1f)		137,222
Other assets		612
Total assets		427,485,464
Liabilities:
Payables:
Investment securities purchased		23,349,880
Capital shares redeemed		106,918
Management fees		198,860
Distribution fees		32,917
Trustees’ fees and expenses		145
Variation margin on futures contracts		36,693
OTC swap contracts (upfront receipts $425,743)		345,272
Unrealized depreciation on OTC forward exchange contracts		2,206,849
Unrealized depreciation on OTC swap contracts		861,921
Deferred tax		23,178
Accrued expenses and other liabilities		172,220
Total liabilities		27,334,853
Net assets, at value		$400,150,611
Net assets consist of:
Paid-in capital		$462,616,382
Total distributable earnings (losses)		(62,465,771	)
Net assets, at value		$400,150,611

The accompanying notes are an integral part of these consolidated financial statements.  |  Semiannual Report         FSI-35

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statement of Assets and Liabilities (continued)

June 30, 2020 (unaudited)

	Franklin Strategic Income VIP Fund
Class 1:
Net assets, at value		$259,057,000
Shares outstanding		25,691,546
Net asset value and maximum offering price per share		$10.08
Class 2:
Net assets, at value		$  92,856,876
Shares outstanding		9,545,697
Net asset value and maximum offering price per share		$9.73
Class 4:
Net assets, at value		$  48,236,735
Shares outstanding		4,816,459
Net asset value and maximum offering price per share		$10.01

FSI-36         Semiannual Report  |  The accompanying notes are an integral part of these consolidated financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin Strategic Income VIP Fund
Investment income:
Dividends:
Non-controlled affiliates (Note 3e)		$        245,699
Interest:(net of foreign taxes)~
Unaffiliated issuers		7,918,259
Total investment income		8,163,958
Expenses:
Management fees (Note 3a)		1,272,884
Distribution fees: (Note 3c)
Class 2		114,671
Class 4		89,045
Custodian fees (Note 4)		5,724
Reports to shareholders		69,917
Professional fees		49,333
Trustees’ fees and expenses		1,329
Marketplace lending fees (Note 1i)		108
Other		46,905
Total expenses		1,649,916
Expense reductions (Note 4)		(7,559	)
Expenses waived/paid by affiliates (Note 3e)		(40,441	)
Net expenses		1,601,916
Net investment income		6,562,042
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		(4,084,766	)
Written options		(523,154	)
Foreign currency transactions		(41,166	)
Forward exchange contracts		(203,042	)
Futures contracts		(1,146,064	)
Swap contracts		(2,557,934	)
Net realized gain (loss)		(8,556,126	)
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(8,253,355	)
Non-controlled affiliates (Note 3e)		(1,197,278	)
Translation of other assets and liabilities denominated in foreign currencies		(19,965	)
Forward exchange contracts		(1,044,217	)
Futures contracts		637,011
Swap contracts		(1,676,219	)
Change in deferred taxes on unrealized appreciation		3,022
Net change in unrealized appreciation (depreciation)		(11,551,001	)
Net realized and unrealized gain (loss)		(20,107,127	)
Net increase (decrease) in net assets resulting from operations		$(13,545,085	)
~Foreign taxes withheld on interest		$        35,603

The accompanying notes are an integral part of these consolidated financial statements.  |  Semiannual Report         FSI-37

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statements of Changes in Net Assets

for the six months ended June 30, 2020 (unaudited)

	Franklin Strategic Income VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income		$    6,562,042			$  17,904,759
Net realized gain (loss)		(8,556,126	)		(907,193	)
Net change in unrealized appreciation (depreciation)		(11,551,001	)		18,715,962
Net increase (decrease) in net assets resulting from operations		(13,545,085	)		35,713,528
Distributions to shareholders:
Class 1		(13,266,506	)		(16,055,733	)
Class 2		(4,661,916	)		(4,608,498	)
Class 4		(2,304,505	)		(2,951,572	)
Total distributions to shareholders		(20,232,927	)		(23,615,803	)
Capital share transactions: (Note 2)
Class 1		(4,445,733	)		(25,284,669	)
Class 2		5,529,772			3,227,556
Class 4		(2,005,542	)		(7,826,645	)
Total capital share transactions		(921,503	)		(29,883,758	)
Net increase (decrease) in net assets		(34,699,515	)		(17,786,033	)
Net assets:
Beginning of period		434,850,126			452,636,159
End of period		$400,150,611			$434,850,126

FSI-38         Semiannual Report  |  The accompanying notes are an integral part of these consolidated financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Consolidated Financial Statements (unaudited)

Franklin Strategic Income VIP Fund

1.  Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin Strategic Income VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. At June 30, 2020, 77.3% of the Fund’s shares were held through one insurance company. Investment activities of these insurance company separate accounts could have a material impact on the Fund. The Fund offers three classes of shares: Class 1, Class 2 and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a.  Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities and derivative financial instruments listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is

determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Debt securities generally trade in the OTC market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value. Securities denominated in a foreign currency are converted into their U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the date that the values of the foreign debt securities are determined.

Investments in open-end mutual funds are valued at the closing NAV.

Certain derivative financial instruments are centrally cleared or trade in the OTC market. The Fund’s pricing services use various techniques including industry standard option pricing models and proprietary discounted cash flow models to determine the fair value of those instruments. The Fund’s net benefit or obligation under the derivative contract, as measured by the fair value of the contract, is included in net assets.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the

Semiannual Report         FSI-39

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

1.  Organization and Significant Accounting

Policies (continued)

a.  Financial Instrument Valuation (continued)

investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b.  Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally,

events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Consolidated Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c.  Securities Purchased on a When-Issued or Delayed Delivery and TBA Basis

The Fund purchases securities on a when-issued or delayed delivery and to-be-announced (TBA) basis, with payment and delivery scheduled for a future date. These transactions are subject to market fluctuations and are subject to the risk that the value at delivery may be more or less than the trade date purchase price. Although the Fund will generally purchase these securities with the intention of holding the securities, it may sell the securities before the settlement date. Sufficient assets have been segregated for these securities and collateral has been pledged and/or received for open TBA trades.

d.  Derivative Financial Instruments

The Fund invested in derivative financial instruments in order to manage risk or gain exposure to various other investments or markets. Derivatives are financial contracts based on an underlying or notional amount, require no initial investment or an initial net investment that is smaller than would normally be required to have a similar response to changes in market factors, and require or permit net settlement. Derivatives contain various risks including the potential inability of the counterparty to fulfill their obligations under the terms of the contract, the potential for an illiquid secondary market, and/or

FSI-40         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

the potential for market movements which expose the Fund to gains or losses in excess of the amounts shown in the Consolidated Statement of Assets and Liabilities. Realized gain and loss and unrealized appreciation and depreciation on these contracts for the period are included in the Consolidated Statement of Operations.

Derivative counterparty credit risk is managed through a formal evaluation of the creditworthiness of all potential counterparties. The Fund attempts to reduce its exposure to counterparty credit risk on OTC derivatives, whenever possible, by entering into International Swaps and Derivatives Association (ISDA) master agreements with certain counterparties. These agreements contain various provisions, including but not limited to collateral requirements, events of default, or early termination. Termination events applicable to the counterparty include certain deteriorations in the credit quality of the counterparty. Termination events applicable to the Fund include failure of the Fund to maintain certain net asset levels and/or limit the decline in net assets over various periods of time. In the event of default or early termination, the ISDA master agreement gives the non-defaulting party the right to net and close-out all transactions traded, whether or not arising under the ISDA agreement, to one net amount payable by one counterparty to the other. However, absent an event of default or early termination, OTC derivative assets and liabilities are presented gross and not offset in the Consolidated Statement of Assets and Liabilities. Early termination by the counterparty may result in an immediate payment by the Fund of any net liability owed to that counterparty under the ISDA agreement.

Collateral requirements differ by type of derivative. Collateral or initial margin requirements are set by the broker or exchange clearing house for exchange traded and centrally cleared derivatives. Initial margin deposited is held at the exchange and can be in the form of cash and/or securities. For OTC derivatives traded under an ISDA master agreement, posting of collateral is required by either the Fund or the applicable counterparty if the total net exposure of all OTC derivatives with the applicable counterparty exceeds the minimum transfer amount, which typically ranges from $100,000 to $250,000, and can vary depending on the counterparty and the type of the agreement. Generally, collateral is determined at the close of Fund business each day and any additional collateral required due to changes in derivative values may be delivered by the Fund or the counterparty the next business day, or within a few business days. Collateral pledged and/or received by the Fund for OTC

derivatives, if any, is held in segregated accounts with the Fund’s custodian/counterparty broker and can be in the form of cash and/or securities. Unrestricted cash may be invested according to the Fund’s investment objectives. To the extent that the amounts due to the Fund from its counterparties are not subject to collateralization or are not fully collateralized, the Fund bears the risk of loss from counterparty non-performance.

The Fund entered into exchange traded futures contracts primarily to manage and/or gain exposure to interest rate risk. A futures contract is an agreement between the Fund and a counterparty to buy or sell an asset at a specified price on a future date. Required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or receivable.

The Fund entered into OTC forward exchange contracts primarily to manage and/or gain exposure to certain foreign currencies. A forward exchange contract is an agreement between the Fund and a counterparty to buy or sell a foreign currency at a specific exchange rate on a future date.

The Fund entered into credit default swap contracts primarily to manage and/or gain exposure to credit risk. A credit default swap is an agreement between the Fund and a counterparty whereby the buyer of the contract receives credit protection and the seller of the contract guarantees the credit worthiness of a referenced debt obligation. These agreements may be privately negotiated in the over-the-counter market (OTC credit default swaps) or may be executed in a multilateral trade facility platform, such as a registered exchange (centrally cleared credit default swaps). The underlying referenced debt obligation may be a single issuer of corporate or sovereign debt, a credit index, a basket of issuers or indices, or a tranche of a credit index or basket of issuers or indices. In the event of a default of the underlying referenced debt obligation, the buyer is entitled to receive the notional amount of the credit default swap contract from the seller in exchange for the referenced debt obligation, a net settlement amount equal to the notional amount of the credit default swap less the recovery value of the referenced debt obligation, or other agreed upon amount. For centrally cleared credit default swaps, required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or receivable in the Consolidated Statement of Assets and Liabilities. Over the term of the contract, the buyer pays the seller a periodic stream of payments, provided that no event

Semiannual Report         FSI-41

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

1. Organization and Significant Accounting

Policies (continued)

d. Derivative Financial Instruments (continued)

of default has occurred. Such periodic payments are accrued daily as an unrealized appreciation or depreciation until the payments are made, at which time they are realized. Upfront payments and receipts are reflected in the Consolidated Statement of Assets and Liabilities and represent compensating factors between stated terms of the credit default swap agreement and prevailing market conditions (credit spreads and other relevant factors). These upfront payments and receipts are amortized over the term of the contract as a realized gain or loss in the Consolidated Statement of Operations.

The Fund entered into OTC cross currency swap contracts primarily to manage and/or gain exposure to certain foreign currencies. A cross currency swap is an agreement between the Fund and a counterparty to exchange cash flows (determined using either a fixed or floating rate) based on the notional amounts of two different currencies. The notional amounts are typically determined based on the spot exchange rates at the opening of the contract. Cross currency swaps may require the exchange of notional amounts at the opening and/or closing of the contract. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized depreciation and appreciation until the payments are made, at which time they are realized. Upfront payments and receipts are reflected in the Consolidated Statement of Assets and Liabilities and represent compensating factors between stated terms of the cross currency swap contract and prevailing market conditions (interest rate spreads and other relevant factors). These upfront payments and receipts are amortized over the term of the contract as a realized gain or loss in the Consolidated Statement of Operations.

The Fund entered into inflation index swap contracts primarily to manage and/or gain exposure to inflation risk. An inflation index swap is an agreement between the Fund and a counterparty to exchange cash flows whereby one party makes payments based on the percentage change in an index that serves as a measure of inflation and the other party makes a regular payment based on a compounded fixed rate, applied to a notional amount. These agreements may be privately negotiated in the over-the-counter market (OTC inflation index swap) or may be executed on a registered exchange (centrally cleared inflation index swap).

For centrally cleared inflation index swaps, required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or receivable. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized depreciation and appreciation until the payments are made, at which time they are realized. Typically, an inflation index swap has payment obligations netted and exchanged upon maturity.

The Fund entered into interest rate swap contracts primarily to manage interest rate risk. An interest rate swap is an agreement between the Fund and a counterparty to exchange cash flows based on the difference between two interest rates, applied to a notional amount. These agreements may be privately negotiated in the over-the-counter market (OTC interest rate swaps) or may be executed on a registered exchange (centrally cleared interest rate swaps). For centrally cleared interest rate swaps, required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or receivable in the Consolidated Statement of Assets and Liabilities. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized depreciation and appreciation until the payments are made, at which time they are realized. The Fund did not hold any interest rate swap contracts at period end.

The Fund entered into OTC total return swap contracts primarily to manage and/or gain exposure to credit and other market risks of an underlying instrument such as a stock, bond, index or basket of securities or indices. A total return swap is an agreement between the Fund and a counterparty to exchange a return linked to an underlying instrument for a floating or fixed rate payment, both based upon a notional amount. Over the term of the contract, contractually required payments to be paid or received are accrued daily and recorded as unrealized appreciation or depreciation until the payments are made, at which time they are recognized as realized gain or loss.

The Fund purchased or wrote OTC option contracts primarily to manage and/or gain exposure to interest rate and credit risk. An option is a contract entitling the holder to purchase or sell a specific amount of shares or units of an asset or notional amount of a swap (swaption), at a specified price. When an option is purchased or written, an amount equal to the premium paid or received is recorded as an asset or

FSI-42         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

liability, respectively. Upon exercise of an option, the acquisition cost or sales proceeds of the underlying investment is adjusted by any premium received or paid. Upon expiration of an option, any premium received or paid is recorded as a realized gain or loss. Upon closing an option other than through expiration or exercise, the difference between the premium received or paid and the cost to close the position is recorded as a realized gain or loss. The Fund did not hold any option contracts at period end.

The Fund invests in value recovery instruments (VRI) primarily to gain exposure to economic growth. Periodic payments from VRI are dependent on established benchmarks for underlying variables. VRI has a notional amount, which is used to calculate amounts of payments to holders. Payments are recorded upon receipt as realized gains in the Consolidated Statement of Operations. The risks of investing in VRI include growth risk, liquidity, and the potential loss of investment.

See Note 11 regarding other derivative information.

e. Loan Participation Notes

The Fund invests in loan participation notes (Participations). Participations are loans originally issued to a borrower by one or more financial institutions (the Lender) and subsequently sold to other investors, such as the Fund. Participations typically result in the Fund having a contractual relationship only with the Lender and not with the borrower. The Fund has the right to receive from the Lender any payments of principal, interest and fees which the Lender received from the borrower. The Fund generally has no rights to either enforce compliance by the borrower with the terms of the loan agreement or to any collateral relating to the original loan. As a result, the Fund assumes the credit risk of both the borrower and the Lender that is selling the Participation. The Participations may also involve interest rate risk and liquidity risk, including the potential default or insolvency of the borrower and/or the Lender.

f. Investments in FT Holdings Corporation III (FT Subsidiary)

The Fund invests in certain financial instruments through its investment in FT Subsidiary. FT Subsidiary is a Delaware Corporation, is a wholly-owned subsidiary of the Fund, and is able to invest in certain financial instruments consistent with the investment objective of the Fund. At June 30, 2020, FT Subsidiary’s investment, Turtle Bay Resort, as well as any

other assets and liabilities of FT Subsidiary are reflected in the Fund’s Consolidated Statement of Investments and Consolidated Statement of Assets and Liabilities.

At June 30, 2020, FT Subsidiary, which is a tax paying entity, recognized an unrealized loss on its Turtle Bay investment. An estimated deferred tax asset based on such unrealized loss is reflected as FT Subsidiary deferred tax benefit in the Consolidated Statement of Assets and Liabilities. The estimated benefit was calculated using a federal rate of 21%. When the Turtle Bay investment liquidates, the FT Subsidiary will recognize a capital loss. This loss may be carried back to offset prior year capital gains, subject to carryback limitation rules. If there are no limitations, the carryback will result in a tax refund which will relieve the deferred tax asset.

The financial statements have been consolidated and include the accounts of the Fund and FT Subsidiary. All intercompany transactions and balances have been eliminated. At June 30, 2020, the net assets of FT Subsidiary were $6,347,180, representing 1.6% of the Fund’s consolidated net assets. The Fund’s investment in FT Subsidiary is limited to 25% of consolidated assets.

g. Mortgage Dollar Rolls

The Fund enters into mortgage dollar rolls, typically on a TBA basis. Mortgage dollar rolls are agreements between the Fund and a financial institution where the Fund sells (or buys) mortgage-backed securities for delivery on a specified date and simultaneously contracts to repurchase (or sell) substantially similar (same type, coupon, and maturity) securities at a future date and at a predetermined price. Gains or losses are realized on the initial sale, and the difference between the repurchase price and the sale price is recorded as an unrealized gain or loss to the Fund upon entering into the mortgage dollar roll. In addition, the Fund may invest the cash proceeds that are received from the initial sale. During the period between the sale and repurchase, the Fund is not entitled to principal and interest paid on the mortgage backed securities. Transactions in mortgage dollar rolls are accounted for as purchases and sales and may result in an increase to the Fund’s portfolio turnover rate. The risks of mortgage dollar roll transactions include the potential inability of the counterparty to fulfill its obligations.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

1. Organization and Significant Accounting

Policies (continued)

h. Senior Floating Rate Interests

The Fund invests in senior secured corporate loans that pay interest at rates which are periodically reset by reference to a base lending rate plus a spread. These base lending rates are generally the prime rate offered by a designated U.S. bank or the London InterBank Offered Rate (LIBOR). Senior secured corporate loans often require prepayment of principal from excess cash flows or at the discretion of the borrower. As a result, actual maturity may be substantially less than the stated maturity. Senior secured corporate loans in which the Fund invests are generally readily marketable, but may be subject to certain restrictions on resale. On July 27, 2017, the United Kingdom’s Financial Conduct Authority announced its intention to cease sustaining LIBOR after 2021. There remains uncertainty regarding the future utilization of LIBOR and the nature of any replacement rate. As such, the potential effect of a transition away from LIBOR on the Fund or the Fund’s investments that use or may use a floating rate based on LIBOR cannot yet be determined.

i. Marketplace Lending

The Fund invests in loans obtained through marketplace lending. Marketplace lending, sometimes referred to as peer-to-peer lending, is a method of financing in which a platform facilitates the borrowing and lending of money. It is considered an alternative to more traditional forms of debt financing. Prospective borrowers are required to provide certain financial information to the platform, including, but not limited to, the intended purpose of the loan, income, employment information, credit score, debt-to-income ratio, credit history (including defaults and delinquencies) and home ownership status. Based on this and other information, the platform assigns its own credit rating to the borrower and sets the interest rate for the requested loan. The platform then posts the borrowing requests online, giving investors the opportunity to purchase the loans based on factors such as the interest rates and expected yields of the loans, the borrower background data, and the credit rating assigned by the platform.

When the Fund invests in these loans, it usually purchase all rights, title and interest in the loans pursuant to a loan purchase agreement directly from the platform. The platform or a third-party servicer typically continues to service the loans, collecting payments and distributing them to the Fund,

less any servicing fees assessed. The servicer is typically responsible for taking actions against a borrower in the event of a default on the loan. Servicing fees, along with other administration fees, are included in marketplace lending fees in the Consolidated Statement of Operations. The Fund, as an investor in a loan, would be entitled to receive payment only from the borrower and would not be able to recover any deficiency from the platform, except under very narrow circumstances. The loans in which the Fund may invest are unsecured.

j. Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

k. Security Transactions, Investment Income,

Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Amortization of

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

premium and accretion of discount on debt securities are included in interest income. Paydown gains and losses are recorded as an adjustment to interest income. Facility fees are recognized as income over the expected term of the loan. Dividend income is recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

Inflation-indexed bonds are adjusted for inflation through periodic increases or decreases in the security’s interest accruals, face amount, or principal redemption value, by amounts corresponding to the rate of inflation as measured by an index. Any increase or decrease in the face amount or principal redemption value will be included as interest income in the Consolidated Statement of Operations.

l.  Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

m.  Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		837,599		$	9,025,672			671,682		$	7,349,679
Shares issued in reinvestment of distributions		1,318,738			13,266,506			1,499,135			16,055,733
Shares redeemed		(2,581,967	)		(26,737,911	)		(4,454,817	)		(48,690,081	)
Net increase (decrease)		(425,630	)	$	(4,445,733	)		(2,284,000	)	$	(25,284,669	)

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

2. Shares of Beneficial Interest (continued)

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 2 Shares:
Shares sold		1,476,226		$	14,944,694			1,948,126		$	20,598,257
Shares issued in reinvestment of distributions		480,115			4,661,916			445,266			4,608,498
Shares redeemed		(1,408,509	)		(14,076,838	)		(2,080,736	)		(21,979,199	)
Net increase (decrease)		547,832		$	5,529,772			312,656		$	3,227,556
Class 4 Shares:
Shares sold		259,830		$	2,824,937			332,522		$	3,653,954
Shares issued in reinvestment of distributions		230,681			2,304,505			277,403			2,951,572
Shares redeemed		(703,841	)		(7,134,984	)		(1,334,939	)		(14,432,171	)
Net increase (decrease)		(213,330	)	$	(2,005,542	)		(725,014	)	$	(7,826,645	)

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Advisers, Inc. (Advisers)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a. Management Fees

The Fund pays an investment management fee to Advisers based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.625%	Up to and including $500 million
0.525%	Over $500 million, up to and including $1 billion
0.480%	Over $1 billion, up to and including $1.5 billion
0.435%	Over $1.5 billion, up to and including $6.5 billion
0.415%	Over $6.5 billion, up to and including $11.5 billion
0.400%	Over $11.5 billion, up to and including $16.5 billion
0.390%	Over $16.5 billion, up to and including $19 billion
0.380%	Over $19 billion, up to and including $21.5 billion
0.370%	In excess of $21.5 billion

b. Administrative Fees

Under an agreement with Advisers, FT Services provides administrative services to the Fund. The fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

c. Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.25% and 0.35% per year of its average daily net assets of Class 2 and Class 4, respectively. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

e. Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Consolidated Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)			Value at End of Period		Number of Shares Held at End of Period		Dividend Income
Non-Controlled Affiliates
Franklin Floating Rate Income Fund	$	9,264,918	$	—	$	—			$    —	$	(1,197,278	)	$	8,067,640		1,118,951	$	216,312
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		11,463,714		102,930,148		(99,913,332	)		—		—			14,480,530		14,480,530		29,387
Total Affiliated Securities	$	20,728,632	$	102,930,148	$	(99,913,332	)		$    —	$	(1,197,278	)	$	22,548,170			$	245,699

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Consolidated Statement of Operations.

5. Income Taxes

For tax purposes, capital losses may be carried over to offset future capital gains.

At December 31, 2019, the capital loss carryforwards were as follows:

Capital loss carryforwards not subject to expiration:
Short term	$	271,803
Long term		44,135,035
Total capital loss carryforwards	$	44,406,838	a

^aSubject to certain limitations under Internal Revenue Code Section 382.

Semiannual Report         FSI-47

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

5. Income Taxes (continued)

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$	427,600,415
Unrealized appreciation	$	12,448,801
Unrealized depreciation		(34,674,613	)
Net unrealized appreciation (depreciation)	$	(22,225,812	)

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of foreign currency transactions, paydown losses, bond discounts and premiums and swaps.

6. Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $239,526,193 and $253,945,343, respectively.

7. Credit Risk and Defaulted Securities

At June 30, 2020, the Fund had 31.4% of its portfolio invested in high yield, senior secured floating rate loans, or other securities rated below investment grade and unrated securities, if any. These securities may be more sensitive to economic conditions causing greater price volatility and are potentially subject to a greater risk of loss due to default than higher rated securities.

The Fund held defaulted securities and/or other securities for which the income has been deemed uncollectible. At June 30, 2020, the aggregate value of these securities was $885,543, representing 0.2% of the Fund’s net assets. The Fund discontinues accruing income on securities for which income has been deemed uncollectible and provides an estimate for losses on interest receivable. The securities have been identified in the accompanying Consolidated Statement of Investments.

8. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

9. Restricted Securities

The Fund invests in securities that are restricted under the Securities Act of 1933 (1933 Act). Restricted securities are often purchased in private placement transactions, and cannot be sold without prior registration unless the sale is pursuant to an exemption under the 1933 Act. Disposal of these securities may require greater effort and expense, and prompt sale at an acceptable price may be difficult. The Fund may have registration rights for restricted securities. The issuer generally incurs all registration costs.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

At June 30, 2020, investments in restricted securities, excluding securities exempt from registration under the 1933 Act, were as follows:

Principal Amount/ Shares/ Units		Issuer	Acquisition Date		Cost		Value
	18,684	a Appvion Operations Inc.		4/12/19	$	252,711	$	353,175
	14,792,309	b K2016470219 South Africa Ltd., A		2/08/13 - 2/01/17		114,768		—
	1,472,041	b K2016470219 South Africa Ltd., B		2/01/17		1,093		—
	143,820	c Onsite Rental Group Operations Pty. Ltd.		5/20/20		—		—
	262,519	c Onsite Rental Group Operations Pty. Ltd., secured note, PIK, 6.10%, 10/26/23		4/12/19		238,236		213,088
	7,021	d Remington Outdoor Co. Inc., Litigation Units		4/12/19		—		—
		Total Restricted Securities (Value is 0.1% of Net Assets)			$	606,808	$	566,263

^aThe Fund also invests in unrestricted securities of the issuer, valued at $266,560 as of June 30, 2020.

^bThe Fund also invests in unrestricted securities of the issuer, valued at $0 as of June 30, 2020.

^cThe Fund also invests in unrestricted securities of the issuer, valued at $161,048 as of June 30, 2020.

^dThe Fund also invests in unrestricted securities of the issuer, valued at $37,288 as of June 30, 2020.

10. Unfunded Loan Commitments

The Fund enters into certain credit agreements, all or a portion of which may be unfunded. The Fund is obligated to fund these loan commitments at the borrowers’ discretion. Unfunded loan commitments and funded portions of credit agreements are marked to market daily and any unrealized appreciation or depreciation is included in the Consolidated Statement of Assets and Liabilities and the Consolidated Statement of Operations. Funded portions of credit agreements are presented in the Consolidated Statement of Investments.

At June 30, 2020, unfunded commitments were as follows:

Borrower	Unfunded Commitment
General Nutrition Centers, Inc., DIP		$	138,096

11. Other Derivative Information

At June 30, 2020, investments in derivative contracts are reflected in the Consolidated Statement of Assets and Liabilities as follows:

	Asset Derivatives				Liability Derivatives
Derivative Contracts Not Accounted for as Hedging Instruments	Consolidated Statement of Assets and Liabilities Location	Fair Value			Consolidated Statement of Assets and Liabilities Location	Fair Value
Interest rate contracts	Variation margin on futures contracts	$	473,752	a	Variation margin on futures contracts	$	—
	Unrealized appreciation on OTC swap contracts		17,535		Unrealized depreciation on OTC swap contracts		—

Semiannual Report         FSI-49

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

11. Other Derivative Information (continued)

	Asset Derivatives				Liability Derivatives
Derivative Contracts Not Accounted for as Hedging Instruments	Consolidated Statement of Assets and Liabilities Location	Fair Value			Consolidated Statement of Assets and Liabilities Location	Fair Value
Foreign exchange contracts	Unrealized appreciation on OTC forward exchange contracts	$	382,336		Unrealized depreciation on OTC forward exchange contracts	$	2,206,849
Credit contracts	Variation margin on centrally cleared swap contracts		4,337	a	Variation margin on centrally cleared swap contracts		41,938	a
	OTC swap contracts (upfront payments)		25,674		OTC swap contracts (upfront receipts)		345,272
	Unrealized appreciation on OTC swap contracts		39,294		Unrealized depreciation on OTC swap contracts		861,921
Inflation contracts	Variation margin on centrally cleared swap contracts		—		Variation margin on centrally cleared swap contracts		746,230
Value recovery instruments	Investments in securities, at value		908,051	b
Totals		$	1,850,979			$	4,202,210

^aThis amount reflects the cumulative appreciation (depreciation) of futures contracts and centrally cleared swap contracts as reported in the Consolidated Statement of Investments. Only the variation margin receivable/payable at period end is separately reported within the Consolidated Statement of Assets and Liabilities. Prior variation margin movements were recorded to cash upon receipt or payment.

^bVRI are included in investments in securities, at value in the Consolidated Statement of Assets and Liabilities.

For the period ended June 30, 2020, the effect of derivative contracts in the Consolidated Statement of Operations was as follows:

Derivative Contracts Not Accounted for as Hedging Instruments	Consolidated Statement of Operations Location	Net Realized Gain (Loss) for the Period			Consolidated Statement of Operations Location	Net Change in Unrealized Appreciation (Depreciation) for the Period
	Net realized gain (loss) from:				Net change in unrealized appreciation (depreciation) on:
Interest rate contracts	Investments	$	(474,306)	a	Investments	$	—
	Written options		190,296		Written options		—
	Futures contracts		(1,146,064)		Futures contracts		637,011
	Swap contracts		158,151		Swap contracts		55,296
Foreign exchange contracts	Investments		86,372	a	Investments		—
	Forward exchange contracts		(203,042)		Forward exchange contracts		(1,044,217)
Credit contracts	Written options		(713,450)		Written options		—
	Swap contracts		(2,343,797)		Swap contracts		(985,285)
Inflation contracts	Swap contracts		(372,288)		Swap contracts		(746,230)
Value recovery instruments	Investments		—		Investments		(29,606)	a
Totals			$(4,818,128)				$(2,113,031)

^aPurchased option contracts and VRI are included in net realized gain (loss) from investments and net change in unrealized appreciation (depreciation) on investments in the Consolidated Statement of Operations.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

For the period ended June 30, 2020, the average month end notional amount of futures contracts, swap contracts and options, and the average month end contract value for forward exchange contracts, and average month end fair value of VRI, were as follows:

Futures Contracts	$	108,113,720
Swap contracts	$	55,934,361
Forward exchange contracts	$	90,676,322
VRI	$	868,671
Options	$	7,214,286

	Gross Amounts of Assets and Liabilities Presented in the Consolidated Statement of Assets and  Liabilities
	Assetsa		Liabilitiesa
Derivatives
Forward exchange contracts		$382,336		$2,206,849
Swap contracts		82,503		1,207,193
Total		$464,839		$3,414,042

^aAbsent an event of default or early termination, OTC derivative assets and liabilities are presented gross and not offset in the Consolidated Statement of Assets and Liabilities.

At June 30, 2020, OTC derivative assets, which may be offset against OTC derivative liabilities and collateral received from the counterparty, are as follows:

			Amounts Not Offset in the Consolidated Statement of Assets and Liabilities
	Gross Amounts of Assets Presented in the Consolidated Statement of Assets and Liabilities		Financial Instruments Available for Offset			Financial Instruments Collateral Received		Cash Collateral Received		Net Amount (Not less than zero)
Counterparty
BNDP		$         —		$          —			$    —		$  —		$  —
BZWS		36,580		(36,580	)		—		—		—
CITI		33,500		(33,500	)		—		—		—
DBAB		—		—			—		—		—
GSCO		—		—			—		—		—
JPHQ		394,759		(394,759	)		—		—		—
MSCO		—		—			—		—		—
Total		$464,839		$(464,839	)		$    —		$  —		$  —

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

11. Other Derivative Information (continued)

At June 30, 2020, OTC derivative liabilities, which may be offset against OTC derivative assets and collateral pledged to the counterparty, are as follows:

			Amounts Not Offset in the Consolidated Statement of Assets and Liabilities
	Gross Amounts of Liabilities Presented in the Consolidated Statement of Assets and Liabilities		Financial Instruments Available for Offset			Financial Instruments Collateral Pledged		Cash Collateral Pledgeda			Net Amount (Not less than zero)
Counterparty
BNDP		$        25,680		$            —			$        —		$    (25,680	)		$            —
BZWS		52,631		(36,580	)		—		—			16,051
CITI		116,017		(33,500	)		—		(82,517	)		—
DBAB		5,681		—			—		—			5,681
GSCO		86,648		—			—		(70,000	)		16,648
JPHQ		2,477,317		(394,759	)		—		(1,850,000	)		232,558
MSCO		650,068		—			—		(590,000	)		60,068
Total		$3,414,042		$(464,839	)		$        —		$(2,618,197	)		$331,006

^aIn some instances, the collateral amounts disclosed in the table above were adjusted due to the requirement to limit the collateral amounts to avoid the effect of overcollateralization. Actual collateral received and/or pledged may be more than the amounts disclosed herein.

See Note 1(d) regarding derivative financial instruments.

See Abbreviations on page FSI-56.

12. Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Consolidated Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

13. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets and liabilities carried at fair value, is as follows:

	Level 1		Level 2		Level 3			Total
Assets:
Investments in Securities:a
Equity Investments:b
Commercial & Professional Services	$	—	$	37,288	$	—		$	37,288
Consumer Services		—		—		41,832			41,832
Energy		39,587		—		190,677			230,264
Materials		67,822		—		353,175			420,997
Media & Entertainment		91,642		—		1,008			92,650
All Other Equity Investments		8,067,640		—		—	c		8,067,640
Convertible Bonds		—		2,189		—			2,189
Corporate Bonds:
Capital Goods		—		6,802,507		213,088			7,015,595
Retailing		—		810,569		1,763	c		812,332
All Other Corporate Bonds		—		168,110,350		—			168,110,350
Senior Floating Rate Interests:
Capital Goods		—		331,225		161,048			492,273
Household & Personal Products		—		—		2,273,679			2,273,679
All Other Senior Floating Rate Interests		—		17,932,767		—			17,932,767
Marketplace Loans		—		—		964,121			964,121
Foreign Government and Agency Securities		—		49,801,941		—			49,801,941
U.S. Government and Agency Securities		—		12,727,306		—			12,727,306
Asset-Backed Securities and Commercial Mortgage-Backed Securities		—		82,596,248		—			82,596,248
Mortgage-Backed Securities		—		30,850,305		—			30,850,305
Municipal Bonds		—		11,789,744		—			11,789,744
Escrows and Litigation Trusts		—		7,215		—	c		7,215
Short Term Investments		14,480,530		60,072		—			14,540,602
Total Investments in Securities	$	22,747,221	$	381,859,726	$	4,200,391		$	408,807,338
Other Financial Instruments:
Futures Contracts	$	473,752	$	—	$	—		$	473,752
Forward Exchange Contracts		—		382,336		—			382,336
Swap Contracts		—		61,166		—			61,166
Unfunded Loan Commitments		—		16,008		—			16,008
Total Other Financial Instruments	$	473,752	$	459,510	$	—		$	933,262

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

13. Fair Value Measurements(continued)

	Level 1		Level 2		Level 3		Total
Liabilities:
Other Financial Instruments:
Forward Exchange Contracts	$	—	$	2,206,849	$	—	$	2,206,849
Swap Contracts		—		1,650,089		—		1,650,089
Total Other Financial Instruments	$	—	$	3,856,938	$	—	$	3,856,938

^aFor detailed categories, see the accompanying Consolidated Statement of Investments.

^bIncludes common stocks and management investment companies as well as other equity interests.

^cIncludes securities determined to have no value at June 30, 2020.

A reconciliation in which Level 3 inputs are used in determining fair value is presented when there are significant Level 3 assets and/or liabilities at the beginning and/or end of the period. At June 30, 2020, the reconciliation is as follows:

	Balance at Beginning of Period			Purchases		Sales		Transfer Into Level 3a		Transfer Out of Level 3b			Cost Basis Adjustmentsc			Net Realized Gain (Loss)		Net Unrealized Appreciation (Depreciation)			Balance at End of Period			Net Change in Unrealized Appreciation (Depreciation) on Assets Held at Period End
Assets:
Investments in Securities:
Equity Investments:d
Commercial & Professional Services		$    46,610			$        —		$—		$        —		$(37,288	)		$        —			$—		$    (9,322	)		$        —			$        —
Consumer Services		41,832			—		—		—		—			—			—		—			41,832			—
Energy		2,073	e		—		—		182,716		—			—			—		5,888			190,677			5,888
Materials		254,512			—		—		—		—			—			—		98,663			353,175			98,663
Media & Entertainment		2,040			—		—		—		—			—			—		(1,032	)		1,008			(1,032	)
Retailing		11,614			—		—		—		—			—			—		(11,614	)		—	e		(11,614	)
Corporate Bonds:
Capital Goods		—			—		—		219,039		—			—			—		(5,951	)		213,088			(5,951	)
Retailing		2,769			196		—		—		—			(69,796	)		—		68,594			1,763	e		68,594
Senior Floating Rate Interests:
Capital Goods		—			—		—		161,048		—			—			—		—			161,048			—
Household & Personal Products		2,416,190			—		—		—		—			8,318			—		(150,829	)		2,273,679			(150,829	)
Marketplace Loans		—			1,149,952		—		—		—			—			—		(185,831	)		964,121			(185,831	)
Escrows and Litigation Trusts		—	e		—		—		—		—			—			—		—			—	e		—
Total Investments in Securities		$2,777,640			$1,150,148		$—		$562,803		$(37,288	)		$(61,478	)		$—		$(191,434	)		$4,200,391			$(182,112	)

^aTransferred into Level 3 as a result of the unavailability of a quoted market price in an active market for identical securities or as a result of the unreliability of the foreign exchange rate and other significant observable valuation inputs.

^bTransferred out Level 3 as a result of the availability of a quoted price in an active market for identical securities and other significant observable valuation inputs.

^cMay include accretion, amortization, partnership adjustments, and/or other cost basis adjustments.

^dIncludes common stocks as well as other equity interests.

^eIncludes securities determined to have no value.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

Significant unobservable valuation inputs for material Level 3 assets and/or liabilities and impact to fair value as a result of changes in unobservable valuation inputs as of June 30, 2020, are as follows:

Description	Fair Value at End of Period			Valuation Technique		Unobservable Inputs		Amount/ Range (Weighted Averagea)		Impact to Fair Value if Input  Increasesb
Assets:
Investments in Securities:
Senior Floating Rate Interests
Household & Personal     Products		$2,273,679			Discounted cash flow		Discount rate		9.7% - 30.3% (15.7%)		Decreasec
							Free cash flow		$1.0 - $1.8 mil ($1.6 mil)		Increased
Marketplace Loans –   Lending Club		964,121			Discounted cash flow		Loss-Adjusted Discount rate		8.7%		Decreasec
							Projected Loss     rate		21.1%		Decreasec
All other Investmentse		962,591	f
Total		$4,200,391

^aWeighted based on the relative fair value of the financial instruments.

^bRepresents the directional change in the fair value that would result from a significant and reasonable increase in the corresponding input. A significant and reasonable ^decrease in the input would have the opposite effect. Significant impacts, if any, to fair value and/or net assets have been indicated.

^cRepresents a significant impact to fair value but not net assets.

^dRepresents a significant impact to fair value and net assets.

^eIncludes fair value of immaterial assets and/or liabilities developed using various valuation techniques and unobservable inputs. May also include values derived using private transaction prices or non-public third party pricing information which is unobservable.

^fIncludes securities determined to have no value at June 30, 2020.

14. New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

15. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the consolidated financial statements and determined that no events have occurred that require disclosure.

Semiannual Report         FSI-55

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Franklin Strategic Income VIP Fund (continued)

Abbreviations    

Counterparty		Currency		Selected Portfolio
BNDP	BNP Paribas SA	COP	Colombian Peso	ARM	Adjustable Rate Mortgage
BZWS	Barclays Bank PLC	DOP	Dominican Peso	CLO	Collateralized Loan Obligation
CITI	Citigroup, Inc.	EUR	Euro	CMT	1 year Constant Maturity Treasury Index
DBAB	Deutsche Bank AG	IDR	Indonesian Rupiah	FHLMC	Federal Home Loan Mortgage Corp.
GSCO	The Goldman Sachs Group, Inc.	MXN	Mexican Peso	FNMA	Federal National Mortgage Association
JPHQ	JP Morgan Chase & Co.	USD	United States Dollar	FRN	Floating Rate Note
MSCO	Morgan Stanley	UYU	Uruguayan peso	GDP	Gross Domestic Product
		ZAR	South African rand	GNMA	Government National Mortgage Association
				GO	General Obligation
				LIBOR	London InterBank Offered Rate
				MBS	Mortgage-Backed Security
				OAT	Obligation Assumable by the Treasurer
				PIK	Payment-In-Kind
				RDA	Redevelopment Agency/Authority
				SF	Single Family
				T-Note	Treasury Note
				USD	United School District

Index Abbreviation
CDX.EM.Series number	CDX Emerging Markets Index
MCDX.NA.Series number	MCDX North America Index
CDX.NA.IG.Series number	CDX North America Investment Grade Index

FSI-56         Semiannual Report

Franklin U.S. Government Securities VIP Fund

This semiannual report for Franklin U.S. Government Securities VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a +3.58% total return for the six-month period ended June 30, 2020.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         FUS-1

FRANKLIN U.S. GOVERNMENT SECURITIES VIP FUND

Fund Goal and Main Investments

The Fund seeks income. Under normal market conditions, the Fund invests at least 80% of its net assets in U.S. government securities.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. The Fund’s share price and yield will be affected by interest rate movements and mortgage prepayments. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in the Fund adjust to a rise in interest rates, the Fund’s share price may decline. Changes in the financial strength of a bond issuer or in a bond’s credit rating may affect its value. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Fund’s primary benchmark, the Bloomberg Barclays U.S. Government -Intermediate Index, posted a +5.75% total return.¹ The Fund’s secondary benchmark, the Lipper VIP General U.S. Government Funds Classification Average, posted a +5.98% total return.² Funds in the Lipper average may allocate as much as 35% of their investments in asset types other than U.S. government and agency mortgage-backed securities.

Economic and Market Overview

The U.S. bond market, as measured by the Bloomberg Barclays U.S. Aggregate Bond Index, advanced during the six-month period despite significant economic disruption in the wake of the novel coronavirus (COVID-19) pandemic. In

Portfolio Composition

Based on Total Net Assets as of 6/30/20

late February 2020, as more countries adopted social distancing and lockdown measures to slow the global pandemic, the U.S. bond market began pricing in the adverse impact on economic activity. Higher-quality, longer-term bonds rallied, while riskier, lower-rated corporate bonds declined sharply, reflecting a reversal in many investors’ risk appetite. During the last quarter of the reporting period, however, as generally slowing infection rates and phased business reopenings by states drove hopes for an economic rebound, corporate bond valuations advanced significantly. Nevertheless, an increase in infection rates toward period-end prompted concern among investors, hindering lower-rated bonds.

The U.S. Federal Reserve (Fed) enacted two emergency rate cuts in response to the COVID-19 pandemic in March 2020, lowering the federal funds target rate to a range of 0.00%–0.25%. In addition, the Fed announced unlimited, open-ended purchasing of government-backed and corporate bonds to help keep markets functioning, significantly expanding its balance sheet.

U.S. Treasury bonds, as measured by the Bloomberg Barclays U.S. Treasury Index, rose significantly during the reporting period. Bond purchasing by the Fed and robust demand for investments perceived as safe drove the U.S. Treasury market higher despite the widening U.S. federal budget deficit and the massive increase in issuance. Mortgage-backed securities (MBS), as measured by the Bloomberg Barclays MBS Index, also posted positive returns, aided by declining Treasury rates and the Fed’s decision to purchase agency MBS.

