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NATIONWIDE LIFE INSURANCE COMPANY
Group Flexible Fund Retirement Contract
Issued by Nationwide Life Insurance Company
through its Nationwide DC Variable Account
The date of this prospectus is May 3, 1999.
- --------------------------------------------------------------------------------
This prospectus contains basic information you should know about the contracts
before investing.
Please read it and keep it for future reference.
THE FOLLOWING UNDERLYING MUTUAL FUNDS ARE AVAILABLE UNDER THE CONTRACTS:
o American Century: International Discovery Fund (formerly American
Century - Twentieth Century International Discovery Fund - Investor
Class)
o American Century: Income & Growth - Investor Class
o American Century: Growth (formerly American Century: Twentieth Century
Growth)
o American Century: Ultra (formerly American Century: Twentieth Century
Ultra)
o Dreyfus Appreciation Fund, Inc.
o Dreyfus Premier Midcap Stock Fund - Class A
o Dreyfus S&P 500 Index Fund
o Dreyfus Third Century Fund, Inc.
o Evergreen Income and Growth Fund (formerly Total Return Fund)
o Federated Bond Fund - Class F
o Federated U.S. Government Securities Fund: 2-5 Years: Institutional
Shares
o Fidelity Advisor Growth Opportunities Fund - Class A
o Fidelity Advisor High Yield Fund - Class T
o Fidelity Asset Manager(TM)
o Fidelity Equity-Income Fund
o INVESCO Dynamics Fund
o INVESCO Industrial Income Fund (formerly Financial Industrial Income
Fund, Inc.)
o INVESCO Total Return Fund
o Janus Fund
o Massachusetts Investors Growth Stock Fund - Class A
o MAS Funds Fixed Income Portfolio
o MFS(R)Growth Opportunities Fund - Class A
o MFS(R) High Income Fund - Class A
o Morgan Stanley Institutional Fund, Inc. - Equity Growth Portfolio -
Class B
o Nationwide(R)Fund - Class D
o Nationwide(R)Growth Fund - Class D
o Nationwide(R)Money Market Fund
o Nationwide S&P 500(R)Index Fund - Class Y
o LifeDesigns Series
- The Aggressive Portfolio
- The Moderately Aggressive Portfolio
- The Moderate Portfolio
- The Moderately Conservative Portfolio
- The Conservative Portfolio
o Nationwide Separate Account Trust - Nationwide Small Company Fund
o Neuberger Berman Partners Trust
o Oppenheimer Global Fund/VA - Class A
o Prestige Balanced Fund - Class Y
o Prestige International Fund - Class Y
o Prestige Large Cap Growth Fund - Class Y
o Prestige Large Cap Value Fund - Class Y
o Prestige Small Cap Fund - Class Y
o Putnam Investors Fund - Class A
o Putnam Voyager Fund - Class A
o Seligman Growth Fund, Inc. - Class A
o Templeton Foreign Fund - Class A
o T. Rowe Price International Stock Fund(R)
o Warburg Pincus Emerging Growth Fund
NOT AVAILABLE FOR NEW PLANS ESTABLISHED ON OR AFTER JUNE 30, 1998:
o Fidelity Contrafund
NOT AVAILABLE FOR NEW CONTRACTS ESTABLISHED ON OR AFTER OCTOBER 30, 1997:
o Fidelity Magellan(R) Fund
NOT AVAILABLE FOR NEW CONTRACTS ESTABLISHED ON OR AFTER JANUARY 1, 1994:
o The Bond Fund of America(SM), Inc.
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o The Income Fund of America(R), Inc.
o The Growth Fund of America(R), Inc.
NOT AVAILABLE FOR NEW CONTRACRTS ESTABLISHED ON OR AFTER AUGUST 1, 1993:
o Delaware Group Decatur Fund, Inc. - Decatur Income Fund
NOT AVAILABLE FOR NEW CONTRACTS ESTABLISHED ON OR AFTER JANUARY 1, 1987:
o Fidelity Capital & Income Fund (formerly Fidelity High Income Fund)
The Statement of Additional Information (dated May 3, 1999) which contains
additional information about the contracts and the Nationwide DC Variable
Account, has been filed with the U.S. Securities and Exchange Commission ("SEC")
and is incorporated herein by reference.
The table of contents for the Statement of Additional information is on page 33.
For general information or to obtain FREE copies of the:
o Statement of Additional Information;
o prospectus for any underlying mutual fund; and
o required Nationwide forms,
call: 1-800-545-4730
TDD 1-800-238-3035
or write:
NATIONWIDE LIFE INSURANCE COMPANY
P.O. BOX 16766
COLUMBUS, OHIO 43216
The Statement of Additional Information and other material incorporated by
reference can be found on the SEC website at:
www.sec.gov
Investors assume certain risks when investing in the contracts, including the
possibility of losing money.
The contracts described in this prospectus are marketed primarily to public
sector sponsors of non-qualified deferred compensation plans which qualify for
tax treatment under Section 457 of the Internal Revenue Code. Many such public
sector plan sponsors are members of national civic associations which provide
assistance to member entities in establishing non-qualified deferred
compensation plans and determining the investment options available under such
plans. Acting on the recommendation of these associations, many plan sponsors
have determined that their plans will permit investment in some, but not all, of
the underlying mutual fund options of the variable account. In such cases, the
offering prospectus for the variable account will reflect only those funds which
the contract owner/plan sponsor has determined to be available under the plan.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SEC, NOR HAS THE
SEC PASSED UPON THE ACCURACY OR ADEQUACY OF THE PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
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GLOSSARY OF SPECIAL TERMS
ACCUMULATION UNIT- An accounting unit used to calculate the contract value
allocated to the variable account before the annuitization date.
ALLOCATED CONTRACT- Contract under which Nationwide maintains individual
accounts on behalf of each participant.
ANNUITIZATION DATE- The date on which annuity payments begin.
ANNUITY COMMENCEMENT DATE- The date on which annuity payments are scheduled to
begin. This date may be changed by the contract owner with Nationwide's consent.
ANNUITY UNIT- An accounting unit used to calculate the variable payment annuity
payments.
CONTRACT VALUE- The total of all accumulation units in a contract.
CONTRACT YEAR- Each year the contract is in force beginning with the date the
contract is issued.
GENERAL ACCOUNT- All assets of Nationwide other than those of the variable
account or in other separate accounts that have been or may be established by
Nationwide.
GROUP FIXED CONTRACT- Nationwide's Group Fixed Fund Retirement contract or Group
Fixed Tax Deferred Annuity contract.
INITIAL TRANSFER- The initial amount transferred by a contract owner from an
investment product offered by a provider other than Nationwide. The initial
transfer is the initial purchase payment under a contract.
NATIONWIDE- Nationwide Life Insurance Company.
PARTICIPANT ACCOUNT- An account established by Nationwide for each participant.
All financial transactions affecting a participant under the contract, other
than the purchase and payment of an annuity from the general account of
Nationwide, are recorded in the participant's account.
PARTICIPANT ACCOUNT YEAR- For each participant, the participant account year is
each one-year period starting with either the date accumulation units were first
credited to the participant's account, or an anniversary of that date.
PARTICIPANT EFFECTIVE DATE- The first date accumulation units are credited to
the participant's account on behalf of the participant under the contract.
RETIRED PARTICIPANT- A participant who is receiving payments according to the
selected optional retirement income form.
SUB-ACCOUNTS- Divisions of the variable account to which underlying mutual fund
shares are allocated and for which accumulation units and annuity units are
separately maintained.
VALUATION PERIOD- Each day the New York Stock Exchange is open for business.
VARIABLE ACCOUNT-Nationwide DC Variable Account, a separate account of
Nationwide that contains variable account allocations. The variable account is
divided into sub-accounts, each of which invests in shares of a separate
underlying mutual fund.
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TABLE OF CONTENTS
GLOSSARY OF SPECIAL TERMS.........................3
SUMMARY OF CONTRACT EXPENSES......................5
UNDERLYING MUTUAL FUND ANNUAL EXPENSES............6
EXAMPLE...........................................9
CONDENSED FINANCIAL INFORMATION..................11
FINANCIAL STATEMENTS.............................11
SYNOPSIS OF THE CONTRACTS........................12
NATIONWIDE LIFE INSURANCE COMPANY................13
NATIONWIDE INVESTMENT SERVICES CORPORATION.......13
INVESTING IN THE CONTRACT........................13
The Variable Account and Underlying
Mutual Funds
STANDARD ACCOUNT CHARGES AND
DEDUCTIONS..................................14
Contingent Deferred Sales Charge
Participant Account Maintenance Charge
Variable Account Annual Expense Fee
Premium Taxes
CONTRACT RIGHTS..................................16
OPERATION OF THE CONTRACT........................16
Minimum Purchase Payments
Application of Purchase Payments
Allocation of Purchase Payments
Determining Variable Account Value -
Valuing an Accumulation Unit
Determining Participant Account Value
Exchange Privilege
Transfer Requests
Experience Credits
MODIFICATION OF THE CONTRACT.....................19
CONTRACT SUSPENSION AND TERMINATION..............19
REDEMPTION OF PARTICIPANT ACCOUNTS...............19
RETIREMENT PERIOD................................20
Additional Purchase Payment Before
Beginning Retirement Income Payments
Retirement Income Payments
Election of Retirement Income Form and Date
Retirement Income Forms
Determination of Life Income Payments
Assumed Investment Rate
Value of an Annuity Unit
DEATH OF PARTICIPANT.............................23
Participant Death Before Retirement
Death of Retired Participant
FEDERAL TAX CONSIDERATIONS.......................24
Contracts Issued under the New York
Model Plan
STATEMENTS AND REPORTS...........................24
YEAR 2000 COMPLIANCE ISSUES......................25
LEGAL PROCEEDINGS................................26
ADVERTISING AND SUB-ACCOUNT
PERFORMANCE SUMMARY.........................27
TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL
INFORMATION.................................33
APPENDIX A: OBJECTIVES FOR UNDERLYING
MUTUAL FUNDS................................34
APPENDIX B: CONDENSED FINANCIAL INFORMATION......43
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SUMMARY OF CONTRACT EXPENSES
All charges are subject to negotiation therefore the expenses described below
may vary from contract to contract. Please refer to the appropriate prospectus
provision for more details.
PARTICIPANT TRANSACTION EXPENSES
Maximum Contingent Deferred Sales Charge
(as a percentage of purchase payments) .................5%
MAXIMUM PARTICIPANT ACCOUNT MAINTENANCE CHARGE.........$50
MAXIMUM VARIABLE ACCOUNT ANNUAL EXPENSE FEE(1) (as a percentage of average
account value) 0.95% per annum
(1) The maximum Variable Account Annual Expense Fee does not include:
o premium taxes that may be imposed by the state in which the contract
was issued; or
o deductions for management fees and other expenses made by the
underlying mutual funds.
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UNDERLYING MUTUAL FUND ANNUAL EXPENSES
(AS A PERCENTAGE OF UNDERLYING MUTUAL FUND
NET ASSETS AFTER EXPENSE REIMBURSEMENT)
<TABLE>
<CAPTION>
Management Other 12b-1 Total Mutual Fund
Fees Expenses Fees Expenses
<S> <C> <C> <C> <C>
American Century International Discovery 1.66% 0.00% 0.00% 1.66%
Fund, Inc. (formerly - Twentieth Century
International Discovery Fund, Inc.) -
Investor Class
American Century: Income & Growth - Investor 0.44% 0.00% 0.50% 0.94%
Class
American Century: Growth (formerly Twentieth 1.00% 0.00% 0.00% 1.00%
Century Growth)
American Century: Ultra (formerly Twentieth 1.00% 0.00% 0.00% 1.00%
Century Ultra)
The Bond Fund of America(SM), Inc. 0.32% 0.09% 0.25% 0.66%
Delaware Group Decatur Fund, Inc.-Decatur 0.48% 0.22% 0.00% 0.70%
Income Fund
Dreyfus Appreciation Fund, Inc. 0.55% 0.34% 0.00% 0.89%
Dreyfus Premier Midcap Stock Fund - Class A 1.10% 0.00% 0.25% 1.35%
Dreyfus S&P 500 Index Fund 0.25% 0.25% 0.00% 0.50%
Dreyfus Third Century Fund, Inc. 0.75% 0.22% 0.00% 0.97%
Evergreen Income and Growth Fund (formerly 0.97% 0.28% 0.00% 1.25%
Total Return Fund)
Federated Bond Fund - Class F 0.65% 0.43% 0.00% 1.08%
Federated U.S. Government Securities Fund: 0.40% 0.14% 0.00% 0.54%
2-5 Years - Institutional Shares
Fidelity Advisor Growth Opportunities Fund - 0.46% 0.25% 0.25% 0.96%
Class A
Fidelity Advisor High Yield Fund - Class T 0.58% 0.24% 0.25% 1.07%
Fidelity Asset Manager(TM) 0.42% 0.17% 0.00% 0.59%
Fidelity Capital & Income Fund (formerly 0.58% 0.23% 0.00% 0.81%
Fidelity High Income Fund)
Fidelity Contrafund 0.45% 0.16% 0.00% 0.61%
Fidelity Equity-Income Fund 0.47% 0.20% 0.00% 0.67%
Fidelity Magellan(R)Fund 0.42% 0.17% 0.00% 0.59%
The Growth Fund of America(R), Inc. 0.35% 0.11% 0.24% 0.70%
The Income Fund of America(R), Inc. 0.28% 0.07% 0.24% 0.59%
INVESCO Dynamics Fund 0.55% 0.28% 0.25% 1.08%
</TABLE>
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UNDERLYING MUTUAL FUND ANNUAL EXPENSES (CONTINUED)
<TABLE>
<CAPTION>
Management Other 12b-1 Total Mutual
Fees Expenses Fees Fund Expenses
<S> <C> <C> <C> <C>
INVESCO Industrial Income Fund, Inc. 0.47% 0.18% 0.25% 0.90%
(formerly Financial Industrial Income Fund,
Inc.)
INVESCO Total Return Fund 0.58% 0.20% 0.25% 1.03%
Janus Fund 0.65% 0.19% 0.00% 0.84%
LifeDesigns Series - The Aggressive 0.50% 0.00% 0.00% 0.50%
Portfolio
LifeDesigns Series - The Conservative 0.50% 0.00% 0.00% 0.50%
Portfolio
LifeDesigns Series - The Moderate Portfolio 0.50% 0.00% 0.00% 0.50%
LifeDesigns Series - The Moderately 0.50% 0.00% 0.00% .050%
Aggressive Portfolio
LifeDesigns Series - The Moderately 0.50% 0.00% 0.00% 0.50%
Conservative Portfolio
MAS Funds Fixed Income Portfolio 0.38% 0.10% 0.00% 0.48%
Massachusetts Investors Growth Stock Fund - 0.25% 0.22% 0.32% 0.79%
Class A
MFS(R) Growth Opportunities Fund - Class A 0.42% 0.21% 0.18% 0.81%
MFS(R) High Income Fund - Class A 0.44% 0.27% 0.30% 1.01%
Morgan Stanley Institutional Fund, Inc. - 0.60% 0.20% 0.25% 1.05%
Equity Growth Portfolio - Class B
Nationwide(R) Fund - Class D 0.57% 0.12% 0.00% 0.69%
Nationwide(R) Growth Fund - Class D 0.58% 0.19% 0.00% 0.77%
Nationwide(R) Money Market Fund 0.40% 0.18% 0.00% 0.58%
Nationwide S&P 500(R) Index Fund - Class Y 0.13% 0.34% 0.00% 0.47%
NSAT - Nationwide Small Company Fund 1.00% 0.07% 0.00% 1.07%
Neuberger Berman Partners Trust 0.85% 0.05% 0.00% 0.90%
Oppenheimer Global Fund/VA - Class A 0.69% 0.23% 0.22% 1.14%
Prestige Balanced Fund - Class Y 0.25% 0.70% 0.00% 0.95%
Prestige International Fund - Class Y 0.43% 0.82% 0.00% 1.25%
Prestige Large Cap Growth Fund - Class Y 0.35% 0.70% 0.00% 1.05%
Prestige Large Cap Value Fund - Class Y 0.30% 0.70% 0.00% 1.00%
Prestige Small Cap Fund - Class Y 0.50% 0.70% 0.00% 1.20%
Putnam Investors Fund - Class A 0.51% 0.19% 0.25% 0.95%
Putnam Voyager Fund - Class A 0.48% 0.23% 0.25% 0.40%
</TABLE>
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UNDERLYING MUTUAL FUND ANNUAL EXPENSES (CONTINUED)
<TABLE>
<CAPTION>
Management Other 12b-1 Total Mutual
Fees Expenses Fees Fund Expenses
<S> <C> <C> <C> <C>
Seligman Growth Fund, Inc. - Class A 0.70% 0.23% 0.23% 1.16%
T. Rowe Price International Stock Fund(R) 0.67% 0.18% 0.00% 0.85%
Templeton Foreign Fund - Class A 0.61% 0.26% 0.25% 1.12%
Warburg Pincus Emerging Growth Fund 0.90% 0.32% 0.00% 1.22%
</TABLE>
The expenses shown above are deducted by the underlying mutual fund before it
provides Nationwide with the daily net asset value. Nationwide then deducts
applicable variable account charges from the net asset value to calculate the
unit value of the corresponding sub-account. The management fees and other
expenses are more fully described in the prospectus for each underlying mutual
fund. Information relating to the underlying mutual funds was provided by the
underlying mutual funds and not independently verified by Nationwide.
Some underlying mutual funds are subject to fee waivers and expense
reimbursements. The following chart shows what the expenses would have been for
such funds without fee waivers and expense reimbursements.
<TABLE>
<CAPTION>
Management Other 12b-1 Total Mutual
Fees Expenses Fees Fund Expenses
<S> <C> <C> <C> <C>
Federated Bond Fund - Class F 0.75% 0.20% 0.00% 0.95%
Federated U.S. Government Securities Fund: 2-5 Years - 0.40% 0.39% 0.00% 0.79%
Institutional Shares
Fidelity Advisor Growth Opportunities Fund - Class A 0.46% 0.26% 0.25% 0.97%
Fidelity Asset Manager 0.42% 0.18% 0.00% 0.60%
Fidelity Contrafund 0.45% 0.20% 0.00% 0.65%
Fidelity Magellan(R) Fund 0.42% 0.17% 0.00% 0.59%
Nationwide S&P 500(R) Index Fund - Class Y 0.13% 0.61% 0.00% 0.74%
</TABLE>
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EXAMPLE
The following chart shows the amount of expenses (in dollars) that would be
incurred under the contracts assuming a $1,000 investment, 5% annual return, and
no change in expenses. These dollar figures are illustrative only and should not
be considered a representation of past or future expenses. Actual expenses may
be greater or less than those shown below.
The example reflects expenses of both the variable account and the underlying
mutual funds. The example reflects the maximum Variable Account Annual Expense
Fee (0.95%). Deductions for premium taxes are not reflected but may apply. The
example also reflects the Contract Maintenance Charge, expressed as a percentage
of average account value. Since the average contract value is greater than
$1,000, the expense effect of the Contract Maintenance Charge is reduced
accordingly.
The summary of contract expenses and example are to help contract owners
understand expenses associated with the contracts.
<TABLE>
<CAPTION>
If you surrender your contract If you do not surrender your If you annuitize your
at the end of the applicable contract at the end of the contract at the end of the
time period applicable time period applicable time period
1 Yr. 3 Yrs. 5 Yrs. 10 Yrs. 1 Yr. 3 Yrs. 5 Yrs. 10 Yrs. 1 Yr. 3 Yrs. 5 Yrs. 10 Yrs.
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
American Century: 77 134 193 354 27 84 143 304 27 84 143 304
International Discovery Fund,
Inc. (formerly Twentieth
Century International
Discovery Fund, Inc.) -
Investor Class
American Century: Income & 67 103 142 250 17 53 92 200 17 59 92 200
Growth - Investor Class
American Century: Growth 70 113 159 284 20 63 109 234 20 63 109 234
(formerly Twentieth Century
Growth)
American Century: Ultra 70 113 159 284 20 63 109 234 20 63 109 234
(formerly Twentieth Century
Ultra)
The Bond Fund of America(SM) 67 102 140 247 17 52 90 197 17 52 90 197
Inc.
Delaware Group Decatur Fund, 67 104 142 251 17 54 92 201 17 54 92 201
Inc. - Decatur Income Fund
Dreyfus Appreciation Fund, 69 110 153 272 19 60 103 222 19 60 103 222
Inc.
Dreyfus Premier Midcap Stock 74 124 177 322 24 74 127 272 24 74 127 272
Fund - Class A
Dreyfus S&P 500 Index Fund 65 97 132 228 15 47 82 178 15 47 82 178
Dreyfus Third Century Fund, 70 112 157 281 20 62 107 231 20 62 107 231
Inc.
Evergreen Income and Growth 73 121 172 311 23 71 122 261 23 71 122 261
Fund (formerly Total Return
Fund)
Federated Bond Fund - Class F 71 116 163 293 21 66 113 243 21 66 113 243
</TABLE>
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EXAMPLE (CONTINUED)
<TABLE>
<CAPTION>
If you surrender your contract If you do not surrender your If you annuitize your
at the end of the applicable contract at the end of the contract at the end of the
time period applicable time period applicable time period
1 Yr. 3 Yrs. 5 Yrs. 10 Yrs. 1 Yr. 3 Yrs. 5 Yrs. 10 Yrs. 1 Yr. 3 Yrs. 5 Yrs. 10 Yrs.
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Federated U. S. Government 66 99 134 233 16 49 84 183 16 49 84 183
Securities Fund: 2-5 Years -
Institutional Shares
Fidelity Advisor Growth 70 112 156 280 20 62 106 230 20 62 106 230
Opportunities Fund - Class A
Fidelity Advisor High Yield 71 115 162 292 21 65 112 242 21 65 112 242
Fund - Class T
Fidelity Asset Manager(TM) 68 105 145 256 18 55 95 206 18 55 95 206
Fidelity Capital & Income 68 107 148 263 18 57 98 213 18 57 98 213
Fund (formerly Fidelity High
Income Fund)
Fidelity Contrafund 66 101 138 241 16 51 88 191 16 51 88 191
Fidelity Equity-Income Fund 67 103 141 248 17 53 91 198 17 53 91 198
Fidelity Magellan(R) Fund 66 100 137 239 16 50 87 189 16 50 87 189
The Growth Fund of America(R) 67 104 142 251 17 54 92 201 17 54 92 201
Inc.
The Income Fund of America(R) 66 100 153 273 19 60 103 223 19 60 103 223
INVESCO Dynamics Fund 71 116 163 293 21 66 113 243 21 66 113 243
INVESCO Industrial Income 69 110 153 273 19 60 103 223 19 60 103 223
Fund, Inc. (formerly
Financial Industrial Income
Fund, Inc.)
INVESCO Total Return Fund 71 114 160 287 21 64 110 237 21 64 110 237
Janus Fund 69 108 150 267 19 58 100 217 19 58 100 217
MAS Funds Fixed Income 65 97 131 226 15 47 81 176 15 47 81 176
Portfolio
Massachusetts Investors 68 107 147 261 18 57 97 211 18 57 97 211
Growth Stock Fund - Class A
MFS(R) Growth Opportunities 68 107 148 263 18 57 98 213 18 57 98 213
Fund - Class A
MFS(R) High Income Fund - Class 71 114 159 285 21 64 109 235 21 64 109 235
A
Morgan Stanley Institutional 71 115 161 290 21 65 111 240 21 65 111 240
Fund, Inc. - Equity Growth
Portfolio - Class B
</TABLE>
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EXAMPLE (CONTINUED)
<TABLE>
<CAPTION>
If you surrender your contract If you do not surrender your If you annuitize your
at the end of the applicable contract at the end of the contract at the end of the
time period applicable time period applicable time period
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Nationwide(R) Fund - Class D 67 103 142 250 17 53 92 200 17 53 92 200
Nationwide(R) Growth Fund - 68 106 146 259 18 56 96 209 18 56 96 209
Class D
Nationwide(R) Money Market Fund 66 100 136 238 16 50 86 188 16 50 86 188
Nationwide S&P 500(R) Index 65 96 130 225 15 46 80 175 15 46 80 175
Fund - Class Y
NSAT - Nationwide Small 71 114 160 287 21 64 110 237 21 64 110 237
Company Fund
Neuberger Berman Partners 68 107 148 262 18 57 98 212 18 57 98 212
Trust
Oppenheimer Global Fund/VA - 72 118 166 299 22 68 116 249 22 68 116 249
Class A
Prestige Balanced Fund - 70 112 156 279 20 62 106 229 20 62 106 229
Class Y
Prestige International Fund - 73 121 172 311 23 71 122 261 23 71 122 261
Class Y
Prestige Large Cap Growth 71 115 161 290 21 65 111 240 21 65 111 240
Fund - Class Y
Prestige Large Cap Value Fund 70 113 159 284 20 63 109 234 20 63 109 234
- - Class Y
Prestige Small Cap Fund - 73 120 169 306 23 70 119 256 23 70 119 256
Class Y
Putnam Investors Fund - Class 70 112 156 279 20 62 106 229 20 62 106 229
A
Putnam Voyager Fund - Class A 70 112 156 280 20 62 106 230 20 62 106 230
Seligman Growth Fund, Inc. - 72 118 167 301 22 68 117 251 22 68 117 251
Class A
T. Rowe Price International 69 108 151 268 19 58 101 218 19 58 101 218
Stock Fund(R)
Templeton Foreign Fund - 72 117 165 297 22 67 115 247 22 67 115 247
Class A
Warburg Pincus Emerging 73 120 170 308 23 70 120 258 23 70 120 258
Growth Fund
</TABLE>
CONDENSED FINANCIAL INFORMATION
The accumulation unit value for each sub-account reflects changes in the value
of the underlying mutual fund and the deduction of the Variable Account Annual
Expense Fee. For specific accumulation unit value for each class of the
underlying mutual funds, please refer to Appendix B.