U.S. corporate bond performance varied significantly based on credit rating, as investors became concerned about the

1. Source: Morningstar.

2. Source: Lipper, a Thomson Reuters Company.

One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

See.www.franklintempletondatasources.com for additional data provider information.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

FUS-2         Semiannual Report

FRANKLIN U.S. GOVERNMENT SECURITIES VIP FUND

pandemic-related economic disruption and the potential credit downgrades of many companies. Investment-grade corporate bonds, as represented by the Bloomberg Barclays U.S. Corporate Bond Index, rebounded significantly after mid-March 2020 to post positive overall returns for the reporting period. In contrast, high-yield corporate bonds, as represented by the Bloomberg Barclays U.S. Corporate High Yield Bond Index, declined due to investor concerns about a potential increase in credit defaults.

Investment Strategy

Using our straightforward investment approach, we seek to produce current income with a high degree of credit safety from a conservatively managed portfolio of U.S. government securities. Analyzing securities using proprietary and nonproprietary research, we seek to identify attractive investment opportunities.

Manager’s Discussion

From a perspective of excess returns over Treasuries of similar duration as measured by Bloomberg Barclays indexes, most major fixed income sectors had negative excess returns during the period. Within the agency mortgage pass-through sector, Ginnie Mae (GNMA) MBS were the best performers and outperformed similar duration U.S. Treasuries. Fannie Mae (FNMA) and Freddie Mac (FHLMC) MBS lagged with negative excess returns. For the GNMA coupon stack, GNMA II 2.5% and 5.0% were the best performers, while GNMA I 3.0% and 3.5% coupons lagged.

The Fund maintains a consistent and disciplined approach to our investment strategy. The Fund’s investment process and strategy have not changed, and the team continues to look for strong cash flow fundamentals and valuations seeking to uncover opportunities across the agency mortgage and agency debenture universe. The Fund emphasizes agency pass-throughs and invests in other agency securities for diversification purposes.

The portfolio’s largest allocation remains in fixed-rate MBS and primarily in 30-year GNMA II securities. The Fund’s largest absolute allocation remained in 3.5% and 3.0% coupons. Over the period, we reduced our exposure to 4.0% coupons, while adding to 3.0% securities.

The Fund’s U.S. yield curve positioning detracted from performance, as did the Fund’s exposure to fixed-rate agency mortgage-backed securities, Treasury inflation-protected securities and U.S. Agency securities.

Thank you for your participation in Franklin U.S. Government Securities VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund.

Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

Semiannual Report         FUS-3

FRANKLIN U.S. GOVERNMENT SECURITIES VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual		Hypothetical
		(actual return after expenses)		(5% annual return before expenses)
			Fund-Level		Fund-Level
			Expenses		Expenses	Net
	Beginning	Ending	Paid During	Ending	Paid During	Annualized
Share	Account	Account	Period	Account	Period	Expense
Class	Value 1/1/20	Value 6/30/20	1/1/20–6/30/201, 2	Value 6/30/20	1/1/20–6/30/201, 2	Ratio2
Class 1	$1,000	$1,035.80	$2.63	$1,022.28	$2.61	0.52%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

FUS-4         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Franklin U.S. Government Securities VIP Fund

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$12.34			$12.07			$12.36			$12.51			$12.74			$13.00
Income from investment operationsa:
Net investment incomeb		0.10			0.27			0.29			0.25			0.22			0.21
Net realized and unrealized gains (losses)		0.34			0.38			(0.22	)		(0.04	)		(0.10	)		(0.12	)
Total from investment operations		0.44			0.65			0.07			0.21			0.12			0.09
Less distributions from:
Net investment income		(0.47	)		(0.38	)		(0.36	)		(0.36	)		(0.35	)		(0.35	)
Net asset value, end of period		$12.31			$12.34			$12.07			$12.36			$12.51			$12.74
Total returnc		3.58%			5.47%			0.60%			1.66%			0.90%			0.71%
Ratios to average net assetsd
Expensese		0.52%			0.51%			0.50%			0.50%			0.50%			0.50%
Net investment income		1.62%			2.23%			2.38%			2.00%			1.75%			1.64%
Supplemental data
Net assets, end of period (000’s)		$55,320			$54,104			$59,213			$66,404			$73,695			$79,620
Portfolio turnover rate		18.02%			24.16%			22.25%			80.49%			86.28%			61.91%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FUS-5

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Franklin U.S. Government Securities VIP Fund (continued)

	Six Months Ended
	June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$12.05			$11.79			$12.09			$12.24			$12.47			$12.73
Income from investment operationsa:
Net investment incomeb		0.08			0.24			0.25			0.21			0.19			0.18
Net realized and unrealized gains (losses)		0.34			0.37			(0.22	)		(0.04	)		(0.10	)		(0.12	)
Total from investment operations		0.42			0.61			0.03			0.17			0.09			0.06
Less distributions from:
Net investment income		(0.43	)		(0.35	)		(0.33	)		(0.32	)		(0.32	)		(0.32	)
Net asset value, end of period		$12.04			$12.05			$11.79			$12.09			$12.24			$12.47
Total returnc		3.49%			5.23%			0.34%			1.34%			0.66%			0.47%
Ratios to average net assetsd
Expensese		0.77%			0.76%			0.75%			0.75%			0.75%			0.75%
Net investment income		1.37%			1.98%			2.13%			1.75%			1.50%			1.39%
Supplemental data
Net assets, end of period (000’s)		$765,235			$771,866			$1,105,627			$1,223,491			$1,268,963			$1,311,974
Portfolio turnover rate		18.02%			24.16%			22.25%			80.49%			86.28%			61.91%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

FUS-6         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Franklin U.S. Government Securities VIP Fund

	Principal Amount		Value
Mortgage-Backed Securities 75.1%
aFederal Home Loan Mortgage Corp. (FHLMC) Adjustable Rate 1.0%
FHLMC, 2.66% - 3.682%, (12-month USD LIBOR +/- MBS Margin), 3/01/36 - 5/01/38	$	3,737,547	$	3,912,533
FHLMC, 3.741%, (US 1 Year CMT T-Note +/- MBS Margin), 5/01/37		193,516		195,814
FHLMC, 3.744%, (12-month USD LIBOR +/- MBS Margin), 4/01/40		4,227,239		4,469,307
				8,577,654
Federal Home Loan Mortgage Corp. (FHLMC) Fixed Rate 8.3%
FHLMC 30 Year, 2.50%, 6/01/50		14,961,528		15,601,956
FHLMC 30 Year, 3.50%, 12/01/47		5,271,896		5,571,627
FHLMC Gold 15 Year, 4.50%, 3/01/25 - 4/01/25		561,023		593,188
FHLMC Gold 30 Year, 3.00%, 5/01/43		354,550		380,006
FHLMC Gold 30 Year, 3.00%, 6/01/46		27,169,465		28,806,477
FHLMC Gold 30 Year, 3.50%, 3/01/32 - 5/01/43		2,569,592		2,752,458
FHLMC Gold 30 Year, 4.00%, 9/01/40 - 12/01/41		5,174,720		5,658,979
FHLMC Gold 30 Year, 4.50%, 5/01/40 - 7/01/41		1,531,038		1,694,595
FHLMC Gold 30 Year, 5.00%, 9/01/33 - 4/01/40		3,859,169		4,430,030
FHLMC Gold 30 Year, 5.50%, 7/01/33 - 5/01/38		831,980		955,072
FHLMC Gold 30 Year, 6.00%, 1/01/24 - 8/01/35		579,198		656,918
FHLMC Gold 30 Year, 6.50%, 12/01/23 - 5/01/35		260,853		292,938
FHLMC Gold 30 Year, 7.00%, 4/01/24 - 9/01/31		85,768		95,180
FHLMC Gold 30 Year, 7.50%, 12/01/22		209		209
FHLMC Gold 30 Year, 8.00%, 9/01/21 - 5/01/22		828		864
FHLMC Gold 30 Year, 8.50%, 7/01/31		160,726		187,859
				67,678,356
aFederal National Mortgage Association (FNMA) Adjustable Rate 3.5%
FNMA, 2.411% - 3.583%, (12-month USD LIBOR +/- MBS Margin), 1/01/32 - 1/01/40		7,622,288		7,957,916
FNMA, 3.676%, (12-month USD LIBOR +/- MBS Margin), 9/01/37		9,064,702		9,591,435
FNMA, 2.422% - 4.168%, (6-month USD LIBOR +/- MBS Margin), 6/01/21 - 7/01/37		703,162		713,689
FNMA, 3.585% - 4.54%, (12-month USD LIBOR +/- MBS Margin), 12/01/32 - 4/01/41		2,878,606		3,009,867
FNMA, 2.50% - 5.109%, (US 1 Year CMT T-Note +/- MBS Margin), 6/01/21 - 10/01/44		6,888,438		7,132,417
FNMA, 1.99% - 5.319%, (11th District COF +/- MBS Margin), 6/01/25 - 6/01/38		101,387		101,806
				28,507,130
Federal National Mortgage Association (FNMA) Fixed Rate 12.6%
FNMA 15 Year, 2.64%, 7/01/25		2,416,709		2,600,914
FNMA 15 Year, 2.77%, 4/01/25		3,500,000		3,785,067
FNMA 15 Year, 3.14%, 10/01/25		3,959,404		4,315,130
FNMA 15 Year, 3.28%, 7/01/27		4,000,000		4,470,367
FNMA 15 Year, 3.51%, 8/01/23		3,000,000		3,220,602
FNMA 15 Year, 5.50%, 1/01/25		394,721		415,574
FNMA 30 Year, 3.00%, 12/01/42		153,675		164,490
FNMA 30 Year, 3.00%, 6/01/50		14,955,360		15,872,626
FNMA 30 Year, 3.50%, 7/01/45		24,672,134		26,435,450
FNMA 30 Year, 4.00%, 1/01/41 - 8/01/41		5,768,312		6,332,396
FNMA 30 Year, 4.00%, 10/01/47		8,229,547		8,784,827
FNMA 30 Year, 4.00%, 9/01/48		12,103,764		13,043,011
FNMA 30 Year, 4.50%, 8/01/40 - 6/01/41		5,184,675		5,789,241

Semiannual Report         FUS-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin U.S. Government Securities VIP Fund (continued)

	Principal Amount		Value
Mortgage-Backed Securities (continued)
Federal National Mortgage Association (FNMA) Fixed Rate (continued)
FNMA 30 Year, 5.00%, 3/01/34 - 7/01/41	$	3,117,186	$	3,579,521
FNMA 30 Year, 5.50%, 12/01/32 - 8/01/35		1,430,257		1,622,463
FNMA 30 Year, 6.00%, 1/01/24 - 8/01/38		1,614,597		1,844,792
FNMA 30 Year, 6.50%, 1/01/24 - 9/01/36		200,604		226,411
FNMA 30 Year, 7.50%, 4/01/23 - 8/01/25		7,132		7,379
FNMA 30 Year, 8.00%, 3/01/22 - 12/01/24		42,978		43,601
FNMA 30 Year, 8.50%, 5/01/21 - 6/01/21		38		38
FNMA 30 Year, 9.00%, 10/01/26		41,148		41,997
FNMA PL 30 Year, 5.50%, 4/01/34		818,099		896,270
				103,492,167
Government National Mortgage Association (GNMA) Fixed Rate 49.7%
GNMA I SF 30 Year, 3.00%, 7/15/42		365,652		392,857
GNMA I SF 30 Year, 4.00%, 10/15/40 - 7/15/46		7,473,305		8,176,731
GNMA I SF 30 Year, 4.00%, 7/15/46 - 8/15/46		253,220		273,529
GNMA I SF 30 Year, 4.50%, 1/15/39 - 5/15/40		7,138,445		8,045,219
GNMA I SF 30 Year, 4.50%, 5/15/40 - 6/15/41		3,627,607		4,063,165
GNMA I SF 30 Year, 5.00%, 6/15/30 - 10/15/39		6,576,997		7,469,128
GNMA I SF 30 Year, 5.00%, 10/15/39 - 3/15/40		6,160,541		7,042,102
GNMA I SF 30 Year, 5.00%, 3/15/40 - 9/15/40		3,251,814		3,710,945
GNMA I SF 30 Year, 5.50%, 12/15/28 - 10/15/39		4,036,132		4,622,335
GNMA I SF 30 Year, 6.00%, 11/15/23 - 11/15/38		1,899,313		2,195,325
GNMA I SF 30 Year, 6.50%, 6/15/23 - 9/15/38		995,274		1,125,984
GNMA I SF 30 Year, 7.00%, 9/15/22 - 1/15/32		183,412		191,292
GNMA I SF 30 Year, 7.50%, 2/15/22 - 8/15/33		263,038		302,111
GNMA I SF 30 Year, 8.00%, 12/15/21 - 7/15/23		40,840		41,799
GNMA I SF 30 Year, 8.50%, 6/15/22 - 12/15/24		21,037		21,417
GNMA I SF 30 Year, 9.50%, 9/15/20 - 12/15/20		830		831
GNMA I SF 30 Year, 10.00%, 8/15/21.		138		138
GNMA II SF 30 Year, 2.50%, 6/02/50		40,000,000		42,155,758
GNMA II SF 30 Year, 3.00%, 12/20/42 - 2/20/45		1,694,323		1,812,690
GNMA II SF 30 Year, 3.00%, 9/20/45		7,030,890		7,502,371
GNMA II SF 30 Year, 3.00%, 4/20/46		19,507,843		20,770,247
GNMA II SF 30 Year, 3.00%, 10/20/47		8,520,876		9,043,745
GNMA II SF 30 Year, 3.00%, 2/20/50		13,132,253		13,938,022
GNMA II SF 30 Year, 3.00%, 5/20/50		21,954,034		23,301,091
GNMA II SF 30 Year, 3.50%, 12/20/40 - 8/20/43		1,800,710		1,956,395
GNMA II SF 30 Year, 3.50%, 8/20/42		5,042,688		5,485,915
GNMA II SF 30 Year, 3.50%, 9/20/42		14,771,329		16,069,692
GNMA II SF 30 Year, 3.50%, 10/20/42		4,513,453		4,910,181
GNMA II SF 30 Year, 3.50%, 11/20/42		8,908,721		9,691,789
GNMA II SF 30 Year, 3.50%, 12/20/42		6,778,350		7,374,170
GNMA II SF 30 Year, 3.50%, 1/20/43		11,469,036		12,477,170
GNMA II SF 30 Year, 3.50%, 3/20/43		4,035,464		4,390,193
GNMA II SF 30 Year, 3.50%, 4/20/43		5,045,535		5,489,063
GNMA II SF 30 Year, 3.50%, 5/20/43		9,350,947		10,184,478
GNMA II SF 30 Year, 3.50%, 6/20/43		4,278,375		4,652,826

FUS-8         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin U.S. Government Securities VIP Fund (continued)

	Principal Amount		Value
Mortgage-Backed Securities (continued)
Government National Mortgage Association (GNMA) Fixed Rate (continued)
GNMA II SF 30 Year, 3.50%, 9/20/47	$	60,140,456	$	64,041,628
GNMA II SF 30 Year, 3.50%, 10/20/47		4,951,319		5,270,042
GNMA II SF 30 Year, 3.50%, 11/20/47		15,654,533		16,664,048
GNMA II SF 30 Year, 4.00%, 11/20/39 - 3/20/41		6,944,904		7,660,408
GNMA II SF 30 Year, 4.00%, 7/20/41 - 2/20/44		3,981,348		4,386,911
GNMA II SF 30 Year, 4.00%, 11/20/41		4,851,260		5,351,951
GNMA II SF 30 Year, 4.00%, 12/20/49		15,844,034		16,809,113
GNMA II SF 30 Year, 4.50%, 10/20/39 - 6/20/41		7,344,104		8,078,621
GNMA II SF 30 Year, 4.50%, 7/20/41 - 2/20/44		7,417,825		8,191,662
GNMA II SF 30 Year, 4.50%, 9/20/41		3,857,711		4,237,730
GNMA II SF 30 Year, 4.50%, 10/20/44		2,001,833		2,194,927
GNMA II SF 30 Year, 5.00%, 9/20/33 - 10/20/42		6,278,655		7,094,889
GNMA II SF 30 Year, 5.00%, 6/20/44		1,952,380		2,204,885
GNMA II SF 30 Year, 5.50%, 5/20/34 - 6/20/38		3,275,237		3,775,634
GNMA II SF 30 Year, 6.00%, 11/20/23 - 7/20/39		2,093,547		2,419,974
GNMA II SF 30 Year, 6.50%, 12/20/27 - 4/20/34		324,591		374,982
GNMA II SF 30 Year, 7.00%, 5/20/32		6,189		7,383
GNMA II SF 30 Year, 7.50%, 9/20/22 - 11/20/26		41,800		46,092
GNMA II SF 30 Year, 8.00%, 8/20/26		3,276		3,783
GNMA II SF 30 Year, 9.50%, 4/20/25		1,534		1,538
				407,696,905
Total Mortgage-Backed Securities (Cost $598,871,800)				615,952,212
U.S. Government and Agency Securities 20.3%
DY9 Leasing LLC, secured bond, 2.372%, 3/19/27		2,129,891		2,233,883
FHLB, 2.625%, 9/12/25		10,000,000		11,057,192
Israel Government Agency for International Development Bond, 5.50%, 9/18/23		12,000,000		13,932,525
New Valley Generation IV, secured bond, 4.687%, 1/15/22		619,287		634,041
Overseas Private Investment Corp.,
senior bond, 4.01%, 5/15/30		1,642,500		1,888,950
senior note, 2.12%, 3/20/24		5,500,000		5,673,454
Petroleos Mexicanos, 2.378%, 4/15/25		1,645,000		1,704,068
Private Export Funding Corp.,
secured note, 4.30%, 12/15/21		1,865,000		1,968,236
senior secured note, MM, 2.30%, 9/15/20.		3,500,000		3,515,764
Reliance Industries Ltd.,
senior bond, 1.87%, 1/15/26		4,421,052		4,508,469
senior bond, 2.512%, 1/15/26		7,875,000		8,177,495
senior note, 2.06%, 1/15/26		3,750,000		3,849,629
TVA, 1.875%, 8/15/22		6,000,000		6,184,802
U.S. International Development Finance Corp., A, Strip, 11/15/20		2,575,000		3,350,589
U.S. Treasury Bond,
2.50%, 2/15/46		6,000,000		7,430,039
bIndex Linked, 2.00%, 1/15/26		1,938,103		2,255,233
bIndex Linked, 1.75%, 1/15/28		9,792,874		11,693,506
bIndex Linked, 3.625%, 4/15/28		7,927,740		10,678,148

Semiannual Report         FUS-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin U.S. Government Securities VIP Fund (continued)

	Principal Amount		Value
U.S. Government and Agency Securities (continued)
U.S. Treasury Bond, (continued)
bIndex Linked, 0.125%, 1/15/30	$	7,973,970	$	8,625,457
U.S. Treasury Note,
2.375%, 8/15/24		22,000,000		23,940,469
2.25%, 8/15/27		6,000,000		6,740,508
bIndex Linked, 0.125%, 7/15/24		16,740,321		17,507,413
bIndex Linked, 0.25%, 7/15/29		8,020,418		8,783,369
Total U.S. Government and Agency Securities (Cost $155,147,150)				166,333,239
Total Investments before Short Term Investments (Cost $754,018,950)				782,285,451
Short Term Investments (Cost $35,555,010) 4.3%
Repurchase Agreements 4.3%
cJoint Repurchase Agreement, 0.065%, 7/01/20 (Maturity Value $35,555,074) BNP Paribas Securities Corp. (Maturity Value $24,667,755) Deutsche Bank Securities Inc. (Maturity Value $6,776,086) HSBC Securities (USA) Inc. (Maturity Value $4,111,233) Collateralized by U.S. Government Agency Securities, 4.00%, 3/20/44; U.S. Government Agency Strips, 8/15/39; and U.S. Treasury Notes, 1.75% - 25%, 4/15/22 - 7/31/24 (valued at $36,306,031)		35,555,010		35,555,010
Total Investments (Cost $789,573,960) 99.7%				817,840,461
Other Assets, less Liabilities 0.3%				2,714,503
Net Assets 100.0%			$	820,554,964

See Abbreviations on page FUS-19.

^aAdjustable Rate Mortgage-Backed Security (ARM); the rate shown is the effective rate at period end. ARM rates are not based on a published reference rate and spread, but instead pass-through weighted average interest income inclusive of any caps or floors, if applicable, from the underlying mortgage loans in which the majority of mortgages pay interest based on the index shown at their designated reset dates plus a spread, less the applicable servicing and guaranty fee (MBS margin).

^bPrincipal amount of security is adjusted for inflation. See Note 1(d).

^cSee Note 1(b) regarding joint repurchase agreement.

FUS-10           Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Franklin U.S. Government Securities VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$754,018,950
Cost - Unaffiliated repurchase agreements		35,555,010
Value - Unaffiliated issuers		$782,285,451
Value - Unaffiliated repurchase agreements		35,555,010
Receivables:
Investment securities sold		301,284
Capital shares sold		903,814
Interest		2,694,743
Other assets		661
Total assets		821,740,963
Liabilities:
Payables:
Capital shares redeemed		587,838
Management fees		323,057
Distribution fees		157,211
Trustees’ fees and expenses		934
Reports to shareholders		86,208
Accrued expenses and other liabilities		30,751
Total liabilities		1,185,999
Net assets, at value		$820,554,964
Net assets consist of:
Paid-in capital		$884,880,367
Total distributable earnings (losses)		(64,325,403	)
Net assets, at value		$820,554,964
Class 1:
Net assets, at value		$ 55,319,961
Shares outstanding		4,492,364
Net asset value and maximum offering price per share		$12.31
Class 2:
Net assets, at value		$765,235,003
Shares outstanding		63,549,533
Net asset value and maximum offering price per share		$12.04

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FUS-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Franklin U.S. Government Securities VIP Fund
Investment income:
Interest:
Unaffiliated issuers:
Paydown gain (loss)		$(3,325,339	)
Paid in cash		12,160,295
Total investment income		8,834,956
Expenses:
Management fees (Note 3a)		1,981,682
Distribution fees: (Note 3c) Class 2		960,138
Custodian fees (Note 4)		3,181
Reports to shareholders		65,007
Professional fees		35,544
Trustees’ fees and expenses		3,215
Other		78,016
Total expenses		3,126,783
Expense reductions (Note 4)		(5,825	)
Net expenses		3,120,958
Net investment income		5,713,998
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		1,929,538
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		20,792,403
Net realized and unrealized gain (loss)		22,721,941
Net increase (decrease) in net assets resulting from operations		$28,435,939

FUS-12           Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Franklin U.S. Government Securities VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income		$   5,713,998			$   21,483,343
Net realized gain (loss)		1,929,538			3,865,232
Net change in unrealized appreciation (depreciation)		20,792,403			32,420,343
Net increase (decrease) in net assets resulting from operations		28,435,939			57,768,918
Distributions to shareholders:
Class 1		(2,038,214	)		(1,737,360	)
Class 2		(26,480,204	)		(31,230,563	)
Total distributions to shareholders		(28,518,418	)		(32,967,923	)
Capital share transactions: (Note 2)
Class 1		1,316,654			(6,397,324	)
Class 2		(6,648,652	)		(357,273,982	)
Total capital share transactions		(5,331,998	)		(363,671,306	)
Net increase (decrease) in net assets		(5,414,477	)		(338,870,311	)
Net assets:
Beginning of period		825,969,441			1,164,839,752
End of period		$820,554,964			$ 825,969,441

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         FUS-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Franklin U.S. Government Securities VIP Fund

1. Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Franklin U.S. Government Securities VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. At June 30, 2020, 52.6% of the Fund’s shares were held through one insurance company. Investment activities of these insurance company separate accounts could have a material impact on the Fund. The Fund offers two classes of shares: Class 1 and Class 2. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a. Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Debt securities generally trade in the over-the-counter market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics

such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value.

Investments in repurchase agreements are valued at cost, which approximates fair value.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

b. Joint Repurchase Agreement

The Fund enters into a joint repurchase agreement whereby its uninvested cash balance is deposited into a joint cash account with other funds managed by the investment manager or an affiliate of the investment manager and is used to invest in one or more repurchase agreements. The value and face amount of the joint repurchase agreement are allocated to the funds based on their pro-rata interest. A repurchase agreement is accounted for as a loan by the Fund to the seller, collateralized by securities which are delivered to the Fund’s custodian. The fair value, including accrued interest, of the initial collateralization is required to be at least 102% of the dollar amount invested by the funds, with the value of the underlying securities marked to market daily to maintain coverage of at least 100%. Repurchase agreements are subject to the terms of Master Repurchase Agreements (MRAs) with approved counterparties (sellers). The MRAs contain various provisions, including but not limited to events of default and maintenance of collateral for repurchase agreements. In the event of default by either the seller or the Fund, certain MRAs may permit the non-defaulting party to net and close-out all transactions, if any, traded under such

FUS-14         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin U.S. Government Securities VIP Fund (continued)

agreements. The Fund may sell securities it holds as collateral and apply the proceeds towards the repurchase price and any other amounts owed by the seller to the Fund in the event of default by the seller. This could involve costs or delays in addition to a loss on the securities if their value falls below the repurchase price owed by the seller. The joint repurchase agreement held by the Fund at period end, as indicated in the Statement of Investments, had been entered into on June 30, 2020.

c. Income Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

d. Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Amortization of premium and accretion of discount on debt securities are included in interest income. Paydown gains and losses are recorded separately in the Statement of Operations. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect

their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

Inflation-indexed bonds are adjusted for inflation through periodic increases or decreases in the security’s interest accruals, face amount, or principal redemption value, by amounts corresponding to the rate of inflation as measured by an index. Any increase or decrease in the face amount or principal redemption value will be included as interest income in the Statement of Operations.

e. Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

f. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin U.S. Government Securities VIP Fund (continued)

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		216,769		$	2,720,672			263,170		$	3,219,496
Shares issued in reinvestment of distributions		165,440			2,038,214			143,584			1,737,360
Shares redeemed		(273,147	)		(3,442,232	)		(929,495	)		(11,354,180	)
Net increase (decrease)		109,062		$	1,316,654			(522,741	)	$	(6,397,324	)
Class 2 Shares:
Shares sold		7,343,891		$	90,277,338			4,193,524		$	50,317,492
Shares issued in reinvestment of distributions		2,197,527			26,480,204			2,639,946			31,230,563
Shares redeemed		(10,022,353	)		(123,406,194	)		(36,549,546	)		(438,822,037	)
Net increase (decrease)		(480,935	)	$	(6,648,652	)		(29,716,076	)	$	(357,273,982	)

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Advisers, Inc. (Advisers)	Investment manager
Franklin Templeton Institutional, LLC (FT Institutional)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a. Management Fees

The Fund pays an investment management fee to Advisers based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.625%	Up to and including $100 million
0.500%	Over $100 million, up to and including $250 million
0.450%	Over $250 million, up to and including $7.5 billion
0.440%	Over $7.5 billion, up to and including $10 billion
0.430%	Over $10 billion, up to and including $12.5 billion
0.420%	Over $12.5 billion, up to and including $15 billion
0.400%	In excess of $15 billion

For the period ended June 30, 2020, the annualized gross effective investment management fee rate was 0.480% of the Fund’s average daily net assets.

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin U.S. Government Securities VIP Fund (continued)

Under a subadvisory agreement, FT Institutional, an affiliate of Advisers, provides subadvisory services to the Fund. The subadvisory fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund. Effective January 31, 2020, the subadvisory agreement was terminated.

b. Administrative Fees

Under an agreement with Advisers, FT Services provides administrative services to the Fund. The fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

c. Distribution Fees

The Board has adopted a distribution plan for Class 2 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plan, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rate, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

5. Income Taxes

For tax purposes, capital losses may be carried over to offset future capital gains.

At December 31, 2019, the capital loss carryforwards were as follows:

Capital loss carryforwards not subject to expiration:
Short term	$	37,909,667
Long term		59,100,269
Total capital loss carryforwards	$	97,009,936

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$	793,109,292
Unrealized appreciation	$	28,713,651
Unrealized depreciation		(3,982,482	)
Net unrealized appreciation (depreciation)	$	24,731,169

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of paydown losses and bond discounts and premiums.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin U.S. Government Securities VIP Fund (continued)

6. Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $142,045,194 and $162,309,001, respectively.

7. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

8. Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

9. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

At June 30, 2020, all of the Fund’s investments in financial instruments carried at fair value were valued using Level 2 inputs.

10. New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Franklin U.S. Government Securities VIP Fund (continued)

modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

11. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations
Currency		Selected Portfolio
USD	United States Dollar	CMT	Constant Maturity Treasury Index
		COF	Cost of Funds
		FHLB	Federal Home Loan Bank
		LIBOR	London InterBank Offered Rate
		MBS	Mortgage-Backed Security
		PL	Project Loan
		SF	Single Family
		T-Note	Treasury Note
		TVA	Tennessee Valley Authority

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Templeton Developing Markets VIP Fund

This semiannual report for Templeton Developing Markets VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -10.83% total return for the six-month period ended June 30, 2020.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

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TEMPLETON DEVELOPING MARKETS VIP FUND

Fund Goal and Main Investments

The Fund seeks long-term capital appreciation. Under normal market conditions, the Fund invests at least 80% of its net assets in emerging market investments.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Special risks are associated with foreign investing, including currency fluctuations, economic instability and political developments. Investments in developing markets, of which frontier markets are a subset, involve heightened risks related to the same factors, in addition to those associated with these markets’ smaller size, lesser liquidity and lack of established legal, political, business and social frameworks to support securities markets. Because these frameworks are typically even less developed in frontier markets, as well as various factors including the increased potential for extreme price volatility, illiquidity, trade barriers and exchange controls, the risks associated with developing markets are magnified in frontier markets. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the MSCI Emerging Markets (EM) Index posted a -9.67% total return, for the same period.¹ Please note, index performance numbers are for reference and we do not attempt to track an index but rather undertake investments on the basis of fundamental research.

Economic and Market Overview

The novel coronavirus (COVID-19) pandemic and resulting lockdown measures caused many emerging market

Geographic Composition

Based on Total Net Assets as of 6/30/20

economies to slow significantly in 2020’s first quarter, as the virus outbreak compounded already weak global economic activity hobbled by U.S.-China trade tensions. In response, many emerging market central banks adopted more accommodative monetary policies. Emerging market equities fell during the period, though losses were limited by a second-quarter rebound as some countries began reopening their economies.

Regarding individual countries, China’s gross domestic product contracted in 2020’s first quarter for the first time on record, reflecting the significant disruption caused by the pandemic after the government shut down nonessential businesses for nearly two months. Taiwan’s year-on-year growth rate slowed as the country’s export-dependent economy was hit by decreased global demand. South Korea’s year-on-year growth rate moderated due largely to slowing services sector activity. India’s year-on-year growth rate moderated to its lowest point since the data became available in 2004, with contractions seen in gross fixed capital formation, exports and manufacturing. Russia’s year-on-year growth rate also moderated in the first quarter, while Brazil’s year-on-year growth rate contracted as the services sector and industrial output shrank.

Turning to monetary policies, the People’s Bank of China (PBOC) cut the benchmark loan prime rate once. Taiwan’s central bank lowered its benchmark interest rate for the first time in four years, while South Korea’s central bank cut its

1. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

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benchmark rate twice, ending at an all-time low. India’s central bank also cut its benchmark interest rate twice. The central banks of Russia and Brazil both cut their benchmark rates multiple times to record lows.

In this environment, emerging market stocks, as measured by the MSCI EM Index, posted a -9.67% total return for the six months ended June 30, 2020.1 Chinese equities rose during the period, as investors were reassured by the government’s aggressive actions to contain the pandemic and encouraging second-quarter economic data. Equities in export-oriented Taiwan declined slightly, with losses limited by stimulus measures and low rates of COVID-19 infections. Russian equities fell as a price war with Saudi Arabia led to a collapse in oil prices, which weighed heavily on Russia’s energy export-dependent economy. Brazilian equities fell significantly due largely to the country’s emergence as the epicenter of the pandemic in Latin America as well as the Brazilian real’s depreciation against the U.S. dollar.

Investment Strategy

We employ a fundamental research, value-oriented, long-term investment approach. We focus on the market price of a company’s securities relative to our evaluation of its long-term earnings, asset value and cash flow potential. This includes an assessment of the potential impacts of material environmental, social and governance factors on the long-term risk and return profile of a company. We also consider a company’s profit and loss outlook, balance sheet strength, cash flow trends and asset value in relation to the current price of the company’s securities. Our analysis considers the company’s position in its sector, the economic framework and political environment.

Manager’s Discussion

Key stock contributors to absolute performance during the reporting period were Tencent Holdings, Naver and Naspers.

Tencent is one of the largest internet services companies in China. The company provides online gaming, social network, financial technology, cloud and other entertainment-related services. Expectations that COVID-19 would have a short-term negative impact on Tencent’s advertising, payments and cloud services as a result of a decline in business activities led shares to reach a period-low in March. Shares subsequently rose, however, on expectations of solid growth in the mobile gaming and financial technology businesses. Tencent reported above-consensus first-quarter corporate results, with double-digit revenue and earnings growth driven by an increase in online gaming and better-than-expected performances in its online advertising

Top 10 Countries    

6/30/20    

	% of Total Net Assets
China		30.4%
South Korea		19.2%
Taiwan		11.4%
Russia		8.5%
Brazil		5.5%
India		5.4%
South Africa		4.8%
U.K.		3.0%
U.S.		1.9%
Thailand		1.5%

and financial technology operations. Expectations of continued growth in online gaming and improved monetization of its social application WeChat further supported sentiment in the stock.

Naver is South Korea’s largest search engine and a major e-commerce company. The company also provides services including LINE messenger, the largest messenger app in Japan, image messaging and multimedia mobile application Snow, digital comics platform Naver Webtoon and group social media platform Naver Band. Concerns in March that COVID-19 would negatively impact Naver’s advertising business in the short term weighed on shares, but the company’s earnings rose due to increased online shopping on its platform amid the pandemic. Investors also remained confident of Naver’s penetration into e-commerce and businesses in other areas such as digital content and financial services, which could contribute to its longer-term growth.

Naspers is a global internet and entertainment group and a majority shareholder in Prosus, which holds stakes in major internet companies globally in areas such as online gaming, social media, food delivery, online classifieds and electronic payments. Shares in Naspers benefited from the strong performance of Prosus’ largest underlying investment, Tencent. Naspers reported double-digit revenue and earnings growth for the fiscal year ended March 2020, driven by e-commerce operations and growth at Tencent. While lockdowns across key markets in early 2020 weighed on Naspers’ interests in the classified segment, investors expect market consolidation to help reduce losses and allow companies to focus on monetization as economies reopen. Management’s commitment to reducing Nasper’s share price discount to net asset value was also viewed positively by investors.

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TEMPLETON DEVELOPING MARKETS VIP FUND

In contrast, key performance detractors included ICICI Bank, Banco Bradesco and Itau Unibanco Holding. Banking stocks around the world faced selling pressure, as expectations for a global economic slowdown weakened the outlook for loan growth, net interest margins and asset quality.

ICICI Bank is one of the largest private-sector banks in India. Investors were concerned about the interim impact of economic disruptions caused by COVID-19 on the bank’s loans and margins. Indian financials stocks were broadly hurt by a crisis at a notable private-sector bank, which resulted in a bailout. Investors also reacted negatively when the Indian central bank extended loan repayment relief while not allowing a one-time restructuring of loans, which sparked fears about bad debts in the banking system. Although ICICI Bank reported a double-digit increase in its March quarter profits, higher-than-expected COVID-19-related costs weighed on profitability. Investors did support the bank’s stake sale of its insurance subsidiaries to raise capital to strengthen its balance sheet, but the bank’s plan to raise money via the issuance of new shares raised concerns of dilution.

Expectations that the Brazilian economy would fall into a recession as a result of COVID-19-related lockdowns weighed on sentiment in leading commercial banks such as Banco Bradesco and Itau Unibanco. Shares in the two banks declined significantly due to market expectations of a decline in asset quality and revenue generation. Both banks reported weak first-quarter corporate results largely due to higher-than-expected costs related to COVID-19 and suspended guidance for 2020. Shares did rebound off their lows as investors used the market correction as a buying opportunity in view of the banks’ sound fundamentals, attractive valuations and dominant market share, which in our view makes them well-positioned to recover once the COVID-19 outbreak is contained and domestic economic activity improves.

We used the market correction as an opportunity to add to our existing high-conviction holdings. Existing positions were increased in Samsung Life Insurance, one of the largest insurance companies in South Korea; Bajaj Holdings & Investment, which owns significant stakes in Indian auto and financial services companies; and the aforementioned Itau Unibanco and Prosus.

The Fund reduced its investments in China, Taiwan and the U.S. to raise funds for redemptions received during the reporting period. Sectors which experienced the largest sales were information technology, financials, health care and consumer discretionary. Key reductions included Cognizant Technology Solutions, a global information

Top 10 Holdings    

6/30/20    

Company Sector/Industry, Country	% of Total         Net Assets
Taiwan Semiconductor Manufacturing Co. Ltd. Semiconductors & Semiconductor Equipment, Taiwan		9.3%
Tencent Holdings Ltd. Interactive Media & Services, China		9.1%
Samsung Electronics Co. Ltd. Technology Hardware, Storage & Peripherals, South Korea		8.6%
Alibaba Group Holding Ltd. Internet & Direct Marketing Retail, China		7.6%
Naver Corp. Interactive Media & Services, South Korea		4.6%
Naspers Ltd. Internet & Direct Marketing Retail, South Africa		4.5%
Unilever PLC Personal Products, U.K.		3.0%
ICICI Bank Ltd. Banks, India		2.8%
Brilliance China Automotive Holdings Ltd. Automobiles, China		2.7%
LUKOIL PJSC Oil, Gas & Consumable Fuels, Russia		2.6%

technology services company, and Glenmark Pharmaceuticals, a mid-size Indian pharmaceutical company. The Fund liquidated its positions in Chinese commercial bank China Construction Bank, Indian biopharmaceutical company Biocon, and Macau resort and casino operator Sands China.

It is important to recognize the effect of currency movements on the Fund’s performance. In general, if the value of the U.S. dollar goes up compared with a foreign currency, an investment traded in that foreign currency will go down in value because it will be worth fewer U.S. dollars. This can have a negative effect on Fund performance. Conversely, when the U.S. dollar weakens in relation to a foreign currency, an investment traded in that foreign currency will increase in value, which can contribute to Fund performance. For the six months ended June 30, 2020, the U.S. dollar rose in value relative to most currencies. As a result, the Fund’s performance was negatively affected by the portfolio’s predominantly in securities with non-U.S. currency exposure.

Thank you for your participation in Templeton Developing Markets VIP Fund. We look forward to serving your future investment needs.

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The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

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TEMPLETON DEVELOPING MARKETS VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual (actual return after expenses)		Hypothetical   (5% annual return before expenses)
Share   Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$891.70	$5.50	$1,019.05	$5.87	1.17%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

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TD P1 P2 P4 05/20

SUPPLEMENT DATED MAY 15, 2020

TO THE PROSPECTUSES DATED MAY 1, 2020

OF

TEMPLETON DEVELOPING MARKETS VIP FUND

(A series of Franklin Templeton Variable Insurance Products Trust)

The Prospectus is amended as follows:

I. The Board of Trustees of Franklin Templeton Variable Insurance Products Trust (Board) recently approved, subject to shareholder approval, a change in the classification of the Templeton Developing Markets VIP Fund (Fund) under the Investment Company Act of 1940 from a “diversified” fund to a “non-diversified” fund. It is anticipated that in July 2020 shareholders of the Fund will receivea proxy statement requesting their votes on such proposal and other matters. If such proposals are approved by the Fund’s shareholders, it is expected that such changes will be effective in early 2021.

The Fund reserves the right to change the above at any time.

Please keep this supplement with your prospectus for future reference.

TD-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Templeton Developing Markets VIP Fund

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$10.80			$ 8.62			$10.31			$ 7.42			$ 6.37			$ 9.27
Income from investment operationsa:
Net investment incomeb		0.01			0.18			0.09			0.08			0.05			0.06
Net realized and unrealized gains (losses)		(1.19	)		2.12			(1.67	)		2.92			1.08			(1.63	)
Total from investment operations		(1.18	)		2.30			(1.58	)		3.00			1.13			(1.57	)
Less distributions from:
Net investment income		(0.45	)		(0.12	)		(0.11	)		(0.11	)		(0.08	)		(0.20	)
Net realized gains		(0.26	)		—			—			—			—			(1.13	)
Total distributions		(0.71	)		(0.12	)		(0.11	)		(0.11	)		(0.08	)		(1.33	)
Net asset value, end of period		$ 8.91			$10.80			$ 8.62			$10.31			$ 7.42			$ 6.37
Total returnc		(10.83)%			26.92%			(15.44)%			40.65%			17.79%			(19.42)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		1.17%			1.15%			1.24%			1.36%			1.38%			1.33%
Expenses net of waiver and payments by affiliates		1.17%	e		1.15%	e		1.24%	e		1.35%	f		1.36%			1.32%
Net investment income		0.28%			1.83%			0.99%			0.86%			0.79%			0.74%
Supplemental data
Net assets, end of period (000’s)		$71,752			$97,271			$85,397			$105,493			$82,596			$77,000
Portfolio turnover rate		2.41%			18.04%			9.22%			10.76%			26.78%			71.69%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^fBenefit of expense reduction rounds to less than 0.01%.

TD-8         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Templeton Developing Markets VIP Fund (continued)

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$10.71			$ 8.54			$10.23			$ 7.36			$ 6.32			$ 9.20
Income from investment operationsa:
Net investment incomeb		—	c		0.15			0.07			0.05			0.04			0.04
Net realized and unrealized gains (losses)		(1.18	)		2.11			(1.68	)		2.91			1.06			(1.61	)
Total from investment operations		(1.18	)		2.26			(1.61	)		2.96			1.10			(1.57	)
Less distributions from:
Net investment income		(0.42	)		(0.09	)		(0.08	)		(0.09	)		(0.06	)		(0.18	)
Net realized gains		(0.26	)		—			—			—			—			(1.13	)
Total distributions		(0.68	)		(0.09	)		(0.08	)		(0.09	)		(0.06	)		(1.31	)
Net asset value, end of period		$ 8.85			$10.71			$ 8.54			$10.23			$ 7.36			$ 6.32
Total returnd		(11.00)%			26.70%			(15.79)%			40.41%			17.44%			(19.60)%
Ratios to average net assetse
Expenses before waiver and payments by affiliates		1.42%			1.40%			1.49%			1.61%			1.63%			1.58%
Expenses net of waiver and payments by affiliates		1.42%	f		1.40%	f		1.49%	f		1.60%	g		1.61%			1.57%
Net investment income		0.03%			1.58%			0.74%			0.61%			0.54%			0.49%
Supplemental data
Net assets, end of period (000’s)		$189,208			$231,645			$195,305			$270,433			$205,151			$192,120
Portfolio turnover rate		2.41%			18.04%			9.22%			10.76%			26.78%			71.69%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cAmount rounds to less than $0.01 per share.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^gBenefit of expense reduction rounds to less than 0.01%.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TD-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Templeton Developing Markets VIP Fund (continued)

	Six Months Ended June 30, 2020
				Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$10.77			$ 8.59			$10.28			$ 7.39			$ 6.34			$ 9.22
Income from investment operationsa:
Net investment incomeb		—	c		0.15			0.06			0.05			0.03			0.03
Net realized and unrealized gains (losses)		(1.20	)		2.11			(1.68	)		2.92			1.06			(1.62	)
Total from investment operations		(1.20	)		2.26			(1.62	)		2.97			1.09			(1.59	)
Less distributions from:
Net investment income		(0.41	)		(0.08	)		(0.07	)		(0.08	)		(0.04	)		(0.16	)
Net realized gains		(0.26	)		—			—			—			—			(1.13	)
Total distributions		(0.67	)		(0.08	)		(0.07	)		(0.08	)		(0.04	)		(1.29	)
Net asset value, end of period		$ 8.90			$10.77			$ 8.59			$10.28			$ 7.39			$ 6.34
Total returnd		(11.04)%			26.49%			(15.81)%			40.30%			17.32%			(19.70)%
Ratios to average net assetse
Expenses before waiver and payments by affiliates		1.52%			1.50%			1.59%			1.71%			1.73%			1.68%
Expenses net of waiver and payments by affiliates		1.52%	f		1.50%	f		1.59%	f		1.70%	g		1.71%			1.67%
Net investment income (loss)		(0.07)%			1.48%			0.64%			0.51%			0.44%			0.39%
Supplemental data
Net assets, end of period (000’s)		$4,593			$5,590			$5,203			$7,199			$6,377			$7,109
Portfolio turnover rate		2.41%			18.04%			9.22%			10.76%			26.78%			71.69%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cAmount rounds to less than $0.01 per share.

^dTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^eRatios are annualized for periods less than one year.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^gBenefit of expense reduction rounds to less than 0.01%.

TD-10         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Templeton Developing Markets VIP Fund

	Industry		Shares		Value
Common Stocks 93.9%
Brazil 2.5%
aB2W Cia Digital		Internet & Direct Marketing Retail		76,800	$	1,512,184
B3 SA - Brasil Bolsa Balcao		Capital Markets		61,400		622,154
Lojas Americanas SA		Multiline Retail		170,860		857,003
M Dias Branco SA		Food Products		106,200		793,257
Vale SA		Metals & Mining		278,500		2,864,501
						6,649,099
Cambodia 0.7%
NagaCorp Ltd.		Hotels, Restaurants & Leisure		1,525,400		1,779,444
China 30.4%
aAlibaba Group Holding Ltd., ADR		Internet & Direct Marketing Retail		93,210		20,105,397
BAIC Motor Corp. Ltd., H		Automobiles		1,686,100		737,882
aBaidu Inc., ADR		Interactive Media & Services		9,411		1,128,285
Brilliance China Automotive Holdings Ltd.		Automobiles		7,970,600		7,214,024
China Merchants Bank Co. Ltd., A		Banks		392,600		1,881,855
China Merchants Bank Co. Ltd., H		Banks		507,700		2,352,738
China Mobile Ltd.		Wireless Telecommunication Services		447,000		3,018,149
China Resources Cement Holdings Ltd.		Construction Materials		2,429,000		2,995,722
CNOOC Ltd.		Oil, Gas & Consumable Fuels		2,008,500		2,254,180
COSCO SHIPPING Ports Ltd.		Transportation Infrastructure		433,196		233,665
bHealth & Happiness H&H International Holdings Ltd.		Food Products		418,400		1,901,710
bMGM China Holdings Ltd.		Hotels, Restaurants & Leisure		254,400		330,620
NetEase Inc., ADR		Entertainment		4,253		1,826,153
Ping An Bank Co. Ltd., A		Banks		802,600		1,459,736
Ping An Insurance Group Co. of China Ltd., A		Insurance		202,225		2,049,211
aProsus NV		Internet & Direct Marketing Retail		32,057		2,979,702
Sunny Optical Technology Group Co. Ltd.		Electronic Equipment, Instruments & Components		161,000		2,591,195
Tencent Holdings Ltd.		Interactive Media & Services		376,700		24,137,977
Uni-President China Holdings Ltd.		Food Products		940,300		940,581
Weifu High-Technology Co. Ltd., B		Auto Components		306,139		522,443
						80,661,225
Czech Republic 0.3%
Moneta Money Bank AS		Banks		390,403		883,994
Hungary 1.0%
Richter Gedeon Nyrt		Pharmaceuticals		131,650		2,730,392
India 5.4%
Bajaj Holdings & Investment Ltd.		Diversified Financial Services		60,776		2,048,194
Coal India Ltd.		Oil, Gas & Consumable Fuels		442,535		781,335
Glenmark Pharmaceuticals Ltd.		Pharmaceuticals		18,613		111,027
ICICI Bank Ltd.		Banks		1,630,254		7,596,332
Infosys Ltd.		IT Services		306,365		2,976,458
Tata Chemicals Ltd.		Chemicals		165,900		683,455
						14,196,801
Indonesia 0.9%
Astra International Tbk PT		Automobiles		7,340,300		2,487,990

Semiannual Report         TD-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Developing Markets VIP Fund (continued)

	Industry		Shares		Value
Common Stocks (continued)
Kenya 0.2%
aEquity Group Holdings PLC		Banks		1,528,708	$	494,983
Mexico 1.5%
Banco Santander Mexico SA Institucion de Banca Multiple Grupo Financiero Santander, ADR		Banks		949,761		3,428,637
Nemak SAB de CV		Auto Components		2,014,800		421,778
						3,850,415
Pakistan 0.2%
Habib Bank Ltd.		Banks		1,116,900		640,418
Peru 0.3%
Intercorp Financial Services Inc.		Banks		31,950		845,078
Philippines 0.2%
BDO Unibank Inc.		Banks		327,469		647,421
Russia 8.5%
Gazprom PJSC, ADR		Oil, Gas & Consumable Fuels		312,600		1,688,018
LUKOIL PJSC, ADR		Oil, Gas & Consumable Fuels		95,250		7,080,324
aMail.Ru Group Ltd., GDR		Interactive Media & Services		81,525		1,838,918
aSberbank of Russia PJSC, ADR		Banks		498,847		5,670,765
aYandex NV, A		Interactive Media & Services		126,319		6,318,476
						22,596,501
South Africa 4.8%
aMassmart Holdings Ltd.		Food & Staples Retailing		580,084		769,260
Naspers Ltd., N		Internet & Direct Marketing Retail		64,938		11,929,100
						12,698,360
South Korea 19.2%
Fila Holdings Corp.		Textiles, Apparel & Luxury Goods		64,280		1,901,969
Hankook Tire & Technology Co. Ltd.		Auto Components		15,300		317,500
KT Skylife Co. Ltd.		Media		166,071		1,101,986
LG Corp.		Industrial Conglomerates		96,342		5,765,192
Naver Corp.		Interactive Media & Services		53,983		12,177,767
POSCO		Metals & Mining		15,429		2,253,347
Samsung Electronics Co. Ltd.		Technology Hardware, Storage & Peripherals		513,903		22,810,142
Samsung Life Insurance Co. Ltd.		Insurance		76,937		2,900,434
SK Hynix Inc.		Semiconductors & Semiconductor Equipment		24,040		1,721,012
						50,949,349
Taiwan 11.4%
Catcher Technology Co. Ltd.		Technology Hardware, Storage & Peripherals		114,000		866,423
CTBC Financial Holding Co. Ltd.		Banks		350,500		243,616
aFIT Hon Teng Ltd.		Electronic Equipment, Instruments & Components		990,600		386,111
Hon Hai Precision Industry Co. Ltd.		Electronic Equipment, Instruments & Components		1,185,000		3,489,454
Largan Precision Co. Ltd.		Electronic Equipment, Instruments & Components		5,300		739,053
Taiwan Semiconductor Manufacturing Co. Ltd.		Semiconductors & Semiconductor Equipment		2,299,000		24,623,553
						30,348,210

TD-12         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Developing Markets VIP Fund (continued)

	Industry		Shares		Value
Common Stocks (continued)
Thailand 1.5%
Kasikornbank PCL, fgn.		Banks		705,000	$	2,142,460
Kiatnakin Bank PCL, fgn.		Banks		859,600		1,118,932
Thai Beverage PCL, fgn.		Beverages		1,450,900		708,301
						3,969,693
United Kingdom 3.0%
Unilever PLC		Personal Products		146,186		7,885,110
United States 1.9%
Cognizant Technology Solutions Corp., A		IT Services		64,484		3,663,981
aIMAX Corp.		Entertainment		118,755		1,331,243
						4,995,224
Total Common Stocks (Cost $185,963,504)						249,309,707
Preferred Stocks 3.0%
Brazil 3.0%
cBanco Bradesco SA, 13.248%, ADR, pfd.		Banks		1,026,866		3,912,359
cItau Unibanco Holding SA, 10.51%, ADR, pfd.		Banks		897,443		4,209,008
Total Preferred Stocks (Cost $7,746,131)						8,121,367
Total Investments before Short Term Investments (Cost $193,709,635)						257,431,074
Short Term Investments 2.9%
Money Market Funds (Cost $6,684,070) 2.5%
United States 2.5%
d,eInstitutional Fiduciary Trust Money Market Portfolio, 0.00%				6,684,070		6,684,070
Investments from Cash Collateral Received for Loaned Securities 0.4%
Money Market Funds (Cost $960,000) 0.4%
United States 0.4%
d,eInstitutional Fiduciary Trust Money Market Portfolio, 0.00%				960,000		960,000
Total Investments (Cost $201,353,705) 99.8%						265,075,144
Other Assets, less Liabilities 0.2%						477,889
Net Assets 100.0%					$	265,553,033

See Abbreviations on page TD-24.

^aNon-income producing.

^bA portion or all of the security is on loan at June 30, 2020. See Note 1(c).

^cVariable rate security. The rate shown represents the yield at period end.

^dSee Note 3(e) regarding investments in affiliated management investment companies.

^eThe rate shown is the annualized seven-day effective yield at period end.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TD-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Templeton Developing Markets VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$193,709,635
Cost - Non-controlled affiliates (Note 3e)		7,644,070
Value - Unaffiliated issuers+		$257,431,074
Value - Non-controlled affiliates (Note 3e)		7,644,070
Receivables:
Investment securities sold		653,901
Capital shares sold		599,038
Dividends		795,076
Other assets		255
Total assets		267,123,414
Liabilities:
Payables:
Capital shares redeemed		167,083
Management fees		223,081
Distribution fees		39,327
Trustees’ fees and expenses		94
Reports to shareholders		102,061
Payable upon return of securities loaned		960,000
Accrued expenses and other liabilities		78,735
Total liabilities		1,570,381
Net assets, at value		$265,553,033
Net assets consist of:
Paid-in capital		$207,856,171
Total distributable earnings (losses)		57,696,862
Net assets, at value		$265,553,033
Class 1:
Net assets, at value		$  71,751,609
Shares outstanding		8,054,721
Net asset value and maximum offering price per share		$8.91
Class 2:
Net assets, at value		$189,208,015
Shares outstanding		21,388,950
Net asset value and maximum offering price per share		$8.85
Class 4:
Net assets, at value		$   4,593,409
Shares outstanding		515,826
Net asset value and maximum offering price per share		$8.90
+Includes securities loaned		$   1,057,818

TD-14         Semiannual Report  |  The accompanying notes are an integral part of these  financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Templeton Developing Markets VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers		$   1,949,098
Non-controlled affiliates (Note 3e)		9,562
Income from securities loaned:
Unaffiliated entities (net of fees and rebates)		7,753
Non-controlled affiliates (Note 3e)		1,521
Total investment income		1,967,934
Expenses:
Management fees (Note 3a)		1,425,717
Distribution fees: (Note 3c)
Class 2		240,375
Class 4		8,184
Custodian fees (Note 4)		43,751
Reports to shareholders		67,422
Professional fees		46,728
Trustees’ fees and expenses		906
Other		13,674
Total expenses		1,846,757
Expenses waived/paid by affiliates (Note 3e)		(5,530	)
Net expenses		1,841,227
Net investment income		126,707
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:#
Unaffiliated issuers		1,449,392
Foreign currency transactions		(41,807	)
Net realized gain (loss)		1,407,585
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(40,080,079	)
Translation of other assets and liabilities denominated in foreign currencies		2,367
Change in deferred taxes on unrealized appreciation		559,174
Net change in unrealized appreciation (depreciation)		(39,518,538	)
Net realized and unrealized gain (loss)		(38,110,953	)
Net increase (decrease) in net assets resulting from operations		$(37,984,246	)

*Foreign taxes withheld on dividends	$	441,127
#Net of foreign taxes	$	180,958

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TD-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Templeton Developing Markets VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income		$       126,707			$    5,141,772
Net realized gain (loss)		1,407,585			16,774,357
Net change in unrealized appreciation (depreciation)		(39,518,538	)		50,174,103
Net increase (decrease) in net assets resulting from operations		(37,984,246	)		72,090,232
Distributions to shareholders:
Class 1		(5,313,566	)		(1,134,638	)
Class 2		(13,445,802	)		(2,113,534	)
Class 4		(329,902	)		(46,961	)
Total distributions to shareholders		(19,089,270	)		(3,295,133	)
Capital share transactions: (Note 2)
Class 1		(11,001,413	)		(8,627,549	)
Class 2		(817,504	)		(10,720,631	)
Class 4		(60,712	)		(845,695	)
Total capital share transactions		(11,879,629	)		(20,193,875	)
Net increase (decrease) in net assets		(68,953,145	)		48,601,224
Net assets:
Beginning of period		334,506,178			285,904,954
End of period		$265,553,033			$334,506,178

TD-16         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Templeton Developing Markets VIP Fund

1. Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Templeton Developing Markets VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. The Fund offers three classes of shares: Class 1, Class 2 and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a. Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued

according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Investments in open-end mutual funds are valued at the closing NAV.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time. At June 30, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day

Semiannual Report         TD-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Developing Markets VIP Fund (continued)

1. Organization and Significant Accounting

Policies (continued)

a. Financial Instrument Valuation (continued)

of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b. Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c. Securities Lending

Certain or all Funds participate in an agency based securities lending program to earn additional income. The Fund receives collateral in the form of cash and/or U.S.

Government and Agency securities against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. Any cash collateral received is deposited into a joint cash account with other funds and is used to invest in a money market fund managed by Franklin Advisers, Inc., an affiliate of the Funds. Additionally, the Fund received $156,817 in U.S. Government and Agency securities as collateral. The Fund may receive income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third-party vendor, is reported separately in the Statements of Operations. The Fund bears the market risk with respect to any cash collateral investment, securities loaned, and the risk that the agent may default on its obligations to the Fund. If the borrower defaults on its obligation to return the securities loaned, the Fund has the right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower.

d. Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be

TD-18         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Developing Markets VIP Fund (continued)

sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

e. Security Transactions, Investment Income,

Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Estimated expenses are accrued daily. Dividend income is recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of

number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

f. Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

g. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		297,789		$	2,572,312			544,413		$	5,344,264
Shares issued in reinvestment of distributions		605,880			5,313,566			121,873			1,134,638
Shares redeemed		(1,856,447	)		(18,887,291	)		(1,570,097	)		(15,106,451	)
Net increase (decrease)		(952,778	)	$	(11,001,413	)		(903,811	)	$	(8,627,549	)

Semiannual Report         TD-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Developing Markets VIP Fund (continued)

2. Shares of Beneficial Interest (continued)

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 2 Shares:
Shares sold		2,237,390		$	21,428,014			5,803,158		$	55,845,696
Shares issued in reinvestment of distributions		1,543,720			13,445,802			228,490			2,113,534
Shares redeemed		(4,019,076	)		(35,691,320	)		(7,263,336	)		(68,679,861	)
Net increase (decrease)		(237,966	)	$	(817,504	)		(1,231,688	)	$	(10,720,631	)
Class 4 Shares:
Shares sold		21,730		$	190,119			26,510		$	252,720
Shares issued in reinvestment of distributions		37,660			329,902			5,050			46,961
Shares redeemed		(62,602	)		(580,733	)		(118,358	)		(1,145,376	)
Net increase (decrease)		(3,212	)	$	(60,712	)		(86,798	)	$	(845,695	)

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or trustees of the following subsidiaries:

Subsidiary	Affiliation
Templeton Asset Management Ltd. (Asset Management)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a. Management Fees

The Fund pays an investment management fee to Asset Management based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
1.050%	Up to and including $1 billion
1.000%	Over $1 billion, up to and including $5 billion
0.950%	Over $5 billion, up to and including $10 billion
0.900%	Over $10 billion, up to and including $15 billion
0.850%	Over $15 billion, up to and including $20 billion
0.800%	In excess of $20 billion

b. Administrative Fees

Under an agreement with Asset Management, FT Services provides administrative services to the Fund. The fee is paid by Asset Management based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

TD-20         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Developing Markets VIP Fund(continued)

c. Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.25% and 0.35% per year of its average daily net assets of Class 2 and Class 4 respectively. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

e. Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Investment Income
Non-Controlled Affiliates
																Dividends
Institutional Fiduciary Trust Money Market Portfolio, 0.00%	$	3,522,232	$	21,477,452	$	(18,315,614	)	$	—	$	—	$	6,684,070		6,684,070		$ 9,562
																Income from securities loaned
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		—		12,732,370		(11,772,370	)		—		—		960,000		960,000		1,521
Total Affiliated Securities	$	3,522,232	$	34,209,822	$	(30,087,984	)	$	—	$	—	$	7,644,070				$11,083

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, there were no credits earned.

Semiannual Report         TD-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Developing Markets VIP Fund (continued)

5. Income Taxes

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$	208,884,501
Unrealized appreciation	$	91,324,396
Unrealized depreciation		(35,133,753	)
Net unrealized appreciation (depreciation)	$	56,190,643

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatment of corporate actions.

6. Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $6,536,950 and $39,857,980, respectively.

At June 30, 2020, in connection with securities lending transactions, the Fund loaned equity investments and received $960,000 of cash collateral. The gross amount of recognized liability for such transactions is included in payable upon return of securities loaned in the Statement of Assets and Liabilities. The agreements can be terminated at any time.

7. Concentration of Risk

Investing in foreign securities may include certain risks and considerations not typically associated with investing in U.S. securities, such as fluctuating currency values and changing local, regional and global economic, political and social conditions, which may result in greater market volatility. Current political and financial uncertainty surrounding the European Union may increase market volatility and the economic risk of investing in securities in Europe. In addition, certain foreign securities may not be as liquid as U.S. securities.

The United States and other nations have imposed and could impose additional sanctions on certain issuers in Russia due to regional conflicts. These sanctions could result in the devaluation of Russia’s currency, a downgrade in Russian issuers’ credit ratings, or a decline in the value and liquidity of Russian stocks or other securities. Such sanctions could also adversely affect Russia’s economy. The Fund may be prohibited from investing in securities issued by companies subject to such sanctions. In addition, if the Fund holds the securities of an issuer that is subject to such sanctions, an immediate freeze of that issuer’s securities could result, impairing the ability of the Fund to buy, sell, receive or deliver those securities. There is also the risk that countermeasures could be taken by Russia’s government, which could involve the seizure of the Fund’s assets. These risks could affect the value of the Fund’s portfolio. While the Fund holds securities of certain issuers impacted by the sanctions, existing investments do not presently violate the applicable terms and conditions of the sanctions. The sanctions currently do not affect the Fund’s ability to sell these securities. At June 30, 2020, the Fund had 8.5% of its net assets invested in Russia.

8. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

TD-22         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Developing Markets VIP Fund (continued)

9. Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

10. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

Semiannual Report         TD-23

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Developing Markets VIP Fund (continued)

10. Fair Value Measurements (continued)

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets carried at fair value, is as follows:    

	Level 1		Level 2		Level 3		Total
Assets:
Investments in Securities:a
Equity Investments:b
Cambodia	$	—	$	1,779,444	$	—	$	1,779,444
China		26,039,537		54,621,688		—		80,661,225
Czech Republic		—		883,994		—		883,994
Hungary		—		2,730,392		—		2,730,392
India		—		14,196,801		—		14,196,801
Indonesia		—		2,487,990		—		2,487,990
Philippines		—		647,421		—		647,421
Russia		6,318,476		16,278,025		—		22,596,501
South Africa		—		12,698,360		—		12,698,360
South Korea		—		50,949,349		—		50,949,349
Taiwan		—		30,348,210		—		30,348,210
Thailand		—		3,969,693		—		3,969,693
United Kingdom		—		7,885,110		—		7,885,110
All Other Equity Investments		25,596,584		—		—		25,596,584
Short Term Investments		7,644,070		—		—		7,644,070
Total Investments in Securities	$	65,598,667	$	199,476,477	$	—	$	265,075,144

^aFor detailed categories, see the accompanying Statement of Investments.    

^bIncludes common and preferred stocks as well as other equity interests.    

11. New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of LIBOR and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

12. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Selected Portfolio
ADR	American Depositary Receipt
GDR	Global Depositary Receipt

TD-24         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Tax Information (unaudited)

Templeton Developing Markets VIP Fund

At December 31, 2019, more than 50% of the Fund’s total assets were invested in securities of foreign issuers. In most instances, foreign taxes were withheld from income paid to the Fund on these investments. As shown in the table below, the Fund hereby reports to shareholders the foreign source income and foreign taxes paid, pursuant to Section 853 of the Internal Revenue Code. This written statement will allow shareholders of record on June 11, 2020, to treat their proportionate share of foreign taxes paid by the Fund as having been paid directly by them. The shareholder shall consider these amounts as foreign taxes paid in the tax year in which they receive the Fund distribution.

The following table provides a detailed analysis of foreign tax paid and foreign source income as reported by the Fund to shareholders of record.

Class	Foreign Tax Paid Per Share		Foreign Source Income Per Share
Class 1		$0.0543		$0.4959
Class 2		$0.0543		$0.4688
Class 4		$0.0543		$0.4576

Foreign Tax Paid Per Share is the amount per share available to you, as a tax credit (assuming you held your shares in the Fund for a minimum of 16 days during the 31-day period beginning 15 days before the ex-dividend date of the Fund’s distribution to which the foreign taxes relate), or, as a tax deduction.

Foreign Source Income Per Share is the amount per share of income dividends attributable to foreign securities held by the Fund, plus any foreign taxes withheld on these dividends. The amounts reported include foreign source qualified dividends that have not been adjusted for the rate differential applicable to such dividend income.

Semiannual Report         TD-25

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Templeton Foreign VIP Fund

This semiannual report for Templeton Foreign VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -18.22% total return* for the six-month period ended June 30, 2020.

*The Fund has a fee waiver associated with any investment it makes in a Franklin Templeton money fund and/or other Franklin Templeton fund, contractually guaranteed through 4/30/21. Fund investment results reflect the fee waiver; without this waiver, the results would have been lower.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         TF-1

TEMPLETON FOREIGN VIP FUND

Fund Goal and Main Investments

The Fund seeks long-term capital growth. Under normal market conditions, the Fund invests at least 80% of its net assets in investments of issuers located outside the U.S., including those in emerging markets.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Special risks are associated with foreign investing, including currency fluctuations, economic instability and political developments; investments in developing markets involve heightened risks related to the same factors. Currency rates may fluctuate significantly over short periods of time, and can reduce returns. Because the Fund may invest its assets in companies in a specific region, including Europe, it is subject to greater risks of adverse developments in that region and/or the surrounding regions than a fund that is more broadly diversified geographically. Current political uncertainty concerning the economic consequences of the departure of the U.K. from the European Union may increase market volatility. Derivatives, including currency management strategies, involve costs and can create economic leverage in the portfolio which may result in significant volatility and cause the Fund to participate in losses (as well as enable gains) on an amount that exceeds the Fund’s initial investment. The Fund may not achieve the anticipated benefits, and may realize losses when a counterparty fails to perform as promised. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. In comparison, the Fund’s benchmark, the MSCI All Country World Index (ACWI) ex

Geographic Composition

Based on Total Net Assets as of 6/30/20

USA Index, posted a -10.76% total return for the same period.¹ Please note, index performance information is provided for reference and we do not attempt to track the index but rather undertake investments on the basis of fundamental research.

Economic and Market Overview

Global developed and emerging market equities, as measured by the MSCI ACWI (USD), posted a -5.99% total return during the six months under review.¹ Stocks fell sharply in early 2020 as countries around the world implemented lockdown measures in an effort to slow the spread of the novel coronavirus (COVID-19). Global supply chain disruptions, business and personal restrictions, and subdued consumer spending drove many investors to sell equity holdings in favor of perceived safe investments such as government bonds and cash. While global equities, notably in the U.S., rebounded in April and May amid optimism about easing lockdown restrictions, concerns about a second wave of infections hindered equities in June, as investors weighed the possibility of renewed restrictions.

In the U.S., government mandates to mitigate the COVID-19 pandemic severely impacted the economy beginning in March 2020. As a result, the unemployment rate surged to 14.7% in April, as many businesses, particularly those involved in hospitality, retail and travel, announced mass layoffs.² According to the National Bureau of Economic Research, the longest U.S. economic expansion in history ended in February 2020 as the country slipped into a severe recession. Nonetheless, near period-end, there were signs that a recovery was underway, as jobless claims fell

1. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

2. Source: U.S. Bureau of Labor Statistics.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

TF-2         Semiannual Report

TEMPLETON FOREIGN VIP FUND

considerably from their peak in early April, retail sales rose sharply in May, and the unemployment rate fell to 11.1% in June.² Along with optimism about improved treatments and potential vaccines for COVID-19, the positive economic signals contributed to a significant equity rebound in April and May. However, an increase in COVID-19 infections in many states throughout June pressured U.S. stocks.

The U.S. Federal Reserve (Fed) made significant efforts to support the U.S. economy. In March 2020, as the pandemic began to severely impact the economy and financial markets, the Fed implemented two emergency rate cuts, lowering the federal funds target rate to a range of 0.00%–0.25%, and announced sweeping quantitative easing measures aimed at ensuring credit flow to borrowers and supporting credit markets with unlimited amounts of bond purchasing.

In the eurozone, some analysts forecasted a significant contraction in 2020, particularly in southern European countries, as the magnitude of the economic disruption caused by the pandemic became apparent. European developed market equities, as measured by the MSCI Europe Index (USD), posted a -12.43% total return for the period.¹ To stimulate growth, the European Central Bank implemented a broad bond-buying program, and many countries passed fiscal stimulus measures.

Asian developed and emerging market equities, as measured by the MSCI All Country Asia Index (USD), posted a -5.51% total return during the six-month period.¹ The onset of the pandemic brought dramatically slower economic activity in Asia, as businesses halted operations and manufacturing and export activity declined sharply in the region’s major economies. Asian markets generally advanced toward period-end, bolstered by fiscal stimulus measures and economies reopening throughout the region.

Emerging market stocks, as measured by the MSCI Emerging Markets Index (USD), posted a -9.67% total return due primarily to the COVID-19 pandemic.¹ A sharp decrease in prices for oil and other natural resources also hurt emerging market economies reliant on these exports. In the last quarter of the reporting period, however, investor optimism led to a stock rally, particularly in emerging market countries that had successfully lowered infection rates.

Investment Strategy

Our investment philosophy is bottom up, value oriented and long term. When choosing investments for the Fund, we generally focus on the market price of a company’s securities relative to our evaluation of the company’s

Top 10 Holdings

6/30/20

Company Sector/Industry, Country	% of Total Net Assets
Samsung Electronics Co. Ltd. Technology Hardware, Storage & Peripherals, South Korea		3.6%
Bayer AG Pharmaceuticals, Germany		3.5%
Takeda Pharmaceutical Co. Ltd. Pharmaceuticals, Japan		3.1%
Wheaton Precious Metals Corp. Metals & Mining, Canada		2.9%
Taiwan Semiconductor Manufacturing Co. Ltd. Semiconductors & Semiconductor Equipment, Taiwan		2.5%
KB Financial Group Inc. Banks, South Korea		2.4%
NXP Semiconductors NV Semiconductors & Semiconductor Equipment, Netherlands		2.3%
CK Hutchison Holdings Ltd. Industrial Conglomerates, Hong Kong		2.3%
Kirin Holdings Co. Ltd. Beverages, Japan		2.2%
Sanofi Pharmaceuticals, France		2.1%

potential long-term earnings, asset value and cash flow. Our analysis includes an assessment of the potential impacts of material environmental, social and governance (ESG) factors on the long-term risk and return profile of a company. We also consider a company’s price/earnings ratio, price/cash flow ratio, profit margins and liquidation value.

The Fund may, from time to time, engage in currency-related derivatives to seek to hedge (protect) against currency risks. The Fund may also use a variety of equity-related derivatives for various purposes including enhancing Fund returns, increasing liquidity and gaining exposure to particular markets in more efficient or less expensive ways.

Manager’s Discussion

During the six months under review, key contributors to the Fund’s performance relative to the MSCI ACWI ex USA Index included stock selection in the materials and utilities sectors.

Within materials, Canadian mining companies Wheaton Precious Metals and Alamos Gold (not part of the index) aided relative results. Their stocks performed particularly

Semiannual Report         TF-3

TEMPLETON FOREIGN VIP FUND

well in the first half of 2020 as the price of gold reached multi-year highs.

In the utilities sector, German energy solutions company E.ON benefited relative performance.

Other key notable contributors included Swiss pharmaceuticals firm Roche Holding and German industrial conglomerate Siemens. Roche performed well as its business is largely unaffected by the COVID-19 pandemic, with its cancer, hemophilia and multiple sclerosis medicines and treatments continuing to be administered.

In contrast, key detractors from the Fund’s relative performance included stock selection in the financials and communication services sectors and an overweighting in the energy sector.

Within financials, our positions in Standard Chartered, ING Groep and Bank of Ireland (not held at period-end) hindered relative results. U.K.-domiciled, Asia-focused lender Standard Chartered was negatively impacted by escalating turmoil in Hong Kong. We believe management’s recent efforts to de-risk the balance sheet, combined with the bank’s solid core franchise in trade finance and high net worth retail client base, position it well to withstand macro adversity and emerge with its growth strategy intact. The shares of Dutch banking services firm ING Groep and Bank of Ireland declined due to broad-based economic fears and low interest rates. ING’s shares were further pressured by management’s suspension of dividend payments.

In the communication services sector, our holding in Luxembourg-based communication satellite owner SES (not held at period-end) hindered relative results.

Within energy, our positions in U.K.-based integrated energy firm BP and U.K.-listed oil and natural gas producer Royal Dutch Shell (not held at period-end) dampened relative results.

From a regional perspective, stock selection and an underweighting in North America, particularly in Canada, contributed to the Fund’s relative performance. In contrast, stock selection in Asia, notably in China, Hong Kong and South Korea, detracted from relative performance. In Europe, stock selection and an overweighting hindered relative performance, as relative weakness in the Netherlands and the U.K. more than offset relative strength in Germany.

Thank you for your participation in Templeton Foreign VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

TF-4         Semiannual Report

TEMPLETON FOREIGN VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual		Hypothetical
		(actual return after expenses)		(5% annual return before expenses)
Share Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$817.80	$3.75	$1,020.74	$4.17	0.83%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

Semiannual Report         TF-5

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Templeton Foreign VIP Fund

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$14.23			$13.01			$15.80			$13.89			$13.46			$15.34
Income from investment operationsa:
Net investment incomeb		0.14			0.44			0.29			0.30			0.33			0.31
Net realized and unrealized gains (losses)		(2.73	)		1.19			(2.64	)		2.03			0.62			(1.16	)
Total from investment operations		(2.59	)		1.63			(2.35	)		2.33			0.95			(0.85	)
Less distributions from:
Net investment income		(0.44	)		(0.27	)		(0.44	)		(0.42	)		(0.29	)		(0.53	)
Net realized gains		—			(0.14	)		—			—			(0.23	)		(0.50	)
Total distributions		(0.44	)		(0.41	)		(0.44	)		(0.42	)		(0.52	)		(1.03	)
Net asset value, end of period		$11.20			$14.23			$13.01			$15.80			$13.89			$13.46
Total returnc		(18.22)%			12.84%			(15.27)%			17.02%			7.49%			(6.31)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		0.86%			0.85%			0.83%			0.82%			0.80%			0.78%
Expenses net of waiver and payments by affiliates		0.83%			0.83%			0.81%			0.81%	e		0.78%			0.78%	f
Net investment income		2.34%			3.25%			1.96%			1.99%			2.38%			2.05%
Supplemental data
Net assets, end of period (000’s)		$97,104			$121,948			$114,784			$152,684			$133,218			$214,172
Portfolio turnover rate		23.71%			28.52%			21.38%			26.81%			20.93%			15.15%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

TF-6         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Templeton Foreign VIP Fund (continued)

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$13.93			$12.74			$15.47			$13.61			$13.20			$15.05
Income from investment operationsa:
Net investment incomeb		0.12			0.40			0.25			0.26			0.28			0.27
Net realized and unrealized gains (losses)		(2.67	)		1.16			(2.58	)		1.98			0.62			(1.13	)
Total from investment operations		(2.55	)		1.56			(2.33	)		2.24			0.90			(0.86	)
Less distributions from:
Net investment income		(0.40	)		(0.23	)		(0.40	)		(0.38	)		(0.26	)		(0.49	)
Net realized gains		—			(0.14	)		—			—			(0.23	)		(0.50	)
Total distributions		(0.40	)		(0.37	)		(0.40	)		(0.38	)		(0.49	)		(0.99	)
Net asset value, end of period		$10.98			$13.93			$12.74			$15.47			$13.61			$13.20
Total returnc		(18.35)%			12.53%			(15.44)%			16.69%			7.18%			(6.49)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		1.11%			1.10%			1.08%			1.07%			1.05%			1.03%
Expenses net of waiver and payments by affiliates		1.08%			1.08%			1.06%			1.06%	e		1.03%			1.03%	f
Net investment income		2.09%			3.00%			1.71%			1.74%			2.13%			1.80%
Supplemental data
Net assets, end of period (000’s)		$917,866			$1,117,813			$1,060,101			$1,394,475			$1,436,518			$1,456,854
Portfolio turnover rate		23.71%			28.52%			21.38%			26.81%			20.93%			15.15%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TF-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Templeton Foreign VIP Fund (continued)

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$14.20			$12.96			$15.71			$13.71			$13.29			$15.16
Income from investment operationsa:
Net investment incomeb		0.12			0.39			0.24			0.23			0.26			0.25
Net realized and unrealized gains (losses)		(2.73	)		1.20			(2.63	)		2.03			0.63			(1.14	)
Total from investment operations		(2.61	)		1.59			(2.39	)		2.26			0.89			(0.89	)
Less distributions from:
Net investment income		(0.39	)		(0.21	)		(0.36	)		(0.26	)		(0.24	)		(0.48	)
Net realized gains		—			(0.14	)		—			—			(0.23	)		(0.50	)
Total distributions		(0.39	)		(0.35	)		(0.36	)		(0.26	)		(0.47	)		(0.98	)
Net asset value, end of period		$11.20			$14.20			$12.96			$15.71			$13.71			$13.29
Total returnc		(18.39)%			12.49%			(15.54)%			16.62%			7.09%			(6.65)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates		1.21%			1.20%			1.18%			1.17%			1.15%			1.13%
Expenses net of waiver and payments by affiliates		1.18%			1.18%			1.16%			1.16%	e		1.13%			1.13%	f
Net investment income		1.99%			2.90%			1.61%			1.64%			2.03%			1.70%
Supplemental data
Net assets, end of period (000’s)		$94,464			$113,681			$125,265			$159,944			$484,763			$472,189
Portfolio turnover rate		23.71%			28.52%			21.38%			26.81%			20.93%			15.15%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of expense reduction rounds to less than 0.01%.

^fBenefit of waiver and payments by affiliates rounds to less than 0.01%.

TF-8         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Templeton Foreign VIP Fund

	Country		Shares		Value
Common Stocks 86.7%
Aerospace & Defense 1.1%
BAE Systems PLC		United Kingdom		1,961,611	$	11,728,900
Auto Components 2.4%
aCie Generale des Etablissements Michelin SCA		France		158,794		16,550,108
Toyota Industries Corp.		Japan		186,300		9,902,335
						26,452,443
Automobiles 3.9%
Bayerische Motoren Werke AG		Germany		205,506		13,118,469
Honda Motor Co. Ltd.		Japan		517,600		13,381,886
Isuzu Motors Ltd.		Japan		1,813,100		16,476,249
						42,976,604
Banks 9.3%
bBNP Paribas SA		France		276,049		11,028,284
ING Groep NV		Netherlands		1,953,931		13,619,453
Kasikornbank PCL, fgn.		Thailand		1,860,000		5,652,448
aKB Financial Group Inc., ADR.		South Korea		956,806		26,618,343
Shinhan Financial Group Co. Ltd.		South Korea		366,922		8,890,839
Standard Chartered PLC		United Kingdom		3,651,049		19,790,786
Sumitomo Mitsui Financial Group Inc.		Japan		606,500		17,116,516
						102,716,669
Beverages 2.7%
aKirin Holdings Co. Ltd.		Japan		1,159,100		24,433,531
Suntory Beverage & Food Ltd.		Japan		153,600		5,993,200
						30,426,731
Chemicals 2.4%
Covestro AG		Germany		199,631		7,602,917
Johnson Matthey PLC		United Kingdom		537,960		14,010,021
Tosoh Corp.		Japan		389,100		5,345,028
						26,957,966
Construction & Engineering 0.5%
Sinopec Engineering Group Co. Ltd.		China		11,734,000		5,038,255
Diversified Telecommunication Services 0.8%
China Telecom Corp. Ltd., H		China		29,703,557		8,343,576
Electronic Equipment, Instruments & Components 2.3%
Hitachi Ltd.		Japan		542,500		17,243,267
Landis+Gyr Group AG		Switzerland		120,834		7,827,652
						25,070,919
Energy Equipment & Services 1.3%
SBM Offshore NV		Netherlands		960,511		14,152,364
Food & Staples Retailing 3.6%
Matsumotokiyoshi Holdings Co. Ltd.		Japan		388,300		14,110,277
Seven & i Holdings Co. Ltd.		Japan		360,100		11,780,139
Sundrug Co. Ltd.		Japan		410,400		13,582,480
						39,472,896

Semiannual Report         TF-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Foreign VIP Fund (continued)

	Country		Shares		Value
Common Stocks (continued)
Health Care Providers & Services 0.6%
Sinopharm Group Co. Ltd., H		China		2,794,800	$	7,185,265
Household Durables 2.3%
Panasonic Corp.		Japan		1,239,300		10,867,479
Sony Corp.		Japan		219,300		15,138,306
						26,005,785
Industrial Conglomerates 3.8%
CK Hutchison Holdings Ltd.		Hong Kong		3,873,500		25,083,025
Siemens AG		Germany		140,525		16,571,641
						41,654,666
Insurance 2.0%
AIA Group Ltd.		Hong Kong		2,416,800		22,615,303
Interactive Media & Services 1.5%
bBaidu Inc., ADR		China		138,230		16,572,395
Internet & Direct Marketing Retail 0.5%
bAlibaba Group Holding Ltd., ADR		China		25,100		5,414,070
Machinery 1.2%
Komatsu Ltd.		Japan		655,000		13,414,740
Marine 0.5%
AP Moeller-Maersk A/S, B		Denmark		5,208		6,103,211
Media 0.7%
Nippon Television Holdings Inc.		Japan		338,900		3,670,618
Tokyo Broadcasting System Holdings Inc.		Japan		262,400		4,197,442
						7,868,060
Metals & Mining 7.0%
Alamos Gold Inc., A		Canada		1,982,052		18,591,648
bArcelorMittal SA		France		1,011,540		10,713,140
Sumitomo Metal Mining Co. Ltd.		Japan		603,700		17,006,099
Wheaton Precious Metals Corp.		Canada		718,100		31,584,657
						77,895,544
Multi-Utilities 1.8%
E.ON SE		Germany		1,722,486		19,441,137
Oil, Gas & Consumable Fuels 4.9%
BP PLC		United Kingdom		4,677,890		17,920,464
Eni SpA		Italy		535,991		5,137,556
Equinor ASA		Norway		1,232,274		17,756,065
Galp Energia SGPS SA, B		Portugal		844,528		9,795,642
Husky Energy Inc.		Canada		1,163,600		3,822,810
						54,432,537
Pharmaceuticals 11.7%
Bayer AG		Germany		527,187		39,073,470
Novartis AG		Switzerland		128,920		11,231,641
Roche Holding AG		Switzerland		63,327		21,939,610
Sanofi		France		228,345		23,285,600

TF-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Foreign VIP Fund (continued)

	Country		Shares		Value
Common Stocks (continued)
Pharmaceuticals (continued)
Takeda Pharmaceutical Co. Ltd.		Japan		966,094	$	34,709,763
						130,240,084
Real Estate Management & Development 4.0%
CK Asset Holdings Ltd.		Hong Kong		3,560,500		21,351,434
Mitsui Fudosan Co. Ltd.		Japan		811,000		14,407,192
Swire Pacific Ltd., A		Hong Kong		1,628,500		8,655,052
						44,413,678
Semiconductors & Semiconductor Equipment 6.0%
Infineon Technologies AG		Germany		590,665		13,839,342
NXP Semiconductors NV		Netherlands		221,300		25,237,052
Taiwan Semiconductor Manufacturing Co. Ltd.		Taiwan		2,587,000		27,708,192
						66,784,586
Technology Hardware, Storage & Peripherals 3.6%
Samsung Electronics Co. Ltd.		South Korea		909,188		40,355,295
Thrifts & Mortgage Finance 1.5%
Housing Development Finance Corp. Ltd.		India		737,453		17,137,981
Tobacco 1.3%
Imperial Brands PLC		United Kingdom		756,727		14,404,955
Wireless Telecommunication Services 1.5%
Vodafone Group PLC, ADR		United Kingdom		1,062,403		16,934,704
Total Common Stocks (Cost $956,638,414)						962,211,319
Short Term Investments 16.4%
Money Market Funds (Cost $141,540,103) 12.8%
c,dInstitutional Fiduciary Trust Money Market Portfolio, 0.00%		United States		141,540,103		141,540,103
eInvestments from Cash Collateral Received for Loaned Securities 3.6%
Money Market Funds (Cost $39,731,419) 3.6%
c,dInstitutional Fiduciary Trust Money Market Portfolio, 0.00%		United States		39,731,419		39,731,419
Total Investments (Cost $1,137,909,936) 103.1%						1,143,482,841
Other Assets, less Liabilities (3.1)%						(34,048,249	)
Net Assets 100.0%					$	1,109,434,592

See Abbreviations on page TF-23.

^aA portion or all of the security is on loan at June 30, 2020. See Note 1(c).

^bNon-income producing.

^cSee Note 3(e) regarding investments in affiliated management investment companies.

^dThe rate shown is the annualized seven-day effective yield at period end.

^eSee Note 1(c) regarding securities on loan.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TF-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Templeton Foreign VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$    956,638,414
Cost - Non-controlled affiliates (Note 3e)		181,271,522
Value - Unaffiliated issuers+		$    962,211,319
Value - Non-controlled affiliates (Note 3e)		181,271,522
Cash		25,093
Receivables:
Investment securities sold		269,828
Capital shares sold		1,391,446
Dividends		4,999,326
European Union tax reclaims		856,368
Other assets		1,024
Total assets		1,151,025,926
Liabilities:
Payables:
Capital shares redeemed		549,936
Management fees		718,128
Distribution fees		217,666
Trustees’ fees and expenses		500
Payable upon return of securities loaned		39,731,419
Deferred tax		22,519
Accrued expenses and other liabilities		351,166
Total liabilities		41,591,334
Net assets, at value		$ 1,109,434,592
Net assets consist of:
Paid-in capital		$ 1,237,636,914
Total distributable earnings (losses)		(128,202,322	)
Net assets, at value		$ 1,109,434,592
Class 1:
Net assets, at value		$      97,104,260
Shares outstanding		8,670,295
Net asset value and maximum offering price per share		$11.20
Class 2:
Net assets, at value		$    917,866,180
Shares outstanding		83,628,570
Net asset value and maximum offering price per share		$10.98
Class 4:
Net assets, at value		$      94,464,152
Shares outstanding		8,435,462
Net asset value and maximum offering price per share		$11.20
+Includes securities loaned		$      37,647,516

TF-12         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Templeton Foreign VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers	$	17,583,181
Non-controlled affiliates (Note 3e)		183,236
Interest:
Unaffiliated issuers		11
Income from securities loaned:
Unaffiliated entities (net of fees and rebates)		89,713
Non-controlled affiliates (Note 3e)		14,818
Total investment income		17,870,959
Expenses:
Management fees (Note 3a)		4,576,857
Distribution fees: (Note 3c)
Class 2		1,167,848
Class 4		166,719
Custodian fees (Note 4)		66,366
Reports to shareholders		134,247
Professional fees		51,591
Trustees’ fees and expenses		3,862
Other		3,693
Total expenses		6,171,183
Expenses waived/paid by affiliates (Note 3e)		(168,562	)
Net expenses		6,002,621
Net investment income		11,868,338
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:
Unaffiliated issuers		(99,310,057	)
Foreign currency transactions		(380,080	)
Net realized gain (loss)		(99,690,137	)
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(154,935,444	)
Translation of other assets and liabilities denominated in foreign currencies		(20,633	)
Change in deferred taxes on unrealized appreciation		(22,519	)
Net change in unrealized appreciation (depreciation)		(154,978,596	)
Net realized and unrealized gain (loss)		(254,668,733	)
Net increase (decrease) in net assets resulting from operations	$	(242,800,395	)
*Foreign taxes withheld on dividends	$	2,085,780

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TF-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Templeton Foreign VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income	$	11,868,338		$	39,750,754
Net realized gain (loss)		(99,690,137	)		(42,940,121	)
Net change in unrealized appreciation (depreciation)		(154,978,596	)		161,044,541
Net increase (decrease) in net assets resulting from operations		(242,800,395	)		157,855,174
Distributions to shareholders:
Class 1		(3,651,171	)		(3,542,825	)
Class 2		(32,735,824	)		(29,727,357	)
Class 4		(3,189,135	)		(2,819,837	)
Total distributions to shareholders		(39,576,130	)		(36,090,019	)
Capital share transactions: (Note 2)
Class 1		756,121			(3,622,678	)
Class 2		33,518,547			(41,982,881	)
Class 4		4,094,883			(22,867,835	)
Total capital share transactions		38,369,551			(68,473,394	)
Net increase (decrease) in net assets		(244,006,974	)		53,291,761
Net assets:
Beginning of period		1,353,441,566			1,300,149,805
End of period		$1,109,434,592			$1,353,441,566

TF-14         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Templeton Foreign VIP Fund

1. Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Templeton Foreign VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. The Fund offers three classes of shares: Class 1, Class 2, and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a. Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued

according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Investments in open-end mutual funds are valued at the closing NAV.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time. At June 30, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day

Semiannual Report         TF-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Foreign VIP Fund (continued)

1. Organization and Significant Accounting

Policies (continued)

a. Financial Instrument Valuation (continued)

of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b. Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c. Securities Lending

The Fund participates in an agency based securities lending program to earn additional income. The Fund receives collateral in the form of cash and/or U.S. Government and

Agency securities against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. Any cash collateral received is deposited into a joint cash account with other funds and is used to invest in a money market fund managed by Franklin Advisers, Inc., an affiliate of the Fund. The Fund may receive income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third-party vendor, is reported separately in the Statement of Operations. The Fund bears the market risk with respect to any cash collateral investment, securities loaned, and the risk that the agent may default on its obligations to the Fund. If the borrower defaults on its obligation to return the securities loaned, the Fund has the right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower.

d. Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

As a result of several court cases, in certain countries across the European Union, the Fund filed additional tax reclaims for previously withheld taxes on dividends earned in those countries (EU reclaims). These additional filings are subject to various administrative proceedings by the local

TF-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Foreign VIP Fund (continued)

jurisdictions’ tax authorities within the European Union, as well as a number of related judicial proceedings. Income recognized, if any, for EU reclaims is reflected as other income in the Statement of Operations and any related receivable, if any, is reflected as European Union tax reclaims in the Statement of Assets and Liabilities. When uncertainty exists as to the ultimate resolution of these proceedings, the likelihood of receipt of these EU reclaims, and the potential timing of payment, no amounts are reflected in the financial statements. For U.S. income tax purposes, when EU reclaims are received by the Fund and the Fund previously passed foreign tax credit on to its shareholders, the Fund must either amend historic tax reporting to shareholders or enter into a closing agreement with the Internal Revenue Service (IRS) in order to pay the associated tax liability on behalf of the Fund’s shareholders.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

e. Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Dividend income is recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings

recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

f. Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

g. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

Semiannual Report         TF-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Foreign VIP Fund (continued)

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		433,172		$	4,826,402			315,303		$	4,277,207
Shares issued in reinvestment of distributions		325,706			3,651,171			273,789			3,542,825
Shares redeemed		(656,723	)		(7,721,452	)		(844,252	)		(11,442,710	)
Net increase (decrease)		102,155		$	756,121			(255,160	)	$	(3,622,678	)
Class 2 Shares:
Shares sold		7,223,300		$	79,940,518			7,564,257		$	99,786,234
Shares issued in reinvestment of distributions		2,981,405			32,735,824			2,342,581			29,727,357
Shares redeemed		(6,792,654	)		(79,157,795	)		(12,910,655	)		(171,496,472	)
Net increase (decrease)		3,412,051		$	33,518,547			(3,003,817	)	$	(41,982,881	)
Class 4 Shares:
Shares sold		909,581		$	10,094,838			784,963		$	10,500,046
Shares issued in reinvestment of distributions		284,490			3,189,135			218,085			2,819,837
Shares redeemed		(766,654	)		(9,189,090	)		(2,661,084	)		(36,187,718	)
Net increase (decrease)		427,417		$	4,094,883			(1,658,036	)	$	(22,867,835	)

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Templeton Investment Counsel, LLC (TIC)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

TF-18         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Foreign VIP Fund (continued)

a. Management Fees

The Fund pays an investment management fee to TIC based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.900%	Up to and including $200 million
0.810%	Over $200 million, up to and including $700 million
0.775%	Over $700 million, up to and including $1.2 billion
0.750%	Over $1.2 billion, up to and including $1.3 billion
0.675%	Over $1.3 billion, up to and including $10 billion
0.655%	Over $10 billion, up to and including $15 billion
0.635%	Over $15 billion, up to and including $20 billion
0.615%	In excess of $20 billion

For the period ended June 30, 2020, the annualized gross effective investment management fee rate was 0.812% of the Fund’s average daily net assets.

b. Administrative Fees

Under an agreement with TIC, FT Services provides administrative services to the Fund. The fee is paid by TIC based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

c. Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.25% and 0.35% per year of its average daily net assets of Class 2 and Class 4, respectively. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

Semiannual Report         TF-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Foreign VIP Fund (continued)

3. Transactions with Affiliates (continued)

e. Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Investment Income
Non-Controlled Affiliates
																	Dividends
Institutional Fiduciary Trust Money Market Portfolio, 0.00%	$	70,825,763	$	199,707,826	$	(128,993,486	)		$    —		$    —	$	141,540,103		141,540,103		$183,236
																	Income from securities loaned
Institutional Fiduciary Trust Money Market Portfolio, 0.00%		—		149,211,823		(109,480,404	)		—		—		39,731,419		39,731,419		14,818
Total Affiliated Securities	$	70,825,763	$	348,919,649	$	(238,473,890	)		$    —		$    —	$	181,271,522				$198,054

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, there were no credits earned.

5. Income Taxes

For tax purposes, capital losses may be carried over to offset future capital gains.

At December 31, 2019, the capital loss carryforwards were as follows:

Capital loss carryforwards not subject to expiration:
Long term	$	43,306,383

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments.	$	1,141,410,946
Unrealized appreciation	$	152,558,258
Unrealized depreciation		(150,486,363	)
Net unrealized appreciation (depreciation)	$	2,071,895

TF-20         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Foreign VIP Fund (continued)

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatment of foreign currency transactions.

6. Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $244,680,631 and $304,740,900, respectively.

At June 30, 2020, in connection with securities lending transactions, the Fund loaned equity investments and received $39,731,419 of cash collateral. The gross amount of recognized liability for such transactions is included in payable upon return of securities loaned in the Statement of Assets and Liabilities. The agreements can be terminated at any time.

7. Concentration of Risk

Investing in foreign securities may include certain risks and considerations not typically associated with investing in U.S. securities, such as fluctuating currency values and changing local, regional and global economic, political and social conditions, which may result in greater market volatility. Current political and financial uncertainty surrounding the European Union may increase market volatility and the economic risk of investing in securities in Europe. In addition, certain foreign securities may not be as liquid as U.S. securities.

8. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

9. Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

10. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

Semiannual Report         TF-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Foreign VIP Fund (continued)

10. Fair Value Measurements (continued)

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets carried at fair value, is as follows:

	Level 1		Level 2		Level 3		Total
Assets:
Investments in Securities:a
Equity Investments:
Aerospace & Defense	$	—	$	11,728,900	$	—	$	11,728,900
Auto Components		—		26,452,443		—		26,452,443
Automobiles		—		42,976,604		—		42,976,604
Banks		26,618,343		76,098,326		—		102,716,669
Beverages		—		30,426,731		—		30,426,731
Chemicals		—		26,957,966		—		26,957,966
Construction & Engineering		—		5,038,255		—		5,038,255
Diversified Telecommunication Services		—		8,343,576		—		8,343,576
Electronic Equipment, Instruments & Components		—		25,070,919		—		25,070,919
Energy Equipment & Services		—		14,152,364		—		14,152,364
Food & Staples Retailing		—		39,472,896		—		39,472,896
Health Care Providers & Services		—		7,185,265		—		7,185,265
Household Durables		—		26,005,785		—		26,005,785
Industrial Conglomerates		—		41,654,666		—		41,654,666
Insurance		—		22,615,303		—		22,615,303
Machinery		—		13,414,740		—		13,414,740
Marine		—		6,103,211		—		6,103,211
Media		—		7,868,060		—		7,868,060
Metals & Mining		50,176,305		27,719,239		—		77,895,544
Multi-Utilities.		—		19,441,137		—		19,441,137
Oil, Gas & Consumable Fuels		3,822,810		50,609,727		—		54,432,537
Pharmaceuticals		—		130,240,084		—		130,240,084
Real Estate Management & Development		—		44,413,678		—		44,413,678
Semiconductors & Semiconductor Equipment .		25,237,052		41,547,534		—		66,784,586
Technology Hardware, Storage & Peripherals		—		40,355,295		—		40,355,295
Thrifts & Mortgage Finance		—		17,137,981		—		17,137,981
Tobacco		—		14,404,955		—		14,404,955
All Other Equity Investments		38,921,169		—		—		38,921,169
Short Term Investments		181,271,522		—		—		181,271,522
Total Investments in Securities	$	326,047,201	$	817,435,640	$	—	$	1,143,482,841

^aFor detailed categories, see the accompanying Statement of Investments.

TF-22         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Foreign VIP Fund (continued)

11. New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

12. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Selected Portfolio                                     

ADR   American Depositary Receipt

Semiannual Report         TF-23

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Tax Information (unaudited)

Templeton Foreign VIP Fund

At December 31, 2019, more than 50% of the Fund’s total assets were invested in securities of foreign issuers. In most instances, foreign taxes were withheld from income paid to the Fund on these investments. As shown in the table below, the Fund hereby reports to shareholders the foreign source income and foreign taxes paid, pursuant to Section 853 of the Internal Revenue Code. This written statement will allow shareholders of record on June 11, 2020, to treat their proportionate share of foreign taxes paid by the Fund as having been paid directly by them. The shareholder shall consider these amounts as foreign taxes paid in the tax year in which they receive the Fund distribution.

The following table provides a detailed analysis of foreign tax paid and foreign source income as reported by the Fund to shareholders of record.

Class	Foreign Tax Paid Per Share		Foreign Source Income Per Share
Class 1		$0.0362		$0.4651
Class 2		$0.0362		$0.4323
Class 4		$0.0362		$0.4177

Foreign Tax Paid Per Share is the amount per share available to you, as a tax credit (assuming you held your shares in the Fund for a minimum of 16 days during the 31-day period beginning 15 days before the ex-dividend date of the Fund’s distribution to which the foreign taxes relate), or, as a tax deduction.

Foreign Source Income Per Share is the amount per share of income dividends attributable to foreign securities held by the Fund, plus any foreign taxes withheld on these dividends.

TF-24         Semiannual Report

Templeton Global Bond VIP Fund

This semiannual report for Templeton Global Bond VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -5.14% total return*,** for the six-month period ended June 30, 2020.

*The Fund has a fee waiver associated with any investment it makes in a Franklin Templeton money fund and/or other Franklin Templeton fund, contractually guaranteed through 4/30/21. Fund investment results reflect the fee waiver; without this waiver, the results would have been lower.

**Total return information is based on net asset values calculated for shareholder transactions. Certain adjustments were made to the net asset values of the Fund at 12/31/19 for financial reporting purposes. Accordingly, adjusted total returns have been disclosed in the Financial Highlights and differ from those reported here.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         TGB-1

TEMPLETON GLOBAL BOND VIP FUND

Fund Goal and Main Investments

The Fund seeks high current income, consistent with preservation of capital, with capital appreciation as a secondary consideration. Under normal market conditions, the Fund invests at least 80% of its net assets in bonds, which include debt securities of any maturity, such as bonds, notes, bills and debentures.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Foreign securities involve special risks, including currency fluctuations and economic and political uncertainties. Currency rates may fluctuate significantly over short periods of time, and can reduce returns. Sovereign debt securities are subject to various risks in addition to those relating to debt securities and foreign securities generally, including, but not limited to, the risk that a governmental entity may be unwilling or unable to pay interest and repay principal on its sovereign debt, or otherwise meet its obligations when due. Adverse conditions in a certain region or country can adversely affect securities of issuers in other countries whose economies appear to be unrelated. Investments in developing markets involve heightened risks related to the same factors, in addition to those associated with these markets’ smaller size, lesser liquidity and lack of established legal, political, business and social frameworks to support securities market. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. For comparison, the J.P. Morgan Global Government Bond Index posted a +4.60% total return

Geographic Composition*

Based on Total Net Assets as of 6/30/20

*Figures represent the net Fund exposure and include certain derivatives held in the portfolio (or their underlying reference assets) and may not total 100% or may be negative due to rounding, use of any derivatives or other factors.

**The Fund’s supranational investment was denominated in the Mexican peso.

and the FTSE World Government Bond Index posted a+4.08% total return for the same period.¹

Economic and Market Overview

The novel coronavirus (COVID-19) pandemic profoundly impacted economies and global financial markets during the six-month period. Lockdown orders from governments trying to “flatten the curve” (i.e., stem the rate of infection) brought entire countries, regions and continents to an economic standstill in March and April. The speed and pervasiveness of the economic shocks were unprecedented. There is no historical comparison for the magnitude of aggregate demand that was destroyed, nor the magnitude of job losses in such a compressed timescale.

Risk aversion rapidly escalated to crisis levels and deepened throughout March, driving correlations to 1.0 across multiple asset classes as investors shed risk and moved into perceived safe havens. Credit markets experienced substantial price volatility, with the lower-rated credit tiers bearing the brunt of the selloffs. Sovereign bond yields declined in higher-rated countries but rose in more vulnerable ones as volatility escalated. The yield on the 10-year U.S. Treasury (UST) note quickly dropped from 2.00% at the start of the period to a low of 0.54% on March

1. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

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TEMPLETON GLOBAL BOND VIP FUND

9. It finished the six-month period at 0.66%, 134 basis points (bps) lower that where it began. The yield on the 10-year German Bund dropped 27 bps further into negative territory during the period, finishing at -0.46%.

The U.S. Federal Reserve (Fed) responded quickly to the deepening crisis with two emergency rate cuts in March, the second of which dropped the federal funds target rate 100 bps to the zero bound that was used during the 2008 global financial crisis (GFC). The Fed also cut reserve requirements and encouraged financial institutions to borrow directly from the discount window. Growing liquidity strains throughout financial markets prompted the Fed to re-start liquidity programs that had been created during the GFC, such as the Commercial Paper Funding Facility and the Primary Dealer Credit Facility.

On March 23, the Fed took its financial market interventions beyond the scope of the GFC programs by creating corporate lending programs, and announcing its intentions to support lending to small- and medium-sized businesses through the newly created Main Street Business Lending Program. The Fed also pledged to buy unlimited government bonds, abandoning the previous quantitative easing targets it had announced a week earlier on March 15.

The heightened demand for U.S. dollars (USD) around the world also led the Fed to expand its liquidity swaps program with foreign central banks beyond the five banks in its standing facility including the European Central Bank (ECB), Bank of Japan (BOJ), Bank of England, Bank of Canada and Swiss National Bank. The swap program was expanded on March 19 to include the Reserve Bank of Australia, Reserve Bank of New Zealand, Danmarks Nationalbank, Norges Bank, Sveriges Riksbank, Bank of Korea, Monetary Authority of Singapore, Banco de Mexico and Banco Central do Brasil. The program enables a foreign central bank to borrow USD directly from the Fed to lend to its own local institutions, facilitating the flow of the world’s reserve currency. The USD notably strengthened from mid-March to mid-May before broadly weakening over the final six weeks of the period.

On the U.S. fiscal side, Congress passed the Coronavirus Aid, Relief, and Economic Security Act on March 26, a USD$2.2 trillion fiscal relief program designed to provide loans to businesses, income support and unemployment benefits to individuals, and funding for hospitals and public health services. It was the largest economic relief bill in U.S. history and was designed as a stopgap for social distancing policies.

On March 18, ECB President Christine Lagarde unveiled the €750 billion Pandemic Emergency Purchase Programme (PEPP) in an unscheduled mid-week announcement. Lagarde commented that, “there are no limits to our commitment to the euro. We are determined to use the full potential of our tools, within our mandate.” PEPP appeared geared to support the more vulnerable states, as the program has unprecedented flexibility to buy a wide range of eligible securities, including Greek and Italian sovereign debt, as well as corporate commercial paper.

In the second quarter of 2020, global financial markets began to rebound from the extreme lows in March, as central banks and governments deployed massive monetary and fiscal measures to respond to the crisis. Regional economies began to incrementally reopen and improving economic data appeared to bolster optimism that the worst of the economic shocks had passed. Credit spreads tightened in many sectors during the second quarter, returning to levels last seen in early March and late February.

However, sharp resurgences in COVID-19 cases in several regions, including the U.S., Latin America and China amongst others, prompted governments to return to shutdown policies in June. Though several economic measures improved in May and June, the stronger figures reflected a rebound from the extreme low points in March and April, and were not trends that could be extrapolated into the upcoming months, in our assessment.

Unprecedented interventions from the Fed and central banks around the world widened the disconnect between financial markets and real economies during the period. Central bank efforts to bolster liquidity in financial markets have been effective, but they do not replace lost revenues or cure insolvencies; they only deepen the debt burdens. We expected corporate bankruptcies to be the next challenge policymakers will have to face, as business insolvencies appeared likely to worsen with each passing month of stifled economic activity. We saw risks for an upcoming second leg down in financial markets.

Rallies in risk assets during the final months of the period appeared to underappreciate the ongoing economic damage and the risks for successive waves of infections that could further suppress economic activity going forward, in our view. Massive unemployment, deepening economic hardship and growing insolvencies will not be fully remedied by partial reopenings or government interventions alone. The longer that economic activity remains suppressed and the longer that workers go without incomes, the more entrenched the economic damage will become.

Semiannual Report         TGB-3

TEMPLETON GLOBAL BOND VIP FUND

On the policy front, the Fed maintained its monetary stance at its April and June meetings, and reaffirmed its commitment to using its “full range of tools to support the U.S. economy.” The updated dot plot survey in June indicated that Fed officials expected rates to remain unchanged through 2022. The Fed also updated its projections for U.S. GDP (gross domestic product) growth to -6.5% for 2020 and +5.0% for 2021. It also projected unemployment to be 9.3% at the end of 2020. Fed Chair Jay Powell commented at the end of June during testimony to the House financial services committee that, “the path forward for the economy is extraordinarily uncertain and will depend in large part on our success in containing the virus.” He also continued to emphasize the importance of fiscal support for workers. Powell also indicated that yield curve control was not in imminent consideration and likely not an appropriate tool for U.S. financial markets. In previous comments, he had also ruled out the potential for negative policy rates.

In Europe, the European Commission proposed a €750 billion financing program in May that would deliver up to €500 billion in grants and €250 billion in loans to member states in need of financial support. The program was still in policy discussions at the end of June. On the monetary side, the ECB increased the size of the PEPP by €600 billion to €1.35 trillion at its June 4 policy meeting. Italian bonds rallied on the news, as did the euro, which appreciated 1.2% against the USD in the month of June. The ECB also updated its growth forecast for the eurozone in 2020 to -8.7%, which would be the largest contraction in the post-war era. In May, Lagarde acknowledged that a recovery to previous GDP levels would take at least two to three years.

In Japan, monetary policy responses to the crisis focused more on ensuring businesses had ample access to capital through various loan programs than on lowering the cost of capital. At its April 27 meeting, the BOJ quadrupled the size of its corporate debt purchases. It also announced that it would remove quantitative easing caps. On the price stability front, deflation returned during the period, despite years of persistent efforts from the BOJ to drive inflation higher. Core inflation dropped to -0.2% year-over-year in April and May. The BOJ offered no indications on whether the return of deflation would alter monetary policy in the months ahead, but it remained a concern that officials continued to monitor. The BOJ kept overnight interest rates at -0.1% and the yield target on the 10-year Japanese government bond at 0.0% throughout the period.

Nearly every country in the world declared some form of fiscal response to the crisis, with most countries pursuing

programs that went beyond the measures they deployed during the GFC. Debt-to-GDP ratios rose significantly in just about every country. On the monetary front, many central banks aggressively cut policy rates during the peaks in financial market volatility in March, but paused on making additional cuts in April, similar to the approaches taken by the Fed and the ECB. Several central banks returned to rate cuts in May and June, with many indicating they intended to respond with additional accommodation as needed. During the period, Brazil cut its policy rate by 225 bps to 2.25%, Mexico by 225 bps to 5.00%, Colombia by 175 bps to 2.50%, India by 115 bps to 4.00%, Indonesia by 75 bps to 4.25%, South Korea by 75 bps to 0.50%, Australia by 50 bps to 0.25%, Norway by 150 bps to 0.00%, Canada by 150 bps to 0.25% and the United Kingdom by 65 bps to 0.10%.

Investment Strategy

We invest selectively in bonds around the world based upon our assessment of changing market, political and economic conditions. While seeking opportunities, we monitor various factors including changes in interest rates, currency exchange rates and credit risks. We seek to manage the Fund’s exposure to various currencies and regularly utilize currency and cross currency forward contracts and may also use currency and currency index futures contracts, currency options and other derivative instruments.

Manager’s Discussion

The fixed income sleeve of the strategy was structured around four key pillars during the reporting period: (1) maintaining high liquidity through elevated cash balances and risk-adjusted position weights; (2) holding long exposures to perceived safe-haven assets such as the Japanese yen, Swiss franc, Norwegian krone and Swedish krona; (3) targeting appropriate risk-adjusted returns in a select subset of emerging markets; and (4) underweighting overvalued developed fixed income markets, notably longer-term USTs. The strategy continued to emphasize select duration exposures in countries that have attractive risk-adjusted yields, resilient economic fundamentals and prudent fiscal and monetary policies. Several emerging markets continued to offer significantly higher yields than those available in the developed markets. The strategy entered the reporting period in a de-risked state as the investment team saw elevated global financial market risks that it believed were significantly underappreciated by markets. While the team was not explicitly anticipating the COVID-19 crisis or the collapse in oil prices in the first quarter of 2020, it was concerned that overvalued risk assets were vulnerable to a geopolitical, economic or financial market shock. The team adjusted the risk-sizing of

TGB-4         Semiannual Report

TEMPLETON GLOBAL BOND VIP FUND

various positions and hedged (using currency forwards) a substantial amount of local-currency emerging market beta risk through proxy hedges (net-negative Australian dollar) and direct hedges (Indian rupee, South Korean won, Mexican peso and Brazilian real). The team also continued to broadly avoid credit sectors, which it believed were overvalued leading up to the crisis and increasingly vulnerable to insolvencies as the economic crisis progressed. The strategy also maintained negative duration exposure to longer-term USTs before the COVID-19 crisis erupted in March 2020, as the team believed that inflation pressures, rising deficit spending and surging levels of debt issuance were significantly underpriced in the longer-term range of the U.S. Treasury yield curve. The team unwound its net-negative positioning in longer-term USTs into curve steepening in March. The strategy continued to hold undervalued safe-haven assets that it had previously added in the third quarter of 2019, notably the Japanese yen, Swiss franc, Swedish krona and Norwegian krone. These positions were intended to hedge against global financial market risks associated with rising geopolitical tensions as well as price distortions from ongoing loose monetary policies across the developed world. The strategy also continued to hold a net-negative position in the euro to hedge against broad-based USD strength and unresolved structural risks across Europe, and a net-negative position in the Australian dollar to hedge against broad emerging market risks. During the period, the team used forward currency exchange contracts and currency options to actively manage currencies, and used interest-rate swaps to tactically manage duration exposures.

During the period, the Fund’s negative absolute performance was primarily due to currency positions. Interest-rate strategies contributed to absolute results, while sovereign credit exposures had a largely neutral effect. Among currencies, positions in Latin America (the Brazilian real, Mexican peso and Argentine peso) detracted from absolute performance, as did currency positions in northern Europe (Norwegian krone). The Fund maintained a defensive approach regarding interest rates in developed markets, while holding duration exposures in select emerging markets. Select duration exposures in Latin America (Mexico and Argentina) and Asia (India) contributed to absolute results, while negative duration exposure to USTs during the first quarter detracted.

On a relative basis, the Fund underperformed its benchmark due to interest-rate strategies, followed by currency positions. Sovereign credit exposures had a largely neutral effect on relative results. Among currencies, overweighted positions in Latin America (the Brazilian real, Mexican peso

and Argentine peso) detracted from relative performance, as did overweighted positions in northern European currencies (the Norwegian krone). Underweighted duration exposure in the U.S. detracted from relative performance, as did select underweighted duration exposures in Europe. However, select overweighted duration exposures in Latin America (Mexico and Argentina) contributed to relative results.

Thank you for your participation in Templeton Global Bond VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

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TEMPLETON GLOBAL BOND VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $ 7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual (actual return after expenses)		Hypothetical (5% annual return before expenses)
Share Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$952.00	$2.09	$1,022.73	$2.16	0.43%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Templeton Global Bond VIP Fund

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$16.63			$17.54			$17.17			$16.85			$16.34			$18.56
Income from investment operationsa:
Net investment incomeb		0.30			0.89			0.88			0.83			0.62			0.52
Net realized and unrealized gains (losses)		(1.11	)		(0.54	)		(0.51	)		(0.46	)		(0.10	)		(1.22	)
Total from investment operations		(0.81	)		0.35			0.37			0.37			0.52			(0.70	)
Less distributions from:
Net investment income and net foreign currency gains		(1.35	)		(1.26	)		—			—			—			(1.43	)
Net realized gains		—			—			—			(0.05	)		(0.01	)		(0.09	)
Total distributions		(1.35	)		(1.26	)		—			(0.05	)		(0.01	)		(1.52	)
Net asset value, end of period		$14.47			$16.63			$17.54			$17.17			$16.85			$16.34
Total returnc		(4.80)%			1.89%			2.15%			2.15%			3.21%			(4.10)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates and expense reduction		0.52%			0.53%			0.56%			0.53%			0.53%			0.52%
Expenses net of waiver and payments by affiliates		0.45%			0.44%			0.47%			0.46%			0.48%			0.52%	e
Expenses net of waiver and payments by affiliates and expense reduction		0.43%			0.42%			0.45%			0.46%	f		0.48%	f		0.52%	e,f
Net investment income		3.79%			5.22%			5.09%			4.81%			3.88%			2.99%
Supplemental data
Net assets, end of period (000’s)		$255,388			$322,794			$285,046			$286,502			$241,792			$292,802
Portfolio turnover rate		39.24%			22.58%			18.22%			37.97%			59.00%			51.58%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned, adjustments to interest income for the inflation-indexed bonds, and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^fBenefit of expense reduction rounds to less than 0.01%.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TGB-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Templeton Global Bond VIP Fund (continued)

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$15.91			$16.83			$16.51			$16.25			$15.80			$17.99
Income from investment operationsa:
Net investment incomeb		0.27			0.82			0.81			0.76			0.56			0.46
Net realized and unrealized gains (losses)		(1.06	)		(0.53	)		(0.49	)		(0.45	)		(0.10	)		(1.17	)
Total from investment operations		(0.79	)		0.29			0.32			0.31			0.46			(0.71	)
Less distributions from:
Net investment income and net foreign currency gains		(1.31	)		(1.21	)		—			—			—			(1.39	)
Net realized gains		—			—			—			(0.05	)		(0.01	)		(0.09	)
Total distributions		(1.31	)		(1.21	)		—			(0.05	)		(0.01	)		(1.48	)
Net asset value, end of period		$13.81			$15.91			$16.83			$16.51			$16.25			$15.80
Total returnc		(4.99)%			1.63%			1.94%			1.93%			2.94%			(4.30)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates and expense reduction		0.77%			0.78%			0.81%			0.78%			0.78%			0.77%
Expenses net of waiver and payments by affiliates		0.70%			0.69%			0.72%			0.71%			0.73%			0.77%	e
Expenses net of waiver and payments by affiliates and expense reduction		0.68%			0.67%			0.70%			0.71%	f		0.73%	f		0.77%	e,f
Net investment income		3.54%			4.97%			4.84%			4.56%			3.63%			2.74%
Supplemental data
Net assets, end of period (000’s)		$2,060,001			$2,389,610			$2,544,900			$2,730,081			$2,812,535			$2,971,667
Portfolio turnover rate		39.24%			22.58%			18.22%			37.97%			59.00%			51.58%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned, adjustments to interest income for the inflation-indexed bonds, and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^fBenefit of expense reduction rounds to less than 0.01%.

TGB-8         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Templeton Global Bond VIP Fund (continued)

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$16.27			$17.19			$16.88			$16.62			$16.18			$18.38
Income from investment operationsa:
Net investment incomeb		0.27			0.82			0.81			0.76			0.56			0.46
Net realized and unrealized gains (losses)		(1.08	)		(0.55	)		(0.50	)		(0.45	)		(0.11	)		(1.21	)
Total from investment operations		(0.81	)		0.27			0.31			0.31			0.45			(0.75	)
Less distributions from:
Net investment income and net foreign currency gains		(1.29	)		(1.19	)		—			—			—			(1.36	)
Net realized gains		—			—			—			(0.05	)		(0.01	)		(0.09	)
Total distributions		(1.29	)		(1.19	)		—			(0.05	)		(0.01	)		(1.45	)
Net asset value, end of period		$14.17			$16.27			$17.19			$16.88			$16.62			$16.18
Total returnc		(5.00)%			1.48%			1.84%			1.76%			2.87%			(4.39)%
Ratios to average net assetsd
Expenses before waiver and payments by affiliates and expense reduction		0.87%			0.88%			0.91%			0.88%			0.88%			0.87%
Expenses net of waiver and payments by affiliates		0.80%			0.79%			0.82%			0.81%			0.83%			0.87%	e
Expenses net of waiver and payments by affiliates and expense reduction		0.78%			0.77%			0.80%			0.81%	f		0.83%	f		0.87%	e,f
Net investment income		3.44%			4.87%			4.74%			4.46%			3.53%			2.64%
Supplemental data
Net assets, end of period (000’s)		$76,889			$90,272			$94,312			$98,934			$96,798			$103,045
Portfolio turnover rate		39.24%			22.58%			18.22%			37.97%			59.00%			51.58%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned, adjustments to interest income for the inflation-indexed bonds, and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^fBenefit of expense reduction rounds to less than 0.01%.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TGB-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Templeton Global Bond VIP Fund

	Principal  Amount*				Value
Foreign Government and Agency Securities 47.8%
Argentina 1.9%
a,b Argentina Treasury Bond BONCER,
Index Linked, 1.20%, 3/18/22		1,476,595,148		ARS	$	13,968,764
Index Linked, 1.40%, 3/25/23		892,881,163		ARS		7,555,529
Index Linked, 1.50%, 3/25/24		892,881,166		ARS		7,054,517
a Argentine Bonos del Tesoro,
18.20%, 10/03/21		820,823,000		ARS		5,964,086
16.00%, 10/17/23		844,288,000		ARS		4,236,420
senior note, 15.50%, 10/17/26		1,668,306,000		ARS		5,998,914
a,c Government of Argentina, FRN, 26.415%, (ARS Badlar + 2.00%), 4/03/22		24,036,000		ARS		217,324
						44,995,554
Brazil 6.9%
Letra Tesouro Nacional,
Strip, 7/01/20		719,675	d	BRL		132,360,143
Strip, 4/01/21		25,610	d	BRL		4,635,595
Strip, 7/01/21		34,210	d	BRL		6,147,342
Nota do Tesouro Nacional, 10.00%, 1/01/21		117,516	d	BRL		22,438,395
						165,581,475
Colombia 1.6%
Government of Colombia,
senior bond, 7.75%, 4/14/21		2,386,000,000		COP		652,155
senior bond, 4.375%, 3/21/23		362,000,000		COP		96,872
senior bond, 9.85%, 6/28/27		576,000,000		COP		193,733
Titulos de Tesoreria,
senior bond, B, 11.00%, 7/24/20		9,167,000,000		COP		2,451,055
senior bond, B, 7.00%, 5/04/22		10,237,000,000		COP		2,913,236
senior bond, B, 10.00%, 7/24/24		40,977,000,000		COP		13,432,810
senior bond, B, 7.50%, 8/26/26		35,134,200,000		COP		10,655,342
senior bond, B, 6.00%, 4/28/28		29,113,600,000		COP		7,889,794
						38,284,997
Ghana 1.6%
Government of Ghana,
24.75%, 3/01/21		690,000		GHS		125,135
16.25%, 5/17/21		7,250,000		GHS		1,245,419
24.50%, 6/21/21		80,000		GHS		14,686
24.75%, 7/19/21		1,190,000		GHS		219,100
18.75%, 1/24/22		26,840,000		GHS		4,704,739
17.60%, 11/28/22		370,000		GHS		63,366
19.75%, 3/25/24		26,840,000		GHS		4,730,705
19.00%, 11/02/26		80,510,000		GHS		12,903,808
senior bond, 19.75%, 3/15/32		80,510,000		GHS		13,008,949
senior note, 18.25%, 9/21/20		480,000		GHS		83,850
senior note, 16.50%, 3/22/21		1,730,000		GHS		298,706
						37,398,463

TGB-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund (continued)

	Principal  Amount*				Value
Foreign Government and Agency Securities (continued)
India 2.8%
Government of India,
senior bond, 8.20%, 2/15/22		500,000,000		INR	$	7,030,227
senior bond, 8.35%, 5/14/22		212,700,000		INR		2,981,170
senior note, 8.79%, 11/08/21		653,000,000		INR		9,171,674
senior note, 8.15%, 6/11/22		1,621,000,000		INR		22,990,586
senior note, 6.84%, 12/19/22		98,000,000		INR		1,376,372
senior note, 7.16%, 5/20/23		133,700,000		INR		1,894,284
senior note, 8.83%, 11/25/23		1,468,100,000		INR		21,780,740
						67,225,053
Indonesia 4.2%
Government of Indonesia,
senior bond, FR34, 12.80%, 6/15/21		324,406,000,000		IDR		24,453,919
senior bond, FR35, 12.90%, 6/15/22		71,229,000,000		IDR		5,664,842
senior bond, FR39, 11.75%, 8/15/23		5,491,000,000		IDR		445,598
senior bond, FR40, 11.00%, 9/15/25		46,856,000,000		IDR		3,898,368
senior bond, FR43, 10.25%, 7/15/22		147,832,000,000		IDR		11,280,040
senior bond, FR44, 10.00%, 9/15/24		4,454,000,000		IDR		353,070
senior bond, FR46, 9.50%, 7/15/23		226,780,000,000		IDR		17,380,374
senior bond, FR61, 7.00%, 5/15/22		244,849,000,000		IDR		17,597,175
senior bond, FR63, 5.625%, 5/15/23		258,951,000,000		IDR		17,962,162
senior bond, FR70, 8.375%, 3/15/24		32,315,000,000		IDR		2,415,407
						101,450,955
Mexico 13.7%
Government of Mexico,
senior bond, M, 6.50%, 6/10/21		18,568,200	e	MXN		82,125,630
senior bond, M, 6.50%, 6/09/22		21,479,940	e	MXN		96,690,517
senior bond, M, 6.75%, 3/09/23		2,291,440	e	MXN		10,491,439
senior bond, M, 8.00%, 12/07/23		8,364,900	e	MXN		40,141,108
senior note, M, 7.25%, 12/09/21		21,545,600	e	MXN		97,115,742
f Mexican Udibonos, Index Linked, 2.50%, 12/10/20		392,943	g	MXN		1,722,665
						328,287,101
Norway 4.9%
h,i Government of Norway,
144A, Reg S, 3.75%, 5/25/21		335,990,000		NOK		36,067,133
144A, Reg S, 2.00%, 5/24/23		315,007,000		NOK		34,443,753
144A, Reg S, 3.00%, 3/14/24		265,052,000		NOK		30,365,034
144A, Reg S, 1.75%, 3/13/25		89,312,000		NOK		9,912,855
144A, Reg S, 1.50%, 2/19/26		52,969,000		NOK		5,854,514
						116,643,289
South Korea 9.8%
Korea Treasury Bond,
senior note, 3.00%, 3/10/23		3,919,000,000		KRW		3,452,698
senior note, 2.25%, 9/10/23		88,312,000,000		KRW		76,685,619
senior note, 1.875%, 3/10/24		33,811,000,000		KRW		29,095,346
senior note, 1.375%, 9/10/24		75,881,910,000		KRW		64,103,846

Semiannual Report         TGB-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund (continued)

			Principal  Amount*			Value
Foreign Government and Agency Securities (continued)
South Korea (continued)
Korea Treasury Bond, (continued)
senior note, 3.00%, 9/10/24				18,500,000,000	KRW	$	16,655,382
senior note, 1.375%, 12/10/29				53,382,000,000	KRW		44,517,796
							234,510,687
j Supranational 0.4%
Inter-American Development Bank, senior bond, 7.50%, 12/05/24				200,000,000	MXN		9,382,165
Total Foreign Government and Agency Securities (Cost $1,438,265,663)							1,143,759,739
U.S. Government and Agency Securities 20.3%
United States 20.3%
U.S. Treasury Note,
1.125%, 9/30/21				3,497,000			3,538,392
1.50%, 9/30/21				15,768,000			16,030,389
2.125%, 12/31/21				3,953,000			4,069,042
1.50%, 10/31/24				64,160,000			67,642,434
1.50%, 11/30/24				50,420,000			53,199,009
1.75%, 12/31/24				22,672,000			24,192,618
2.00%, 2/15/25				49,140,000			53,069,281
2.125%, 5/15/25				58,760,000			63,994,460
2.875%, 5/31/25				76,680,000			86,356,357
2.625%, 12/31/25				44,803,000			50,361,372
1.625%, 2/15/26				24,220,000			25,916,819
2.125%, 5/31/26				11,063,000			12,185,722
1.625%, 10/31/26				24,220,000			26,023,255
Total U.S. Government and Agency Securities (Cost $465,062,407)							486,579,150
	Number of Contracts		Notional  Amount#
Options Purchased 1.5%
Calls - Over-the-Counter
Currency Options 1.1%
AUD/JPY, Counterparty CITI, September Strike Price 79.45 JPY, Expires 9/11/20		1		19,760,000	AUD		38,694
AUD/JPY, Counterparty CITI, October Strike Price 77.95 JPY, Expires 10/22/20		1		39,519,000	AUD		252,366
AUD/JPY, Counterparty CITI, October Strike Price 79.00 JPY, Expires 10/29/20		1		16,302,000	AUD		75,702
AUD/JPY, Counterparty CITI, November Strike Price 84.33 JPY, Expires 11/12/20		1		8,878,000	AUD		7,663
AUD/JPY, Counterparty CITI, December Strike Price 82.15 JPY, Expires 12/21/20		1		35,514,000	AUD		86,477
AUD/JPY, Counterparty CITI, January Strike Price 79.00 JPY, Expires 1/22/21		1		26,674,000	AUD		212,247
AUD/JPY, Counterparty CITI, April Strike Price 72.90 JPY, Expires 4/29/21		1		15,018,000	AUD		563,529
AUD/JPY, Counterparty CITI, April Strike Price 81.00 JPY, Expires 4/29/21		1		19,266,000	AUD		125,770

TGB-12         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund (continued)

	Number of Contracts		Notional Amount#			Value
Options Purchased (continued)
Calls - Over-the-Counter (continued)
Currency Options (continued)
AUD/JPY, Counterparty CITI, June Strike Price 81.00 JPY, Expires 6/21/21		1		29,640,000	AUD	$	237,648
AUD/USD, Counterparty HSBK, January Strike Price $0.71, Expires 1/22/21		1		7,904,000	AUD		121,019
AUD/USD, Counterparty HSBK, February Strike Price $0.75, Expires 2/08/21		1		15,808,000	AUD		78,589
AUD/USD, Counterparty HSBK, February Strike Price $0.74, Expires 2/10/21		1		18,969,000	AUD		111,306
AUD/USD, Counterparty MSCO, October Strike Price $0.75, Expires 10/28/20		1		7,904,000	AUD		12,838
AUD/USD, Counterparty MSCO, May Strike Price $0.77, Expires 5/12/21		1		21,309,000	AUD		94,880
USD/JPY, Counterparty CITI, September Strike Price 112.24 JPY, Expires 9/22/20		1		38,210,000			48,909
USD/JPY, Counterparty CITI, February Strike Price 115.00 JPY, Expires 2/24/21		1		98,607,000			261,309
USD/MXN, Counterparty CITI, July Strike Price 21.03 MXN, Expires 7/30/20		1		12,204,000			1,096,297
USD/MXN, Counterparty CITI, September Strike Price 21.94 MXN, Expires 9/03/20		1		3,050,000			187,846
USD/MXN, Counterparty CITI, September Strike Price 23.21 MXN, Expires 9/03/20		1		6,941,000			203,836
USD/MXN, Counterparty CITI, September Strike Price 23.34 MXN, Expires 9/03/20		1		4,083,000			107,534
USD/MXN, Counterparty CITI, September Strike Price 31.04 MXN, Expires 9/03/20		1		11,917,000			7,734
USD/MXN, Counterparty CITI, September Strike Price 21.91 MXN, Expires 9/08/20		1		21,237,000			1,351,289
USD/MXN, Counterparty CITI, September Strike Price 27.34 MXN, Expires 9/24/20		1		37,848,000			158,394
USD/MXN, Counterparty CITI, November Strike Price 26.72 MXN, Expires 11/09/20		1		34,941,000			368,313
USD/MXN, Counterparty CITI, December Strike Price 23.97 MXN, Expires 12/07/20		1		26,279,000			912,249
USD/MXN, Counterparty CITI, February Strike Price 25.49 MXN, Expires 2/11/21		1		49,104,000			1,351,244
USD/MXN, Counterparty CITI, March Strike Price 24.62 MXN, Expires 3/24/21		1		22,167,000			897,564
USD/MXN, Counterparty CITI, April Strike Price 23.75 MXN, Expires 4/09/21		1		11,742,000			649,943
USD/MXN, Counterparty CITI, April Strike Price 25.48 MXN, Expires 4/09/21		1		22,442,000			751,964
USD/MXN, Counterparty CITI, April Strike Price 27.45 MXN, Expires 4/28/21		1		69,992,000			1,538,634
USD/MXN, Counterparty CITI, June Strike Price 26.09 MXN, Expires 6/18/21		1		23,833,000			831,295
USD/MXN, Counterparty CITI, June Strike Price 24.81 MXN, Expires 6/30/21		1		35,754,000			1,857,134
USD/MXN, Counterparty CITI, December Strike Price 29.73 MXN, Expires 12/07/21		1		31,535,000			880,552
USD/MXN, Counterparty GSCO, July Strike Price 20.00 MXN, Expires 7/31/20		1		11,665,000			1,560,649
USD/MXN, Counterparty GSCO, July Strike Price 24.18 MXN, Expires 7/31/20		1		11,665,000			96,330
USD/MXN, Counterparty GSCO, March Strike Price 20.62 MXN, Expires 3/03/21		1		7,624,000			1,029,263
USD/MXN, Counterparty GSCO, June Strike Price 22.83 MXN, Expires 6/09/21		1		7,291,000			589,543
USD/MXN, Counterparty JPHQ, July Strike Price 20.90 MXN, Expires 7/27/20		1		12,571,000			1,187,809
USD/MXN, Counterparty JPHQ, September Strike Price 23.25 MXN, Expires 9/22/20		1		16,908,000			539,686
USD/MXN, Counterparty JPHQ, December Strike Price 22.30 MXN, Expires 12/04/20		1		25,925,000			1,763,263