FINANCIAL STATEMENTS
Financial Statements for the variable account and Nationwide are located in the
Statement of Additional Information. A current Statement of Additional
Information may be obtained without charge by contacting Nationwide's home
office at the telephone number located on page 2 of this prospectus.
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SYNOPSIS OF THE CONTRACTS
Group Flexible Fund Retirement Contracts are designed for use in connection with
supplemental deferred compensation plans for employees of tax exempt entities.
The plans generally will qualify for favorable tax treatment under Sections 401,
403(b), or 457 of the Internal Revenue Code, but may also include other
non-qualified deferred compensation plans. Contracts are issued only to
employers who are exempt from taxation to fund deferred compensation plans.
Employees generally are not subject to federal income tax on amounts deferred
under these plans until distributions are received from the plan.
Plans established for the benefit of any organization that is exempt from
federal income tax under Section 457 of the Internal Revenue Code with the
exception of government plans, remain the sole property of the contract owner,
subject to the claims of the contract owner's general creditors. Consequently,
all amounts deferred to the plan, all income and property attributable to such
amounts remain the property of the contract owner until such amounts are made
available to participants in the plan or to the participants' beneficiaries.
Plans established after August 20, 1996 by a state, or any political subdivision
of a state, must hold the assets and income of the plan in trust for the
exclusive benefit of the participants and beneficiaries of the plan. For this
purpose, custodial accounts and certain annuity contracts are treated as trusts.
Plans in existence on August 20, 1996 must be amended prior to January 1, 1999
to satisfy these trust and exclusive benefit requirements to continue to receive
favorable tax treatment.
For these Plans, Nationwide issues a single group contract to the contract
owner, covering all present and future participating employees. Nationwide
provides a certificate to the contract owner to deliver to each retired
participant or other person for whom a Retirement Income Form is purchased. The
certificate sets forth the benefits to which the recipient is entitled. And if
legally required, Nationwide provides a certificate to the contract owner for
delivery to any other person required by law to receive a certificate.
Nationwide establishes an account for each participant under the contracts. The
account contains values and reflects activity for each participant. Plan
participants generally receive tax deferral on amounts deposited into the plan
and are taxed when amounts are distributed from the plan.
Purchase payments are normally submitted monthly, but the schedule may be
adjusted to fit the contract owner's payroll practices. Purchase payments made
by or on behalf of each participant must be at least $20 per month.
The contracts strive to provide each participant with:
o an initial retirement income payment, reflecting cost of living changes
during pre-retirement years (without requiring increased purchase
payments to keep pace with cost of living increases during those
years), and
o subsequent retirement income payments which will vary with the cost of
living changes during his or her retired lifetime.
Although the contracts strive to achieve their goals, there can be no assurance
that the contracts will achieve them.
Nationwide will apply purchase rates set forth in the contracts to accumulated
amounts in participant accounts. These accumulated amounts reflect the
investment performance of the underlying mutual funds selected by the
participant. Consequently, a participants' retirement income payments are
directly affected by their investment choices under the contract. Historically,
the value of a diversified portfolio of common stocks held for an extended
period of time has tended to rise during periods of inflation. However, there is
no exact correlation and for some periods, the prices of securities have
declined while the cost of living was rising.
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MINIMUM PURCHASE PAYMENTS
Purchase payments made at any time by or on behalf of any participant must be at
least $20 per month.
CHARGES AND EXPENSES
Nationwide does not deduct a sales charge from purchase payments upon deposit
into the contracts. However, Nationwide may deduct a Contingent Deferred Sales
Charge ("CDSC") if any amount is withdrawn from the contract. This CDSC
reimburses Nationwide for sales expenses. The amount of the CDSC will not exceed
5% of purchase payments surrendered.
Nationwide may assess a Participant Account Maintenance Charge. This charge
varies from contract to contract and will not be assessed unless specifically
agreed upon by the contract owner and Nationwide. The maximum Participant
Account Maintenance Charge is $50 per year (see "Participant Account Maintenance
Charge").
Nationwide can deduct a Variable Account Annual Expense Fee at a maximum of
0.95% of the daily average account value. Nationwide can assess this fee in
return for bearing certain risks and administrative expenses. This fee is
negotiable and varies from contract to contract to reflect unique plan
characteristics.
The CDSC, Participant Account Maintenance Charge and Variable Account Annual
Expense Fee, when negotiated, may be decreased upon notice to the contract owner
(see "Modification of the Contract").
RETIREMENT INCOME PAYMENTS
Retirement income payments begin on the annuitization date. Payments are based
on the retirement income form chosen (see "Retirement Income Payments" and
"Retirement Income Forms").
TAXATION
How the contracts are taxed depends on the type of contract issued. Nationwide
will charge against the contract any premium taxes levied by any governmental
authority (see "Federal Tax Considerations" and "Premium Taxes").
NATIONWIDE LIFE INSURANCE COMPANY
Nationwide is a stock life insurance company organized under Ohio law in March,
1929, with its home office at One Nationwide Plaza, Columbus, Ohio 43215.
Nationwide is a provider of life insurance, annuities and retirement products.
It is admitted to do business in all states, the District of Columbia and Puerto
Rico.
NATIONWIDE INVESTMENT SERVICES CORPORATION
The contracts are underwritten and distributed by Nationwide Investment Services
Corporation ("NISC"), Two Nationwide Plaza, Columbus, Ohio 43215. NISC is a
wholly owned subsidiary of Nationwide.
INVESTING IN THE CONTRACT
THE VARIABLE ACCOUNT AND UNDERLYING MUTUAL FUNDS
The variable account is a separate account that invests in the underlying mutual
funds listed in Appendix A. Nationwide established the variable account on July
10, 1974 pursuant to Ohio law. Although the variable account is registered with
the SEC as a unit investment trust pursuant to the Investment Company Act of
1940 ("1940 Act"), the SEC does not supervise it or the management of
Nationwide.
Income, gains, and losses credited to, or charged against, the variable account
reflect the variable account's own investment experience and not the investment
experience of Nationwide's other assets. The variable account's assets are held
separately from Nationwide's assets and are not chargeable with liabilities
incurred in any other business of Nationwide. Nationwide is
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obligated to pay all amounts promised to contract owners under the contracts.
The variable account is divided into sub-accounts. Nationwide uses the assets of
each sub-account to buy shares of the underlying mutual funds based on contract
owner instructions.
Each underlying mutual fund's prospectus contains more detailed information
about that fund. Prospectuses for the underlying mutual funds should be read in
conjunction with this prospectus.
Voting Rights
Contract owners who have allocated assets to the underlying mutual funds are
entitled to certain voting rights. Nationwide will vote contract owner shares at
special shareholder meetings based on contract owner instructions. However, if
the law changes and Nationwide is allowed to vote in its own right, it may elect
to do so.
Contract owners with voting interests in an underlying mutual fund will be
notified of issues requiring the shareholders' vote as soon as possible before
the shareholder meeting. Notification will contain proxy materials and a form
with which to give Nationwide voting instructions. Nationwide will vote shares
for which no instructions are received in the same proportion as those that are
received.
The number of shares which a contract owner may vote is determined by dividing
the cash value of the amount they have allocated to an underlying mutual fund by
the net asset value of that underlying mutual fund. Nationwide will designate a
date for this determination not more than 90 days before the shareholder
meeting.
Material Conflicts
The underlying mutual funds may be offered through separate accounts of other
insurance companies, as well as through other separate accounts of Nationwide.
Nationwide does not anticipate any disadvantages to this. However, it is
possible that a conflict may arise between the interests of the variable account
and one or more of the other separate accounts in which these underlying mutual
funds participate.
Material conflicts may occur due to a change in law affecting the operations of
variable life insurance policies and variable annuity contracts, or differences
in the voting instructions of the contract owners and those of other companies.
If a material conflict occurs, Nationwide will take whatever steps are necessary
to protect contract owners and variable annuity payees, including withdrawal of
the variable account from participation in the underlying mutual fund(s)
involved in the conflict.
Substitution of Securities
Nationwide may substitute, eliminate, or combine shares of another underlying
mutual fund for shares already purchased or to be purchased in the future if
either of the following occurs:
1) shares of a current underlying mutual fund are no longer available for
investment; or
2) further investment in an underlying mutual fund is inappropriate.
No substitution, elimination, or combination of shares may take place without
the prior approval of the SEC and state insurance
departments.
STANDARD ACCOUNT CHARGES AND DEDUCTIONS
The charges and fees described in this section vary from contract to contract,
depending on plan characteristics and the particular needs and preferences of
contract owners. Generally, the charges and fees are negotiable. This
flexibility allows Nationwide and the contract owner to custom design a charge
structure that meets the financial goals of both the contract owners and
Nationwide.
While a contract is in effect, a circumstance may arise that would require a
re-negotiation of the contract terms. In this situation, charges and fees will
not be higher than those in effect before the re-negotiation. In other words,
the charges and fees
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of a re-negotiated contract may decrease, but under no circumstances will they
increase.
CONTINGENT DEFERRED SALES CHARGE
No sales charge is deducted from purchase payments when amounts are deposited
into the contracts. However, if any part of the contract is surrendered,
Nationwide will deduct a CDSC when applicable. The CDSC is used to cover sales
expenses, including commissions, production of sales material, and other
promotional expenses. If expenses are greater than the CDSC, Nationwide will
make up any shortfall from its general account.
If part or all of the contract value representing participant accounts that have
been established under the contract and held in the variable account for less
than 16 years is surrendered, a CDSC, when it is applicable, can be assessed by
Nationwide. The CDSC will not exceed 5% of purchase payments surrendered.
The total CDSC assessed to any participant will never exceed 5% (or a lesser
percentage, if applicable) of the total purchase payments made on behalf of the
participant for the 16 years before the surrender date.
When a CDSC of less than 5% is negotiated and assessed, the reduced charge may
reflect actual variations in expenses, usually resulting from reduced expenses
to Nationwide in connection with case acquisition costs, plan start-up expenses,
commissions and marketing expenses. Nationwide will not apply any deductions in
a discriminatory manner.
No CDSC will be assessed against distributions paid as:
o any life income payment option;
o designated period payment option of 5 or more years for a participant
who has a minimum of 5 participant account years before the beginning
of benefit payments; and
o a single-sum or periodic payment resulting from a participant's death.
PARTICIPANT ACCOUNT MAINTENANCE CHARGE
Nationwide may assess a Participant Account Maintenance Charge to reimburse it
for administrative expenses involved in issuing and maintaining the contracts.
The maximum Participant Account Maintenance Charge is $50. Nationwide will not
assess this charge unless it is negotiated and contractually agreed upon by
Nationwide and the contract owner.
Generally, by negotiating a higher Participant Account Maintenance Charge, a
contract owner can expect to lower other charges that are assessed in connection
with the contract. Conversely, a contract owner that negotiates a lower
Participant Account Maintenance Charge can expect to incur higher charges
elsewhere in the expense structure.
If a Participant Account Maintenance Charge is negotiated, it will be assessed
against each applicable participant in the plan. Nationwide will deduct the
charge from each participant's account on the participant anniversary, which is
the anniversary of the date accumulation units were first credited to the
participant's account. Each year's deduction will compensate Nationwide for
expenses incurred during the previous year. The deduction will occur during both
the accumulation and annuity payment periods.
The Participant Account Maintenance Charge is made by canceling a number of
accumulation units during both the accumulation and annuity periods, equal in
value to the applicable charge. If a participant account includes more than one
sub-account, the deduction will be allocated among sub-accounts on the basis of
relative values at the time the deduction is made.
On the date that a full withdrawal is taken from a participant's account,
Nationwide will deduct a pro-rated Participant Account Maintenance Charge. The
amount of the charge will be 1/12 of the applicable Participant Account
Maintenance Charge, multiplied by the number of whole or partial months between
the last participant anniversary (or participant effective
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date during the first year of a participant account) and the withdrawal date.
The deduction for the Participant Account Maintenance Charge will be taken
proportionately from each sub-account based on relative value at the time the
deduction is made.
This contract may be used by a plan in conjunction with other investment
options, such as Nationwide's Group Fixed Fund Retirement Contract. In this
case, the deduction for the Participant Account Maintenance Charge may be
reduced so that the combined total of the Participant Account Maintenance Charge
and any similar charges imposed under other investment options does not exceed
the Participant Account Maintenance Charge negotiated for this contract. The
charge will be deducted proportionately from the sub-accounts and amounts held
in the other investment options based on the relative values at the time the
deduction is made.
THE VARIABLE ACCOUNT MAINTENANCE CHARGE WILL NOT BE ASSESSED UNLESS NEGOTIATED
BETWEEN NATIONWIDE AND THE CONTRACT OWNER.
VARIABLE ACCOUNT ANNUAL EXPENSE FEE
Nationwide can deduct a Variable Account Annual Expense Fee up to an maximum
rate of 0.95% of average account value in exchange for assuming various risks
and administrative expenses associated with the contracts. This fee is subject
to negotiation and can vary for each contract to reflect unique plan
characteristics.
The following factors may be considered in negotiating the amount of this fee:
1) plan size;
2) the number of eligible employees;
3) the number of plan participants;
4) demographics of the plan participants;
5) general economic conditions;
6) the varying costs associated with the underlying mutual funds that are
offered in the contract;
7) the type of contract (e.g. allocated vs. unallocated);
8) distribution costs;
9) any recovery of credits on initial transfers; and
10) other factors Nationwide deems relevant.
PREMIUM TAXES
Nationwide may charge against the contract value any premium taxes levied by a
state or other government entity. Premium tax rates currently range from 0% to
3.5%. This range is subject to change. The method used to assess premium tax
will be determined by Nationwide at its sole discretion in compliance with state
law.
If applicable, Nationwide will deduct premium taxes from the contract either at:
(1) the time the contract is surrendered;
(2) annuitization; or
(3) such other date as Nationwide becomes subject to premium taxes.
Premium taxes may be deducted from death benefit proceeds.
CONTRACTS RIGHTS
The contract owner owns the contract for the exclusive benefit of the plan's
participants and beneficiaries. Contractual rights may be exercised by the
contract owner subject to those rights specifically reserved in the plan
documents for participants, either as a group or as individuals. The contract
owner may not take any action inconsistent with the rights of the plan's
participants. The contract may not be assigned except to accommodate a change in
state or federal law.
OPERATION OF THE CONTRACT
MINIMUM PURCHASE PAYMENTS
Purchase payments for each participant must be at least $20 per month. Payments
must be made no less frequently than monthly, unless Nationwide agrees
otherwise.
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APPLICATION OF PURCHASE PAYMENTS
Initial purchase payments allocated to sub-accounts will be priced at the
accumulation unit value determined no later than 2 business days after receipt
of an order to purchase if the application and all necessary information are
complete. If the application is not complete, Nationwide may retain a purchase
payment for up to 5 business days while attempting to complete it. If the
application is not completed within 5 business days, the prospective purchaser
will be informed of the reason for the delay. The purchase payment will be
returned unless the prospective purchaser specifically allows Nationwide to hold
the purchase payment until the application is completed.
Subsequent purchase payments will be priced based on the next available
accumulation unit value after the payment is received.
Purchase payments will not be priced when the New York Stock Exchange is closed
or on the following nationally recognized holidays:
o New Year's Day o Independence Day
o Martin Luther King, Jr. Day o Labor Day
o Presidents Day o Thanksgiving
o Good Friday o Christmas
o Memorial Day
Nationwide also will not price purchase payments if:
(1) trading on the New York Stock Exchange is restricted;
(2) an emergency exists making disposal or valuation of securities held in
the variable account impracticable; or
(3) the SEC, by order, permits a suspension or postponement for the
protection of security holders.
Rules and regulations of the SEC will govern as to when the conditions described
in (2) and (3) exist. If Nationwide is closed on days when the New York Stock
Exchange is open, contract value may be affected since the contract owner and
participant would not have access to their account.
ALLOCATION OF PURCHASE PAYMENTS
Nationwide allocates purchase payments to each participant's account as
instructed by the contract owner. Shares of the underlying mutual funds
allocated to the sub-accounts are purchased at net asset value, then converted
into accumulation units. The contract owner, or the participant if the plan so
permits, may change allocations among sub-accounts for future purchase payments.
However, no change may be made that would result in an amount less than 1% of
the purchase payments being allocated to any sub-account for any participant.
Nationwide will accept these changes as frequently as permitted by the plan. An
allocation change will not affect the allocation of purchase payments before the
change.
DETERMINING VARIABLE ACCOUNT VALUE - VALUING AN ACCUMULATION UNIT
Purchase payments or transfers allocated to sub-accounts are accounted for in
accumulation units. Accumulation unit values (for each sub-account) are
determined by calculating the net investment factor for the underlying mutual
funds for the current valuation period and multiplying that result with the
accumulation unit values determined on the previous valuation period.
Nationwide uses the net investment factor as a way to calculate the investment
performance of a sub-account from valuation period to valuation period. For each
sub-account, the net investment factor shows the investment performance of the
underlying mutual fund in which a particular sub-account invests, including the
charges assessed against that sub-account for a valuation period.
The net investment factor for any particular sub-account is determined by
dividing (a) by (b), and then subtracting (c) from the result, where:
(a) is:
(1) the net asset value of the underlying mutual fund as of the
end of the current valuation period; and
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(2) the per share amount of any dividend or income distributions
made by the underlying mutual fund (if the ex-dividend date
occurs during the current valuation period).
(b) is the net asset value of the underlying mutual fund determined as of
the end of the preceding valuation period.
(c) is a factor representing the daily variable account charges, which may
include charges for contract options chosen by the contract owner. The
factor is equal to an annual rate ranging from 0.00% to 0.95% of the
daily net assets of the variable account, depending on which contract
features a plan has chosen.
Based on the change in the net investment factor, the value of an accumulation
unit may increase or decrease. Changes in the net investment factor may not be
directly proportional to changes in the net asset value of the underlying mutual
fund shares because of the deduction of variable account charges.
Though the number of accumulation units will not change as a result of
investment experience, the value of an accumulation unit may increase or
decrease from valuation period to valuation period.
DETERMINING PARTICIPANT ACCOUNT VALUE
A participant's account value is equal to the sum of the value of all
accumulation units credited to the participant's account. The number of
accumulation units credited to each participant account for each sub-account is
determined by dividing the amount allocated to that sub-account for that
participant by the accumulation unit value for that sub-account for the
valuation period the purchase payment was received.
The value of a participant's account on any day can be determined by multiplying
the total number of accumulation units credited to the participant's account for
each sub-account by the current accumulation unit value for that sub-account.
Each participant and the contract owner will be advised periodically of the
number of accumulation units credited to his or her account for each
sub-account, the current accumulation unit values, and the total value of his or
her account. These reports are for informational purposes only and do not mean
that a participant has any rights in his or her account beyond those provided
for in the plan.
EXCHANGE PRIVILEGE
The contract owner, or the participant if the plan so provides, may exchange
amounts among the sub-accounts as frequently as permitted by the plan, subject
to the limits and rules set by each underlying mutual fund. Certain Plans may
impose limitations of participant exchange privileges as a consequence of
agreements entered into to purchase mutual funds or other investments unrelated
to the contract. If the contract owner elects an exchange privilege, there is no
charge for exchanges.
TRANSFER REQUESTS
In addition to submitting exchange requests in writing, the participant also may
make exchanges by telephone and the internet, provided that the contract owner
executes documents agreeing to certain restrictions applicable to these
privileges. Telephone and internet exchange requests must be received by
Nationwide by the close of the New York Stock Exchange in order to receive that
day's closing sub-account price.
Nationwide will use reasonable procedures to confirm that telephone and internet
instructions are genuine and will not be liable for following telephone or
internet instructions that it reasonably determined to be genuine. Nationwide
may withdraw the telephone and/or internet exchange privilege upon 30 days
written notice to contract owners and participants.
If Nationwide receives the transfer request before the end of a valuation date,
the transfer will receive the accumulation unit values of that date. However, if
Nationwide receives the transfer request after the close of business on a
valuation date, the transfer will receive the next valuation date's accumulation
unit value.
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For those plans funded by this contract and Nationwide's Group Fixed Fund
Retirement Contract, the contract owner, or the participant if the plan so
provides, may exchange values between any sub-account and the Group Fixed Fund
Retirement Contract. Exchanges from the Nationwide Group Fixed Fund Retirement
Contract to any sub-account will be subject to the limitations of the Nationwide
Group Fixed Fund Retirement Contract. Exchanges will be effective when received
in good order at Nationwide's home office.
EXPERIENCE CREDITS
Depending on the state in which the contract was issued, the contracts are
either participating or non-participating. Contract owners of participating
contracts have the right to receive any surplus distributed by Nationwide. A
surplus distribution will occur if Nationwide's Board of Directors determines
that charges and fees assessed under the contracts were higher than necessary to
maintain the contracts. Nationwide will distribute any surplus by purchasing
additional accumulation units and crediting them to participant accounts. To
date, Nationwide has not made any surplus distributions to participant accounts
and Nationwide does not guarantee that there will be a surplus distribution in
the future. Non-participating contracts do not have the right to receive surplus
distributions.
MODIFICATION OF THE CONTRACT
The following charges may be decreased, if negotiated, upon notice to the
contract owner:
o Contingent Deferred Sales Charge
o Participant Account Maintenance Charge
o Variable Account Annual Expense Fee
Nationwide may change any other provision of the contract by giving notice to
contract owners not less than 90 days before the change is to be effective.
CONTRACT SUSPENSION AND TERMINATION
Nationwide may suspend the contract at any time upon written notice to contract
owners if:
a) the contract owner fails to remit to Nationwide any purchase payment
specified in the plan; or
b) Nationwide rejects a plan amendment submitted by the contract owner
that Nationwide determines would adversely affect the contract's
financial experience.
The contract owner may suspend the contract at any time upon 90 days written
notice to Nationwide. Suspension will become effective on the 91st day after
Nationwide receives the notice. If a contract is suspended, Nationwide will not
accept new purchase payments, except by mutual consent. All other contract terms
will continue to apply.
Once the suspension is effective, the contract owner may, upon 30 days written
notice to Nationwide, terminate the contract. Termination will become effective
on the 31st day after Nationwide receives the notice. Upon termination,
Nationwide will pay the contract owner the value of the contract, in accordance
with the terms of the contract. This amount is subject to applicable charges
including CDSC.
REDEMPTION OF PARTICIPANT ACCOUNTS
The contract owner's right to redeem participant accounts, either fully or
partially, will be governed by the terms of the plan.
If the plan so permits, the contract owner may redeem a participant account,
fully or partially, at any time before retirement income payments begin under
Option B1 or B2 (see "Retirement Income Forms"). A partial redemption will not
affect requirements to make future purchase payments.
For partial redemptions, Nationwide will cancel accumulation units from the
sub-accounts. The requested dollar amount cannot exceed available accumulation
unit value. The contract owner
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must instruct Nationwide how the redemption should be taken from the
sub-accounts. If no instruction is given, the redemption will be taken
proportionately from each sub-account based on the value of each sub-account at
the time of the redemption.
Instead of a lump sum distribution of a full or partial redemption, the contract
owner (or participant, if permitted by the plan) may elect to have the
redemption paid pursuant to Retirement Income Form A1 or A2, subject to the
minimums applicable to these options.
If the contract owner terminates the contract, all participant accounts under
the contract will be redeemed as permitted by the plan. A CDSC may apply.