Semiannual Report         TGB-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund (continued)

	Number of Contracts		Notional Amount#			Value
Options Purchased (continued)
Calls - Over-the-Counter (continued)
Currency Options (continued)
USD/MXN, Counterparty JPHQ, December Strike Price 23.25 MXN, Expires 12/23/20		1		19,020,000		$	935,366
USD/MXN, Counterparty MSCO, September Strike Price 22.82 MXN, Expires 9/02/20		1		24,211,000			876,172
USD/MXN, Counterparty MSCO, September Strike Price 25.02 MXN, Expires 9/02/20		1		8,051,000			72,829
USD/MXN, Counterparty MSCO, March Strike Price 28.75 MXN, Expires 3/30/21		1		49,338,000			711,553
							24,843,231
Puts - Over-the-Counter
Currency Options 0.4%
AUD/JPY, Counterparty CITI, October Strike Price 67.10 JPY, Expires 10/29/20		1		43,471,000	AUD		222,503
AUD/JPY, Counterparty CITI, November Strike Price 66.78 JPY, Expires 11/12/20		1		4,439,000	AUD		24,534
AUD/JPY, Counterparty CITI, November Strike Price 69.18 JPY, Expires 11/12/20		1		2,664,000	AUD		22,227
AUD/JPY, Counterparty CITI, December Strike Price 65.85 JPY, Expires 12/21/20		1		17,757,000	AUD		113,604
AUD/JPY, Counterparty CITI, March Strike Price 68.50 JPY, Expires 3/24/21		1		17,783,000	AUD		242,657
AUD/JPY, Counterparty CITI, April Strike Price 71.00 JPY, Expires 4/29/21		1		51,376,000	AUD		1,075,146
AUD/JPY, Counterparty CITI, June Strike Price 58.95 JPY, Expires 6/21/21		1		39,520,000	AUD		261,235
AUD/JPY, Counterparty CITI, June Strike Price 71.44 JPY, Expires 6/21/21		1		39,520,000	AUD		981,077
AUD/JPY, Counterparty CITI, June Strike Price 69.20 JPY, Expires 6/24/21		1		31,616,000	AUD		615,271
AUD/USD, Counterparty HSBK, October Strike Price $0.63, Expires 10/27/20		1		15,808,000	AUD		53,043
AUD/USD, Counterparty HSBK, January Strike Price $0.61, Expires 1/22/21		1		24,503,000	AUD		123,743
AUD/USD, Counterparty HSBK, February Strike Price $0.65, Expires 2/08/21		1		31,616,000	AUD		379,756
AUD/USD, Counterparty HSBK, February Strike Price $0.65, Expires 2/10/21		1		37,939,000	AUD		404,658
AUD/USD, Counterparty HSBK, March Strike Price $0.64, Expires 3/22/21		1		20,946,000	AUD		226,055
AUD/USD, Counterparty MSCO, October Strike Price $0.67, Expires 10/28/20		1		15,808,000	AUD		157,145
AUD/USD, Counterparty MSCO, November Strike Price $0.65, Expires 11/19/20		1		33,541,000	AUD		235,136
AUD/USD, Counterparty MSCO, December Strike Price $0.65, Expires 12/18/20		1		28,653,000	AUD		269,058
USD/JPY, Counterparty CITI, September Strike Price 100.70 JPY, Expires 9/16/20		1		69,025,000			78,896
USD/JPY, Counterparty CITI, September Strike Price 106.75 JPY, Expires 9/22/20		1		76,420,000			630,771
USD/JPY, Counterparty CITI, October Strike Price 103.60 JPY, Expires 10/29/20		1		49,304,000			251,450
USD/JPY, Counterparty CITI, February Strike Price 105.70 JPY, Expires 2/24/21		1		49,303,000			869,951
USD/MXN, Counterparty CITI, September Strike Price 19.11 MXN, Expires 9/03/20		1		23,836,000			4,147
USD/MXN, Counterparty CITI, September Strike Price 21.33 MXN, Expires 9/03/20		1		35,756,000			125,361
USD/MXN, Counterparty CITI, September Strike Price 20.85 MXN, Expires 9/17/20		1		43,738,000			99,242

TGB-14         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund (continued)

	Number of Contracts		Notional Amount#				Value
Options Purchased (continued)
Puts - Over-the-Counter (continued)
Currency Options (continued)
USD/MXN, Counterparty CITI, November Strike Price 22.45 MXN, Expires 11/09/20		1		17,471,000			$	352,093
USD/MXN, Counterparty CITI, February Strike Price 20.88 MXN, Expires 2/11/21		1		24,552,000				179,328
USD/MXN, Counterparty CITI, March Strike Price 20.66 MXN, Expires 3/24/21		1		10,516,000				72,287
USD/MXN, Counterparty CITI, April Strike Price 21.20 MXN, Expires 4/09/21		1		24,495,000				272,139
USD/MXN, Counterparty GSCO, July Strike Price 20.83 MXN, Expires 7/31/20		1		23,330,000				15,164
USD/MXN, Counterparty GSCO, July Strike Price 22.03 MXN, Expires 7/31/20		1		10,459,000				54,565
USD/MXN, Counterparty GSCO, August Strike Price 22.45 MXN, Expires 8/31/20		1		8,163,000				113,433
USD/MXN, Counterparty GSCO, August Strike Price 20.30 MXN, Expires 8/31/20		1		8,730,000				6,713
USD/MXN, Counterparty GSCO, September Strike Price 23.73 MXN, Expires 9/30/20		1		23,330,000				1,012,755
USD/MXN, Counterparty GSCO, March Strike Price 18.65 MXN, Expires 3/03/21		1		7,624,000				8,325
USD/MXN, Counterparty GSCO, June Strike Price 22.83 MXN, Expires 6/09/21		1		7,291,000				254,711
USD/MXN, Counterparty MSCO, September Strike Price 20.11 MXN, Expires 9/02/20		1		24,211,000				15,447
USD/MXN, Counterparty MSCO, September Strike Price 20.64 MXN, Expires 9/10/20		1		14,301,000				22,495
USD/MXN, Counterparty MSCO, September Strike Price 20.13 MXN, Expires 9/22/20		1		25,142,000				24,061
USD/MXN, Counterparty MSCO, September Strike Price 22.46 MXN, Expires 9/22/20		1		7,678,000				124,645
								9,994,827
Total Options Purchased (Cost $41,855,242)								34,838,058
Total Investments before Short Term Investments (Cost $1,945,183,312)								1,665,176,947
			Principal  Amount*
Short Term Investments 30.8%
Foreign Government and Agency Securities 7.4%
Argentina 0.3%
a,bArgentina Treasury Bond BONCER, Index Linked, 1.10%, 4/17/21				279,926,000		ARS		2,724,843
a,bLetras de la Nacion Argentina con Ajuste por CER, Index Linked, 0.00%, 12/04/20				345,512,200		ARS		3,401,141
								6,125,984
Brazil 1.3%
Letra Tesouro Nacional, Strip, 10/01/20				166,070	d	BRL		30,385,330

Semiannual Report         TGB-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund (continued)

			Principal  Amount*				Value
Short Term Investments (continued)
Foreign Government and Agency Securities (continued)
Japan 5.2%
kJapan Treasury Discount Bill,
7/06/20				5,427,000,000		JPY	$	50,262,439
7/10/20 - 10/12/20				7,969,900,000		JPY		73,833,146
								124,095,585
Mexico 0.5%
kMexico Treasury Bill, 7/16/20 - 10/22/20				28,120,440	l	MXN		12,128,917
Norway 0.1%
h,i,kNorway Treasury Bill, 144A, Reg S, 9/16/20				28,866,000		NOK		2,997,979
Total Foreign Government and Agency Securities (Cost $177,699,512)								175,733,795
U.S. Government and Agency Securities 10.1%
United States 10.1%
kU.S. Treasury Bill, 7/16/20				64,460,000				64,457,213
8/06/20				113,820,000				113,806,626
9/10/20				64,460,000				64,444,427
Total U.S. Government and Agency Securities (Cost $242,709,226)								242,708,266
Total Investments before Money Market Funds (Cost $2,365,592,050)								2,083,619,008
			Shares
Money Market Funds (Cost $318,975,444) 13.3%
United States 13.3%
m,nInstitutional Fiduciary Trust Money Market Portfolio, 0.00%				318,975,444				318,975,444
Total Investments (Cost $2,684,567,494) 100.4%								2,402,594,452
Options Written (1.3)%								(30,318,364	)
Other Assets, less Liabilities 0.9%.								20,001,366
Net Assets 100.0%							$	2,392,277,454
	Number of       Contracts		Notional Amount#
oOptions Written (1.3)%
Calls - Over-the-Counter
Currency Options (0.8)%
AUD/JPY, Counterparty CITI, September Strike Price 75.80 JPY, Expires 9/11/20		1		19,760,000		AUD		(194,617	)
AUD/JPY, Counterparty CITI, October Strike Price 71.60 JPY, Expires 10/29/20		1		32,603,000		AUD		(1,231,052	)
AUD/JPY, Counterparty CITI, December Strike Price 75.70 JPY, Expires 12/21/20		1		35,514,000		AUD		(620,213	)

TGB-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund(continued)

	Number of Contracts		Notional Amount#			Value
oOptions Written (continued)
Calls - Over-the-Counter (continued)
Currency Options (continued)
AUD/JPY, Counterparty CITI, January Strike Price 76.00 JPY, Expires 1/22/21		1		26,674,000	AUD	$	(473,323	)
AUD/JPY, Counterparty CITI, January Strike Price 76.95 JPY, Expires 1/22/21		1		31,616,000	AUD		(442,475	)
AUD/JPY, Counterparty CITI, April Strike Price 71.75 JPY, Expires 4/29/21		1		38,532,000	AUD		(1,722,736	)
AUD/JPY, Counterparty CITI, June Strike Price 78.00 JPY, Expires 6/21/21		1		29,640,000	AUD		(465,826	)
AUD/USD, Counterparty HSBK, October Strike Price $0.67, Expires 10/27/20		1		23,712,000	AUD		(760,734	)
AUD/USD, Counterparty HSBK, November Strike Price $0.71, Expires 11/05/20		1		11,838,000	AUD		(98,566	)
AUD/USD, Counterparty HSBK, January Strike Price $0.67, Expires 1/22/21		1		24,503,000	AUD		(823,222	)
AUD/USD, Counterparty HSBK, February Strike Price $0.69, Expires 2/08/21		1		15,808,000	AUD		(362,577	)
AUD/USD, Counterparty HSBK, February Strike Price $0.69, Expires 2/10/21		1		18,969,000	AUD		(496,831	)
AUD/USD, Counterparty HSBK, May Strike Price $0.78, Expires 5/05/21		1		19,730,000	AUD		(68,817	)
AUD/USD, Counterparty MSCO, August Strike Price $0.69, Expires 8/12/20		1		14,674,000	AUD		(121,400	)
AUD/USD, Counterparty MSCO, August Strike Price $0.70, Expires 8/12/20		1		10,236,000	AUD		(82,310	)
AUD/USD, Counterparty MSCO, October Strike Price $0.72, Expires 10/28/20		1		7,904,000	AUD		(45,577	)
AUD/USD, Counterparty MSCO, May Strike Price $0.74, Expires 5/12/21		1		42,617,000	AUD		(390,126	)
USD/JPY, Counterparty CITI, September Strike Price 107.50 JPY, Expires 9/16/20		1		39,442,000			(529,351	)
USD/JPY, Counterparty CITI, September Strike Price 108.77 JPY, Expires 9/22/20		1		76,420,000			(602,495	)
USD/JPY, Counterparty CITI, February Strike Price 110.50 JPY, Expires 2/24/21		1		98,607,000			(1,020,583	)
USD/MXN, Counterparty CITI, November Strike Price 31.74 MXN, Expires 11/09/20		1		17,471,000			(47,224	)
USD/MXN, Counterparty CITI, December Strike Price 23.46 MXN, Expires 12/07/20		1		8,760,000			(373,623	)
USD/MXN, Counterparty CITI, December Strike Price 25.43 MXN, Expires 12/07/20		1		8,760,000			(174,359	)
USD/MXN, Counterparty CITI, February Strike Price 29.11 MXN, Expires 2/11/21		1		36,827,000			(398,137	)
USD/MXN, Counterparty CITI, March Strike Price 25.87 MXN, Expires 3/24/21		1		17,883,000			(505,821	)
USD/MXN, Counterparty CITI, March Strike Price 31.07 MXN, Expires 3/24/21		1		8,867,000			(77,125	)
USD/MXN, Counterparty CITI, April Strike Price 27.24 MXN, Expires 4/09/21		1		22,442,000			(480,393	)
USD/MXN, Counterparty CITI, June Strike Price 28.24 MXN, Expires 6/18/21		1		23,833,000			(522,086	)
USD/MXN, Counterparty CITI, June Strike Price 28.40 MXN, Expires 6/30/21		1		23,836,000			(547,990	)
USD/MXN, Counterparty CITI, December Strike Price 27.93 MXN, Expires 12/07/21		1		10,512,000			(394,105	)
USD/MXN, Counterparty GSCO, July Strike Price 22.03 MXN, Expires 7/31/20.		1		10,459,000			(534,675	)
USD/MXN, Counterparty GSCO, July Strike Price 22.94 MXN, Expires 7/31/20		1		11,665,000			(291,613	)
USD/MXN, Counterparty GSCO, July Strike Price 23.32 MXN, Expires 7/31/20		1		11,665,000			(209,585	)
USD/MXN, Counterparty GSCO, August Strike Price 22.45 MXN, Expires 8/31/20		1		8,163,000			(368,037	)
USD/MXN, Counterparty GSCO, August Strike Price 24.62 MXN, Expires 8/31/20		1		8,730,000			(96,702	)
USD/MXN, Counterparty GSCO, June Strike Price 30.36 MXN, Expires 6/09/21		1		7,291,000			(104,524	)
USD/MXN, Counterparty JPHQ, July Strike Price 22.30 MXN, Expires 7/27/20		1		12,571,000			(508,660	)

Semiannual Report         TGB-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund (continued)

	Number of Contracts		Notional Amount#			Value
oOptions Written (continued)
Calls - Over-the-Counter (continued)
Currency Options (continued)
USD/MXN, Counterparty JPHQ, September Strike Price 24.90 MXN, Expires 9/22/20		1		8,454,000		$	(107,873	)
USD/MXN, Counterparty MSCO, September Strike Price 23.31 MXN, Expires 9/02/20		1		24,211,000			(640,526	)
USD/MXN, Counterparty MSCO, September Strike Price 22.46 MXN, Expires 9/10/20		1		4,767,000			(225,803	)
USD/MXN, Counterparty MSCO, September Strike Price 22.46 MXN, Expires 9/22/20		1		7,678,000			(380,645	)
USD/MXN, Counterparty MSCO, March Strike Price 34.23 MXN, Expires 3/30/21		1		32,892,000			(178,242	)
							(17,720,579	)
Puts - Over-the-Counter
Currency Options (0.5)%
AUD/JPY, Counterparty CITI, October Strike Price 62.80 JPY, Expires 10/29/20		1		21,735,000	AUD		(53,375	)
AUD/JPY, Counterparty CITI, April Strike Price 66.00 JPY, Expires 4/29/21		1		25,688,000	AUD		(297,970	)
AUD/JPY, Counterparty CITI, April Strike Price 72.90 JPY, Expires 4/29/21		1		15,018,000	AUD		(397,451	)
AUD/JPY, Counterparty CITI, June Strike Price 64.86 JPY, Expires 6/21/21		1		59,280,000	AUD		(716,256	)
AUD/USD, Counterparty HSBK, January Strike Price $0.52, Expires 1/22/21		1		11,856,000	AUD		(11,502	)
AUD/USD, Counterparty HSBK, January Strike Price $0.63, Expires 1/27/21		1		10,457,000	AUD		(68,315	)
AUD/USD, Counterparty HSBK, March Strike Price $0.59, Expires 3/22/21		1		8,497,000	AUD		(33,683	)
AUD/USD, Counterparty MSCO, August Strike Price $0.63, Expires 8/12/20		1		10,482,000	AUD		(8,108	)
AUD/USD, Counterparty MSCO, August Strike Price $0.64, Expires 8/12/20		1		8,386,000	AUD		(9,524	)
AUD/USD, Counterparty MSCO, August Strike Price $0.68, Expires 8/12/20		1		10,276,000	AUD		(61,502	)
USD/JPY, Counterparty CITI, September Strike Price 89.80 JPY, Expires 9/16/20		1		34,512,000			(3,555	)
USD/JPY, Counterparty CITI, September Strike Price 102.25 JPY, Expires 9/22/20		1		38,210,000			(76,917	)
USD/JPY, Counterparty CITI, October Strike Price 106.00 JPY, Expires 10/29/20		1		49,304,000			(458,034	)
USD/MXN, Counterparty CITI, July Strike Price 23.10 MXN, Expires 7/30/20		1		8,749,000			(184,455	)
USD/MXN, Counterparty CITI, September Strike Price 22.93 MXN, Expires 9/03/20		1		23,838,000			(549,895	)
USD/MXN, Counterparty CITI, September Strike Price 23.21 MXN, Expires 9/03/20		1		6,941,000			(203,836	)
USD/MXN, Counterparty CITI, September Strike Price 23.34 MXN, Expires 9/03/20		1		4,083,000			(134,323	)
USD/MXN, Counterparty CITI, September Strike Price 21.91 MXN, Expires 9/08/20		1		21,237,000			(169,259	)
USD/MXN, Counterparty CITI, September Strike Price 20.06 MXN, Expires 9/17/20		1		21,869,000			(17,714	)
USD/MXN, Counterparty CITI, September Strike Price 22.40 MXN, Expires 9/17/20		1		21,869,000			(321,124	)
USD/MXN, Counterparty CITI, September Strike Price 24.20 MXN, Expires 9/24/20		1		10,516,000			(630,907	)
USD/MXN, Counterparty CITI, November Strike Price 23.88 MXN, Expires 11/09/20		1		34,941,000			(1,868,819	)

TGB-18         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund(continued)

	Number of Contracts		Notional Amount#		Value
oOptions Written (continued)
Puts - Over-the-Counter (continued)
Currency Options (continued)
USD/MXN, Counterparty CITI, February Strike Price 22.92 MXN, Expires 2/11/21		1		36,827,000	$	(1,241,328	)
USD/MXN, Counterparty CITI, April Strike Price 22.71 MXN, Expires 4/09/21		1		24,495,000		(767,306	)
USD/MXN, Counterparty CITI, April Strike Price 23.02 MXN, Expires 4/28/21		1		34,996,000		(1,328,623	)
USD/MXN, Counterparty CITI, June Strike Price 20.24 MXN, Expires 6/30/21		1		11,918,000		(74,523	)
USD/MXN, Counterparty GSCO, August Strike Price 21.54 MXN, Expires 8/31/20		1		8,730,000		(38,648	)
USD/MXN, Counterparty GSCO, September Strike Price 22.40 MXN, Expires 9/30/20		1		46,660,000		(670,971	)
USD/MXN, Counterparty GSCO, March Strike Price 19.80 MXN, Expires 3/03/21		1		7,624,000		(23,070	)
USD/MXN, Counterparty GSCO, June Strike Price 19.61 MXN, Expires 6/09/21		1		7,291,000		(28,260	)
USD/MXN, Counterparty JPHQ, December Strike Price 22.30 MXN, Expires 12/04/20		1		25,925,000		(498,615	)
USD/MXN, Counterparty JPHQ, December Strike Price 23.25 MXN, Expires 12/23/20		1		19,020,000		(743,454	)
USD/MXN, Counterparty MSCO, September Strike Price 21.23 MXN, Expires 9/02/20		1		18,669,000		(56,436	)
USD/MXN, Counterparty MSCO, September Strike Price 21.50 MXN, Expires 9/10/20		1		14,301,000		(69,203	)
USD/MXN, Counterparty MSCO, September Strike Price 21.68 MXN, Expires 9/22/20		1		25,142,000		(171,418	)
USD/MXN, Counterparty MSCO, March Strike Price 23.03 MXN, Expires 3/30/21		1		16,446,000		(609,406	)
						(12,597,785	)
Total Options Written (Premiums received $27,270,984)						(30,318,364	)

Semiannual Report         TGB-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund (continued)

*The principal amount is stated in U.S. dollars unless otherwise indicated.

^#Notional amount is the number of units specified in the contract, and can include currency units, bushels, shares, pounds, barrels or other units. Currency units are stated in U.S. dollars unless otherwise indicated.

^aSecurities denominated in Argentine Peso have been designated as Level 3 investments. See Note 12 regarding fair value measurements.

^bRedemption price at maturity is adjusted for inflation. See Note 1(g).

^cThe coupon rate shown represents the rate at period end.

^dPrincipal amount is stated in 1,000 Brazilian Real Units.

^ePrincipal amount is stated in 100 Mexican Peso Units.

^fPrincipal amount of security is adjusted for inflation. See Note 1(g).

^gPrincipal amount is stated in 100 Unidad de Inversion Units.

^hSecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in a public offering registered under the Securities Act of 1933. At June 30, 2020, the aggregate value of these securities was $119,641,268, representing 5.0% of net assets.

ⁱSecurity was purchased pursuant to Regulation S under the Securities Act of 1933, which exempts from registration securities offered and sold outside of the United States. Such a security cannot be sold in the United States without either an effective registration statement filed pursuant to the Securities Act of 1933, or pursuant to an exemption from registration. At June 30, 2020, the aggregate value of these securities was $119,641,268, representing 5.0% of net assets.

^jA supranational organization is an entity formed by two or more central governments through international treaties.

^kThe security was issued on a discount basis with no stated coupon rate.

^lPrincipal amount is stated in 10 Mexican Peso Units.

^mSee Note 3(e) regarding investments in affiliated management investment companies.

ⁿThe rate shown is the annualized seven-day effective yield at period end.

^oSee Note 1(c) regarding written options.

At June 30, 2020, the Fund had the following forward exchange contracts outstanding. See 1(c).

Forward Exchange Contracts

Currency	Counterpartya		Type		Quantity		Contract Amount*			Settlement Date		Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts
Brazilian Real		CITI		Buy		107,801,461		19,885,899			7/02/20	$	—	$	(59,590	)
Brazilian Real		CITI		Buy		206,375,000		36,375,253	EUR		7/02/20		—		(2,910,504	)
Brazilian Real		CITI		Sell		42,892,761		7,406,375			7/02/20		—		(482,249	)
Brazilian Real		CITI		Sell		64,908,700		12,516,622			7/02/20		578,936		—
Brazilian Real		CITI		Sell		206,375,000		33,607,185	EUR		7/02/20		—		(199,298	)
Brazilian Real		HSBK		Buy		93,532,700		17,146,233			7/02/20		55,837		—
Brazilian Real		HSBK		Sell		93,532,700		18,459,843			7/02/20		1,257,773		—
Brazilian Real		JPHQ		Buy		147,867,600		27,251,677			7/02/20		—		(56,602	)
Brazilian Real		JPHQ		Sell		147,867,600		29,149,224			7/02/20		1,954,148		—
South Korean Won		DBAB		Sell		13,919,000,000		11,570,241			7/06/20		—		(33,161	)
Brazilian Real		JPHQ		Sell		147,867,600		27,241,134			7/09/20		54,692		—
Australian Dollar		HSBK		Sell		14,684,959		1,102,253,022	JPY		7/13/20		76,121		—
Australian Dollar		JPHQ		Sell		22,450,754		1,688,925,318	JPY		7/13/20		151,313		—
Australian Dollar		JPHQ		Sell		25,330,000		1,891,479,755	JPY		7/14/20		40,658		—
Brazilian Real		CITI		Sell		107,801,461		19,875,267			7/15/20		60,643		—
Brazilian Real		HSBK		Sell		93,532,700		17,138,064			7/15/20		—		(53,867	)
Swedish Krona		DBAB		Buy		416,064,650		38,822,999	EUR		7/15/20		1,024,135		—
Norwegian Krone		JPHQ		Buy		198,445,700		18,305,288	EUR		7/16/20		51,432		—
South Korean Won		HSBK		Sell		13,984,825,441		12,171,831			7/17/20		512,165		—
Euro		UBSW		Buy		1,922,305		2,166,765			7/23/20		—		(6,025	)
Euro		UBSW		Sell		1,922,305		2,182,681			7/23/20		21,942		—
South Korean Won		HSBK		Sell		39,774,174,559		32,296,029			7/28/20		—		(869,126	)
South Korean Won		HSBK		Sell		24,029,880,977		19,597,032			7/29/20		—		(440,175	)
Euro		CITI		Sell		40,213,773		4,737,280,517	JPY		7/31/20		—		(1,318,635	)

TGB-20         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund(continued)

Forward Exchange Contracts (continued)

Currency	Counterpartya	Type		Quantity		Contract  Amount*		Settlement Date		Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts (continued)
Brazilian Real	CITI		Sell		42,960,900		7,406,375		8/04/20	$	—	$	(483,054	)
Brazilian Real	HSBK		Sell		40,142,900		7,652,972		8/04/20		281,046		—
Brazilian Real	HSBK		Sell		54,206,239		9,497,869		8/04/20		—		(456,677	)
Brazilian Real	JPHQ		Sell		193,543,900		38,701,031		8/04/20		3,158,227		—
South Korean Won	DBAB		Sell		13,920,000,000		11,743,862		8/07/20		137,240		—
Swiss Franc	UBSW		Buy		8,689,106		8,259,018	EUR	8/10/20		—		(104,649	)
Swiss Franc	UBSW		Buy		34,756,424		32,085,555	EUR	8/10/20		650,254		—
South Korean Won	HSBK		Sell		75,818,000,000		62,145,902		8/11/20		—		(1,070,112	)
Swiss Franc	GSCO		Buy		34,110,076		31,546,498	EUR	8/12/20		573,953		—
Swedish Krona	DBAB		Buy		416,064,600		39,213,964	EUR	8/13/20		571,158		—
Swiss Franc	GSCO		Buy		17,055,038		16,229,755	EUR	8/13/20		—		(226,249	)
Euro	HSBK		Buy		1,800,000		2,035,908		8/14/20		—		(11,642	)
Euro	HSBK		Sell		1,800,000		1,961,352		8/14/20		—		(62,914	)
Australian Dollar	JPHQ		Sell		45,472,501		3,268,860,463	JPY	8/21/20		—		(1,093,242	)
Australian Dollar	CITI		Sell		35,607,467		2,527,369,963	JPY	8/24/20		—		(1,154,961	)
Australian Dollar	JPHQ		Sell		52,305,500		3,724,936,182	JPY	8/24/20		—		(1,582,003	)
Euro	HSBK		Sell		50,507,118		5,965,867,876	JPY	8/24/20		—		(1,520,739	)
Australian Dollar	JPHQ		Sell		52,305,500		3,860,368,198	JPY	8/25/20		—		(326,463	)
Euro	HSBK		Sell		25,253,559		3,061,640,442	JPY	8/25/20		—		(31,181	)
Australian Dollar	CITI		Sell		3,372,533		239,109,190	JPY	8/26/20		—		(111,836	)
Indian Rupee	HSBK		Sell		640,300,000		8,350,069		8/26/20		—		(73,989	)
Japanese Yen	JPHQ		Buy		2,297,117,500		21,362,275		8/26/20		—		(72,169	)
Indian Rupee	SCNY		Sell		945,558,000		12,949,745		8/27/20		510,975		—
Japanese Yen	JPHQ		Buy		2,297,161,600		20,973,377		8/27/20		317,401		—
Indian Rupee	SCNY		Sell		1,135,539,000		15,483,004		8/28/20		546,713		—
Euro	BOFA		Buy		27,627,938		31,263,775		8/31/20		—		(182,138	)
Euro	BOFA		Sell		27,627,938		30,471,129		8/31/20		—		(610,508	)
Japanese Yen	CITI		Buy		2,796,566,000		27,059,295		8/31/20		—		(1,138,357	)
Brazilian Real	CITI		Sell		69,291,613		12,956,062		9/02/20		246,708		—
Brazilian Real	CITI		Sell		104,390,000		18,621,110		9/02/20		—		(525,933	)
Brazilian Real	HSBK		Sell		67,353,775		11,574,031		9/02/20		—		(779,890	)
Indian Rupee	SCNY		Sell		2,362,358,000		30,773,494		9/03/20		—		(278,227	)
Euro	JPHQ		Buy		6,775,311		7,663,872		9/04/20		—		(40,886	)
Euro	JPHQ		Sell		6,775,311		7,582,149		9/04/20		—		(40,837	)
Euro	SCNY		Buy		17,972,751		20,343,510		9/08/20		—		(120,260	)
Euro	SCNY		Sell		17,972,751		20,208,741		9/08/20		—		(14,508	)
South Korean Won	GSCO		Sell		44,346,000,000		36,942,686		9/09/20		—		(38,782	)
Australian Dollar	CITI		Sell		23,089,500		1,766,923,987	JPY	9/10/20		441,955		—
Australian Dollar	HSBK		Sell		14,685,041		1,101,157,799	JPY	9/11/20		71,600		—
Australian Dollar	HSBK		Sell		19,340,000		1,310,343,020	JPY	9/14/20		—		(1,201,770	)
Australian Dollar	JPHQ		Sell		22,449,246		1,687,049,615	JPY	9/14/20		144,447		—
Australian Dollar	JPHQ		Sell		22,880,000		1,553,370,104	JPY	9/14/20		—		(1,392,247	)
Swedish Krona	DBAB		Buy		208,032,350		19,832,248	EUR	9/15/20		24,764		—
Australian Dollar	HSBK		Sell		81,620,000		6,022,698,990	JPY	9/16/20		—		(502,144	)
Norwegian Krone	JPHQ		Buy		198,445,700		18,283,198	EUR	9/16/20		51,923		—
Swedish Krona	DBAB		Buy		208,032,400		19,801,766	EUR	9/16/20		58,836		—

Semiannual Report         TGB-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund (continued)

Forward Exchange Contracts (continued)

Currency	Counterpartya	Type		Quantity		Contract  Amount*		Settlement Date		Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts (continued)
Australian Dollar	HSBK		Sell		9,830,000		716,970,710	JPY	9/17/20	$	—	$	(138,064	)
Norwegian Krone	JPHQ		Buy		177,591,200		19,683,519		9/21/20		—		(1,222,664	)
Norwegian Krone	JPHQ		Buy		202,667,400		18,878,646	EUR	9/21/20		—		(181,455	)
South Korean Won	CITI		Sell		4,215,000,000		3,491,406		9/22/20		—		(24,836	)
Japanese Yen	JPHQ		Buy		1,180,260,000		11,065,422		9/23/20		—		(121,458	)
Japanese Yen	BNDP		Buy		2,244,657,680		21,028,125		9/24/20		—		(214,173	)
Euro	HSBK		Sell		25,254,215		3,044,092,592	JPY	9/25/20		—		(200,417	)
Euro	CITI		Sell		74,682,227		8,935,683,733	JPY	9/30/20		—		(1,210,326	)
Norwegian Krone	JPHQ		Buy		230,077,650		21,080,208	EUR	9/30/20		185,504		—
Brazilian Real	HSBK		Sell		93,155,800		17,474,358		10/02/20		405,686		—
Brazilian Real	JPHQ		Sell		78,488,300		15,049,046		10/02/20		667,859		—
Euro	GSCO		Buy		17,044,025		19,273,383		10/05/20		—		(82,505	)
Euro	GSCO		Sell		17,044,025		19,070,901		10/05/20		—		(119,978	)
South Korean Won	HSBK		Sell		42,561,000,000		34,840,373		10/07/20		—		(674,717	)
Mexican Peso	CITI		Sell		157,383,000		6,167,287		10/08/20		—		(592,506	)
Mexican Peso	CITI		Sell		161,485,000		7,836,491		10/08/20		900,512		—
Mexican Peso	CITI		Sell		121,288,000		5,877,353		10/09/20		668,505		—
Euro	HSBK		Buy		33,800,018		38,282,239		10/13/20		—		(216,395	)
Euro	HSBK		Sell		33,800,018		37,982,433		10/13/20		—		(83,411	)
Mexican Peso	CITI		Sell		404,375,000		19,555,619		10/13/20		2,197,551		—
Mexican Peso	CITI		Sell		595,223,000		28,888,991		10/15/20		3,344,724		—
Euro	BOFA		Buy		3,900,000		4,416,052		10/16/20		—		(23,478	)
Euro	BOFA		Sell		5,251,819		5,944,009		10/16/20		28,880		—
Euro	HSBK		Buy		5,439,447		6,119,357		10/16/20		7,097		—
Euro	HSBK		Sell		8,692,000		9,833,042		10/16/20		43,234		—
Mexican Peso	CITI		Sell		545,017,000		26,695,974		10/16/20		3,309,103		—
South Korean Won	HSBK		Sell		7,007,000,000		5,737,799		10/20/20		—		(110,175	)
Japanese Yen	BNDP		Buy		8,410,370,000		77,686,199		10/26/20		358,041		—
Euro	BOFA		Buy		11,635,109		13,192,189		10/30/20		—		(82,491	)
Euro	BOFA		Buy		15,750,554		17,727,720		10/30/20		18,997		—
Euro	BOFA		Sell		27,385,662		29,817,509		10/30/20		—		(1,038,906	)
Euro	HSBK		Buy		25,974,891		29,458,291		10/30/20		—		(191,443	)
Euro	HSBK		Sell		25,974,891		28,262,500		10/30/20		—		(1,004,348	)
Japanese Yen	CITI		Buy		1,511,588,790		14,131,356		10/30/20		—		(103,184	)
Japanese Yen	JPHQ		Buy		4,187,000,000		39,263,309		10/30/20		—		(406,210	)
Brazilian Real	CITI		Sell		177,213,700		32,316,503		11/04/20		—		(119,209	)
Swiss Franc	UBSW		Buy		8,689,106		8,265,853	EUR	11/09/20		—		(105,630	)
Swiss Franc	UBSW		Buy		17,378,212		15,853,718	EUR	11/09/20		552,865		—
Swiss Franc	GSCO		Buy		17,055,038		15,564,006	EUR	11/12/20		537,363		—
Japanese Yen	CITI		Buy		727,486,679		6,790,754		11/16/20		—		(36,621	)
Euro	BOFA		Sell		10,878,191		11,840,584		11/20/20		—		(423,373	)
Euro	GSCO		Sell		1,898,500		2,069,593		11/20/20		—		(70,756	)
Euro	BOFA		Sell		7,066,000		7,766,311		11/23/20		—		(200,483	)
Euro	GSCO		Sell		1,230,811		1,350,975		11/23/20		—		(36,743	)
Euro	JPHQ		Buy		18,850,000		21,264,308		11/23/20		—		(11,256	)
Euro	JPHQ		Sell		48,239,690		53,079,523		11/23/20		—		(1,309,902	)

TGB-22         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Global Bond VIP Fund (continued)

Forward Exchange Contracts (continued)

Currency	Counterpartya	Type		Quantity		Contract  Amount*		Settlement Date		Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts (continued)
Australian Dollar	JPHQ		Sell		15,157,499		1,110,777,880	JPY	11/24/20	$	—	$	(147,965	)
Euro	HSBK		Sell		25,253,559		2,982,874,592	JPY	11/24/20		—		(774,817	)
Euro	MSCO		Sell		30,744,500		33,641,247		11/27/20		—		(1,026,480	)
Japanese Yen	MSCO		Buy		12,189,000,000		115,214,473		12/18/20		—		(1,962,391	)
Japanese Yen	JPHQ		Buy		1,180,260,000		11,082,774		12/22/20		—		(115,529	)
Japanese Yen	BNDP		Buy		2,244,657,680		21,061,272		12/24/20		—		(202,400	)
Japanese Yen	CITI		Buy		4,212,680,000		39,535,263		12/24/20		—		(388,202	)
Euro	CITI		Sell		33,700,000		37,987,988		1/04/21		—		(50,894	)
Mexican Peso	CITI		Sell		539,656,000		23,963,623		3/11/21		1,200,531		—
Total Forward Exchange Contracts										$	28,053,447	$	(36,703,390	)
Net unrealized appreciation (depreciation)												$	(8,649,943	)

*In U.S. dollars unless otherwise indicated.

^aMay be comprised of multiple contracts with the same counterparty, currency and settlement date.

See Note 10 regarding other derivative information.

See Abbreviations on page TGB-40.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TGB-23

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Templeton Global Bond VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$2,365,592,050
Cost - Non-controlled affiliates (Note 3e)		318,975,444
Value - Unaffiliated issuers		$2,083,619,008
Value - Non-controlled affiliates (Note 3e)		318,975,444
Restricted cash for OTC derivative contracts (Note 1d)		11,409,000
Restricted currency, at value (cost $84,852) (Note 1e)		91,508
Foreign currency, at value (cost $1,448,101)		1,412,177
Receivables:
Investment securities sold		8,539,316
Capital shares sold		3,671,185
Interest		12,967,979
Deposits with brokers for:
OTC derivative contracts		13,018,000
Unrealized appreciation on OTC forward exchange contracts		28,053,447
Other assets		2,208
Total assets		2,481,759,272
Liabilities:
Payables:
Investment securities purchased		7,067,962
Capital shares redeemed		446,814
Management fees		840,842
Distribution fees		443,513
Trustees’ fees and expenses		1,030
Deposits from brokers for:
OTC derivative contracts		11,409,000
Options written, at value (premiums received $27,270,984)		30,318,364
Unrealized depreciation on OTC forward exchange contracts		36,703,390
Deferred tax		916,073
Accrued expenses and other liabilities		1,334,830
Total liabilities		89,481,818
Net assets, at value		$2,392,277,454
Net assets consist of:
Paid-in capital		$2,865,789,115
Total distributable earnings (losses)		(473,511,661	)
Net assets, at value		$2,392,277,454

TGB-24         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities (continued)

June 30, 2020 (unaudited)

	Templeton Global Bond VIP Fund
Class 1:
Net assets, at value		$ 255,387,738
Shares outstanding.		17,644,597
Net asset value and maximum offering price per share		$14.47
Class 2:
Net assets, at value		$2,060,001,073
Shares outstanding.		149,131,897
Net asset value and maximum offering price per share		$13.81
Class 4:
Net assets, at value		$ 76,888,643
Shares outstanding.		5,425,612
Net asset value and maximum offering price per share		$14.17

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TGB-25

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Templeton Global Bond VIP Fund
Investment income:
Dividends:
Non-controlled affiliates (Note 3e)		$    1,688,573
Interest:(net of foreign taxes)~
Unaffiliated issuers		52,385,893
Total investment income		54,074,466
Expenses:
Management fees (Note 3a)		5,894,522
Distribution fees: (Note 3c)
Class 2		2,753,167
Class 4		145,714
Custodian fees (Note 4)		413,940
Reports to shareholders		164,117
Professional fees		48,535
Trustees’ fees and expenses		8,523
Other		65,559
Total expenses		9,494,077
Expense reductions (Note 4)		(234,633	)
Expenses waived/paid by affiliates (Note 3e)		(839,756	)
Net expenses		8,419,688
Net investment income		45,654,778
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:#
Unaffiliated issuers		(49,504,370	)
Written options		(7,136,540	)
Foreign currency transactions		(10,461,978	)
Forward exchange contracts		17,116,778
Swap contracts		(117,098,171	)
Net realized gain (loss)		(167,084,281	)
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(60,372,744	)
Translation of other assets and liabilities denominated in foreign currencies		(220,470	)
Forward exchange contracts		27,429,748
Written options		(8,433,743	)
Swap contracts		28,588,210
Change in deferred taxes on unrealized appreciation		164,682
Net change in unrealized appreciation (depreciation)		(12,844,317	)
Net realized and unrealized gain (loss)		(179,928,598	)
Net increase (decrease) in net assets resulting from operations		$(134,273,820	)
~Foreign taxes withheld on interest	$	1,390,733
#Net of foreign taxes	$	446,028

TGB-26         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Templeton Global Bond VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income		$     45,654,778			$    143,948,395
Net realized gain (loss)		(167,084,281	)		40,922,392
Net change in unrealized appreciation (depreciation)		(12,844,317	)		(136,420,695	)
Net increase (decrease) in net assets resulting from operations		(134,273,820	)		48,450,092
Distributions to shareholders:
Class 1		(22,007,754	)		(22,427,340	)
Class 2		(177,367,048	)		(175,601,316	)
Class 4		(6,339,040	)		(6,224,019	)
Total distributions to shareholders		(205,713,842	)		(204,252,675	)
Capital share transactions: (Note 2)
Class 1		(30,908,254	)		55,417,128
Class 2		(36,916,825	)		(21,954,185	)
Class 4		(2,586,311	)		758,324
Total capital share transactions		(70,411,390	)		34,221,267
Net increase (decrease) in net assets		(410,399,052	)		(121,581,316	)
Net assets:
Beginning of period		2,802,676,506			2,924,257,822
End of period		$2,392,277,454			$2,802,676,506

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TGB-27

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Templeton Global Bond VIP Fund

1. Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Templeton Global Bond VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. The Fund offers three classes of shares: Class 1, Class 2 and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a. Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Debt securities generally trade in the over-the-counter (OTC) market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal

repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value. Securities denominated in a foreign currency are converted into their U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the date that the values of the foreign debt securities are determined.

Investments in open-end mutual funds are valued at the closing NAV.

Certain derivative financial instruments are centrally cleared or trade in the OTC market. The Fund’s pricing services use various techniques including industry standard option pricing models and proprietary discounted cash flow models to determine the fair value of those instruments. The Fund’s net benefit or obligation under the derivative contract, as measured by the fair value of the contract, is included in net assets.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

b. Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally,

TGB-28         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c. Derivative Financial Instruments

The Fund invested in derivative financial instruments in order to manage risk or gain exposure to various other investments or markets. Derivatives are financial contracts based on an underlying or notional amount, require no initial investment or an initial net investment that is smaller than would normally be required to have a similar response to changes in market factors, and require or permit net settlement. Derivatives contain various risks including the potential inability of the counterparty to fulfill their obligations under the terms of the contract, the potential for an illiquid secondary market, and/or the potential for market movements which expose the Fund to gains or losses in excess of the amounts shown in the Statement of Assets and Liabilities. Realized gain and loss and unrealized appreciation and depreciation on these contracts for the period are included in the Statement of Operations.

Derivative counterparty credit risk is managed through a formal evaluation of the creditworthiness of all potential counterparties. The Fund attempts to reduce its exposure to counterparty credit risk on OTC derivatives, whenever possible, by entering into International Swaps and Derivatives Association (ISDA) master agreements with certain counterparties. These agreements contain various provisions, including but not limited to collateral requirements, events of

default, or early termination. Termination events applicable to the counterparty include certain deteriorations in the credit quality of the counterparty. Termination events applicable to the Fund include failure of the Fund to maintain certain net asset levels and/or limit the decline in net assets over various periods of time. In the event of default or early termination, the ISDA master agreement gives the non-defaulting party the right to net and close-out all transactions traded, whether or not arising under the ISDA agreement, to one net amount payable by one counterparty to the other. However, absent an event of default or early termination, OTC derivative assets and liabilities are presented gross and not offset in the Statement of Assets and Liabilities. Early termination by the counterparty may result in an immediate payment by the Fund of any net liability owed to that counterparty under the ISDA agreement.

Collateral requirements differ by type of derivative. Collateral terms are contract specific for OTC derivatives. For OTC derivatives traded under an ISDA master agreement, posting of collateral is required by either the Fund or the applicable counterparty if the total net exposure of all OTC derivatives with the applicable counterparty exceeds the minimum transfer amount, which typically ranges from $100,000 to $250,000, and can vary depending on the counterparty and the type of the agreement. Generally, collateral is determined at the close of Fund business each day and any additional collateral required due to changes in derivative values may be delivered by the Fund or the counterparty the next business day, or within a few business days. Collateral pledged and/or received by the Fund, if any, is held in segregated accounts with the Fund’s custodian/counterparty broker and can be in the form of cash and/or securities. Unrestricted cash may be invested according to the Fund’s investment objectives. To the extent that the amounts due to the Fund from its counterparties are not subject to collateralization or are not fully collateralized, the Fund bears the risk of loss from counterparty non-performance.

The Fund entered into OTC forward exchange contracts primarily to manage and/or gain exposure to certain foreign currencies. A forward exchange contract is an agreement between the Fund and a counterparty to buy or sell a foreign currency at a specific exchange rate on a future date.

The Fund entered into interest rate swap contracts primarily to manage interest rate risk. An interest rate swap is an agreement between the Fund and a counterparty to exchange cash flows based on the difference between two

Semiannual Report         TGB-29

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

1. Organization and Significant Accounting Policies (continued)

c. Derivative Financial Instruments (continued)

interest rates, applied to a notional amount. These agreements may be privately negotiated in the over-the-counter market (OTC interest rate swaps) or may be executed on a registered exchange (centrally cleared interest rate swaps). For centrally cleared interest rate swaps, required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or receivable in the Statement of Assets and Liabilities. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized depreciation and appreciation until the payments are made, at which time they are realized.

The Fund purchased or wrote OTC option contracts primarily to manage and/or gain exposure to foreign exchange rate risk. An option is a contract entitling the holder to purchase or sell a specific amount of shares or units of an asset or notional amount of a swap (swaption), at a specified price. When an option is purchased or written, an amount equal to the premium paid or received is recorded as an asset or liability, respectively. Upon exercise of an option, the acquisition cost or sales proceeds of the underlying investment is adjusted by any premium received or paid. Upon expiration of an option, any premium received or paid is recorded as a realized gain or loss. Upon closing an option other than through expiration or exercise, the difference between the premium received or paid and the cost to close the position is recorded as a realized gain or loss.

See Note 10 regarding other derivative information.

d. Restricted Cash

At June 30, 2020, the Fund held restricted cash in connection with investments in certain derivative securities. Restricted cash is held in a segregated account with the Fund’s custodian and is reflected in the Statement of Assets and Liabilities.

e. Restricted Currency

At June 30, 2020 the fund held currencies in certain markets in which the ability to repatriate such currency is limited. As a result of such limitations on repatriation, the Fund may incur substantial delays in gaining access to these assets and may be exposed to potential adverse movements in currency value.

f. Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

g. Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income and estimated expenses are accrued daily. Amortization of premium and accretion of discount on debt securities are included in interest income. Dividend income is recorded on the ex-dividend date. Distributions to shareholders are

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

Inflation-indexed bonds are adjusted for inflation through periodic increases or decreases in the security’s interest accruals, face amount, or principal redemption value, by

amounts corresponding to the rate of inflation as measured by an index. Any increase or decrease in the face amount or principal redemption value will be included as interest income in the Statement of Operations.

h. Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

i. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		2,470,753		$	38,475,650			5,087,795		$	89,164,653
Shares issued in reinvestment of distributions		1,520,923			22,007,754			1,330,210			22,427,340
Shares redeemed		(5,755,199	)		(91,391,658	)		(3,257,868	)		(56,174,865	)
Net increase (decrease)		(1,763,523	)	$	(30,908,254	)		3,160,137		$	55,417,128
Class 2 Shares:
Shares sold		4,093,946		$	61,612,521			7,233,859		$	119,112,193
Shares issued in reinvestment of distributions		12,843,378			177,367,048			10,873,146			175,601,316
Shares redeemed		(18,006,272	)		(275,896,394	)		(19,122,225	)		(316,667,694	)
Net increase (decrease)		(1,068,948	)	$	(36,916,825	)		(1,015,220	)	$	(21,954,185	)

Semiannual Report         TGB-31

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

2. Shares of Beneficial Interest (continued)

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 4 Shares:
Shares sold		316,381		$	4,929,156			692,994		$	11,712,750
Shares issued in reinvestment of distributions		447,356			6,339,040			376,529			6,224,019
Shares redeemed		(885,254	)		(13,854,507	)		(1,010,027	)		(17,178,445	)
Net increase (decrease)		(121,517	)	$	(2,586,311	)		59,496		$	758,324

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Franklin Advisers, Inc. (Advisers)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a. Management Fees

The Fund pays an investment management fee to Advisers based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
0.625%	Up to and including $100 million
0.500%	Over $100 million, up to and including $250 million
0.450%	Over $250 million, up to and including $7.5 billion
0.440%	Over $7.5 billion, up to and including $10 billion
0.430%	Over $10 billion, up to and including $12.5 billion
0.420%	Over $12.5 billion, up to and including $15 billion
0.400%	In excess of $15 billion

For the period ended June 30, 2020, the annualized gross effective investment management fee rate was 0.460% of the Fund’s average daily net assets.

b. Administrative Fees

Under an agreement with Advisers, FT Services provides administrative services to the Fund. The fee is paid by Advisers based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

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FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

c. Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.25% and 0.35% per year of its average daily net assets of Class 2 and Class 4, respectively. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

e. Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Dividend Income
Non-Controlled Affiliates
Institutional Fiduciary Trust Money Market Portfolio, 0.00%	$	691,092,548	$	336,305,086	$	(708,422,190	)	$	—	$	—	$	318,975,444		318,975,444		$1,688,573

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, the custodian fees were reduced as noted in the Statement of Operations.

5. Income Taxes

For tax purposes, capital losses may be carried over to offset future capital gains.

At December 31, 2019, the capital loss carryforwards were as follows:

Capital loss carryforwards not subject to expiration:
Short term	$	1,874,982
Long term		56,256,007
Total capital loss carryforwards	$	58,130,989

Semiannual Report         TGB-33

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

5. Income Taxes (continued)

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$	2,705,229,978
Unrealized appreciation	$	108,946,474
Unrealized depreciation		(450,259,313)
Net unrealized appreciation (depreciation)	$	(341,312,839)

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of foreign currency transactions and tax straddles.

6. Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2020, aggregated $685,549,046 and $742,772,129, respectively.

7. Credit Risk

At June 30, 2020, the Fund had 11.8% of its portfolio invested in high yield or other securities rated below investment grade and unrated securities, if any. These securities may be more sensitive to economic conditions causing greater price volatility and are potentially subject to a greater risk of loss due to default than higher rated securities.

8. Concentration of Risk

Investments in issuers domiciled or with significant operations in developing or emerging market countries may be subject to higher risks than investments in developed countries. These risks include fluctuating currency values, underdeveloped legal or business systems, and changing local and regional economic, political and social conditions, which may result in greater market volatility. In addition, certain foreign securities may not be as liquid as U.S. securities. Currencies of developing or emerging market countries may be subject to significantly greater risks than currencies of developed countries, including the potential inability to repatriate those currencies into U.S. dollars.

At June 30, 2020, the Fund had 2.2% of its net assets denominated in Argentine Pesos, which has restricted currency repatriation since September 2019, and had restructured certain issues of its debt. Political and economic conditions in Argentina could continue to affect the value of the Fund’s holdings.

9. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

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FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

10. Other Derivative Information

At June 30, 2020, investments in derivative contracts are reflected in the Statement of Assets and Liabilities as follows:

	Asset Derivatives				Liability Derivatives
Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Assets and Liabilities Location	Fair Value			Statement of Assets and Liabilities Location	Fair Value
Foreign exchange contracts	Investments in securities, at value	$	34,838,058	a	Options written, at value	$	30,318,364
	Unrealized appreciation on OTC forward exchange contracts		28,053,447		Unrealized depreciation on OTC forward exchange contracts		36,703,390
Totals		$	62,891,505			$	67,021,754

^aPurchased option contracts are included in investments in securities, at value in the Statement of Assets and Liabilities.

For the period ended June 30, 2020, the effect of derivative contracts in the Statement of Operations was as follows:

Derivative Contracts Not Accounted for as Hedging Instruments	Statement of Operations Location	Net Realized Gain (Loss) for the Period			Statement of Operations Location	Net Change in Unrealized Appreciation (Depreciation) for the Period
	Net realized gain (loss) from:				Net change in unrealized appreciation (depreciation) on:
Interest rate contracts	Swap contracts		$(117,098,171)		Swap contracts		$28,588,210
Foreign exchange contracts	Investments		41,669,494	a	Investments		11,586,887	a
	Written options		(7,136,540)		Written options		(8,433,743	)
	Forward exchange contracts		17,116,778		Forward exchange contracts		27,429,748
Totals			$ (65,448,439)				$59,171,102

^aPurchased option contracts are included in net realized gain (loss) from investments and net change in unrealized appreciation (depreciation) on investments in the Statement of Operations.

For the period ended June 30, 2020, the average month end notional amount of swap contracts and options represented $112,474,571 and $2,914,680,736, respectively. The average month end contract value of forward exchange contracts was $3,074,304,590.

See Note 1(c) regarding derivative financial instruments.

Semiannual Report         TGB-35

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

10. Other Derivative Information (continued)

At June 30, 2020, OTC derivative assets and liabilities are as follows:

	Gross Amounts of Assets and Liabilities Presented     in the Statement of Assets and Liabilities
	Assetsa		Liabilitiesa
Derivatives
Forward exchange contracts		$28,053,447		$36,703,390
Options purchased		34,838,058		—
Options written		—		30,318,364
Total		$62,891,505		$67,021,754

^aAbsent an event of default or early termination, OTC derivative assets and liabilities are presented gross and not offset in the Statement of Assets and Liabilities.

At June 30, 2020, OTC derivative assets, which may be offset against OTC derivative liabilities and collateral received from the counterparty, are as follows:

			Amounts Not Offset in the Statement of Assets and Liabilities
	Gross Amounts of Assets Presented in the Statement of Assets and Liabilities		Financial Instruments Available for Offset		Financial Instruments Collateral Receiveda,b			Cash Collateral Receivedb		Net Amount (Not less than zero)
Counterparty
BNDP		$     358,041		$  (358,041)		$—			$—		$—
BOFA		47,877		(47,877)		—			—		—
CITI		34,505,223		(31,229,399)		—			(3,275,824)		—
DBAB		1,816,133		(33,161)		(1,696,771	)		—		86,201
GSCO		5,852,767		(2,941,098)		—			(2,911,669)		—
HSBK		4,208,728		(4,208,728)		—			—		—
JPHQ		11,203,728		(9,979,490)		(1,224,238	)		—		—
MSCO		2,616,259		(2,616,259)		—			—		—
SCNY		1,057,688		(412,995)		—			(644,693)		—
UBSW		1,225,061		(216,304)		(888,209	)		—		120,548
Total		$62,891,505		$(52,043,352)		$(3,809,218	)		$(6,832,186)		$206,749

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FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

At June 30, 2020, OTC derivative liabilities, which may be offset against OTC derivative assets and collateral pledged to the counterparty, are as follows:

			Amounts Not Offset in the Statement of Assets and Liabilities
	Gross Amounts of Liabilities Presented in the Statement of Assets and Liabilities		Financial Instruments Available for Offset			Financial Instruments Collateral Pledged		Cash Collateral Pledgedb			Net Amount (Not less than zero)
Counterparty
BNDP		$     416,573		$    (358,041	)		$—		$—			$58,532
BOFA		2,561,377		(47,877	)		—		(2,500,000	)		13,500
CITI		31,229,399		(31,229,399	)		—		—			—
DBAB		33,161		(33,161	)		—		—			—
GSCO		2,941,098		(2,941,098	)		—		—			—
HSBK		13,192,260		(4,208,728	)		—		(7,468,000	)		1,515,532
JPHQ		9,979,490		(9,979,490	)		—		—			—
MSCO		6,039,097		(2,616,259	)		—		(2,750,000	)		672,838
SCNY		412,995		(412,995	)		—		—			—
UBSW		216,304		(216,304	)		—		—			—
Total		$67,021,754		$(52,043,352	)		$—		$(12,718,000	)		$2,260,402

^aAt June 30, 2020, the Fund received U.S. Treasury Bills, Bonds and Notes as collateral for derivatives.

^bIn some instances, the collateral amounts disclosed in the table above were adjusted due to the requirement to limit the collateral amounts to avoid the effect of overcollateralization. Actual collateral received and/or pledged may be more than the amounts disclosed herein.

See Abbreviations on page TGB-40.

11. Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

12. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

Semiannual Report         TGB-37

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

12. Fair Value Measurements (continued)

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets and liabilities carried at fair value, is as follows:

	Level 1		Level 2		Level 3		Total
Assets:
Investments in Securities:a
Foreign Government and Agency Securities:
Argentina	$	—	$	—	$	44,995,554	$	44,995,554
All Other Foreign Government and Agency Securities		—		1,098,764,185		—		1,098,764,185
U.S. Government and Agency Securities		—		486,579,150		—		486,579,150
Options Purchased		—		34,838,058		—		34,838,058
Short Term Investments:
Argentina		—		—		6,125,984		6,125,984
All Other Short Term Investments		561,683,710		169,607,811		—		731,291,521
Total Investments in Securities	$	561,683,710	$	1,789,789,204	$	51,121,538	$	2,402,594,452
Other Financial Instruments:
Forward Exchange Contracts	$	—	$	28,053,447	$	—	$	28,053,447
Restricted Currency (ARS)		—		—		91,508		91,508
Total Other Financial Instruments	$	—	$	28,053,447	$	91,508	$	28,144,955
Receivables:
Interest (ARS)	$	—	$	—	$	1,240,246	$	1,240,246
Liabilities:
Other Financial Instruments:
Options Written	$	—	$	30,318,364	$	—	$	30,318,364
Forward Exchange Contracts		—		36,703,390		—		36,703,390
Total Other Financial Instruments	$	—	$	67,021,754	$	—	$	67,021,754
Payables:
Deferred Tax (ARS)	$	—	$	—	$	2,884	$	2,884

^aFor detailed categories, see the accompanying Statement of Investments.

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FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

A reconciliation in which Level 3 inputs are used in determining fair value is presented when there are significant Level 3 assets and/or liabilities at the beginning and/or end of the period. At June 30, 2020, the reconciliation is as follows:

	Balance at Beginning of Period		Purchases		Sales			Transfer Into/Out of Level 3		Cost Basis Adjustmentsa		Net Realized Gain (Loss)			Net Unrealized Appreciation (Depreciation)			Balance at End of Period		Net Change in Unrealized Appreciation (Depreciation) on Assets Held at Period End
Assets:
Investments in Securities:
Foreign Government and Agency Securities:
Argentina		$35,675,197		$19,260,092		$(10,217,792	)		$—		$4,900,882		$(18,641,512	)		$14,018,687			$44,995,554		$6,508,509
Short Term Investments:
Argentina		3,394,233		6,610,964		(2,160,508	)		—		752,471		(817,458	)		(1,653,718)			6,125,984		(644,903)
Total Investments in Securities		$39,069,430		$25,871,056		$(12,378,300	)		$—		$5,653,353		$(19,458,970	)		$12,364,969			$51,121,538		$5,863,606
Other Financial Instruments:
Restricted Currency (ARS)		$  8,460,563		$  8,913,882		$(15,804,994	)		$—		$             —		$ (1,714,126	)		$    236,183			$        91,508		$       6,656
Receivables:
Interest (ARS)		$  1,601,869		$  3,080,353		$  (2,879,272	)		$—		$             —		$    (761,876	)		$    199,172			$   1,240,246		$     78,763
Liabilities:
Payables:
Deferred Tax (ARS)		$          4,066		$               —		$               —			$—		$             —		$              —			$      (1,182	)		$       2,884		$     (1,182)

^aMay include accretion, amortization, partnership adjustments, and/or other cost basis adjustments.

Significant unobservable valuation inputs for material Level 3 assets and/or liabilities and impact to fair value as a result of changes in unobservable valuation inputs as of June 30, 2020, are as follows:

Description	Fair Value at End of Period		Valuation Technique	Unobservable Inputs	Amount		Impact to Fair Value if Input Increasesa
Assets:
Investments in Securities:
Foreign Government and Agency Securities
Argentina		$44,995,554	Market comparables	Implied Foreign exchange rate		105.9 ARS/USD		Decreaseb
Short Term Investments
Argentina		6,125,984	Market comparables	Implied Foreign exchange rate		105.9 ARS/USD		Decreasec
Other Financial Instruments:
Restricted Currency (ARS)		91,508	Market comparables	Implied Foreign exchange rate		105.9 ARS/USD		Decreasec
All otherd		1,240,246

Semiannual Report         TGB-39

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Templeton Global Bond VIP Fund (continued)

12. Fair Value Measurements (continued)

Description	Fair Value at End of Period		Valuation Technique	Unobservable Inputs	Amount	Impact to Fair Value if Input Increasesa
Liabilities:
All otherd		2,884

^aRepresents the directional change in the fair value that would result from a significant and reasonable increase in the corresponding input. A significant and reasonable decrease in the input would have the opposite effect. Significant impacts, if any, to fair value and/or net assets have been indicated.

^bRepresents a significant impact to fair value and net assets.

^cRepresents a significant impact to fair value but not net assets.

^dIncludes fair value of immaterial assets and/or liabilities developed using various valuation techniques and unobservable inputs. May also include with values derived using private transaction prices or non-public third party pricing information which is unobservable.

13. New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

14. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Counterparty		Currency		Selected Portfolio
BNDP	BNP Paribas SA	ARS	Argentine Peso	BADLAR	Argentina Deposit Rates Badlar Private Banks ARS
BOFA	Bank of America Corp.	AUD	Australian Dollar	FRN	Floating Rate Note
CITI	Citigroup, Inc.	BRL	Brazilian Real
DBAB	Deutsche Bank AG	COP	Colombian Peso
GSCO	The Goldman Sachs Group, Inc.	EUR	Euro
HSBK	HSBC Bank PLC	GHS	Ghanaian Cedi
JPHQ	JP Morgan Chase & Co.	IDR	Indonesian Rupiah
MSCO	Morgan Stanley	INR	Indian Rupee
SCNY	Standard Chartered Bank	JPY	Japanese Yen
UBSW	UBS AG	KRW	South Korean Won
		MXN	Mexican Peso
		NOK	Norwegian Krone
		USD	United States Dollar

TGB-40         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Tax Information (unaudited)

Templeton Global Bond VIP Fund

At December 31, 2019, more than 50% of the Fund’s total assets were invested in securities of foreign issuers. In most instances, foreign taxes were withheld from income paid to the Fund on these investments. As shown in the table below, the Fund hereby reports to shareholders the foreign source income and foreign taxes paid, pursuant to Section 853 of the Internal Revenue Code. This written statement will allow shareholders of record on June 11, 2020, to treat their proportionate share of foreign taxes paid by the Fund as having been paid directly by them. The shareholder shall consider these amounts as foreign taxes paid in the tax year in which they receive the Fund distribution.

The following table provides a detailed analysis of foreign tax paid and foreign source income as reported by the Fund to shareholders of record.

Class	Foreign Tax Paid Per Share		Foreign Source Income Per Share
Class 1		$0.0241		$0.8881
Class 2		$0.0241		$0.8586
Class 4		$0.0241		$0.8460

Foreign Tax Paid Per Share is the amount per share available to you, as a tax credit (assuming you held your shares in the Fund for a minimum of 16 days during the 31-day period beginning 15 days before the ex-dividend date of the Fund’s distribution to which the foreign taxes relate), or, as a tax deduction.

Foreign Source Income Per Share is the amount per share of income dividends attributable to foreign securities held by the Fund, plus any foreign taxes withheld on these dividends.

Semiannual Report         TGB-41

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Templeton Growth VIP Fund

This semiannual report for Templeton Growth VIP Fund covers the period ended June 30, 2020.

Class 1 Performance Summary as of June 30, 2020

The Fund’s Class 1 Shares posted a -13.41% total return for the six-month period ended June 30, 2020.

Performance reflects the Fund’s Class 1 operating expenses, but does not include any contract fees, expenses or sales charges. If they had been included, performance would be lower. These charges and deductions, particularly for variable life policies, can have a significant effect on contract values and insurance benefits. See the contract prospectus for a complete description of these expenses, including sales charges.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown.

Semiannual Report         TG-1

TEMPLETON GROWTH VIP FUND

Fund Goal and Main Investments

The Fund seeks long-term capital growth. Under normal market conditions, the Fund invests predominantly in equity securities (primarily common stocks) of companies located anywhere in the world, including developing markets.

Fund Risks

All investments involve risks, including possible loss of principal. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. Special risks are associated with foreign investing, including currency fluctuations, economic instability and political developments; investments in developing markets involve heightened risks related to the same factors. Because the Fund may invest its assets in companies in a specific region, including Europe, it is subject to greater risks of adverse developments in that region and/or the surrounding regions than a fund that is more broadly diversified geographically. Political, social or economic disruptions in the region, even in countries in which the Fund is not invested, may adversely affect the value of securities held by the Fund. Current political uncertainty concerning the economic consequences of the departure of the U.K. from the European Union may increase market volatility. Derivatives involve costs and can create economic leverage which may result in significant volatility and cause the Fund to participate in losses (and enable gains) on an amount that exceeds the Fund’s initial investment. In addition, securities issued by small- and mid-capitalization companies have historically experienced more price volatility than larger-company stocks, especially over the short term and may involve additional risks. The Fund is actively managed but there is no guarantee that the manager’s investment decisions will produce the desired results. The Fund’s prospectus also includes a description of the main investment risks.

Geographic Composition

Based on Total Net Assets as of 6/30/20

Performance Overview

You can find the Fund’s six-month total return in the Performance Summary. For comparison, the Fund’s benchmark, the MSCI All Country World Index (ACWI), posted a -5.99% total return for the period under review.¹

Economic and Market Overview

Global developed and emerging market equities, as measured by the MSCI ACWI (USD), posted a -5.99% total return during the six months under review.¹ Stocks fell sharply in early 2020 as countries around the world implemented lockdown measures in an effort to slow the spread of the novel coronavirus (COVID-19). Global supply chain disruptions, business and personal restrictions, and subdued consumer spending drove many investors to sell equity holdings in favor of perceived safe investments such as government bonds and cash. While global equities, notably in the U.S., rebounded in April and May amid optimism about easing lockdown restrictions, concerns about a second wave of infections hindered equities in June, as investors weighed the possibility of renewed restrictions.

In the U.S., government mandates to mitigate the COVID-19 pandemic severely impacted the economy beginning in March 2020. As a result, the unemployment rate surged to 14.7% in April, as many businesses, particularly those involved in hospitality, retail and travel, announced mass layoffs.² According to the National Bureau of Economic Research, the longest U.S. economic expansion in history ended in February 2020 as the country slipped into a severe recession. Nonetheless, near period-end, there were signs that a recovery was underway, as jobless claims fell

1. Source: Morningstar. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. Please see Index Descriptions following the Fund Summaries.

2. Source: U.S. Bureau of Labor Statistics.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s Statement of Investments (SOI).

TG-2         Semiannual Report

TEMPLETON GROWTH VIP FUND

considerably from their peak in early April, retail sales rose sharply in May, and the unemployment rate fell to 11.1% in June.² Along with optimism about improved treatments and potential vaccines for COVID-19, the positive economic signals contributed to a significant equity rebound in April and May. However, an increase in COVID-19 infections in many states throughout June pressured U.S. stocks.

The U.S. Federal Reserve (Fed) made significant efforts to support the U.S. economy. In March 2020, as the pandemic began to severely impact the economy and financial markets, the Fed implemented two emergency rate cuts, lowering the federal funds target rate to a range of 0.00%–0.25%, and announced sweeping quantitative easing measures aimed at ensuring credit flow to borrowers and supporting credit markets with unlimited amounts of bond purchasing.

In the eurozone, some analysts forecasted a significant contraction in 2020, particularly in southern European countries, as the magnitude of the economic disruption caused by the pandemic became apparent. European developed market equities, as measured by the MSCI Europe Index (USD), posted a -12.43% total return for the period.¹ To stimulate growth, the European Central Bank implemented a broad bond-buying program, and many countries passed fiscal stimulus measures.

Asian developed and emerging market equities, as measured by the MSCI All Country Asia Index (USD), posted a -5.51% total return during the six-month period.¹ The onset of the pandemic brought dramatically slower economic activity in Asia, as businesses halted operations and manufacturing and export activity declined sharply in the region’s major economies. Asian markets generally advanced toward period-end, bolstered by fiscal stimulus measures and economies reopening throughout the region.

Emerging market stocks, as measured by the MSCI Emerging Markets Index (USD), posted a -9.67% total return due primarily to the COVID-19 pandemic.¹ A sharp decrease in prices for oil and other natural resources also hurt emerging market economies reliant on these exports. In the last quarter of the reporting period, however, investor optimism led to a stock rally, particularly in emerging market countries that had successfully lowered infection rates.

Investment Strategy

Our investment philosophy is bottom up, value oriented and long term. When choosing equity investments for the Fund, we focus on the market price of a company’s securities relative to our evaluation of the company’s potential

long-term earnings, asset value and cash flow. Our analysis includes an assessment of the potential impacts of material environmental, social and governance (ESG) factors on the long-term risk and return profile of a company. We also consider a company’s price/earnings ratio, price/cash flow ratio, profit margins and liquidation value.

The Fund may, from time to time, seek to hedge (protect) against currency risks, using certain currency-related derivative instruments. The Fund may also use a variety of equity-related derivatives for various purposes including enhancing Fund returns, increasing liquidity and gaining exposure to particular markets in more efficient or less expensive ways.

Manager’s Discussion

During the six months under review, key contributors to the Fund’s performance relative to the MSCI ACWI included stock selection in the materials, health care and industrials sectors, as well as underweighted allocations in the materials and industrials sectors and an overweighted allocation in the health care sector.

Within materials, Canadian mining company Wheaton Precious Metals aided relative results. Its stock performed particularly well in the first half of 2020 as the price of gold reached multi-year highs.

In the health care sector, U.S. biotechnology firm Gilead Sciences, U.S.-listed pharmaceutical products company Allergan (not held at period-end) and French pharmaceuticals firm Sanofi boosted relative performance. Gilead Sciences performed well due to indications that its remdesivir drug was a leading candidate for coronavirus treatment. The drug has received approval from the U.S. Food and Drug Administration.

In the industrials sector, U.S. diesel engine and military truck manufacturer Navistar International (not part of the index; not held at period-end) supported relative results.

Other key individual contributors to relative performance included U.S. supermarket operator Kroger, which benefited from consumer stockpiling ahead of an extended period of stay-at-home measures.

In contrast, key detractors from the Fund’s relative performance included stock selection and an underweighting in the information technology (IT) sector and stock selection in the communication services and consumer discretionary sectors.

Semiannual Report         TG-3

TEMPLETON GROWTH VIP FUND

Top 10 Holdings    

6/30/20    

Company Sector/Industry, Country	% of Total Net Assets
Wheaton Precious Metals Corp. Metals & Mining, Canada		3.2%
Sanofi Pharmaceuticals, France		2.9%
Samsung Electronics Co. Ltd. Technology Hardware, Storage & Peripherals, South Korea		2.7%
Roche Holding AG Pharmaceuticals, Switzerland		2.4%
Verizon Communications Inc. Diversified Telecommunication Services, U.S.		2.1%
Comcast Corp. Media, U.S.		2.1%
E.ON SE Multi-Utilities, Germany		2.1%
Dollar Tree Inc. Multiline Retail, U.S.		2.0%
Siemens AG Industrial Conglomerates, Germany		1.9%
Oracle Corp. Software, U.S.		1.8%

Within IT, our position in Japanese electronic equipment manufacturer Kyocera hindered relative results.

In the communication services sector, our positions in Luxembourg-based communication satellite owner SES and diversified telecommunication services provider Singapore Telecommunications (not held at period-end) hindered relative results.

In consumer discretionary, our position in U.K. specialty retailer Kingfisher (not held at period-end) hurt relative performance.

Other key individual detractors from relative performance included shares in U.S. energy exploration and production firm Apache (not held at period-end), U.K.-domiciled, Asia-focused lender Standard Chartered (not held at period-end) and French banking and financial services provider BNP Paribas (not held at period-end). Apache’s shares declined as sharply lower oil prices raised concerns about cash flow pressures and balance sheet dynamics. Standard Chartered was negatively impacted by escalating turmoil in Hong Kong. BNP Paribas declined due to broad-based economic fears and low interest rates.

From a geographic perspective, stock selection and an underweighting in the Middle East and Africa, namely in Israel, contributed to the Fund’s relative performance. In North America, stock selection and an underweighting in the U.S. detracted from relative results, while stock selection in Canada contributed. In Europe, relative weakness in the U.K., France and the Netherlands more than offset relative strength in Germany and Switzerland. In Asia, our positions in China, Hong Kong and Japan hindered relative results.

Thank you for your participation in Templeton Growth VIP Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2020, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund.

Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

TG-4         Semiannual Report

TEMPLETON GROWTH VIP FUND

Class 1 Fund Expenses

As an investor in a variable insurance contract (Contract) that indirectly provides for investment in an underlying mutual fund, you can incur transaction and/or ongoing expenses at both the Fund level and the Contract Level: (1) transaction expenses can include sales charges (loads) on purchases, surrender fees, transfer fees and premium taxes; and (2) ongoing expenses can include management fees, distribution and service (12b-1) fees, contract fees, annual maintenance fees, mortality and expense risk fees and other fees and expenses. All mutual funds and Contracts have some types of ongoing expenses. The table below shows Fund-level ongoing expenses and can help you understand these costs and compare them with those of other mutual funds offered through the Contract. The table assumes a $1,000 investment held for the six months indicated. Please refer to the Fund prospectus for additional information on operating expenses.

Actual Fund Expenses

The table below provides information about the actual account values and actual expenses in the columns under the heading “Actual.” In these columns the Fund’s actual return, which includes the effect of ongoing Fund expenses but does not include the effect of ongoing Contract expenses, is used to calculate the “Ending Account Value.” You can estimate the Fund-level expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number under the headings “Actual” and “Fund-Level Expenses Paid During Period” (if Fund-Level Expenses Paid During Period were $ 7.50, then 8.6 x $7.50 = $64.50). In this illustration, the estimated expenses paid this period at the Fund level are $64.50.

Hypothetical Example for Comparison with Other Mutual Funds

Under the heading “Hypothetical” in the table, information is provided about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other mutual funds offered through the Contract. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds offered through the Contract.

Please note that expenses shown in the table are meant to highlight ongoing costs at the Fund level only and do not reflect any ongoing expenses at the Contract level, or transaction expenses at either the Fund or Contract levels. In addition, while the Fund does not have transaction expenses, if the transaction and ongoing expenses at the Contract level were included, the expenses shown below would be higher. You should consult your Contract prospectus or disclosure document for more information.

		Actual (actual return after expenses)		Hypothetical   (5% annual return before expenses)
Share   Class	Beginning Account Value 1/1/20	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period 1/1/20–6/30/201, 2	Ending Account Value 6/30/20	Fund-Level Expenses Paid During Period   1/1/20–6/30/201, 2	Net Annualized Expense Ratio2
Class 1	$1,000	$865.90	$4.18	$1,020.39	$4.52	0.90%

1. Expenses are equal to the annualized expense ratio for the six-month period as indicated above—in the far right column—multiplied by the simple average account value over the period indicated, and then multiplied by 182/366 to reflect the one-half year period.

2. Reflects expenses after fee waivers and expense reimbursements. Does not include any ongoing expenses of the Contract for which the Fund is an investment option or acquired fund fees and expenses.

Semiannual Report         TG-5

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Financial Highlights

Templeton Growth VIP Fund

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 1
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$11.15			$12.44			$16.24			$13.93			$13.54			$14.85
Income from investment operationsa:
Net investment incomeb		0.10			0.30			0.28			0.29			0.26			0.28
Net realized and unrealized gains (losses)		(1.59	)		1.30			(2.42	)		2.30			0.96			(1.17	)
Total from investment operations		(1.49	)		1.60			(2.14	)		2.59			1.22			(0.89	)
Less distributions from:
Net investment income		(0.33	)		(0.40	)		(0.35	)		(0.28	)		(0.31	)		(0.42	)
Net realized gains		—			(2.49	)		(1.31	)		—			(0.52	)		—
Total distributions		(0.33	)		(2.89	)		(1.66	)		(0.28	)		(0.83	)		(0.42	)
Net asset value, end of period		$ 9.33			$11.15			$12.44			$16.24			$13.93			$13.54
Total returnc		(13.41)%			15.43%			(14.61)%			18.77%			9.90%			(6.24)%
Ratios to average net assetsd
Expensese		0.90%			0.86%			0.83%			0.82%	f		0.82%			0.80%
Net investment income		1.95%			2.52%			1.90%			1.94%			2.01%			1.96%
Supplemental data
Net assets, end of period (000’s)		$79,370			$97,988			$354,164			$466,207			$453,997			$468,548
Portfolio turnover rate		46.03%			19.69%			29.25%			26.46%			22.88%			20.92%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^fBenefit of expense reduction rounds to less than 0.01%.

TG-6         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Templeton Growth VIP Fund (continued)

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 2
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$10.90			$12.21			$15.97			$13.70			$13.32			$14.61
Income from investment operationsa:
Net investment incomeb		0.08			0.26			0.24			0.25			0.23			0.25
Net realized and unrealized gains (losses)		(1.55	)		1.28			(2.38	)		2.26			0.94			(1.16	)
Total from investment operations		(1.47	)		1.54			(2.14	)		2.51			1.17			(0.91	)
Less distributions from:
Net investment income		(0.30	)		(0.36	)		(0.31	)		(0.24	)		(0.27	)		(0.38	)
Net realized gains		—			(2.49	)		(1.31	)		—			(0.52	)		—
Total distributions		(0.30	)		(2.85	)		(1.62	)		(0.24	)		(0.79	)		(0.38	)
Net asset value, end of period		$ 9.13			$10.90			$12.21			$15.97			$13.70			$13.32
Total returnc		(13.52)%			15.15%			(14.85)%			18.50%			9.62%			(6.49)%
Ratios to average net assetsd
Expensese		1.15%			1.11%			1.08%			1.07%	f		1.07%			1.05%
Net investment income		1.70%			2.27%			1.65%			1.69%			1.76%			1.71%
Supplemental data
Net assets, end of period (000’s)		$521,323			$659,412			$625,311			$879,521			$876,128			$921,895
Portfolio turnover rate		46.03%			19.69%			29.25%			26.46%			22.88%			20.92%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^fBenefit of expense reduction rounds to less than 0.01%.

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TG-7

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL HIGHLIGHTS

Templeton Growth VIP Fund (continued)

	Six Months Ended June 30, 2020			Year Ended December 31,
	(unaudited)			2019			2018			2017			2016			2015
Class 4
Per share operating performance (for a share outstanding throughout the period)
Net asset value, beginning of period		$11.07			$12.36			$16.13			$13.83			$13.44			$14.73
Income from investment operationsa:
Net investment incomeb		0.08			0.26			0.23			0.24			0.22			0.23
Net realized and unrealized gains (losses)		(1.58	)		1.29			(2.40	)		2.28			0.94			(1.16	)
Total from investment operations		(1.50	)		1.55			(2.17	)		2.52			1.16			(0.93	)
Less distributions from:
Net investment income		(0.28	)		(0.35	)		(0.29	)		(0.22	)		(0.25	)		(0.36	)
Net realized gains		—			(2.49	)		(1.31	)		—			(0.52	)		—
Total distributions		(0.28	)		(2.84	)		(1.60	)		(0.22	)		(0.77	)		(0.36	)
Net asset value, end of period		$ 9.29			$11.07			$12.36			$16.13			$13.83			$13.44
Total returnc		(13.52)%			14.97%			(14.88)%			18.38%			9.47%			(6.54)%
Ratios to average net assetsd
Expensese		1.25%			1.21%			1.18%			1.17%	f		1.17%			1.15%
Net investment income		1.60%			2.17%			1.55%			1.59%			1.66%			1.61%
Supplemental data
Net assets, end of period (000’s)		$22,083			$27,330			$28,238			$38,798			$43,286			$47,777
Portfolio turnover rate		46.03%			19.69%			29.25%			26.46%			22.88%			20.92%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.

^bBased on average daily shares outstanding.

^cTotal return does not include fees, charges or expenses imposed by the variable annuity and life insurance contracts for which Franklin Templeton Variable Insurance Products Trust serves as an underlying investment vehicle. Total return is not annualized for periods less than one year.

^dRatios are annualized for periods less than one year.

^eBenefit of waiver and payments by affiliates rounds to less than 0.01%.

^fBenefit of expense reduction rounds to less than 0.01%.

TG-8         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Statement of Investments, June 30, 2020 (unaudited)

Templeton Growth VIP Fund

	Country		Shares		Value
Common Stocks 86.3%
Aerospace & Defense 0.9%
BAE Systems PLC		United Kingdom		936,202	$	5,597,756
Air Freight & Logistics 1.3%
United Parcel Service Inc., B		United States		70,479		7,835,855
Airlines 0.6%
Japan Airlines Co. Ltd.		Japan		197,900		3,571,208
Auto Components 1.0%
BorgWarner Inc.		United States		93,910		3,315,023
Lear Corp.		United States		27,913		3,043,075
						6,358,098
Automobiles 1.8%
Honda Motor Co. Ltd.		Japan		316,000		8,169,776
Isuzu Motors Ltd.		Japan		304,100		2,763,459
						10,933,235
Banks 2.6%
Bangkok Bank PCL, fgn		Thailand		1,552,060		5,418,671
KB Financial Group Inc.		South Korea		159,595		4,530,159
Sumitomo Mitsui Financial Group Inc.		Japan		226,060		6,379,818
						16,328,648
Beverages 5.4%
Anheuser-Busch InBev SA/NV		Belgium		229,367		11,305,966
aKirin Holdings Co. Ltd.		Japan		497,400		10,485,065
Pernod Ricard SA		France		31,230		4,917,237
Suntory Beverage & Food Ltd.		Japan		185,560		7,240,223
						33,948,491
Biotechnology 2.3%
AbbVie Inc.		United States		45,763		4,493,011
Gilead Sciences Inc.		United States		125,136		9,627,964
						14,120,975
Chemicals 0.7%
DuPont de Nemours Inc.		United States		86,981		4,621,301
Diversified Telecommunication Services 2.1%
Verizon Communications Inc.		United States		240,340		13,249,944
Electrical Equipment 1.2%
Mitsubishi Electric Corp.		Japan		565,700		7,388,758
Electronic Equipment, Instruments & Components 1.7%
Kyocera Corp.		Japan		192,100		10,485,694
Entertainment 1.0%
The Walt Disney Co.		United States		56,090		6,254,596
Food & Staples Retailing 4.0%
The Kroger Co.		United States		262,521		8,886,336
Seven & i Holdings Co. Ltd.		Japan		233,500		7,638,607
Sysco Corp.		United States		150,174		8,208,511
						24,733,454

Semiannual Report         TG-9

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

	Country		Shares		Value
Common Stocks (continued)
Food Products 1.5%
Kellogg Co.		United States		144,817	$	9,566,611
Gas Utilities 0.5%
Kunlun Energy Co. Ltd.		China		4,364,470		2,858,389
Health Care Equipment & Supplies 1.5%
Medtronic PLC		United States		46,160		4,232,872
Zimmer Biomet Holdings Inc.		United States		40,829		4,873,349
						9,106,221
Health Care Providers & Services 0.5%
bLaboratory Corp. of America Holdings		United States		19,533		3,244,627
Hotels, Restaurants & Leisure 4.8%
Compass Group PLC		United Kingdom		366,778		5,046,095
Galaxy Entertainment Group Ltd.		Macau		1,031,300		7,074,411
InterContinental Hotels Group PLC		United Kingdom		96,760		4,271,311
Starbucks Corp.		United States		46,480		3,420,463
Whitbread PLC		United Kingdom		45,548		1,253,089
Yum China Holdings Inc.		China		181,361		8,718,023
						29,783,392
Household Durables 3.2%
Gree Electric Appliances Inc. of Zhuhai		China		379,820		3,054,252
Panasonic Corp.		Japan		1,127,450		9,886,661
Sony Corp.		Japan		98,620		6,807,751
						19,748,664
Industrial Conglomerates 1.9%
Siemens AG		Germany		100,557		11,858,349
Insurance 1.5%
AIA Group Ltd.		Hong Kong		977,000		9,142,317
Interactive Media & Services 1.0%
bBaidu Inc., ADR.		China		50,650		6,072,429
Internet & Direct Marketing Retail 2.7%
bAlibaba Group Holding Ltd.		China		280,370		7,565,395
bBooking Holdings Inc.		United States		5,950		9,474,423
						17,039,818
IT Services 0.4%
bEPAM Systems Inc.		United States		11,016		2,776,142
Machinery 2.7%
Komatsu Ltd.		Japan		440,500		9,021,669
Makita Corp.		Japan		137,200		4,989,203
Stanley Black & Decker Inc.		United States		22,400		3,122,112
						17,132,984
Marine 1.4%
AP Moeller-Maersk A/S, B		Denmark		7,724		9,051,690

TG-10         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

	Country		Shares		Value
Common Stocks (continued)
Media 3.0%
Comcast Corp., A		United States		333,281	$	12,991,293
SES SA, IDR		Luxembourg		881,520		6,022,792
						19,014,085
Metals & Mining 5.4%
bArcelorMittal SA		France		505,963		5,358,614
Freeport-McMoRan Inc.		United States		734,044		8,492,889
Wheaton Precious Metals Corp.		Canada		453,417		19,942,933
						33,794,436
Multiline Retail 2.1%
bDollar Tree Inc.		United States		138,022		12,791,879
Multi-Utilities 3.2%
E.ON SE		Germany		1,144,619		12,918,941
Veolia Environnement SA		France		299,720		6,767,422
						19,686,363
Oil, Gas & Consumable Fuels 2.8%
BP PLC		United Kingdom		2,100,831		8,048,044
Husky Energy Inc.		Canada		686,221		2,254,463
Royal Dutch Shell PLC, B		United Kingdom		467,119		7,081,374
						17,383,881
Pharmaceuticals 8.6%
Bayer AG		Germany		150,406		11,147,627
Roche Holding AG		Switzerland		42,833		14,839,473
Sanofi		France		177,087		18,058,539
Takeda Pharmaceutical Co. Ltd.		Japan		261,562		9,397,383
						53,443,022
Real Estate Management & Development 1.1%
CK Asset Holdings Ltd.		Hong Kong		824,190		4,942,463
Sun Hung Kai Properties Ltd.		Hong Kong		145,260		1,855,718
						6,798,181
Road & Rail 0.6%
East Japan Railway Co.		Japan		31,800		2,203,589
Keisei Electric Railway Co. Ltd.		Japan		44,600		1,397,782
						3,601,371
Semiconductors & Semiconductor Equipment 1.0%
NXP Semiconductors NV		Netherlands		55,236		6,299,113
Software 1.8%
Oracle Corp.		United States		208,438		11,520,368
Specialty Retail 2.1%
Ross Stores Inc.		United States		72,630		6,190,981
The TJX Cos. Inc.		United States		132,377		6,692,981
						12,883,962
Technology Hardware, Storage & Peripherals 2.7%
Samsung Electronics Co. Ltd.		South Korea		373,630		16,583,973

Semiannual Report         TG-11

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

STATEMENT OF INVESTMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

	Country		Shares			Value
Common Stocks (continued)
Textiles, Apparel & Luxury Goods 1.7%
bAdidas AG		Germany		14,503		$	3,823,399
Burberry Group PLC		United Kingdom		355,780			7,029,960
							10,853,359
Total Common Stocks (Cost $502,481,970)							537,463,639
				Principal Amount	*
Short Term Investments 9.5%
U.S. Government and Agency Securities (Cost $400,000) 0.1%
cFFCB, 7/01/20.		United States	$	400,000			400,000
Time Deposits 7.7%
BNP Paribas SA/New York NY, 0.06%, 7/01/20		France		28,000,000			28,000,000
Royal Bank of Canada, 0.08%, 7/01/20		Canada		20,000,000			20,000,000
Total Time Deposits (Cost $48,000,000)							48,000,000
			Shares
Investments from Cash Collateral Received for Loaned Securities 1.7%
Money Market Funds (Cost $10,490,166) 1.7%
d,eInstitutional Fiduciary Trust Money Market Portfolio, 0.00%.		United States		10,490,166			10,490,166
Total Investments (Cost $561,372,136) 95.8%.							596,353,805
Other Assets, less Liabilities 4.2%.							26,422,056
Net Assets 100.0%						$	622,775,861

See Abbreviations on page TG-24.