However, absent contract termination, no CDSC will apply to full or partial
redemptions.
Nationwide will pay all redemption amounts to the contract owner. The contract
owner is obligated to distribute these amounts to the participant. The contract
owner and Nationwide may agree to have Nationwide pay these amounts directly to
the participant.
Nationwide will pay any redemption amounts within 7 days of receiving the
redemption request. However, Nationwide may suspend or postpone payment when:
(1) the New York Stock Exchange is closed;
(2) trading on the New York Stock Exchange is restricted;
(3) an emergency is declared by the SEC making disposal or valuation of
securities held in the variable account impracticable; or
(4) the SEC, by order, permits a suspension or postponement for the
protection of security holders.
Rules and regulations of the SEC will govern as to when conditions described in
(2) and (3) exist. If Nationwide is closed on days when the New York Stock
Exchange is open, contract value could be affected since the contract owner and
participant would not have access to their account.
Participant account value upon full surrender may be more or less than the total
of all purchase payments.
RETIREMENT PERIOD
ADDITIONAL PURCHASE PAYMENT BEFORE BEGINNING RETIREMENT INCOME PAYMENTS
The contract owner may make one additional purchase payment to each
participant's account in order to increase retirement income payments. The
contract owner must notify Nationwide of this election in the documentation
electing the Retirement Income Form and retirement date (see "Election of
Retirement Income Form and Date"). The purchase payment must be made by the last
business day before retirement income payments begin. This purchase payment is
subject to any applicable premium taxes.
The annuity rates under the contract apply to the entire value, including any
such additional purchase payment that does not exceed 5 times the purchase
payments allocated to a participant's account before the date of notice is
given. Any amount in excess of this amount may be applied at annuity rates
currently offered to this type of contract.
RETIREMENT INCOME PAYMENTS
The distribution period is the period during which a participant account is paid
out in installments. Since the distribution period usually occurs after a
participant retires, it is also referred to as the retirement period.
Nationwide will pay all retirement distributions to the contract owner. The
contract owner is obligated to distribute these amounts to the participant. The
contract owner and Nationwide may agree to have Nationwide pay these amounts
directly to the participant.
Upon retirement, a participant's account value can be used to purchase either a
fixed dollar annuity, a variable payment annuity, or an available combination of
both.
Nationwide is obligated to make payments under a variable payment annuity.
However, the amount
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of each payment is not guaranteed. Variable payment amounts will reflect the
investment performance of the sub-accounts, but will not be affected by adverse
mortality experience or by increased expenses.
A fixed dollar annuity provides for payments that are guaranteed as to dollar
amount during the distribution period. Upon retirement, the participant's
account value is used to purchase a contract funded by Nationwide's general
account. Once this contract has been purchased, the participant's account will
no longer vary with the investment performance of the underlying mutual funds.
To determine the amount of the first fixed dollar annuity payment, the value is
applied to the applicable annuity table based on the distribution schedule
elected. The fixed payment annuity can be distributed in any of the forms listed
under the provision "Retirement Income Forms." Specifically, they can be
distributed as:
1) payments for a designated period;
2) payments of a designated amount;
3) life income with payment certain; or
4) joint and survivor life income.
Fixed dollar annuities are available under a plan upon the contract owner's
election.
ELECTION OF RETIREMENT INCOME FORM AND DATE
The contract provides for retirement income payments to begin on the date and
under the retirement options set forth in the plan. At least one month before
retirement income payments are set to begin, the contract owner may elect one of
the retirement income options set forth in this prospectus. Nationwide must
receive this election in writing. The plan may restrict changes in the
retirement income option elected.
If, at retirement, the present value of a participant's account is less than
$3,500, Nationwide may make a lump sum distribution instead of periodic
payments.
RETIREMENT INCOME FORMS
Retirement distributions may take any of the following forms, as permitted by
the plan:
AMOUNT AND PERIOD CERTAIN OPTIONS
Option A1: Payments for a Designated Period
Payments will be made monthly for a set number of years not to exceed 30
years. The amount of each payment will vary with the performance of the
underlying mutual funds in which the participant account invests. Nationwide
calculates each payment by multiplying (a) by (b), where:
(a) is the accumulation unit value on the day the payment is made; and
(b) is the number of accumulation units applied under this option divided
by the number of payments selected.
Once the amount of the payment is calculated, Nationwide will cancel
available accumulation units to equal the dollar amount of that payment.
Exchanges between the investment options are permitted subject to the
limitations set forth in the Group Fixed Fund Retirement Contract. Exchanges
may cause the number of accumulation units to change, necessitating a
recalculation of the payment amount.
If the period selected under this option is less than 5 years, and the
participant has less than 5 participant account years, a CDSC will be
assessed against each payment.
Option A2: Payments of a Designated Amount
Payments will be made monthly in equal installments of a set amount (not less
than $25 per month) until no accumulation units remain in the participant
account. The participant's account is adjusted each valuation date to reflect
investment results. Nationwide will cancel accumulation units up to the
designated dollar amount of the payment.
Exchanges between the investment options are permitted subject to the
limitations set forth in the Group Fixed Fund Retirement Contract.
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LIFE INCOME OPTIONS
For the following options, payments will be determined annually and will remain
level throughout the year. Each year, on the anniversary of the beginning of
retirement income payments, a new monthly payment will be determined. That new
payment will remain level for that year.
Nationwide will use the retired participant's adjusted age to determine each
year's set monthly payment. This adjusted age may not be the same as the retired
participant's actual age.
Life income options are based on:
o the mortality tables specified in the contract;
o the adjusted age of the retired participant;
o the type of retirement income payment option(s) selected; and
o in the case of variable payments, the investment performance of the
specific sub-accounts elected.
Option B1: Life Income with Payment Certain
Payments will be made at least annually during a participant's lifetime for a
set period of 60, 120, 180, 240, 300 or 360 months, as elected. If the
participant dies before the end of the selected period, level payments will
continue to the beneficiary during the remainder of the selected period.
Unless prohibited by the plan, the beneficiary may elect at any time to
receive the present value of the remaining number of payments in a single
payment, calculated using the same assumed investment rate used previously.
Nationwide will cancel accumulation units up to the designated dollar amount
of each payment.
Option B2: Joint and Survivor Life Income
Payments will be made monthly during the joint lifetime of a designated
annuitant and a named beneficary. Payments will be made as long as either of
the two is living. If the annuitant predeceases the beneficiary, payments
will continue to be paid to the beneficiary at 100%, 75%, 66 2/3% or 50% of
the original payment amount as elected until the beneficiary's death. If the
beneficiary predeceases the designated annuitant, payments will continue at
100% to the designated annuitant.
Nationwide will cancel accumulation units up to the designated dollar amount
of each payment.
Other Options
Alternate distribution methods may be used with Nationwide's consent.
Frequency of Payment
The retired participant, with the contract owner's consent, may receive payments
under any option annually, semi-annually, or quarterly instead of monthly. Any
change in frequency of payments must be on the anniversary of the beginning of
retirement income payments.
Withdrawal
If allowed by the plan, any amount remaining under option A1 or A2 may be
withdrawn. If that amount is at least $5,000, the withdrawn amount may be
applied to option B1 or B2, subject to minimum payment requirements.
DETERMINATION OF LIFE INCOME PAYMENTS
The amount of annuity payments will vary depending on the performance of the
underlying mutual funds selected.
Assumed Investment Rate
An assumed investment rate is the percentage rate of return assumed to determine
the amount of the first payment under a variable payment annuity. Nationwide
uses the assumed investment rate of 3.5% to calculate the first annuity payment
and to calculate the investment performance of an underlying mutual fund in
order to determine subsequent payments under a variable payment annuity. If not
prohibited by law, a contract owner may, at contract issuance, elect an
alternate assumed investment rate of 5% per annum. The choice of assumed
investment rate affects the pattern of retirement income payments. An assumed
investment rate is the percentage rate of return required to
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maintain level variable annuity payments. Subsequent years' variable annuity
payments may be more or less than the first payment based on whether actual
investment performance is higher or lower than the assumed investment rate.
Value of an Annuity Unit
Annuity unit values for sub-accounts are determined by multiplying the net
investment factor for the valuation period for which the annuity unit is being
calculated by the immediately preceding valuation period's annuity unit value,
and multiplying the result by an interest factor to neutralize the assumed
investment rate built into the variable payment annuity purchase rate basis in
the contracts.
First Years' Payments
To determine the payment that will be distributed monthly for the first year
after retirement, Nationwide first determines the participant's account value as
of the retirement date. This value is found by multiplying the number of
accumulation units in each sub-account for that participant's account by the
accumulation unit value for that sub-account on the last business day of the
second calendar week before the date the first payment will be made.
Based on the participant's account value, Nationwide then determines the amount
of each monthly payment. The monthly payment amount is found by dividing the
accumulation unit value of that sub-account in the participant's account by the
amount required to provide $1 per month (the purchase rate).
Once the monthly payment amount is found, Nationwide multiplies the payment by
12 to get the total payment for the year. Then Nationwide cancels the number of
accumulation units from the participant's account to equal the total payments
for the year. The accumulation units will be canceled from each sub-account in
the same proportion that new purchase payments are allocated. The value is then
transferred to Nationwide's general account from which monthly payments are
made.
The total annual amount is calculated so that if there are no partial
redemptions, and no underlying mutual fund dividends are taken in cash, the
monthly payments will be level as long as the net investment factor equals the
assumed investment rate plus an amount equal to the annual administrative
charge. Payments in subsequent years will vary depending on how the
sub-accounts' performance compares to the assumed investment rate.
Second and Subsequent Years' Payments
On each anniversary of the beginning of the retirement income payments, the
second year's monthly payment amount will be calculated. The calculation will be
performed in the same manner as the first year's payment, except that the
current participant account value will be used. Similarly, accumulation units
will be cancelled and the value will be transferred to Nationwide's general
account, from which monthly payments will be made. Subsequent years' payments
will be calculated in the same fashion on each anniversary date.
DEATH OF PARTICIPANT
PARTICIPANT DEATH BEFORE RETIREMENT
If a participant dies before beginning retirement income payments, a death
benefit equal to the participant's account value is payable as set forth in the
plan. The death benefit will be paid when Nationwide:
1) receives and verifies the participant's death; and
2) verifies beneficiary designations.
If the plan so provides, the beneficiary may receive the death benefit:
1) as a lump sum; or
2) in the form of a Retirement Income Form contained in the contract, subject
to applicable minimums. Retirement income payments may be fixed, variable,
or a combination of both.
DEATH OF RETIRED PARTICIPANT
If a retired participant dies while receiving payments, any payment due will be
determined
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<PAGE> 24
according to the Retirement Income Form elected. The calculation of the net
present value of any remaining payments under a period certain option will be
based on the same assumed investment rated used in determining the payments
before the retired participant's death.
The participant account will be reduced by the number of accumulation units not
required to provide further payments during the remainder of a period certain,
if any, or to a contingent retired participant. Depending on Nationwide's
obligation under the contract, the accumulation units will either remain in the
variable account or be transferred to Nationwide's general account.
FEDERAL TAX CONSIDERATIONS
Consult a financial adviser, legal counsel or tax adviser to discuss in detail
the taxation and the use of the contracts.
Nationwide does not guarantee the tax status of the contracts or any
transactions involving the contracts. The contracts are treated as a trust under
rules similar to Internal Revenue Code Section 401(f).
Under existing federal income tax law, Nationwide is not required to pay taxes
on the variable account's investment income when it is credited to contract
owners. Nationwide is taxed as a life insurance company under Part One,
Subchapter L of the Internal Revenue Code.
Contract owners would normally be taxed on income and capital gains earned under
the contract, whether or not taken in cash. However, the contracts are issued
only to organizations exempt from federal income tax.
Distributions will normally contain purchase payments that were not previously
included in the participant's gross income. Upon distribution, these amounts
should be included in the gross income of the recipient.
The contract owner is responsible for ensuring that the plan is established and
administered in accordance with the provisions set forth in the Internal Revenue
Code.
CONTRACTS ISSUED UNDER THE NEW YORK MODEL PLAN
In order to sell the contracts to governmental employers in the state of New
York, the following amendments must be made to the contract:
o References to "annuity" payments throughout the prospectus are modified
to mean "benefit" payments.
o The "Suspension and Termination" provision is amended to allow a
participant to "freeze" his or her account and maintain the account on
deposit with Nationwide even though the contract was terminated.
o All references to Life Retirement Income Forms A1, A2, B1 and B2
throughout this prospectus shall mean Option 1, Option 2, Option 3, and
Option 4, respectively.
o All references to "CDSC" and "Contingent Deferred Sales Charge"
throughout this prospectus are deleted.