*The principal amount is stated in U.S. dollars unless otherwise indicated.

^aA portion or all of the security is on loan at June 30, 2020. See Note 1(c).

^bNon-income producing.

^cThe security was issued on a discount basis with no stated coupon rate.

^dSee Note 3(e) regarding investments in affiliated management investment companies.

^eThe rate shown is the annualized seven-day effective yield at period end.

TG-12         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities

June 30, 2020 (unaudited)

	Templeton Growth VIP Fund
Assets:
Investments in securities:
Cost - Unaffiliated issuers		$550,881,970
Cost - Non-controlled affiliates (Note 3e)		10,490,166
Value - Unaffiliated issuers+		$585,863,639
Value - Non-controlled affiliates (Note 3e)		10,490,166
Cash		6,514
Foreign currency, at value (cost $34,109,277)		33,994,768
Receivables:
Investment securities sold		1,577,822
Capital shares sold		600,726
Dividends and interest		1,697,996
European Union tax reclaims		787,852
Other assets		594
Total assets		635,020,077
Liabilities:
Payables:
Investment securities purchased		532,391
Capital shares redeemed		410,181
Management fees		436,346
Distribution fees		114,738
Payable upon return of securities loaned		10,490,166
Accrued expenses and other liabilities.		260,394
Total liabilities		12,244,216
Net assets, at value		$622,775,861
Net assets consist of:
Paid-in capital		$670,491,362
Total distributable earnings (losses)		(47,715,501	)
Net assets, at value		$622,775,861
Class 1:
Net assets, at value		$ 79,369,895
Shares outstanding.		8,504,503
Net asset value and maximum offering price per share		$9.33
Class 2:
Net assets, at value		$521,322,739
Shares outstanding.		57,079,661
Net asset value and maximum offering price per share		$9.13
Class 4:
Net assets, at value		$ 22,083,227
Shares outstanding.		2,377,705
Net asset value and maximum offering price per share		$9.29

⁺Includes securities loaned         $   9,960,811

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TG-13

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statement of Operations

for the six months ended June 30, 2020 (unaudited)

	Templeton Growth VIP Fund
Investment income:
Dividends:(net of foreign taxes)*
Unaffiliated issuers		$    9,136,701
Interest:
Unaffiliated issuers		138,349
Income from securities loaned:
Unaffiliated entities (net of fees and rebates)		9,982
Non-controlled affiliates (Note 3e)		1,609
Total investment income		9,286,641
Expenses:
Management fees (Note 3a)		2,742,841
Distribution fees: (Note 3c)
Class 2		683,322
Class 4		40,255
Custodian fees (Note 4)		66,119
Reports to shareholders		83,758
Professional fees		53,098
Trustees’ fees and expenses		2,617
Other		(2,366	)
Total expenses		3,669,644
Expenses waived/paid by affiliates (Note 3e)		(4,997	)
Net expenses		3,664,647
Net investment income		5,621,994
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments:#
Unaffiliated issuers		(69,975,086	)
Foreign currency transactions		312,185
Net realized gain (loss)		(69,662,901	)
Net change in unrealized appreciation (depreciation) on:
Investments:
Unaffiliated issuers		(40,871,435	)
Translation of other assets and liabilities denominated in foreign currencies		(162,654	)
Change in deferred taxes on unrealized appreciation		388,289
Net change in unrealized appreciation (depreciation)		(40,645,800	)
Net realized and unrealized gain (loss)		(110,308,701	)
Net increase (decrease) in net assets resulting from operations		$(104,686,707	)
*Foreign taxes withheld on dividends.		$        852,011
#Net of foreign taxes		$        523,662

TG-14         Semiannual Report  |  The accompanying notes are an integral part of these financial statements.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

FINANCIAL STATEMENTS

Statements of Changes in Net Assets

	Templeton Growth VIP Fund
	Six Months Ended June 30, 2020 (unaudited)			Year Ended December 31, 2019
Increase (decrease) in net assets:
Operations:
Net investment income		$      5,621,994			$      19,938,552
Net realized gain (loss)		(69,662,901	)		(13,584,687	)
Net change in unrealized appreciation (depreciation)		(40,645,800	)		128,174,019
Net increase (decrease) in net assets resulting from operations		(104,686,707	)		134,527,884
Distributions to shareholders:
Class 1		(2,680,578	)		(20,901,613	)
Class 2		(16,492,099	)		(139,418,589	)
Class 4		(659,619	)		(6,044,047	)
Total distributions to shareholders		(19,832,296	)		(166,364,249	)
Capital share transactions: (Note 2)
Class 1		(3,075,020	)		(275,115,440	)
Class 2		(33,359,573	)		82,734,600
Class 4		(1,000,215	)		1,233,451
Total capital share transactions		(37,434,808	)		(191,147,389	)
Net increase (decrease) in net assets		(161,953,811	)		(222,983,754	)
Net assets:
Beginning of period		784,729,672			1,007,713,426
End of period		$  622,775,861			$    784,729,672

The accompanying notes are an integral part of these financial statements.  |  Semiannual Report         TG-15

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Notes to Financial Statements (unaudited)

Templeton Growth VIP Fund

1. Organization and Significant Accounting Policies

Franklin Templeton Variable Insurance Products Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of eighteen separate funds and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). Templeton Growth VIP Fund (Fund) is included in this report. Shares of the Fund are generally sold only to insurance company separate accounts to fund the benefits of variable life insurance policies or variable annuity contracts. The Fund offers three classes of shares: Class 1, Class 2 and Class 4. Each class of shares may differ by its distribution fees, voting rights on matters affecting a single class and its exchange privilege.

The following summarizes the Fund’s significant accounting policies.

a. Financial Instrument Valuation

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Fund may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued

according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Debt securities generally trade in the OTC market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value.

Investments in open-end mutual funds are valued at the closing NAV. Investments in time deposits are valued at cost, which approximates fair value.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the

TG-16         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Fund’s portfolio securities to the latest indications of fair value at 4 p.m Eastern time. At June 30, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

b. Foreign Currency Translation

Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.

The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar

equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.

c. Securities Lending

The Fund participates in an agency based securities lending program to earn additional income. The Fund receives cash collateral against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. The collateral is deposited into a joint cash account with other funds and is used to invest in a money market fund managed by Franklin Advisers, Inc., an affiliate of the Fund. The Fund may receive income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third-party vendor, is reported separately in the Statement of Operations. The Fund bears the market risk with respect to the collateral investment, securities loaned, and the risk that the agent may default on its obligations to the Fund. If the borrower defaults on its obligation to return the securities loaned, the Fund has the right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower.

d. Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and if applicable, excise taxes. As a result, no provision for U.S. federal income taxes is required.

The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital

Semiannual Report         TG-17

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

1. Organization and Significant Accounting

Policies (continued)

d. Income and Deferred Taxes (continued)

gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

As a result of several court cases, in certain countries across the European Union, the Fund filed additional tax reclaims for previously withheld taxes on dividends earned in those countries (EU reclaims). These additional filings are subject to various administrative proceedings by the local jurisdictions’ tax authorities within the European Union, as well as a number of related judicial proceedings. Income recognized, if any, for EU reclaims is reflected as other income in the Statement of Operations and any related receivable, if any, is reflected as European Union tax reclaims in the Statement of Assets and Liabilities. When uncertainty exists as to the ultimate resolution of these proceedings, the likelihood of receipt of these EU reclaims, and the potential timing of payment, no amounts are reflected in the financial statements. For U.S. income tax purposes, when EU reclaims are received by the Fund and the Fund previously passed foreign tax credit on to its shareholders, the Fund must either amend historic tax reporting to shareholders or enter into a closing agreement with the Internal Revenue Service (IRS) in order to pay the associated tax liability on behalf of the Fund’s shareholders.

The Fund may recognize an income tax liability related to its uncertain tax positions under U.S. GAAP when the uncertain tax position has a less than 50% probability that it will be sustained upon examination by the tax authorities based on its technical merits. As of June 30, 2020, the Fund has determined that no tax liability is required in its financial statements related to uncertain tax positions for any open tax years (or expected to be taken in future tax years). Open tax years are those that remain subject to examination and are based on the statute of limitations in each jurisdiction in which the Fund invests.

e. Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Interest income

and estimated expenses are accrued daily. Dividend income and capital gain distributions are recorded on the ex-dividend date except for certain dividends from securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by the Fund. Distributions to shareholders are recorded on the ex-dividend date. Distributable earnings are determined according to income tax regulations (tax basis) and may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the Funds based on the ratio of net assets of each Fund to the combined net assets of the Trust or based on the ratio of number of shareholders of each Fund to the combined number of shareholders of the Trust. Fund specific expenses are charged directly to the Fund that incurred the expense.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

f. Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

g. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Fund, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is

TG-18         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2. Shares of Beneficial Interest

At June 30, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

	Six Months Ended June 30, 2020						Year Ended December 31, 2019
	Shares			Amount			Shares			Amount
Class 1 Shares:
Shares sold		47,404		$	449,446			68,873		$	790,173
Shares issued in reinvestment of distributions		287,000			2,680,578			2,083,910			20,901,613
Shares redeemed		(614,433	)		(6,205,044	)		(21,838,635	)		(296,807,226	)
Net increase (decrease)		(280,029	)	$	(3,075,020	)		(19,685,852	)	$	(275,115,440	)
Class 2 Shares:
Shares sold		2,219,982		$	19,766,911			3,619,417		$	39,550,989
Shares issued in reinvestment of distributions		1,804,387			16,492,099			14,197,412			139,418,589
Shares redeemed		(7,418,146	)		(69,618,583	)		(8,538,686	)		(96,234,978	)
Net increase (decrease)		(3,393,777	)	$	(33,359,573	)		9,278,143		$	82,734,600
Class 4 Shares:
Shares sold		86,631		$	804,235			148,576		$	1,690,506
Shares issued in reinvestment of distributions		71,003			659,619			605,616			6,044,047
Shares redeemed		(248,136	)		(2,464,069	)		(571,458	)		(6,501,102	)
Net increase (decrease)		(90,502	)	$	(1,000,215	)		182,734		$	1,233,451

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:

Subsidiary	Affiliation
Templeton Global Advisors Limited (Global Advisors)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

Semiannual Report         TG-19

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

3. Transactions with Affiliates (continued)

a. Management Fees

The Fund pays an investment management fee to Global Advisors based on the average daily net assets of the Fund as follows:

Annualized Fee Rate	Net Assets
1.000%	Up to and including $100 million
0.900%	Over $100 million, up to and including $250 million
0.800%	Over $250 million, up to and including $500 million
0.750%	Over $500 million, up to and including $1 billion
0.700%	Over $1 billion, up to and including $5 billion
0.675%	Over $5 billion, up to and including $10 billion
0.655%	Over $10 billion, up to and including $15 billion
0.635%	Over $15 billion, up to and including $20 billion
0.615%	In excess of $20 billion

For the period ended June 30, 2020, the annualized gross effective investment management fee rate was 0.843% of the Fund’s average daily net assets.

b. Administrative Fees

Under an agreement with Global Advisors, FT Services provides administrative services to the Fund. The fee is paid by Global Advisors based on the Fund’s average daily net assets, and is not an additional expense of the Fund.

c. Distribution Fees

The Board has adopted distribution plans for Class 2 and Class 4 shares pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to 0.35% per year of its average daily net assets of each class. The Board has agreed to limit the current rate to 0.25% per year for Class 2. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

d. Transfer Agent Fees

Investor Services, under terms of an agreement, performs shareholder servicing for the Fund and is not paid by the Fund for the services.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

e. Investments in Affiliated Management Investment Companies

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the period ended June 30, 2020, the Fund held investments in affiliated management investment companies as follows:

	Value at Beginning of Period		Purchases		Sales			Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Income from securities loaned
Non-Controlled Affiliates
Institutional Fiduciary Trust Money Market Portfolio, 0.00%	$	—		$41,621,171		$(31,131,005	)		$      —	$	—		$10,490,166		10,490,166		$1,609

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the period ended June 30, 2020, there were no credits earned.

5. Income Taxes

For tax purposes, capital losses may be carried over to offset future capital gains.

At December 31, 2019, the capital loss carryforwards were as follows:

Capital loss carryforwards not subject to expiration:
Short term	$1,856,399
Long term	3,209,150
Total capital loss carryforwards	$5,065,549

At June 30, 2020, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments	$575,582,222
Unrealized appreciation	$  79,117,116
Unrealized depreciation	(58,345,533	)
Net unrealized appreciation (depreciation)	$  20,771,583

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatment of wash sales.

6. Investment Transactions

Purchases and sales of investments (excluding short term securities) for the period ended June 30, 2019, aggregated $268,297,262 and $335,926,574, respectively.

Semiannual Report         TG-21

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

6. Investment Transactions(continued)

At June 30, 2020, in connection with securities lending transactions, the Fund loaned equity investments and received $10,490,166 of cash collateral. The gross amount of recognized liability for such transactions is included in payable upon return of securities loaned in the Statement of Assets and Liabilities. The agreements can be terminated at any time.

7. Concentration of Risk

Investing in foreign securities may include certain risks and considerations not typically associated with investing in U.S. securities, such as fluctuating currency values and changing local, regional and global economic, political and social conditions, which may result in greater market volatility. Current political and financial uncertainty surrounding the European Union may increase market volatility and the economic risk of investing in securities in Europe. In addition, certain foreign securities may not be as liquid as U.S. securities.

8. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations and its ability to achieve its investment objectives.

9. Credit Facility

The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statement of Operations. During the period ended June 30, 2020, the Fund did not use the Global Credit Facility.

10. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

A summary of inputs used as of June 30, 2020, in valuing the Fund’s assets carried at fair value, is as follows:

	Level 1		Level 2		Level 3		Total
Assets:
Investments in Securities:a
Equity Investments:
Aerospace & Defense	$	—	$	5,597,756	$	—	$	5,597,756
Airlines		—		3,571,208		—		3,571,208
Automobiles		—		10,933,235		—		10,933,235
Banks		—		16,328,648		—		16,328,648
Beverages		—		33,948,491		—		33,948,491
Electrical Equipment		—		7,388,758		—		7,388,758
Electronic Equipment, Instruments &
Components		—		10,485,694		—		10,485,694
Food & Staples Retailing		17,094,847		7,638,607		—		24,733,454
Gas Utilities		—		2,858,389		—		2,858,389
Hotels, Restaurants & Leisure		12,138,486		17,644,906		—		29,783,392
Household Durables		—		19,748,664		—		19,748,664
Industrial Conglomerates		—		11,858,349		—		11,858,349
Insurance		—		9,142,317		—		9,142,317
Internet & Direct Marketing Retail		9,474,423		7,565,395		—		17,039,818
Machinery		3,122,112		14,010,872		—		17,132,984
Marine		—		9,051,690		—		9,051,690
Media		12,991,293		6,022,792		—		19,014,085
Metals & Mining		28,435,822		5,358,614		—		33,794,436
Multi-Utilities		—		19,686,363		—		19,686,363
Oil, Gas & Consumable Fuels		2,254,463		15,129,418		—		17,383,881
Pharmaceuticals		—		53,443,022		—		53,443,022
Real Estate Management & Development		—		6,798,181		—		6,798,181
Road & Rail		—		3,601,371		—		3,601,371
Technology Hardware, Storage & Peripherals		—		16,583,973		—		16,583,973
Textiles, Apparel & Luxury Goods		—		10,853,359		—		10,853,359
All Other Equity Investments		126,702,121		—		—		126,702,121
Short Term Investments		10,490,166		48,400,000		—		58,890,166
Total Investments in Securities	$	222,703,733	$	373,650,072	$	—	$	596,353,805

^aFor detailed categories, see the accompanying Statement of Investments.

11. New Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.

Semiannual Report         TG-23

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Templeton Growth VIP Fund (continued)

12. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.

Abbreviations

Selected Portfolio
ADR	American Depositary Receipt
FFCB	Federal Farm Credit Bank
IDR	International Depositary Receipt

TG-24         Semiannual Report

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Tax Information (unaudited)

Templeton Growth VIP Fund

At December 31, 2019, more than 50% of the Fund’s total assets were invested in securities of foreign issuers. In most instances, foreign taxes were withheld from income paid to the Fund on these investments. As shown in the table below, the Fund hereby reports to shareholders the foreign source income and foreign taxes paid, pursuant to Section 853 of the Internal Revenue Code. This written statement will allow shareholders of record on June 11, 2020, to treat their proportionate share of foreign taxes paid by the Fund as having been paid directly by them. The shareholder shall consider these amounts as foreign taxes paid in the tax year in which they receive the Fund distribution.

The following table provides a detailed analysis of foreign tax paid, and foreign source income as reported by the Fund to shareholders of record.

Class	Foreign Tax Paid Per Share		Foreign Source Income Per Share
Class 1		$0.0280		$0.2741
Class 2		$0.0280		$0.2517
Class 4		$0.0280		$0.2415

Foreign Tax Paid Per Share (Column 1) is the amount per share available to you, as a tax credit (assuming you held your shares in the Fund for a minimum of 16 days during the 31-day period beginning 15 days before the ex-dividend date of the Fund’s distribution to which the foreign taxes relate), or, as a tax deduction.

Foreign Source Income Per Share (Column 2) is the amount per share of income dividends attributable to foreign securities held by the Fund, plus any foreign taxes withheld on these dividends.

Semiannual Report         TG-25

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Index Descriptions

The indexes are unmanaged and include reinvestment of any income or distributions (after the deduction of certain withholding taxes for the NR or Net Return Index). They do not reflect any fees, expenses or sales charges.

For Russell Indexes: Frank Russell Company is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell^® is a trademark of Frank Russell Company.

See www.franklintempletondatasources.com for additional data provider information.

Bloomberg Barclays 1-3 Month U.S. Treasury Bill Index measures the performance of U.S. Treasury bills that have a remaining maturity of greater than or equal to one month and less than three months.

Bloomberg Barclays U.S. Aggregate Bond Index is a market capitalization-weighted index representing the U.S. investment-grade, fixed-rate, taxable bond market with index components for government and corporate, mortgage pass-through and asset-backed securities. All issues included are SEC registered, taxable, dollar denominated and nonconvertible, must have at least one year to final maturity and must be rated investment grade (Baa3/ BBB-/BBB- or higher) using the middle rating of Moody’s, Standard & Poor’s and Fitch, respectively.

Bloomberg Barclays U.S. Corporate Bond Index measures the investment grade, fixed-rate, taxable corporate bond market. It includes U.S. dollar-denominated securities publicly issued by U.S. and non-U.S. industrial, utility and financial issuers.

Bloomberg Barclays U.S. Corporate High Yield Bond Index measures the U.S. dollar-denominated, high yield, fixed-rate corporate bond market. Securities are classified as high yield if the middle rating of Moody’s, Fitch and Standard & Poor’s is Ba1/BB+/BB+ or below.

Bloomberg Barclays U.S. Corporate Investment Grade Index is a broad-based benchmark that measures the investment-grade, fixed-rate, taxable corporate bond market.

Bloomberg Barclays U.S. Government Index: Intermediate Component is the intermediate component of the Barclays U.S. Government Index, which includes public obligations of the U.S. Treasury with at least one year to final maturity and publicly issued debt of U.S. government agencies, quasi-federal corporations, and corporate or foreign debt guaranteed by the U.S. government.

Bloomberg Barclays U.S. High Yield Very Liquid Index is a component of the U.S. Corporate High Yield Index that is designed to track a more liquid component of the U.S. dollar-denominated, high-yield fixed-rate corporate bond market.

Bloomberg Barclays U.S. Treasury Index measures U.S. dollar-denominated, fixed-rate, nominal debt issued by the U.S. Treasury with at least one year until final maturity.

FTSE^® EPRA^®/NAREIT^® Developed Index is a free float-adjusted index designed to measure the performance of publicly traded real estate securities in the North American, European and Asian real estate markets.

FTSE World Government Bond Index is a market capitalization-weighted index consisting of investment-grade world government bond markets.

J.P. Morgan (JPM) Global Government Bond Index (GGBI) tracks total returns for liquid, fixed-rate, domestic government bonds with maturities greater than one year issued by developed countries globally.

Lipper Multi-Sector Income Funds Classification Average is calculated by averaging the total returns of all funds within the Lipper Multi-Sector Income Funds Classification in the Lipper Open-End underlying funds universe. Lipper Multi-Sector Income Funds are defined as funds that seek current income by allocation of assets among different fixed income securities sectors (not primarily in one sector except for defensive purposes), including U.S. and foreign governments, with a significant portion rated below investment grade. For the six-month period ended 6/30/20, there were 37 funds in this category. Lipper calculations do not include contract fees, expenses or sales charges, and may have been different if such charges had been considered.

Lipper VIP General U.S. Government Funds Classification Average is an equally weighted average calculation of performance figures for all funds within the Lipper General U.S. Government Funds classification in the Lipper VIP underlying funds universe. Lipper General U.S. Government Funds invest primarily in U.S. government and agency issues. For the six-month period ended 6/30/20, there were 26 funds in this category. Lipper calculations do not include contract fees, expenses or sales charges, and may have been different if such charges had been considered.

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

  INDEX DESCRIPTIONS

MSCI All Country Asia Index is a free float-adjusted, market capitalization-weighted index designed to measure equity market performance in developed and emerging markets in Asia.

MSCI All Country World Index (ACWI) is a free float-adjusted, market capitalization-weighted index designed to measure equity market performance in global developed and emerging markets.

MSCI All Country World Index (ACWI) ex USA Index is a free float-adjusted, market capitalization-weighted index designed to measure equity market performance in global developed and emerging markets, excluding the U.S.

MSCI Europe Index is a free float-adjusted market capitalization-weighted index designed to measure the equity market performance of developed markets in Europe.

MSCI Europe, Australasia, Far East (EAFE) Index is a free float-adjusted market capitalization-weighted index designed to measure the equity market performance of developed markets, excluding the U.S. and Canada.

MSCI Emerging Markets (EM) Index is a free float-adjusted, market capitalization-weighted index designed to measure equity market performance in global emerging markets.

MSCI USA High Dividend Yield Index is based on the MSCI USA Index, its parent index, and includes large- and mid-capitalization stocks. The index is designed to reflect the performance of equities in the parent index (excluding real estate investment trusts) with higher dividend income and quality characteristics than average dividend yields that are both sustainable and persistent.

MSCI World ex USA Index-NR is a free float-adjusted, market capitalization-weighted index designed to measure equity market performance in global developed markets, excluding the U.S. Net Returns (NR) include income net of tax withholding when dividends are paid.

MSCI World Index is a free float-adjusted, market capitalization-weighted index designed to measure equity market performance in global developed markets.

Russell 1000^® Growth Index is market capitalization weighted and measures performance of those Russell 1000^® Index companies with relatively higher price-to- book ratios and higher forecasted growth values.

Russell 1000^® Index is market capitalization weighted and measures performance of the largest companies in the Russell 3000^® Index, which represents the majority of the U.S. market’s total capitalization.

Russell 1000^® Value Index is market capitalization weighted and measures performance of those Russell 1000^® Index companies with relatively lower price-to-book ratios and lower forecasted growth values.

Russell 2000^® Index is market capitalization weighted and measures performance of the 2,000 smallest companies in the Russell 3000^® Index, which represent a small amount of the total market capitalization of the Russell 3000^® Index.

Russell 2000^® Value Index is market capitalization weighted and measures performance of those Russell 2000^® Index companies with relatively lower price-to-book ratios and lower forecasted growth values.

Russell 3000^® Index is market capitalization weighted and represents the majority of the U.S. market’s total capitalization.

Russell 3000^® Growth Index is market capitalization weighted and measures performance of those Russell 3000^® Index companies with relatively higher price-to-book ratios and higher forecasted growth values.

Russell Midcap^® Growth Index is market capitalization weighted and measures performance of those Russell Midcap^® Index companies with relatively higher price-to-book ratios and higher forecasted growth values.

Russell Midcap^® Index is market capitalization weighted and measures performance of the smallest companies in the Russell 1000^® Index, which represents a modest amount of the Russell 1000^® Index’s total market capitalization.

Standard & Poor’s^® 500 Index (S&P 500^®) is a market capitalization-weighted index of 500 stocks designed to measure total U.S. equity market performance.

Standard & Poor’s^®/International Finance Corporation Investable (S&P/IFCI) Composite Index is a free float-adjusted, market capitalization-weighted index designed to measure equity performance in global emerging markets.

Semiannual Report         I-2

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

SHAREHOLDER INFORMATION

Shareholder Information

Board Approval of Investment

Management Agreements

FRANKLIN TEMPLETON VARIABLE INSURANCE

PRODUCTS TRUST

Franklin Allocation VIP Fund

Franklin Flex Cap Growth VIP Fund

Franklin Global Real Estate VIP Fund

Franklin Growth and Income VIP Fund

Franklin Income VIP Fund

Franklin Large Cap Growth VIP Fund

Franklin Mutual Global Discovery VIP Fund

Franklin Mutual Shares VIP Fund

Franklin Rising Dividends VIP Fund

Franklin Small Cap Value VIP Fund

Franklin Small-Mid Cap Growth VIP Fund

Franklin Strategic Income VIP Fund

Franklin U.S. Government Securities VIP Fund

Franklin VolSmart Allocation VIP Fund

Templeton Developing Markets VIP Fund

Templeton Foreign VIP Fund

Templeton Global Bond VIP Fund

Templeton Growth VIP Fund

(each a Fund)

At a meeting held on April 7, 2020 (Meeting), the Board of Trustees (Board) of Franklin Templeton Variable Insurance Products Trust (Trust), including a majority of the trustees who are not “interested persons” as defined in the Investment Company Act of 1940 (Independent Trustees), reviewed and approved the continuance of the (i) investment management agreement between Franklin Advisers, Inc. (FAI) and the Trust, on behalf of each of Franklin Allocation VIP Fund, Franklin Flex Cap Growth VIP Fund, Franklin Growth and Income VIP Fund, Franklin Income VIP Fund, Franklin Large Cap Growth VIP Fund, Franklin Rising Dividends VIP Fund, Franklin Small-Mid Cap Growth VIP Fund, Franklin Strategic Income VIP Fund, Franklin U.S. Government Securities VIP Fund, Franklin VolSmart Allocation VIP Fund, and Templeton Global Bond VIP Fund; (ii) the investment sub-advisory agreement between FAI and Franklin Templeton Institutional, LLC (FTIL), an affiliate of FAI, on behalf of Franklin Allocation VIP Fund; (iii) the investment sub-advisory agreement between FAI and Templeton Global Advisors Limited (TGAL), an affiliate of FAI, on behalf of Franklin Allocation VIP Fund; (iv) the investment management agreement between FTIL and the Trust, on behalf of Franklin Global Real Estate VIP Fund; (v) the investment management agreement between Franklin

Mutual Advisers, LLC (FMA) and the Trust, on behalf of each of Franklin Mutual Global Discovery VIP Fund, Franklin Mutual Shares VIP Fund and Franklin Small Cap Value VIP Fund; (vi) the investment management agreement between Templeton Asset Management Ltd. (TAML) and the Trust, on behalf of Templeton Developing Markets VIP Fund; (vii) the investment management agreement between Templeton Investment Counsel, LLC (TICL) and the Trust, on behalf of Templeton Foreign VIP Fund; and (viii) the investment management agreement between TGAL and the Trust, on behalf of Templeton Growth VIP Fund (each a Management Agreement) for an additional one-year period. The Independent Trustees received advice from and met separately with Independent Trustee counsel in considering whether to approve the continuation of each Management Agreement. Although the Management Agreements for the Funds were considered at the same Board meeting, the Board considered the information provided to it about the Funds together and with respect to each Fund separately as the Board deemed appropriate. FAI, FTIL, FMA, TAML, TICL and TGAL are each referred to herein as a Manager.

In considering the continuation of each Management Agreement, the Board reviewed and considered information provided by each Manager at the Meeting and throughout the year at meetings of the Board and its committees. The Board also reviewed and considered information provided in response to a detailed set of requests for information submitted to each Manager by Independent Trustee counsel on behalf of the Independent Trustees in connection with the annual contract renewal process. In addition, prior to the Meeting, the Independent Trustees held a telephonic contract renewal meeting at which the Independent Trustees conferred amongst themselves and Independent Trustee counsel about contract renewal matters and, in some cases, requested additional information from the Managers relating to the contract. The Board reviewed and considered all of the factors it deemed relevant in approving the continuance of each Management Agreement, including, but not limited to: (i) the nature, extent and quality of the services provided by each Manager; (ii) the investment performance of each Fund; (iii) the costs of the services provided and profits realized by each Manager and its affiliates from the relationship with each Fund; (iv) the extent to which economies of scale are realized as each Fund grows; and (v) whether fee levels reflect these economies of scale for the benefit of Fund investors.

In approving the continuance of each Management Agreement, the Board, including a majority of the

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FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

SHAREHOLDER INFORMATION

Independent Trustees, determined that the terms of each Management Agreement are fair and reasonable and that the continuance of such Management Agreement is in the interests of the applicable Fund and its shareholders. While attention was given to all information furnished, the following discusses some primary factors relevant to the Board’s determination.

Nature, Extent and Quality of Services

The Board reviewed and considered information regarding the nature, extent and quality of investment management services provided by each Manager and its affiliates to the Funds and their shareholders. This information included, among other things, the qualifications, background and experience of the senior management and investment personnel of each Manager; as well as information on succession planning where appropriate; the structure of investment personnel compensation; oversight of third-party service providers; investment performance reports and related financial information for each Fund; reports on expenses and shareholder services; legal and compliance matters; risk controls; pricing and other services provided by each Manager and its affiliates; and management fees charged by each Manager and its affiliates to US funds and other accounts, including management’s explanation of differences among accounts where relevant. The Board also reviewed and considered an annual report on payments made by Franklin Templeton (FT) or the Funds to financial intermediaries, as well as a memorandum relating to third-party servicing arrangements, which included discussion of the changing distribution landscape for the Funds. The Board noted management’s continuing efforts and expenditures in establishing effective business continuity plans and developing strategies to address areas of heightened concern in the mutual fund industry, such as cybersecurity and liquidity risk management.

The Board also reviewed and considered the benefits provided to Fund shareholders of investing in a fund that is part of the FT family of funds. The Board noted the financial position of Franklin Resources, Inc. (FRI), the Managers’ parent, and its commitment to the mutual fund business as evidenced by its continued introduction of new funds, reassessment of the fund offerings in response to the market environment and project initiatives and capital investments relating to the services provided to the Funds by the FT organization. The Board specifically noted FT’s commitment to enhancing services and controlling costs, as reflected in its plan to outsource certain administrative functions, and growth opportunities, as evidenced by its

upcoming acquisition of the Legg Mason companies. The Board acknowledged the change in leadership at FRI and the opportunity to hear from Jennifer Johnson, President and Chief Executive Officer of FRI, about goals she has for the company that will benefit the Funds.

Following consideration of such information, the Board was satisfied with the nature, extent and quality of services provided by each Manager and its affiliates to the Funds and their shareholders.

Fund Performance

The Board reviewed and considered the performance results of each Fund over various time periods ended January 31, 2020. The Board considered the performance returns for each Fund in comparison to the performance returns of mutual funds deemed comparable to the Fund included in a universe (Performance Universe) selected by Broadridge Financial Solutions, Inc. (Broadridge), an independent provider of investment company data. The Board received a description of the methodology used by Broadridge to select the mutual funds included in a Performance Universe. The Board also considered the performance returns for the Franklin Income VIP Fund and Franklin VolSmart Allocation VIP Fund in comparison to the performance returns of a customized peer group (Performance Customized Peer Group) selected by the Manager. The Board also reviewed and considered Fund performance reports provided and discussions that occurred with portfolio managers at Board meetings throughout the year. A summary of each Fund’s performance results is below.

Franklin Allocation VIP Fund - The Performance Universe for this Fund included the Fund and all mixed-asset target allocation growth funds underlying variable insurance products (VIPs). The Board noted that the Fund’s annualized income return for the one-, three-, five- and 10-year periods was above the median and in the first quintile (best) of its Performance Universe. The Board also noted that the Fund’s annualized total return for the one-, three-, five- and 10-year periods was below the median of its Performance Universe. The Board discussed this performance with management and management explained that the Performance Universe was not directly comparable to the Fund as the Performance Universe includes funds with equity exposures between 60%-80% and the Fund maintains a strategic asset allocation of 60% equities. Management further explained that the Fund’s strategic allocation has served as a headwind for peer-relative returns since the Fund’s repositioning on May 1, 2019 to a direct investment fund with

Semiannual Report         SI-2

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

SHAREHOLDER INFORMATION

an actively managed dynamic allocation strategy. The Board noted management’s explanations and determined that, in light of the recent strategy changes, additional time will be needed to evaluate the effectiveness of management’s actions. The Board concluded that the Fund’s Management Agreement should be continued for an additional one-year period, and management’s efforts should continue to be monitored.

Franklin Flex Cap Growth VIP Fund - The Performance Universe for this Fund included the Fund and all large-cap growth funds underlying VIPs. The Board noted that the Fund’s annualized total return for the three-year period was above the median of its Performance Universe, but for the one-, five- and 10-year periods was below the median of its Performance Universe. The Board discussed this performance with management and management explained that during the one-year period, Information Technology and Industrials were the two largest sectors of underperformance for the Fund. Management further explained that the Fund’s cash position was also a detractor from the Fund’s performance. The Board noted management’s steps to address the underperformance of the Fund. The Board concluded that the Fund’s Management Agreement should be continued for an additional one-year period, and management’s efforts should continue to be monitored. In doing so, the Board noted that, while below median, the Fund’s annualized total return for the one-, five- and 10-year periods was 23.48%, 12.99% and 12.87%, respectively.

Franklin Growth and Income VIP Fund - The Performance Universe for the Fund included the Fund and all equity income funds underlying VIPs. The Board noted that the Fund’s annualized income return and annualized total return for the one-, three-, five- and 10-year periods were above the medians of its Performance Universe. The Board concluded that the Fund’s performance was satisfactory.

Franklin Income VIP Fund - The Performance Universe for the Fund included the Fund and all mixed-asset target allocation moderate funds underlying VIPs. The Performance Customized Peer Group for the Fund consisted of funds sorted by trailing 12-month yield and set to be top quartile (highest yield). The Board noted that the Fund’s annualized income return for the one-, three-, five- and 10-year periods was above the medians and in the first quintile (best) of its Performance Universe and Performance Customized Peer Group. The Board also noted that the Fund’s annualized total return for the one-, three-, five- and 10-year periods was below the medians of its Performance Universe and

Performance Customized Peer Group. Given the Fund’s income-oriented investment objective, the Board concluded that the Fund’s performance was satisfactory.

Franklin Strategic Income VIP Fund - The Performance Universe for the Fund included the Fund and all multi-sector income funds underlying VIPs. The Board noted that the Fund’s annualized income return for the one-, three-, five-and 10-year periods was above the median and in the first quintile (best) of its Performance Universe. The Board also noted that the Fund’s annualized total return for the one-, three-, five- and 10-year periods was below the median of its Performance Universe. The Board discussed this performance with management and management explained that the Fund’s relative underperformance was due, in part, to a shorter duration profile of its portfolio holdings and a reduced exposure to credit risk. The Board also noted management’s continued enhancements to the Fund’s investment process, which includes a greater role for macroeconomics and incorporates more quantitative techniques to assist with portfolio construction. Given the Fund’s income-oriented investment objective and the considerations noted above, the Board concluded that the Fund’s performance was satisfactory.

Franklin Large Cap Growth VIP Fund - The Performance Universe for the Fund included the Fund and all multi-cap growth funds underlying VIPs. The Board noted that the Fund’s annualized total return for the 10-year period was below the median of its Performance Universe, but for the one-, three- and five-year periods was above the median of its Performance Universe. The Board concluded that the Fund’s performance was satisfactory.

Franklin Mutual Global Discovery VIP Fund –The Performance Universe for the Fund included the Fund and all global multi-cap value funds underlying VIPs. The Board noted that the Fund’s annualized total return for the one- and 10-year periods was above the median and in the first quintile (best) of its Performance Universe, but for the three-year period was slightly below the median of its Performance Universe and for the five-year period was equal to the median of its Performance Universe. The Board concluded that the Fund’s performance was satisfactory.

Franklin Mutual Shares VIP Fund - The Performance Universe for the Fund included the Fund and all multi-cap value funds underlying VIPs. The Board noted that the Fund’s annualized total return for the one-, three-, five- and 10-year periods was below the median of its Performance Universe. The Board discussed this performance with

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management and management explained that the Fund’s underperformance in 2017 was material and continues to adversely impact the Fund’s ranking over longer-term periods. Management reminded the Board of the primary factors that impacted the 2017 performance, including, among factors, exposure to non-US equities and stock selection. Management then explained that, over the one-year period, the Fund’s non-equity investments and stock selection weighed on the Fund’s relative performance. Management also explained that approximately 15% of the Fund’s portfolio was in non-equity investments which relatively underperformed the robust 2019 equity market performance. Management further explained that the Fund’s cash position also weighed on relative performance. Management then discussed with the Board the actions that continue to be taken in an effort to address the sources of the Fund’s underperformance, including enhancements to the Fund’s investment process, particularly with respect to portfolio and quantitative analytics. The Board concluded that the Fund’s Management Agreement should be continued for an additional one-year period, and management’s efforts should continue to be monitored.

Franklin Small-Mid Cap Growth VIP Fund - The Performance Universe for the Fund included the Fund and all mid-cap growth funds underlying VIPs. The Board noted that the Fund’s annualized total return for the one-, three-, five- and 10-year periods was below the median of its Performance Universe. The Board discussed this performance with management and management explained that the Fund’s positioning in the energy, healthcare, consumer, materials, industrial and information technology sectors was a primary detractor from relative performance over the one-, three-and five-year periods. Management further explained that, during the one-, three- and five-year periods, the Fund had more exposure to smaller cap stocks in comparison to its peers, noting that these stocks meaningfully underperformed during the requisite periods. Management then discussed with the Board the actions that are being taken in an effort to address the sources of the Fund’s underperformance, including consolidating the Fund into fewer positions which have demonstrated certain attributes and working closely with the Investment Risk Management Group to limit the amount of risk in the Fund’s portfolio and minimize permanent loss of capital. The Board concluded that the Fund’s Management Agreement should be continued for an additional one-year period, and management’s efforts should continue to be monitored. In doing so, the Board noted that, while below median, the Fund’s annualized total return for the one-,

three-, five- and 10-year periods was 20.96%, 14.29%, 9.99% and 12.87%, respectively.

Franklin Global Real Estate VIP Fund - The Performance Universe for the Fund included the Fund and all global real estate funds underlying VIPs. The Board noted that the Fund’s annualized total return for the three-, five- and 10-year periods was above the median of its Performance Universe, but for the one-year period was below the median of its Performance Universe. The Board further noted that, while below the median, the Fund’s one-year annualized total return was 12.02% and only slightly below the Performance Universe median of 13.11%. The Board concluded that the Fund’s performance was acceptable.

Franklin Rising Dividends VIP Fund- The Performance Universe for the Franklin Rising Dividends VIP Fund included the Fund and all large-cap core funds underlying VIPs. The Board noted that the Fund’s annualized total return for the three-, five- and 10-year periods was above the median of its Performance Universe, but for the one-year period was below the median of its Performance Universe. The Board further noted that, while below the median, the Fund’s one-year annualized total return was 20.55% and only slightly below the Performance Universe median of 20.92%. The Board concluded that the Fund’s performance was acceptable.

Franklin Small Cap Value VIP Fund and Templeton Developing Markets VIP Fund - The Performance Universe for the Franklin Small Cap Value VIP Fund included the Fund and all small-cap value funds underlying VIPs. The Performance Universe for the Templeton Developing Markets VIP Fund included the Fund and all emerging markets funds underlying VIPs. The Board noted that each Fund’s annualized total return for the one-, three-, five- and 10-year periods was above the median of its Performance Universe. The Board concluded that each Fund’s performance was satisfactory.

Franklin U.S. Government Securities VIP Fund -The Performance Universe for the Fund included the Fund and all intermediate US government funds underlying VIPs. The Board noted that the Fund’s annualized income return for the one-, three-, five- and 10-year periods was above the median and in the first quintile (best) of its Performance Universe. The Board also noted that the Fund’s annualized total return for the one-, three-, five- and 10-year periods was below the median of its Performance Universe. Given the Fund’s income-oriented investment objective and conservative policy of investing a significant to substantial amount in

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Ginnie Mae obligations, the Board concluded that the Fund’s performance was satisfactory.

Franklin VolSmart Allocation VIP Fund - The Performance Universe for the Fund included the Fund and all flexible portfolio funds underlying VIPs. The Performance Customized Peer Group for the Fund consisted of the Fund and all retail and institutional mixed-asset target allocation moderate funds. The Fund has been in operation for less than 10 years. The Board noted that the Fund’s annualized total return for the three- and five-year periods was below the medians of its Performance Universe and Performance Customized Peer Group, but for the one-year period was above the medians of its Performance Universe and Performance Customized Peer Group. The Board further noted that the Fund’s annualized total return for the three-year period was only 0.02% below the median of its Performance Universe and that the Fund’s annualized total return for the one-year period was 13.90% and in the second quintile of its Performance Universe. The Board concluded that the Fund’s performance was satisfactory.

Templeton Foreign VIP Fund - The Performance Universe for the Fund included the Fund and all international multi-cap value funds underlying VIPs. The Board noted that the Fund’s annualized total return for the one-, three-, five- and 10-year periods was below the median of its Performance Universe. The Board discussed this performance with management and management explained that, even though the Fund’s peer group is comprised of multi-cap value funds, the Fund has a more intense value tilt than the Performance Universe, which has negatively impacted the Fund’s relative returns during a period of historic and sustained outperformance of growth over value. Management further explained that over the one-, three- and five-year periods, the Fund’s performance was also negatively impacted by stock selection among overweight health care holdings and underweight industrials and consumer discretionary stocks. Management then discussed with the Board the actions that are being taken in an effort to address the sources of the Fund’s underperformance, including a focus on constructing a more diversified and high-conviction portfolio. The Board concluded that the Fund’s Management Agreement should be continued for an additional one-year period, and management’s efforts should continue to be monitored.

Templeton Global Bond VIP Fund - The Performance Universe for the Fund included the Fund and all global income funds underlying VIPs. The Board noted that the

Fund’s annualized income return for the one-, three-, five-and 10-year periods was above the median of its Performance Universe. The Board also noted that the Fund’s annualized total return for the one-, three- and five-year periods was below the median of its Performance Universe, but for the 10-year period was above the median of its Performance Universe. The Board discussed this performance with management and management explained that during the one-, three- and five- year periods, management largely positioned the Fund’s strategies for rising rates by maintaining low portfolio duration and aiming at a negative correlation with US Treasury returns. Management further explained that the interest-rate strategies detracted from the Fund’s relative return, while currency positions contributed to the return. Management then discussed with the Board the portfolio manager’s outlook going forward and expectation that the risk management strategies that had weighted on return would be valuable in a diversifying portfolio going forward. The Board concluded that the Fund’s Management Agreement should be continued for an additional one-year period, and management’s efforts should continue to be monitored.

Templeton Growth VIP Fund - The Performance Universe for this Fund included the Fund and all global multi-cap value funds underlying VIPs. The Board noted that the Fund’s annualized total return for the one-, three-, five- and 10-year periods was below the median of its Performance Universe. The Board discussed this performance with management and management explained that the Fund’s higher exposure to value stocks, which have experienced a period of historic underperformance, and underweight position in US stocks, as compared to peers contributed to the Fund’s relative underperformance. Management also explained that weightings in particular sectors (such as information technology, communications services, cyclical energy and financials) and overall stock selection contributed to the Fund’s relative underperformance. Management then discussed with the Board the actions that are being taken in an effort to address the sources of the Fund’s underperformance, including a focus on constructing a more diversified and high-conviction portfolio. The Board concluded that the Fund’s Management Agreement should be continued for an additional one-year period, and management’s efforts should continue to be monitored.

Comparative Fees and Expenses

The Board reviewed and considered information regarding each Fund’s actual total expense ratio and its various components, including, as applicable, management fees;

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transfer agent expenses; underlying fund expenses; Rule 12b-1 and non-Rule 12b-1 service fees; and other non-management fees. The Board also noted the quarterly and annual reports it receives on all marketing support payments made by FT to financial intermediaries. The Board considered the actual total expense ratio and, separately, the contractual management fee rate, without the effect of fee waivers, if any (Management Rate) of each Fund in comparison to the median expense ratio and median Management Rate, respectively, of other mutual funds deemed comparable to and with a similar expense structure to the Fund selected by Broadridge (Expense Group). Broadridge fee and expense data is based upon information taken from each fund’s most recent annual report, which reflects historical asset levels that may be quite different from those currently existing, particularly in a period of market volatility. While recognizing such inherent limitation and the fact that expense ratios and Management Rates generally increase as assets decline and decrease as assets grow, the Board believed the independent analysis conducted by Broadridge to be an appropriate measure of comparative fees and expenses. The Broadridge Management Rate includes administrative charges. The Board received a description of the methodology used by Broadridge to select the mutual funds included in an Expense Group.

Franklin Flex Cap Growth VIP Fund, Templeton Foreign VIP Fund and Templeton Growth VIP Fund - The Expense Group for the Franklin Flex Cap Growth VIP Fund included the Fund and 11 other large-cap growth funds underlying VIPs. The Expense Group for the Templeton Foreign VIP Fund included the Fund, eight other international multi-cap value funds underlying VIPs and three international large-cap value funds underlying VIPs. The Expense Group for the Templeton Growth VIP Fund included the Fund, two other global multi-cap value funds underlying VIPs, two global multi-cap core funds underlying VIPs and five global multi-cap growth funds underlying VIPs. The Board noted that the Management Rates for these Funds were above the medians of their respective Expense Groups, but their actual total expense ratios were below the medians of their respective Expense Groups. The Board further noted that the Management Rate for the Templeton Foreign VIP Fund was approximately six basis points above the median of its Expense Group and the Management Rate for the Templeton Growth VIP Fund was approximately nine basis points above the median of its Expense Group. The Board concluded that the Management Rates charged to these Funds are reasonable. In doing so, the Board noted that the

Franklin Flex Cap Growth Fund’s actual total expense ratio reflected a fee waiver from management.

Franklin Mutual Shares VIP Fund - The Expense Group for the Fund included the Fund and 10 other multi-cap value funds underlying VIPs. The Board noted that the Management Rate for the Fund was approximately 7.5 basis points above the median of its Expense Group, but its actual total expense ratio was equal to the median of its Expense Group. The Board further noted management’s explanation that the portfolio management team makes investments in distressed securities and merger arbitrage situations that are specialized in nature and therefore require additional expertise and resources, whereas the Fund’s Expense Group generally does not make such investments. The Board concluded that the Management Rate charged to the Fund is reasonable.

Franklin Strategic Income VIP Fund and Templeton Developing Markets VIP Fund - The Expense Group for the Franklin Strategic Income VIP Fund included the Fund and 10 other multi-sector income funds underlying VIPs. The Expense Group for the Templeton Developing Markets VIP Fund included the Fund and 13 other emerging markets funds underlying VIPs. The Board noted that the Management Rates for the Funds were equal to the medians of their respective Expense Groups, and their actual total expense ratios were below the medians of their respective Expense Groups. The Board concluded that the Management Rate charged to each Fund is reasonable.

Franklin Small-Mid Cap Growth VIP Fund - The Expense Group for the Franklin Small-Mid Cap Growth VIP Fund included the Fund and 12 other mid-cap growth funds underlying VIPs. The Board noted that the Management Rate for the Fund was below the median of its Expense Group, and the actual total expense ratio for the Fund was equal to the median of its Expense Group. The Board concluded that the Management Rate charged to the Fund is reasonable.

Franklin Allocation VIP Fund, Franklin Global Real Estate VIP Fund, Franklin Large Cap Growth VIP Fund and Franklin Mutual Global Discovery VIP Fund – The Expense Group for the Franklin Allocation VIP Fund included the Fund and 10 other mixed-asset target allocation growth affiliated funds of funds underlying VIPs. The Expense Group for the Franklin Global Real Estate VIP Fund included the Fund and seven other global real estate funds underlying VIPs. The Expense Group for the Franklin Large Cap Growth VIP Fund included the Fund and 11 other multi-cap growth funds underlying

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VIPs. The Expense Group for the Franklin Mutual Global Discovery VIP Fund included the Fund, two other global multi-cap value funds underlying VIPs, two global multi-cap core funds underlying VIPs and five global multi-cap growth funds underlying VIPs. The Board noted that the Management Rates and actual total expense ratios for these Funds were above the medians of their respective Expense Groups. With respect to the Franklin Allocation VIP Fund, the Board discussed with management the reasons for the increase in the contractual management fee over the past year. Management reminded the Board that prior to May 1, 2019, the Fund was a static allocation fund of funds and did not have an investment manager or pay direct investment management fees, and that effective May 1, 2019, the Fund began investing directly in securities, entered into the Management Agreement with FAI and began paying the contractual management fee. Management also explained that Broadridge did not account for the change in the Fund’s structure and continued to use a peer group of funds of funds to compare expenses. With respect to the Franklin Mutual Global Discovery VIP Fund, the Board noted management’s explanation that the portfolio management team makes investments in distressed securities and merger arbitrage situations that are specialized in nature and therefore require additional expertise and resources, whereas the Fund’s Expense Group generally does not make such investments. The Board also noted that the Fund’s actual total expense ratio was only slightly above (less than 5 basis points) the median of the Fund’s Expense Group. With respect to the Franklin Global Real Estate VIP Fund, the Board noted management’s explanation that the portfolio managers’ rigorous fundamental analysis and active risk controls elevate management costs. The Board also noted that the Fund’s actual total expense ratio reflected a fee waiver from management. With respect to the Franklin Large Cap Growth VIP Fund, the Board noted that the Fund’s Management Rate and actual total expense ratio were only slightly above (approximately 2 basis points or less) the medians of the Fund’s Expense Group. The Board concluded that the Management Rates charged to these Funds are reasonable. In doing so, the Board noted that the Franklin Allocation VIP Fund’s sub-advisers, FTIL and TGAL, are paid by FAI out of the management fee FAI receives from the Fund.

Franklin Growth and Income VIP Fund, Franklin Income VIP Fund, Franklin Rising Dividends VIP Fund, Franklin Small Cap Value VIP Fund, Franklin U.S. Government Securities VIP Fund and Templeton Global Bond VIP Fund – The Expense Group for the Franklin Growth and Income VIP

Fund included the Fund and 10 other equity income funds underlying VIPs. The Expense Group for the Franklin Income VIP Fund included the Fund and nine other mixed-asset target allocation moderate funds underlying VIPs. The Expense Group for Franklin Rising Dividends VIP Fund included the Fund and 11 other large-cap core funds underlying VIPs. The Expense Group for the Franklin Small Cap Value VIP Fund included the Fund and eight other small-cap value funds underlying VIPs. The Expense Group for the Franklin U.S. Government Securities VIP Fund included the Fund, three other intermediate US government funds underlying VIPs and eight inflation-protected bond funds underlying VIPs. The Expense Group for the Templeton Global Bond VIP Fund included the Fund and 10 other global income funds underlying VIPs. The Board noted that the Management Rates and actual total expense ratios for these Funds were below the medians of their respective Expense Groups. The Board concluded that the Management Rates charged to these Funds are reasonable. The Board also noted that the Franklin Growth and Income VIP Fund’s actual total expense ratio reflected a fee waiver from management.

Franklin VolSmart Allocation VIP Fund – The Expense Group for this Fund included the Fund, three other flexible portfolio funds underlying VIPs and one mixed-asset target allocation growth fund underlying VIP. The Board noted the small size of the Expense Group. The Board also noted that the Management Rate for the Fund was below the median of its Expense Group and its actual total expense ratio was above the median of its Expense Group. The Board concluded that the Management Rate charged to the Fund is reasonable. In doing so, the Board noted that the Fund’s actual total expense ratio reflected a fee waiver from management.

Profitability

The Board reviewed and considered information regarding the profits realized by each Manager and its affiliates in connection with the operation of each Fund. In this respect, the Board considered the Fund profitability analysis that addresses the overall profitability of FT’s US fund business, as well as its profits in providing investment management and other services to each of the individual funds during the 12-month period ended September 30, 2019, being the most recent fiscal year-end for FRI. The Board noted that although management continually makes refinements to its methodologies used in calculating profitability in response to organizational and product-related changes, the overall methodology has remained consistent with that used in the

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Funds’ profitability report presentations from prior years. Additionally, PricewaterhouseCoopers LLP, auditor to FRI and certain FT funds, was engaged to review and assess the allocation methodologies to be used solely by the Funds’ Board with respect to the profitability analysis.

The Board noted management’s belief that costs incurred in establishing the infrastructure necessary for the type of mutual fund operations conducted by each Manager and its affiliates may not be fully reflected in the expenses allocated to each Fund in determining its profitability, as well as the fact that the level of profits, to a certain extent, reflected operational cost savings and efficiencies initiated by management. As part of this evaluation, the Board considered the initiative currently underway to outsource certain operations, which effort would require considerable up-front expenditures by the Managers but, over the long run is expected to result in greater efficiencies. The Board also noted management’s expenditures in improving shareholder services provided to the Funds, as well as the need to implement systems and meet additional regulatory and compliance requirements resulting from recent US Securities and Exchange Commission and other regulatory requirements, notably in the area of cybersecurity protections.

The Board also considered the extent to which each Manager and its affiliates might derive ancillary benefits from fund operations, including revenues generated from transfer agent services, potential benefits resulting from personnel and systems enhancements necessitated by fund growth, as well as increased leverage with service providers and counterparties. Based upon its consideration of all these factors, the Board concluded that the level of profits realized by each Manager and its affiliates from providing services to each Fund was not excessive in view of the nature, extent and quality of services provided to each Fund.

Economies of Scale

The Board reviewed and considered the extent to which each Manager may realize economies of scale, if any, as each Fund grows larger and whether each Fund’s management fee structure reflects any economies of scale for the benefit of shareholders. With respect to possible economies of scale, the Board noted the existence of management fee breakpoints for each Fund (except for the Franklin Allocation VIP Fund and the Franklin VolSmart Allocation VIP Fund), which operate generally to share any economies of scale with a Fund’s shareholders by reducing the Fund’s effective management fees as the Fund grows in

size. The Board considered management’s view that any analyses of potential economies of scale in managing a particular fund are inherently limited in light of the joint and common costs and investments each Manager incurs across the FT family of funds as a whole. The Board concluded that to the extent economies of scale may be realized by each Manager and its affiliates, each Fund’s management fee structure (except for the Franklin Allocation VIP Fund and the Franklin VolSmart Allocation VIP Fund) provided a sharing of benefits with the Fund and its shareholders as the Fund grows. The Board recognized that there would not likely be any economies of scale for the Franklin Flex Cap Growth VIP Fund, Franklin Global Real Estate VIP Fund, Franklin Growth and Income VIP Fund, Franklin Large Cap Growth VIP Fund and Franklin VolSmart Allocation VIP Fund until each Fund’s assets grow. The Board also recognized that given the decline in assets over the past three calendar years for each of the Franklin Income VIP Fund, Franklin Rising Dividends VIP Fund, Franklin Small Cap Value VIP Fund, Franklin Strategic Income VIP Fund, Franklin U.S. Government Securities VIP Fund, Templeton Foreign VIP Fund and Templeton Growth VIP Fund, these Funds are not expected to experience additional economies of scale in the foreseeable future.

Conclusion

Based on its review, consideration and evaluation of all factors it believed relevant, including the above-described factors and conclusions, the Board unanimously approved the continuation of each Management Agreement for an additional one-year period.

Board Approval of Investment

Management Agreements

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST

Templeton Developing Markets VIP Fund

(Fund)

At a meeting held on May 13, 2020 (Meeting), the Board of Trustees (Board) of Franklin Templeton Variable Insurance Products Trust (Trust), including a majority of the trustees who are not “interested persons” as defined in the Investment Company Act of 1940 (Independent Trustees), reviewed and approved a new investment sub-advisory agreement between Templeton Asset Management Ltd. (Manager), the Fund’s investment manager, and Franklin Templeton Investment Management Limited (Sub-Adviser),

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on behalf of the Fund (Sub-Advisory Agreement) for an initial two-year period. The Independent Trustees received advice from and met separately with Independent Trustee counsel in considering whether to approve the Sub-Advisory Agreement.

The Board reviewed and considered information provided by the Manager at the Meeting with respect to the Sub-Advisory Agreement. The Board also reviewed and considered the factors it deemed relevant in approving the Sub-Advisory Agreement, including, but not limited to: (i) the nature, extent, and quality of the services to be provided by the Sub-Adviser; and (ii) the costs of the services to be provided by the Sub-Adviser. The Board further reviewed and considered information provided by management showing the expected impact of hiring the Sub-Adviser on the Manager’s profitability consistent with the Order (as defined below). The Board also considered that management proposed that the Board approve the Sub-Advisory Agreement in order to facilitate certain portfolio management team enhancements. The Board reviewed and further considered the form of Sub-Advisory Agreement and the terms of the Sub-Advisory Agreement which were discussed at the Meeting, noting that the terms and conditions of the Sub-Advisory Agreement were substantially identical to the terms and conditions of sub-advisory agreements for other Franklin Templeton (FT) mutual funds.

In approving the Sub-Advisory Agreement, the Board, including a majority of the Independent Trustees, determined that the hiring of the Sub-Adviser is in the best interests of the Fund and its shareholders and does not involve a conflict of interest from which the Manager or Sub-Adviser derives an inappropriate advantage. The Board also determined that the terms of the Sub-Advisory Agreement are fair and reasonable and that the approval of such Sub-Advisory Agreement is in the interests of the Fund and its shareholders. While attention was given to all information furnished, the following discusses some primary factors relevant to the Board’s determination.

Nature, Extent and Quality of Services

The Board reviewed and considered information regarding the nature, extent and quality of investment management services to be provided by the Sub-Adviser and currently being provided by the Manager and its affiliates to the Fund and its shareholders. In doing so, the Board noted that the Fund employs a “manager of managers” structure pursuant to an exemptive order (Order) granted to the Manager by the U.S. Securities and Exchange Commission, whereby the

Manager and the Fund may, without shareholder approval, enter into sub-advisory agreements with sub-advisers that are indirect or direct wholly owned subsidiaries of Franklin Resources, Inc. (FRI). In particular, with respect to the Sub-Adviser, the Board took into account that the Sub-Advisory Agreement would not affect how the Fund is managed or the Fund’s investment goal, principal investment strategies or principal risks associated with an investment in the Fund. The Board reviewed and considered information regarding the nature, quality and extent of investment subadvisory services to be provided by the Sub-Adviser to the Fund and its shareholders under the Sub-Advisory Agreement; the Sub-Adviser’s experience as manager of other funds and accounts, including those within the FT organization; the personnel, operations, financial condition, and investment management capabilities, methodologies and resources of the Sub-Adviser and the Sub-Adviser’s capabilities, as demonstrated by, among other things, its policies and procedures designed to prevent violations of the federal securities laws, which had previously been approved by the Board in connection with its oversight of other funds in the FT organization.

The Board also reviewed and considered the benefits provided to Fund shareholders of investing in a fund that is part of the FT family of funds. The Board noted the financial position of FRI, the parent of the Manager and Sub-Adviser, and its commitment to the mutual fund business as evidenced by its continued introduction of new funds, reassessment of the fund offerings in response to the market environment and project initiatives and capital investments relating to the services provided to the Fund by the FT organization. The Board specifically noted FT’s commitment to enhancing services and controlling costs, as reflected in its plan to outsource certain administrative functions, and growth opportunities, as evidenced by its upcoming acquisition of the Legg Mason companies. The Board acknowledged the change in leadership at FRI and the opportunity to hear from Jennifer Johnson, President and Chief Executive Officer of FRI, about goals she has for the company that will benefit the Fund.

Following consideration of such information, the Board was satisfied with the nature, extent and quality of services to be provided by the Sub-Adviser and its affiliates to the Fund and its shareholders.

Fund Performance

The Board noted its review and consideration of the performance results of the Fund in connection with the April

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2020 annual contract renewal (Annual Contract Renewal) of the Fund’s investment management agreement. The Board recalled its conclusion at that time that the Fund’s performance was satisfactory. The Board also noted the proposed portfolio management team enhancements for the Fund, and determined that, in light of these changes, additional time will be needed to evaluate the effectiveness of management’s actions.

Comparative Fees and Expenses

The Board reviewed and considered information regarding the investment subadvisory fee to be charged by the Sub-Adviser. The Board noted that the addition of the Sub-Adviser will have no impact on the amount of management fees that are currently paid by the Fund as the Sub-Adviser will be paid by the Manager out of the management fee that the Manager receives from the Fund. The Board further noted that the allocation of the fee between the Manager and the Sub-Adviser reflected the services to be provided by each. The Board concluded that the proposed investment subadvisory fee is reasonable.

Management Profitability and Economies of Scale

The Board noted that it reviewed and considered information showing the expected impact of retaining the Sub-Adviser on the profitability of the Manager consistent with the conditions of the Order. The Board determined that its conclusions regarding profitability and economies of scale reached in connection with the Annual Contract Renewal of the investment management agreement with the Manager had not changed as a result of the proposal to approve the Sub-Advisory Agreement.

Conclusion

Based on its review, consideration and evaluation of all factors it believed relevant, including the above-described factors and conclusions, the Board unanimously approved the Sub-Advisory Agreement for an initial two-year period.

Liquidity Risk Management Program

The Funds have adopted and implemented a written Liquidity Risk Management Program (the “LRMP”) as required by Rule 22e-4 under the Investment Company Act of 1940. The program is designed to assess and manage each Fund’s liquidity risk, taking into consideration the Fund’s investment strategy and the liquidity of its portfolio investments during normal and reasonably foreseeable stressed conditions; its short and long-term cash flow projections; and its cash holdings and access to other

funding sources including the Funds’ interfund lending facility and line of credit. The Funds’ Board of Trustees approved the appointment of the Director of Liquidity Risk within the Investment Risk Management Group (the “IRMG”) as the Administrator of the LRMP. The IRMG maintains the Investment Liquidity Committee (the “ILC”) to provide oversight and administration of policies and procedures governing liquidity risk management for FT products and portfolios. The ILC includes representatives from Franklin Templeton’s Risk, Trading, Global Compliance, Investment Compliance, Investment Operations, Valuation Committee and Product Management groups.

The LRMP Administrator Annual Report was presented to the Fund(s) Board of Trustees at their meetings in May 2020. The report covered the adequacy and effectiveness of the program during the period December 1, 2018 to December 31, 2019 (the “covered period”). The report concluded that (i.) the LRMP, as adopted and implemented, remains reasonably designed to assess and manage each Fund’s liquidity risk; (ii.) the LRMP, including the Highly Liquid Investment Minimum (“HLIM”) where applicable, was implemented and operated effectively to achieve the goal of assessing and managing each Fund’s liquidity risk; and (iii.) each fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund. In addition, the LRMP Administrator presented the Fund Board of Trustees an update on liquidity during the first quarter of 2020 in relation to the COVID-19 pandemic.

During the reporting period, the Fund maintained a high level of liquid assets that are defined under the Liquidity Rule as “Highly Liquid Investments.” As a result, the Fund was designated a “Primarily Highly Liquid Fund” as defined under the Liquidity Rule and has not adopted a “Highly Liquid Investment Minimum.” A Highly Liquid Investment is defined as cash and any investment reasonably expected to be convertible to cash in current market conditions in three business days or less without the conversion to cash significantly changing the market value of the investment.

There can be no assurance that the program will achieve its objectives in the future. Please refer to your Fund’s prospectus for more information regarding the Fund’s exposure to liquidity risk and other principal risks to which an investment in the Fund may be subject.

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Proxy Voting Policies and Procedures

The Trust’s investment manager has established Proxy Voting Policies and Procedures (Policies) that the Trust uses to determine how to vote proxies relating to portfolio securities. Shareholders may view the Trust’s complete Policies online at franklintempleton.com. Alternatively, shareholders may request copies of the Policies free of charge by calling the Proxy Group collect at (954) 527-7678 or by sending a written request to: Franklin Templeton Companies, LLC, 300 S.E. 2nd Street, Fort Lauderdale, FL 33301, Attention: Proxy Group. Copies of the Trust’s proxy voting records are also made available online at franklintempleton.com and posted on the U.S. Securities and Exchange Commission’s website at sec.gov and reflect the most recent 12-month period ended June 30.

Quarterly Statement of Investments

The Trust files a complete statement of investments with the U.S. Securities and Exchange Commission for the first and third quarters for each fiscal year as an exhibit to its report on Form N-PORT. Shareholders may view the filed Form N-PORT by visiting the Commission’s website at sec.gov. The filed form may also be viewed and copied at the Commission’s Public Reference Room in Washington, DC. Information regarding the operations of the Public Reference Room may be obtained by calling (800) SEC-0330.

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Franklin Templeton Variable Insurance Products Trust (FTVIP) shares are not offered to the public; they are offered and sold only to: (1) insurance company separate accounts (Separate Account) to serve as the underlying investment vehicle for variable contracts; (2) certain qualified plans; and (3) other mutual funds (funds of funds).

Authorized for distribution to investors in Separate Accounts only when accompanied or preceded by the current prospectus for the applicable contract, which includes the Separate Account and the FTVIP prospectuses. Investors should carefully consider a fund’s investment goals, risks, charges and expenses before investing. The prospectus contains this and other information; please read it carefully before investing.

To help ensure we provide you with quality service, all calls to and from our service areas are monitored and/or recorded.

	Semiannual Report Franklin Templeton Variable Insurance Products Trust
	Investment Managers	Fund Administrator	Distributor
	Franklin Advisers, Inc.	Franklin Templeton Services, LLC	Franklin Templeton Distributors, Inc.
	Franklin Mutual Advisers, LLC
	Franklin Templeton
	Institutional, LLC
	Templeton Asset
	Management Ltd.
	Templeton Global Advisors Limited
	Templeton Investment Counsel, LLC

© 2020 Franklin Templeton Investments. All rights reserved. VIP1 S 08/20

Item 2. Code of Ethics.

(a) The Registrant has adopted a code of ethics that applies to its principal executive officers and principal financial and accounting officer.

(c) N/A

(d) N/A

(f) Pursuant to Item 13(a)(1), the Registrant is attaching as an exhibit a copy of its code of ethics that applies to its principal executive officers and principal financial and accounting officer.

Item 3. Audit Committee Financial Expert.

(a) (1) The Registrant has an audit committee financial expert serving on its audit committee.

     (2) The audit committee financial expert is Mary C. Choksi and she is “independent” as defined under the relevant Securities and Exchange Commission Rules and Releases.

Item 4. Principal Accountant Fees and Services.                     N/A

Item 5. Audit Committee of Listed Registrants.                                              N/A

Item 6. Schedule of Investments.                                                      N/A

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.     N/A

Item 8. Portfolio Managers of Closed-End Management Investment Companies.                                                          N/A

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.     N/A

Item 10. Submission of Matters to a Vote of Security Holders.

There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees that would require disclosure herein.

Item 11. Controls and Procedures.

(a)    Evaluation of Disclosure Controls and Procedures.     The Registrant maintains disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the Registrant’s filings under the Securities Exchange Act of 1934, as amended, and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrant’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrant’s management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Within 90 days prior to the filing date of this Shareholder Report on Form N-CSR, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant’s management, including the Registrant’s principal executive officer and the Registrant’s principal financial officer, of the effectiveness of the design and operation of the Registrant’s disclosure controls and procedures. Based on such evaluation, the Registrant’s principal executive officer and principal financial officer concluded that the Registrant’s disclosure controls and procedures are effective.

(b)    Changes in Internal Controls.     There have been no changes in the Registrant’s internal control over financial reporting that occurred

during the period covered by this report that has materially affected, or is reasonably likely to materially affect the internal control over financial reporting.

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Company.         N/A

Item 13. Exhibits.

(a)(1) Code of Ethics

(a)(2) Certifications pursuant to Section  302 of the Sarbanes–Oxley Act of 2002 of Matthew T. Hinkle, Chief Executive Officer – Finance and Administration, and Gaston Gardey, Chief Financial Officer and Chief Accounting Officer

(b) Certifications pursuant to Section  906 of the Sarbanes–Oxley Act of 2002 of Matthew T. Hinkle, Chief Executive Officer – Finance and Administration, and Gaston Gardey, Chief Financial Officer and Chief Accounting Officer

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Franklin Templeton Variable Insurance Products Trust

By	S\MATTHEW T. HINKLE
	Matthew T. Hinkle
	Chief Executive Officer – Finance and Administration

Date August 25, 2020

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By	S\MATTHEW T. HINKLE
	Matthew T. Hinkle
	Chief Executive Officer – Finance and Administration

Date August 25, 2020

By	S\GASTON GARDEY
	Gaston Gardey
	Chief Financial Officer and Chief Accounting Officer

Date August 25, 2020

EX-99.CODE

Code of Ethics for Principal Executives & Senior Financial Officers

Procedures Revised December 10, 2018  

FRANKLIN TEMPLETON FUNDS

CODE OF ETHICS FOR PRINCIPAL EXECUTIVES AND

SENIOR FINANCIAL OFFICERS

I. Covered Officers and Purpose of the Code

This code of ethics (the “Code”) applies to the Principal Executive Officers, Principal Financial Officer and Principal Accounting Officer (the “Covered Officers,” each of whom is set forth in Exhibit A) of each investment company advised by a Franklin Resources subsidiary and that is registered with the United States Securities & Exchange Commission (“SEC”) (collectively, “FT Funds”) for the purpose of promoting:

• Honest and ethical conduct, including the ethical resolution of actual or apparent conflicts of interest between personal and professional relationships;

• Full, fair, accurate, timely and understandable disclosure in reports and documents that a registrant files with, or submits to, the SEC and in other public communications made by or on behalf of the FT Funds;

• Compliance with applicable laws and governmental rules and regulations;

• The prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and

• Accountability for adherence to the Code.

Each Covered Officer will be expected to adhere to a high standard of business ethics and must be sensitive to situations that may give rise to actual as well as apparent conflicts of interest.

* Rule 38a-1 under the Investment Company Act of 1940 (“1940 Act”) and Rule 206(4)-7 under the Investment Advisers Act of 1940 (“Advisers Act”) (together the “Compliance Rule”) require registered investment companies and registered investment advisers to, among other things, adopt and implement written policies and procedures reasonably designed to prevent violations of the federal securities laws (“Compliance Rule Policies and Procedures”).

CONFIDENTIAL INFORMATION. This document is the proprietary product of Franklin Templeton Investments. It may NOT be distributed outside the company unless it is made subject to a non-disclosure agreement and/or such release receives authorization by an FTI Chief Compliance Officer. Any unauthorized use, reproduction or transfer of this document is strictly prohibited. Franklin Templeton Investments © 2014. All Rights Reserved.

FTI Compliance Procedures Standards of Business Conduct

II. Other Policies and Procedures

This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder.

Franklin Resources, Inc. has separately adopted the Code of Ethics and Business Conduct (“Business Conduct”), which is applicable to all officers, directors and employees of Franklin Resources, Inc., including Covered Officers. It summarizes the values, principles and business practices that guide the employee’s business conduct and also provides a set of basic principles to guide officers, directors and employees regarding the minimum ethical requirements expected of them. It supplements the values, principles and business conduct identified in the Code and other existing employee policies.

Additionally, the Franklin Templeton Funds have separately adopted the FTI Personal Investments and Insider Trading Policy governing personal securities trading and other related matters. The Code for Insider Trading provides for separate requirements that apply to the Covered Officers and others, and therefore is not part of this Code.

Insofar as other policies or procedures of Franklin Resources, Inc., the Funds, the Funds’ adviser, principal underwriter, or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superceded by this Code to the extent that they overlap or conflict with the provisions of this Code. Please review these other documents or consult with the Legal Department if have questions regarding the applicability of these policies to you.

III. Covered Officers Should Handle Ethically Actual and Apparent Conflicts of Interest

Overview. A “conflict of interest” occurs when a Covered Officer’s private interest interferes with the interests of, or his or her service to, the FT Funds. For example, a conflict of interest would arise if a Covered Officer, or a member of his family, receives improper personal benefits as a result of apposition with the FT Funds.

Certain conflicts of interest arise out of the relationships between Covered Officers and the FT Funds and already are subject to conflict of interest provisions in the Investment Company Act of 1940 (“Investment Company Act”) and the Investment Advisers Act of 1940 (“Investment Advisers Act”). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the FT Funds because of their status as “affiliated persons” of the FT Funds. The FT Funds’ and the investment advisers’ compliance programs and procedures are designed to prevent, or identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and such conflicts fall outside of the parameters of this Code.

Although typically not presenting an opportunity for improper personal benefit, conflicts arise from, or as a result of, the contractual relationship between the FT Funds, the investment advisers and the fund administrator of which the Covered Officers are also officers or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for the FT Funds, for the adviser, the administrator, or

2

FTI Compliance Procedures Standards of Business Conduct

for all three), be involved in establishing policies and implementing decisions that will have different effects on the adviser, administrator and the FT Funds. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the FT Funds, the adviser, and the administrator and is consistent with the performance by the Covered Officers of their duties as officers of the FT Funds. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the FT Funds’ Boards of Directors (“Boards”) that the Covered Officers may also be officers or employees of one or more other investment companies covered by this or other codes.

Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but Covered Officers should keep in mind that these examples are not exhaustive. The overarching principle is that the personal interest of a Covered Officer should not be placed improperly before the interest of the FT Funds.

Each Covered Officer must:

• Not use his or her personal influence or personal relationships improperly to influence investment decisions or financial reporting by the FT Funds whereby the Covered Officer would benefit personally to the detriment of the FT Funds;

• Not cause the FT Funds to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit the FT Funds;

• Not retaliate against any other Covered Officer or any employee of the FT Funds or their affiliated persons for reports of potential violations that are made in good faith;

• Report at least annually the following affiliations or other relationships:¹

• all directorships for public companies and all companies that are required to file reports with the SEC;

• any direct or indirect business relationship with any independent directors of the FT Funds;

• any direct or indirect business relationship with any independent public accounting firm (which are not related to the routine issues related to the firm’s service as the Covered Persons accountant); and

• any direct or indirect interest in any transaction with any FT Fund that will benefit the officer (not including benefits derived from the advisory, sub-advisory, distribution or service agreements with affiliates of Franklin Resources).

These reports will be reviewed by the Legal Department for compliance with the Code.

There are some conflict of interest situations that should always be approved in writing by Franklin Resources General Counsel or Deputy General Counsel, if material. Examples of these include²:

• Service as a director on the board of any public or private Company.

¹  Reporting of these affiliations or other relationships shall be made by completing the annual Directors and Officers Questionnaire and returning the questionnaire to Franklin Resources Inc, General Counsel or Deputy General Counsel.

²  Any activity or relationship that would present a conflict for a Covered Officer may also present a conflict for the Covered Officer if a member of the Covered Officer’s immediate family engages in such an activity or has such a relationship. The Cover Person should also obtain written approval by FT’s General Counsel in such situations.

3

FTI Compliance Procedures Standards of Business Conduct

• The receipt of any gifts in excess of $100 from any person, from any corporation or association.

• The receipt of any entertainment from any Company with which the FT Funds has current or prospective business dealings unless such entertainment is business related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise any question of impropriety. Notwithstanding the foregoing, the Covered Officers must obtain prior approval from the Franklin Resources General Counsel for any entertainment with a value in excess of $1000.

• Any ownership interest in, or any consulting or employment relationship with, any of the FT Fund’s service providers, other than an investment adviser, principal underwriter, administrator or any affiliated person thereof.

• A direct or indirect financial interest in commissions, transaction charges or spreads paid by the FT Funds for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer’s employment, such as compensation or equity ownership.

• Franklin Resources General Counsel or Deputy General Counsel will provide a report to the FT Funds Audit Committee of any approvals granted at the next regularly scheduled meeting.

IV. Disclosure and Compliance

• Each Covered Officer should familiarize himself with the disclosure requirements generally applicable to the FT Funds;

• Each Covered Officer should not knowingly misrepresent, or cause others to misrepresent, facts about the FT Funds to others, whether within or outside the FT Funds, including to the FT Funds’ directors and auditors, and to governmental regulators and self-regulatory organizations;

• Each Covered Officer should, to the extent appropriate within his or her area of responsibility, consult with other officers and employees of the FT Funds, the FT Fund’s adviser and the administrator with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the FT Funds file with, or submit to, the SEC and in other public communications made by the FT Funds; and

• It is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and regulations.

V. Reporting and Accountability

Each Covered Officer must:

• Upon becoming a covered officer affirm in writing to the Board that he or she has received, read, and understands the Code (see Exhibit B);

• Annually thereafter affirm to the Board that he has complied with the requirements of the Code; and

• Notify Franklin Resources’ General Counsel or Deputy General Counsel promptly if he or she knows of any violation of this Code. Failure to do so is itself is a violation of this Code.

4

FTI Compliance Procedures Standards of Business Conduct

Franklin Resources’ General Counsel and Deputy General Counsel are responsible for applying this Code to specific situations in which questions are presented under it and have the authority to interpret this Code in any particular situation.³ However, the Independent Directors of the respective FT Funds will consider any approvals or waivers⁴ sought by any Chief Executive Officers of the Funds.

The FT Funds will follow these procedures in investigating and enforcing this Code:

• Franklin Resources General Counsel or Deputy General Counsel will take all appropriate action to investigate any potential violations reported to the Legal Department;

• If, after such investigation, the General Counsel or Deputy General Counsel believes that no violation has occurred, The General Counsel is not required to take any further action;

• Any matter that the General Counsel or Deputy General Counsel believes is a violation will be reported to the Independent Directors of the appropriate FT Fund;

• If the Independent Directors concur that a violation has occurred, it will inform and make a recommendation to the Board of the appropriate FT Fund or Funds, which will consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of the investment adviser or its board; or a recommendation to dismiss the Covered Officer;

• The Independent Directors will be responsible for granting waivers, as appropriate; and

• Any changes to or waivers of this Code will, to the extent required, are disclosed as provided by SEC rules.⁵

VI. Other Policies and Procedures

This Code shall be the sole code of ethics adopted by the FT Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder. Insofar as other policies or procedures of the FT Funds, the FT Funds’ advisers, principal underwriter, or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superseded by this Code to the extent that they overlap or conflict with the provisions of this Code. The FTI Personal Investments and Insider Trading Policy, adopted by the FT Funds, FT investment advisers and FT Fund’s principal underwriter pursuant to Rule 17j-1 under the Investment Company Act, the Code of Ethics and Business Conduct and more detailed policies and procedures set forth in FT’s Employee Handbook are separate requirements applying to the Covered Officers and others, and are not part of this Code.

³  Franklin Resources General Counsel and Deputy General Counsel are authorized to consult, as appropriate, with members of the Audit Committee, counsel to the FT Funds and counsel to the Independent Directors, and are encouraged to do so.

⁴  Item 2 of Form N-CSR defines “waiver” as “the approval by the registrant of a material departure from a provision of the code of ethics” and “implicit waiver,” which must also be disclosed, as “the registrant’s failure to take action within a reasonable period of time regarding a material departure from a provision of the code of ethics that has been made known to an executive officer” of the registrant. See Part X.

⁵ See Part X.

5

FTI Compliance Procedures Standards of Business Conduct

VII. Amendments

Any amendments to this Code, other than amendments to Exhibit A, must be approved or ratified by a majority vote of the FT Funds’ Board including a majority of independent directors.

VIII. Confidentiality

All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the FT Funds’ Board and their counsel.

IX. Internal Use

The Code is intended solely for the internal use by the FT Funds and does not constitute an admission, by or on behalf of any FT Funds, as to any fact, circumstance, or legal conclusion.

X. Disclosure on Form N-CSR

Item 2 of Form N-CSR requires a registered management investment company to disclose annually whether, as of the end of the period covered by the report, it has adopted a code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these officers are employed by the registrant or a third party. If the registrant has not adopted such a code of ethics, it must explain why it has not done so.

The registrant must also: (1) file with the SEC a copy of the code as an exhibit to its annual report; (2) post the text of the code on its Internet website and disclose, in its most recent report on Form N-CSR, its Internet address and the fact that it has posted the code on its Internet website; or (3) undertake in its most recent report on Form N-CSR to provide to any person without charge, upon request, a copy of the code and explain the manner in which such request may be made. Disclosure is also required of amendments to, or waivers (including implicit waivers) from, a provision of the code in the registrant’s annual report on Form N-CSR or on its website. If the registrant intends to satisfy the requirement to disclose amendments and waivers by posting such information on its website, it will be required to disclose its Internet address and this intention.

The Legal Department shall be responsible for ensuring that:

• a copy of the Code is filed with the SEC as an exhibit to each Fund’s annual report; and

• any amendments to, or waivers (including implicit waivers) from, a provision of the Code is disclosed in the registrant’s annual report on Form N-CSR.

In the event that the foregoing disclosure is omitted or is determined to be incorrect, the Legal Department shall promptly file such information with the SEC as an amendment to Form N-CSR.

In such an event, the Fund Chief Compliance Officer shall review the Code and propose such changes to the Code as are necessary or appropriate to prevent reoccurrences.

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FTI Compliance Procedures Standards of Business Conduct

EXHIBIT A

Persons Covered by the Franklin Templeton Funds

Code of Ethics

December 2018

FRANKLIN GROUP OF FUNDS

Edward Perks	President and Chief Executive Officer – Investment Management
Rupert H. Johnson, Jr.	Chairman of the Board and Vice President – Investment Management
Don Taylor	President and Chief Executive Officer – Investment Management
Sonal Desai)	President and Chief Executive Officer – Investment Management
Matthew Hinkle	Chief Executive Officer – Finance and Administration
Gaston R. Gardey	Chief Financial Officer and Chief Accounting Officer and Treasurer

FRANKLIN MUTUAL SERIES FUNDS

Peter Langerman	Chief Executive Officer – Investment Management
Matthew Hinkle	Chief Executive Officer – Finance and Administration
Robert G. Kubilis	Chief Financial Officer and Chief Accounting Officer

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

Mat S. Gulley	Chief Executive Officer – Investment Management
Matthew Hinkle	Chief Executive Officer – Finance and Administration
Robert G. Kubilis	Chief Financial Officer and Chief Accounting Officer

TEMPLETON GROUP OF FUNDS

Manraj S. Sekhon	President and Chief Executive Officer – Investment Management
Michael Hasenstab, Ph.D.	President and Chief Executive Officer – Investment Management
Norman Boersma	President and Chief Executive Officer – Investment Management
Matthew Hinkle	Chief Executive Officer – Finance and Administration
Robert G. Kubilis	Chief Financial Officer, Chief Accounting Officer and Treasurer

7

FTI Compliance Procedures Standards of Business Conduct

Exhibit B

ACKNOWLEDGMENT FORM

Franklin Templeton Funds Code of Ethics

For Principal Executives and Senior Financial Officers

Instructions:

1. Complete all sections of this form.

2. Print the completed form, sign, and date.

3. Submit completed form to FT’s General Counsel c/o Code of Ethics Administration within 10 days of becoming a Covered Officer and by February 15th of each subsequent year.

Inter-office mail:	Code of Ethics Administration, Global Compliance SM-920/2
Fax:	(650) 312-5646
E-mail:	Code of Ethics Inquiries & Requests (internal address);
	lpreclear@franklintempleton.com (external address)

Covered Officer’s Name:

Title:

Department:

Location:

Certification for Year Ending:

To: Franklin Resources General Counsel, Legal Department

I acknowledge receiving, reading and understanding the Franklin Templeton Fund’s Code of Ethics for Principal Executive Officers and Senior Financial Officers (the “Code”). I will comply fully with all provisions of the Code to the extent they apply to me during the period of my employment. I further understand and acknowledge that any violation of the Code may subject me to disciplinary action, including termination of employment.

Signature Date signed

8

EX-99.CERT

Exhibit 13 (a) (2)

I, Matthew T. Hinkle, certify that:

1. I have reviewed this report on Form N-CSR of Franklin Templeton Variable Insurance Products Trust;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

8/25/2020

S\MATTHEW T. HINKLE

Matthew T. Hinkle

Chief Executive Officer - Finance and Administration

Exhibit 13 (a) (2)

I, Gaston Gardey, certify that:

1. I have reviewed this report on Form N-CSR of Franklin Templeton Variable Insurance Products Trust;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

8/25/2020

S\GASTON GARDEY

Gaston Gardey

Chief Financial Officer and Chief Accounting Officer

EX-99.906CERT

Exhibit 13 (b)

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

I, Matthew T. Hinkle, Chief Executive Officer of the Franklin Templeton Variable Insurance Products Trust (the “Registrant”), certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

1. The periodic report on Form N-CSR of the Registrant for the period ended 6/30/2020 (the “Form N-CSR”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Dated: 8/25/2020

S\MATTHEW T. HINKLE

Matthew T. Hinkle

Chief Executive Officer - Finance and Administration

Exhibit 13 (b)

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

I, Gaston Gardey, Chief Financial Officer of the Franklin Templeton Variable Insurance Products Trust (the “Registrant”), certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

1. The periodic report on Form N-CSR of the Registrant for the period ended 6/30/2020 (the “Form N-CSR”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Dated: 8/25/2020

S\GASTON GARDEY

Gaston Gardey

Chief Financial Officer and Chief Accounting Officer