STATEMENTS AND REPORTS
Nationwide (or a designee) will provide each participant a Statement of Assets,
Liabilities and Contract Owners' Equity and a Statement of Operations and
Changes in Contract Owners' Equity for the variable account at least
semi-annually. Nationwide will also provide annual and semi-annual reports
containing all applicable information and financial statements or their
equivalent, which must be sent to the underlying mutual fund beneficial
shareholders as required by the rules under the Investment Company Act of 1940
for the variable account.
Additionally, each participant and retired participant will receive periodic
reports on the value of his or her account.
Participants should review these reports carefully. All errors or corrections
must be reported to Nationwide immediately to assure proper crediting to the
contract. Unless Nationwide is notified within 30 days of receipt of the report,
Nationwide will assume all transactions are correct.
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<PAGE> 25
Nationwide will provide contract owners with the variable account's prospectus
to make available to participants. The contract owner may, under the terms of
the plan, be required to provide additional information to participants, such as
changes in the plan, changes in the tax status of the plan, or the financial
condition of the contract owner as it relates to obligations under the plan.
YEAR 2000 COMPLIANCE ISSUES
Nationwide has developed and implemented a plan to address issues related to the
Year 2000. The problem relates to many existing computer systems using only two
digits to identify a year in a date field. These systems were designed and
developed without considering the impact of the upcoming change in the century.
If not corrected, many computer systems could fail or create erroneous results
when processing information dated after December 31, 1999. Like many
organizations, Nationwide is required to renovate or replace computer systems so
that the systems will function properly after December 31, 1999.
Nationwide has completed an inventory and assessment of all computer systems and
has implemented a plan to renovate or replace all applications that were
identified as not Year 2000 compliant. Nationwide has renovated all applications
that required renovation. Testing of the renovated programs included running
each application in a Year 2000 environment and was completed as planned during
1998. For applications being replaced, Nationwide had all replacement systems in
place and functioning as planned by year-end 1998. Conversions of existing
traditional life policies will continue through second quarter, 1999. In
addition, the shareholder services system that supports our mutual fund products
will be fully deployed in the first quarter of 1999.
Nationwide has completed an inventory and assessment of all vendor products and
has tested and certified that each vendor product is Year 2000 compliant. Any
vendor products that could not be certified as Year 2000 compliant were replaced
or eliminated in 1998.
Nationwide has also addressed issues associated with the exchange of electronic
data with external organizations. Nationwide has completed an inventory and
assessment of all business partners including electronic interfaces. Processes
have been put into place and programs initiated to process data irrespective of
the format by converting non-compliant data into a Year 2000 compliant format.
Systems supporting Nationwide's infrastructure such as telecommunications, voice
and networks will be compliant by March 1999. Nationwide's assessment of Year
2000 issues has also included non-information technology systems with embedded
computer chips. Nationwide's building systems such as fire, security, and
elevators and escalators supporting facilities in Columbus, Ohio have been
tested and are Year 2000 compliant.
In addition to resolving internal Year 2000 readiness issues, Nationwide is
surveying significant external organizations (business partners) to assess if
they will be Year 2000 compliant and be in a position to do business in the Year
2000 and beyond. Specifically, nationwide has contacted mutual fund
organizations that provide funds for our variable annuity and life products. The
same action will continue during the first quarter of 1999 with wholesale
producers. Nationwide continues its efforts to identify external risk factors
and is planning to develop contingency plans as part of its ongoing risk
management strategy.
Operating expenses in 1998 and 1997 included approximately $44.7 million and
$45.4 million, respectively, for technology projects, including costs related to
Year 2000. Nationwide anticipates spending approximately $5 million on Year 2000
activities in 1999. These expenses do not have an effect on the assets of the
variable account and are not charged through to the contract owner.
Management does not anticipate that the completion of Year 2000 renovation and
replacement activities will result in a reduction in operating expenses. Rather,
personnel and resources currently allocated to Year 2000
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<PAGE> 26
issues will be assigned to other technology-related projects.
LEGAL PROCEEDINGS
Nationwide is a party to litigation and arbitration proceedings in the ordinary
course of its business, none of which is expected to have a material adverse
effect on Nationwide.
In recent years, life insurance companies have been named as defendants in
lawsuits, including class action lawsuits, relating to life insurance and
annuity pricing and sales practices. A number of these lawsuits have resulted in
substantial jury awards or settlements.
In February 1997, Nationwide was named as a defendant in a lawsuit filed in New
York state court related to the sale of whole life policies on a "vanishing
premium" basis (John H. Snyder v. Nationwide Life Insurance Co.). In April 1998,
Nationwide was named as a defendant in a lawsuit filed in Ohio state court
similar to the Snyder case (David and Joan Mishler v. Nationwide Life Insurance
Co.). In August 1998, Nationwide Mutual Insurance Company and Nationwide and the
plaintiffs executed a stipulation of settlement and submitted it to the New York
state court for approval. On August 20, 1998, the court in the Snyder case
signed an order preliminarily approving a class for settlement purposes (which
would include the Mishler case) and scheduled a fairness hearing for December
17, 1998. At that hearing, the court reviewed the fairness and reasonableness of
the proposed settlement and issued a final order and judgment. The approved
settlement provides for dismissal of both the Snyder and Mishler cases, bars
class members from pursuing litigation against Nationwide Mutual Insurance
Company and its affiliates, including Nationwide and its subsidiaries, relating
to the allegations in the Snyder case, and provides class members with a
potential value of approximately $100 million in policy adjustments, discounted
premiums and discounted products.
In November 1997, two plaintiffs, one who was the owner of a variable life
insurance policy and the other who was the owner of a variable annuity contract,
commenced a lawsuit in a federal court in Texas against Nationwide and the
American Century group of defendants (Robert Young and David D. Distad v.
Nationwide Life Insurance Company et al.). In this lawsuit, plaintiffs seek to
represent a class of variable life insurance policy owners and variable annuity
contract owners whom they claim were allegedly misled when purchasing these
variable contracts into believing that the performance of their underlying
mutual fund option managed by American Century, whose shares may only be
purchased by insurance companies, would track the performance of a mutual fund,
also managed by American Century, whose shares are publicly traded. The amended
complaint seeks unspecified compensatory and punitive damages. On April 27,
1998, the district court denied, in part, and granted, in part, Nationwide and
American Century's motions to dismiss the complaint. The remaining claims
against Nationwide allege securities fraud, common law fraud, civil conspiracy
and breach of contract. On December 2, 1998, the district court issued an order
denying plaintiffs' motion for class certification. On December 10, 1998, the
district court stayed the lawsuit pending plaintiffs' petition to the federal
appeals court for interlocutory review of the order denying class certification.
On December 14, 1998, plaintiffs filed their petition for interlocutory review,
on which the federal appeals court has not yet ruled. Nationwide intends to
defend the case vigorously.
On October 29, 1998, Nationwide and certain of its subsidiaries were named in a
lawsuit filed in Ohio state court related to the sale of deferred annuity
products for use as investments in tax-deferred contributory retirement plans
(Mercedes Castillo v. Nationwide Financial Services, Inc., Nationwide Life
Insurance Company and Nationwide Life and Annuity Insurance Company). The
plaintiff in such lawsuit seeks to represent a national class of Nationwide's
customers and seeks unspecified compensatory and punitive damages.
26
<PAGE> 27
Nationwide currently is evaluating this lawsuit, which has not been certified as
a class. Nationwide intends to defend this lawsuit vigorously.
There can be no assurance that any litigation relating to pricing or sales
practices will not have a material adverse effect on Nationwide in the future.
The general distributor, NISC, is not a party to any litigation of any material
nature.
ADVERTISING AND SUB-ACCOUNT PERFORMANCE SUMMARY
A "yield" and "effective yield" may be advertised for the Nationwide Money
Market Fund, NSAT - Money Market Fund, and the Dreyfus Cash Management Fund -
Class A. "Yield" is a measure of the net dividend and interest income earned
over a specific seven-day period (which period will be stated in the
advertisement) expressed as a percentage of the offering price of the fund's
units. Yield is an annualized figure, which means that it is assumed that funds
generate the same level of net income over a 52-week period. The "effective
yield" is calculated similarly but includes the effect of assumed compounding,
calculated under rules prescribed by the SEC. The effective yield will be
slightly higher than yield due to this compounding effect.
Nationwide may advertise the performance of a sub-account in relation to the
performance of other variable annuity sub-accounts, underlying mutual fund
options with similar or different objectives, or the investment industry as a
whole. Other investments to which the sub-accounts may be compared include, but
are not limited to:
o precious metals;
o real estate;
o stocks and bonds;
o closed-end funds;
o bank money market deposit accounts and passbook savings;
o CDs; and
o the Consumer Price Index.
Market Indexes
The sub-accounts will be compared to certain market indexes, such as:
o S&P 500;
o Shearson/Lehman Intermediate Government/Corporate Bond Index;
o Shearson/Lehman Long-Term Government/Corporate Bond Index;
o Donoghue Money Fund Average;
o U.S. Treasury Note Index;
o Bank Rate Monitor National Index of 2 1/2 Year CD Rates; and
o Dow Jones Industrial Average.
Tracking & Rating Services; Publications
Nationwide's rankings and ratings are sometimes published by other services,
such as:
o Lipper Analytical Services, Inc.,
o CDA/Wiesenberger,
o Morningstar,
o Donoghue's,
o magazines such as:
-- Money;
-- Forbes;
-- Kiplinger's Personal Finance Magazine;
-- Financial World;
-- Consumer Reports;
-- Business Week;
-- Time;
-- Newsweek;
-- National Underwriter; and
-- News and World Report;
o LIMRA;
o Value;
o Best's Agent Guide;
o Western Annuity Guide;
o Comparative Annuity Reports;
o Wall Street Journal;
o Barron's;
o Investor's Daily;
o Standard & Poor's Outlook; and
o Variable Annuity Research & Data Service (The VARDS Report).
These rating services and publications rank the underlying mutual funds'
performance against
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<PAGE> 28
other funds. These rankings may or may not include the effects of sales charges
or other fees.
Financial Rating Services
Nationwide is also ranked and rated by independent financial rating services,
among which are Moody's, Standard & Poor's and A.M. Best Company. Nationwide may
advertise these ratings. These ratings reflect Nationwide's financial strength
or claims-paying ability. The ratings are not intended to reflect the investment
experience or financial strength of the variable account.
Some Nationwide advertisements and endorsements may include lists of
organizations, individuals or other parties that recommend Nationwide or the
contract. Furthermore, Nationwide may occasionally advertise comparisons of
currently taxable and tax deferred investment programs, based on selected tax
brackets, or discussions of alternative investment vehicles and general economic
conditions.
Historical Performance of the Sub-Accounts
Nationwide will advertise historical performance of the sub-accounts. Nationwide
may advertise for the sub-account's standardized "average annual total return,"
calculated in a manner prescribed by the SEC, and nonstandardized "total
return." Average annual total return shows the percentage rate of return of a
hypothetical initial investment of $1,000 for the most recent one, five and ten
year periods (or for a period covering the time the underlying mutual fund has
been available in the variable account if it has not been available for one of
the prescribed periods). This calculation reflects the deduction of all charges
made to the contracts, except for premium taxes, which may be imposed by certain
states.
Nonstandardized "total return," calculated similar to standardized "average
annual total return," shows the percentage rate of return of a hypothetical
initial investment of $10,000 for the most recent one, five and ten year periods
(or for a period covering the time the underlying mutual fund has been in
existence). For those underlying mutual funds which have not been available for
one of the prescribed periods, the nonstandardized total return illustrations
will show the investment performance the underlying mutual funds would have
achieved (reduced by the same charges except the CDSC) had they been available
in the variable account for one of the periods. The CDSC is not reflected
because the contracts are designed for long term investment. The CDSC, if
reflected, would decrease the level of performance. An initial investment of
$10,000 is assumed because that amount is closer to the size of a typical
contract than $1,000, which is used in calculating the standardized average
annual total return.
The standardized average annual total return and nonstandardized total return
quotations are calculated using data for the period ended December 31, 1998.
However, Nationwide generally provides performance information more frequently.
Information relating to performance of the sub-accounts is based on historical
earnings and does not represent or guarantee future results.
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<PAGE> 29
SUB-ACCOUNT PERFORMANCE SUMMARY
STANDARDIZED AVERAGE ANNUAL TOTAL RETURN MONEY MARKET FUND
<TABLE>
<CAPTION>
CURRENT YIELD EFFECTIVE YIELD
SERIES OPTION PERIOD ENDING 12/31/98 PERIOD ENDING 12/31/98
<S> <C> <C>
Dreyfus Cash Management Fund - 1.90% 1.91%
Class A
Nationwide(R)Money Market Fund 3.74% 3.80%
NSAT-Money Market Fund 3.87% 3.95%
</TABLE>
STANDARDIZED AVERAGE ANNUAL TOTAL RETURN (OTHER THAN MONEY MARKET FUNDS)
<TABLE>
<CAPTION>
10 YEARS OR
DATE FUND
AVAILABLE IN
THE VARIABLE
1 YEAR 5 YEARS ACCOUNT
SERIES OPTION TO 12/31/98 TO 12/31/98 TO 12/31/98
<S> <C> <C> <C>
American Century: International Discovery Fund, Inc. - N/A N/A 74.80%
Investor Class
American Century: Income & Growth - Investor Fund N/A N/A 92.81%
American Century: Growth 25.48% 12.82% 14.53%
American Century: Ultra 23.27% 13.96% 13.67%
The Bond Fund of America(SM), Inc. -5.79% -0.50% 3.65%
Delaware Group Decatur Fund, Inc. - Decatur Income Fund -0.95% 11.89% 9.72%
Dreyfus Appreciation Fund, Inc. N/A N/A 69.51%
Dreyfus Premier Midcap Stock Fund - Class A N/A N/A 148.72%
Dreyfus S&P 500 Index Fund 16.87% N/A 21.38%
Dreyfus Third Century Fund, Inc. 18.94% 15.14% 9.28%
Evergreen Income and Growth Fund -11.40% 3.58% 5.04%
Federated Bond Fund - Class F N/A N/A 4.96%
Federated U. S. Government Securities Fund: 2-5 Years - -2.92% -1.22% -1.75%
Institutional Shares
Fidelity Advisor Growth Opportunities Fund - Class A N/A N/A 81.44%
Fidelity Advisor High Yield Fund - Class T N/A N/A 34.55
Fidelity Asset Manager(TM) 5.00% 5.19% 4.65%
Fidelity Capital & Income Fund -6.18% 1.37% 5.56%
Fidelity Contrafund 20.28% 15.61% 16.19%
Fidelity Equity-Income Fund 1.46% 12.53% 10.53%
Fidelity Magellan(R) Fund 22.36% 14.35% 13.60%
The Growth Fund of America(R) Inc. 20.53% 17.41% 11.27%
The Income Fund of America(R) -1.57% 7.84% 8.62%
INVESCO Dynamics Fund N/A N/A 225.01%
INVESCO Industrial Income Fund, Inc. (formerly Financial 3.05% 9.21% 9.53%
Industrial Income Fund, Inc.)
INVESCO Total Return N/A N/A 9.30%
Janus Fund 27.58% 14.99% 13.79%
LifeDesigns Series - The Aggressive Portfolio N/A N/A 5.90%
</TABLE>
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<PAGE> 30
STANDARDIZED AVERAGE ANNUAL TOTAL RETURN (CONTINUED)
<TABLE>
<CAPTION>
10 YEARS OR
DATE FUND
AVAILABLE IN
THE VARIABLE
1 YEAR 5 YEARS ACCOUNT
SERIES OPTION TO 12/31/98 TO 12/31/98 TO 12/31/98
<S> <C> <C> <C>
LifeDesigns Series - The Conservative Portfolio N/A N/A 1.44%
LifeDesigns Series - The Moderate Portfolio N/A N/A 5.23%
LifeDesigns Series - The Moderately Aggressive Portfolio N/A N/A 4.97%
LifeDesigns Series - The Moderately Conservative N/A N/A 3.73%
MAS Funds Fixed Income Portfolio -4.10% N/A 1.58%
Massachusetts Investors Growth Stock Fund - Class A 28.68% 18.70% 17.28%
MFS(R) Growth Opportunities Fund - Class A 17.95% 13.98% 11.88%
MFS(R) High Income Fund - Class A -9.68% 1.08% 3.53%
Morgan Stanley Institutional Fund, Inc. - Equity Growth N/A N/A 105.94%
Portfolio - Class B
Nationwide(R) Fund - Class D 19.11% 18.20% 14.33%
Nationwide(R) Growth Fund - Class D 12.58% 12.86% 9.82%
Nationwide(R) Money Market Fund -5.87% -2.26% -1.30%
Nationwide S&P 500(R) Index Fund N/A N/A 87.19%
NSAT - Small Company Fund N/A N/A -9.15%
Neuberger Berman Partners Trust N/A N/A 26.39%
Oppenheimer Global Fund/VA - Class A N/A N/A 105.60%
Prestige Balanced Fund N/A N/A 46.53%
Prestige International Fund N/A N/A 84.97%
Prestige Large Cap Growth Fund N/A N/A 159.56%
Prestige Large Cap Value Fund N/A N/A 34.00%
Prestige Small Cap Fund N/A N/A 82.70%
Putnam Investors Fund - Class A 24.24% 18.12% 15.64%
Putnam Voyager Fund - Class A 12.88% 13.98% 16.07%
Seligman Growth Fund, Inc. - Class A 23.96% 12.73% 12.83%
T. Rowe Price International Stock Fund(R) 5.04% 1.94% 3.80%
Templeton Foreign Fund - -15.25% -0.94% 4.31%
Class A
Warburg Pincus Emerging Growth Fund N/A N/A -4.10%
</TABLE>
30
<PAGE> 31
NON-STANDARDIZED AVERAGE ANNUAL TOTAL RETURN
(The total return figures shown below do not reflect the deduction of the
Participant Account Maintenance Charge or any applicable CDSC).
<TABLE>
<CAPTION>
10 YEARS OR
DATE FUND
WAS EFFECTIVE
TO 12/31/98
1 YEAR 5 YEARS
SERIES OPTION TO 12/31/98 TO 12/31/98
<S> <C> <C> <C>
American Century: International Discovery Fund, Inc. - Investor 16.25% N/A 15.96%
Class
American Century: Income & Growth - Investor Class 25.97% 22.17% 20.95%
American Century: Growth 34.98% 17.68% 17.35%
American Century: Ultra 32.77% 18.59% 22.65%
The Bond Fund of America(SM), Inc. 3.67% 5.13% 7.80%
Delaware Group Decatur Fund, Inc. - Decatur Income Fund 8.55% 16.39% N/A
Dreyfus Appreciation Fund, Inc. 29.11% 23.06% 17.11%
Dreyfus Premier Midcap Stock Fund - Class A 7.09% N/A 18.87%
Dreyfus S&P 500 Index Fund 26.37% 21.82% 15.70%
Dreyfus Third Century Fund, Inc. 28.44% 19.78% 15.40%
Evergreen Income and Growth Fund -2.23% 8.78% 9.15%
Federated Bond Fund - Class F 4.12% 6.01% 8.46%
Federated U. S. Government Securities Fund: 2-5 Years - 6.58% 4.49% 6.43%
Institutional Shares
Fidelity Advisor Growth Opportunities Fund - Class A 22.54% 19.30% 18.82%
Fidelity Advisor High Yield Fund - Class T -1.90% 7.35% 11.62%
Fidelity Asset Manager(TM) 14.50% 10.53% 12.55%
Fidelity Capital & Income Fund 3.26% 6.83% 9.74%
Fidelity Contrafund 29.78% 20.04% 22.65%
Fidelity Equity-Income Fund 10.96% 17.00% 14.26%
Fidelity Magellan(R) Fund 31.86% 18.93% 18.49%
The Growth Fund of America(R) Inc. 30.03% 18.49% 16.49%
The Income Fund of America(R) 7.93% 12.66% 12.48%
INVESCO Dynamics Fund 21.59% 17.46% 18.55%
INVESCO Industrial Income Fund, Inc. (formerly Financial Industrial 12.55% 14.05% 15.44%
Income Fund, Inc.)
INVESCO Total Return Fund 12.06% 14.71% 13.12%
Janus Fund 37.08% 19.59% 19.04%
MAS Funds Fixed Income Portfolio 5.40% 5.71% 8.36%
Massachusetts Investors Growth Stock Fund - Class A 38.18% 23.37% 20.22%
MFS(R) Growth Opportunities Fund - Class A 27.45% 18.58% 15.34%
MFS(R) High Income Fund - Class A -0.43% 6.45% 8.11%
Morgan Stanley Institutional Fund, Inc. - Equity Growth Portfolio 17.14% N/A 25.05%
- - Class B
LifeDesigns Series - The Aggressive Portfolio N/A N/A 15.90%
LifeDesigns Series - The Conservative Portfolio N/A N/A 11.44%
LifeDesigns Series - The Moderate Portfolio N/A N/A 15.23%
LifeDesigns Series - The Moderately Aggressive Portfolio N/A N/A 14.97%
LifeDesigns Series - The Moderately Conservative N/A N/A 13.73%
Nationwide(R) Fund - Class D 28.61% 22.57% 17.52%
Nationwide(R) Growth Fund - Class D 22.08% 17.41% 13.64%
Nationwide(R) Money Market Fund 3.58% 3.42% 3.83%
Nationwide S&P 500(R) Index Fund N/A N/A 95.06%
NSAT - Nationwide Small Company Fund -0.45% N/A 15.71%
Neuberger Berman Partners Trust 4.77% 16.66% 14.81%
Oppenheimer Global Fund/VA - Class A 11.14% 11.25% 12.93%
Prestige Balanced Fund N/A N/A 50.56%
</TABLE>
31
<PAGE> 32
<TABLE>
<CAPTION>
10 YEARS OR
DATE FUND
WAS EFFECTIVE
TO 12/31/98
1 YEAR 5 YEARS
SERIES OPTION TO 12/31/98 TO 12/31/98
<S> <C> <C> <C>
Prestige International Fund N/A N/A 37.31%
Prestige Large Cap Growth Fund N/A N/A 137.41%
Prestige Large Cap Value Fund N/A N/A 38.69%
Prestige Small Cap Fund N/A N/A 62.90%
Putnam Investors Fund - Class A 33.74% 22.55% 18.73%
Putnam Voyager Fund - Class A 22.38% 18.41% 18.91%
Seligman Growth Fund, Inc. - Class A 33.46% 17.49% 16.00%
T. Rowe Price International Stock Fund(R) 14.54% 7.38% 9.05%
Templeton Foreign Fund - Class A -6.29% 4.50% 9.24%
Warburg Pincus Emerging Growth Fund 4.32% 13.76% 15.11%
</TABLE>
32
<PAGE> 33
TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL INFORMATION
PAGE
General Information and History...............................................1
Services......................................................................1
Purchase of Securities Being Offered..........................................2
Underwriters..................................................................2
Calculations of Performance...................................................2
Annuity Payments..............................................................3
Financial Statements..........................................................4
33
<PAGE> 34
APPENDIX A: OBJECTIVES FOR UNDERLYING MUTUAL FUNDS
A summary of the investment objective for each underlying mutual fund is listed
below.
There is no guarantee that the investment objectives will be met.
THE FOLLOWING UNDERLYING MUTUAL FUNDS ARE AVAILABLE WHEN THE CONTRACTS ARE
ISSUED TO 457 DEFERRED COMPENSATION PLANS.
AMERICAN CENTURY: INTERNATIONAL DISCOVERY FUND (FORMERLY AMERICAN CENTURY -
TWENTIETH CENTURY INTERNATIONAL DISCOVERY FUND - INVESTOR CLASS)
The investment objective of the Fund is capital growth by investing primarily in
an internationally diversified portfolio of equity securities of issuers that
meet certain fundamental and technical standards of selection (relating
primarily to acceleration of earnings and revenues). The Fund will invest its
assets primarily in equity securities of small foreign issuers (those issuers
having, at the time of investment, a market capitalization of less than U.S. $1
billion or a public float of less than U.S. $500 million). The "public float" of
an issuer is defined as the aggregate market value of the issuer's outstanding
securities held by non-affiliates of the issuer. The Fund may invest up to 50%
of its assets in securities of issuers in emerging market countries. Due to the
significant risks associated with the Fund's investment strategy, an investment
in the Fund may not be appropriate for all investors. American Century
Investment Management, Inc. serves as the Fund's investment adviser.
AMERICAN CENTURY: INCOME & GROWTH - INVESTOR CLASS GROWTH
The investment objective of the Fund is to seek dividend growth, current income
and capital appreciation by investing in common stocks. The Fund may buy
securities convertible into common stock, such as convertible bonds, convertible
preferred stocks or warrants. The Fund may also, for liquidity purposes, invest
in high-quality money market instruments with remaining maturities of one year
or less. The Fund may also enter into repurchase agreements, collateralized by
U.S. government securities, with banks or broker-dealers deemed to present
minimal credit risk. American Century Investment Management, Inc. serves as the
Fund's investment adviser.
AMERICAN CENTURY: GROWTH (FORMERLY AMERICAN CENTURY: TWENTIETH CENTURY GROWTH)
The investment objective of the Fund is capital growth through investment in
securities which the management considers to have better-than-average prospects
for appreciation. It is management's intention that the portfolio will generally
consist of common stocks of large, established companies. American Century
Investment Management, Inc. serves as the Fund's investment adviser.
AMERICAN CENTURY: ULTRA (FORMERLY AMERICAN CENTURY: TWENTIETH CENTURY ULTRA)
The investment objective of the Fund is capital growth by investing primarily in
common stocks that are considered by management to have better-than-average
prospects for appreciation. It is management's intention that the portfolio will
generally consist of common stocks of medium-sized and smaller companies.
American Century Investment Management, Inc. serves as the Fund's investment
adviser.
DREYFUS APPRECIATION FUND, INC.
The primary investment objective of the Fund is to provide long-term capital
growth consistent with the preservation of capital. Current income is a
secondary investment objective. The Fund seeks to meet its objectives by
investing primarily in the common stocks of domestic and foreign issuers. The
Dreyfus Corporation serves as the Fund's investment adviser.
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<PAGE> 35
DREYFUS PREMIER MIDCAP STOCK FUND - CLASS A
The investment objective of the Fund is to seek total investment returns
(including capital appreciation and income) which consistently outperform the
Standard & Poor's 400 MidCap Index. The Fund attempts to maintain a diversified
holding in common stocks of medium capitalization companies (firms with a market
value between $200 million and $5 billion). The Dreyfus Corporation serves as
the Fund's investment adviser.
DREYFUS S&P 500 INDEX FUND
The Fund's objective is to provide investment results that correspond to the
price and yield performance of publicly-traded common stocks in the aggregate,
as represented by the Standard & Poor's 500 Composite Stock Price Index. The
Dreyfus Corporation serves as the Fund's investment adviser.
DREYFUS THIRD CENTURY FUND, INC.
The Fund's primary goal is to provide capital growth through equity investment
in companies that, in the opinion of the Fund's management, not only meet
traditional investment standards, but which also show evidence that they conduct
their business in a manner that contributes to the enhancement of the quality of
life in America. Current income is secondary to the primary goal. The Dreyfus
Corporation serves as the Fund's investment adviser.
EVERGREEN INCOME AND GROWTH FUND (FORMERLY EVERGREEN TOTAL RETURN FUND)
The investment objective of the Fund is current income and capital appreciation.
The Fund invests primarily in common and preferred stocks, securities
convertible into or exchangeable for common stocks, and fixed income securities.
The Fund's objective is to maximize the "total return" on its portfolio of
investments. Evergreen Asset Management Corp. serves as the Fund's investment
adviser.
FEDERATED BOND FUND - CLASS F
The investment objective of the Fund is to provide as high a level of current
income as is consistent with the preservation of capital. The Fund invests
primarily in a professionally managed, diversified portfolio of bonds. Under
normal circumstances, at least 65% of the Fund's net assets will be invested in
investment grade securities, including repurchase agreements collateralized by
investment grade securities. The Fund may invest in corporate debt obligations,
U.S. Government obligations, municipal securities, asset-backed securities,
adjustable rate mortgage securities, collateralized mortgage obligations, and
other securities which are deemed to be consistent with the Fund's investment
objectives. Federated Advisers serves as the Fund's investment adviser.
FEDERATED U.S. GOVERNMENT SECURITIES FUND: 2-5 YEARS - INSTITUTIONAL SHARES
The investment objective of the Fund is current income. The Fund pursues this
investment objective by investing in U.S. Government Securities with remaining
maturities of five years or less. Federated Management serves as the Fund's
investment adviser.
FIDELITY ADVISOR GROWTH OPPORTUNITIES FUND - CLASS A
The investment objective of the Fund is to pursue capital growth that exceeds
market performance through investments in growth, cyclical, and value stocks.
Fidelity Management & Research Company serves as the Fund's investment adviser.
FIDELITY ADVISOR HIGH YIELD FUND - CLASS T
The Fidelity Advisor High Yield Fund is a bond fund designed to meet the needs
of the long-term investor, seeking above-average monthly income and potential
capital growth by investing in lower-rated, high-yielding, fixed income
securities. Fidelity Management & Research Company serves as the Fund's
investment adviser.
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<PAGE> 36
FIDELITY ASSET MANAGER(TM)
The investment objective of the Fund is a high total return with reduced risk
over the long term by allocating its assets among domestic and foreign stocks,
bonds, and short-term instruments. Fidelity Management & Research Company serves
as the Fund's investment adviser.
FIDELITY EQUITY-INCOME FUND
The investment objective of the Fund is to obtain reasonable income from a
portfolio consisting primarily of income-producing equity securities. The Fund
seeks a yield which exceeds the composite yield on the securities comprising the
Standard & Poor's Composite Index of 500 Stocks. In pursuing this objective, the
Fund will also consider the potential for capital appreciation. Fidelity
Management & Research Company serves as the Fund's investment adviser.
FIDELITY GROWTH & INCOME PORTFOLIO
The investment objective of the Portfolio is to seek high total return through a
combination of current income and capital appreciation by investing mainly in
equity securities.
INVESCO DYNAMICS FUND
The investment objective of the Fund is to seek appreciation of capital through
aggressive investment policies. The Fund invests primarily in common stocks of
U.S. companies traded on national securities exchanges and over-the-counter. The
Fund also has the flexibility to invest in preferred stocks and convertible or
straight issues of debentures, as well as foreign securities. INVESCO Funds
Group, Inc. serves as the Fund's investment adviser
INVESCO INDUSTRIAL INCOME FUND, INC. (FORMERLY FINANCIAL INDUSTRIAL INCOME FUND,
INC.)
The investment objective of the Fund is to seek the best possible current income
while following sound investment practices by investing in securities which will
provide a relatively high yield and stable return and which, over a period of
years, may also provide capital appreciation. Capital growth potential is a
secondary factor in the selection of portfolio securities of the Fund. The Fund
invests in common stocks, as well as convertible bond and preferred stocks.
INVESCO Funds Group, Inc. serves as the Fund's investment adviser.
INVESCO TOTAL RETURN FUND
The investment objective of the Fund is to seek to achieve a high total return
on investment through capital appreciation and current income by investing in a
combination of equity securities (consisting of common stocks and, to a lesser
degree, securities convertible into common stock) and fixed income securities.
The equity securities purchased by the Fund generally will be issued by
companies which are listed on a national securities exchange and which usually
pay regular dividends. This Fund seeks reasonably consistent total returns over
a variety of market cycles. INVESCO Funds Group, Inc. serves as the Fund's
investment adviser. INVESCO Capital Management, Inc. serves as the Fund's
sub-adviser.
JANUS FUND
The Janus Fund is a diversified fund that seeks long-term growth of capital by
investing primarily in common stocks of a large number of issuers of any size.
Janus Capital's fundamental analysis and selection process focuses on stocks
with earnings growth potential that may not be recognized by the market. Such
securities are selected solely for their capital growth potential; investment
income is not a consideration. Janus Capital Corporation serves as the Fund's
investment adviser.
LIFEDESIGNS SERIES
LifeDesigns Series consists of five separate nondiversified funds each of which
is a separately managed nondiversified portfolio with its own investment
objective and policies. The objective of each of the Portfolios which is
fundamental, is to maximize total investment return (i.e. capital growth and
income) subject to investment restrictions and asset allocation policies. The
Portfolios will maximize total investment return as is specifically detailed in
36
<PAGE> 37
the following objectives which are non-fundamental and can be changed without
approval of a Portfolio's shareholders.
- THE AGGRESSIVE PORTFOLIO
The investment objective of this Fund is to provide growth of capital by
investing in underlying funds which invest primarily in equity securities
("Equity Funds"). This Fund is generally appropriate for investors seeking
higher returns over an investment time horizon of at least 15 years and
having a higher tolerance for market fluctuations. Nationwide Advisory
Services, Inc. ("NAS") serves as the Fund's investment adviser.
- THE MODERATELY AGGRESSIVE PORTFOLIO
The investment objective of this Fund is to provide growth of capital by
investing primarily in Equity Funds. However, the Fund attempts to reduce
its volatility by also investing in the Nationwide Contract and Proprietary
Funds which also invest primarily in fixed income securities ("Bond
Funds"). This Fund is generally appropriate for moderate investors seeking
high returns over an investment time horizon of 15 years or for more
aggressive investors with an investment time horizon of 10 to 15 years. NAS
serves as the Fund's investment adviser.
- THE MODERATE PORTFOLIO
The investment objective of this Fund is to provide growth of capital by
investing primarily in Equity Funds, but will also invest a significant
percentage of its assets in the Nationwide Contract and in Bond Funds. This
Fund is generally appropriate for moderate investors seeking moderate
returns over an investment time horizon of between 10 and 15 years;
conservative investors with an investment time horizon of at least 15 years
or more; and more aggressive investors with an investment time horizon of 5
to 10 years. NAS serves as the Fund's investment adviser.
- THE MODERATELY CONSERVATIVE PORTFOLIO
The investment objective of this Fund is to provide primarily income and,
secondarily, long term growth of capital. This Fund will seek to meet its
objectives by generally investing half of its assets in Equity Funds with
the remainder in the Nationwide Contract and Bond Funds. This Fund is
generally appropriate for moderate investors seeking lower fluctuations in
principal combined with some of the upside potential of equity investments
over an investment time horizon of between 5 and 10 years. This Fund is
also generally appropriate for conservative investors with an investment
time horizon of between 10 and 15 years and more aggressive investors with
an investment time horizon of less than 5 years. NAS serves as the Fund's
investment adviser.
- THE CONSERVATIVE PORTFOLIO
The investment objective of this Fund is to provide primarily income and,
secondarily, long term growth of capital. This Fund will seek to meet its
objectives by primarily investing in a combination of the Nationwide
Contract and Bond Funds, with a smaller investment in Equity Funds. This
Fund is generally appropriate for investors seeking low fluctuations in
principal over an investment time horizon of less than 5 years, as well as
more conservative investors with an investment time horizon of between 5
and 10 years. NAS serves as the Fund's investment adviser.
MASSACHUSETTS INVESTORS GROWTH STOCK FUND - CLASS A
The investment objective of the Fund is long-term growth of capital and future
income rather than current income. Massachusetts Financial Services Company
serves as the fund's investment adviser.
MAS FUNDS FIXED INCOME PORTFOLIO
The investment objective of the Fund is to achieve above-average total return
over a
37
<PAGE> 38
market cycle of three to five years, consistent with reasonable risk, by
investing in a diversified portfolio of U.S. Government securities, corporate
bonds (including bonds rated below investment grade commonly referred to as
"junk bonds"), foreign fixed-income securities and mortgage-backed securities of
domestic issuers and other fixed-income securities. The portfolio's average
weighted maturity will ordinarily be greater than five years. Miller Anderson &
Sherrerd, L.L.P. serves as the Fund's investment adviser.
MFS(R) GROWTH OPPORTUNITIES FUND - CLASS A (FORMERLY MFS(R) CAPITAL DEVELOPMENT
FUND)
The investment objective of the Fund is growth of capital. Dividend income, if
any, is incidental to the objective of capital growth. To achieve this
objective, a flexible approach toward types of companies as well as types of
securities is maintained by the Fund, depending upon the economic environment
and the relative attractiveness of the various securities markets. Massachusetts
Financial Services Company serves as the Fund's investment adviser.
MFS(R) HIGH INCOME FUND - CLASS A
The investment objective of the Fund is high current income by investing
primarily in a professionally managed diversified portfolio of fixed income
securities, some of which may involve equity features. Securities offering the
high current income sought by this Fund are ordinarily in the lower rating
categories of recognized rating agencies or are unrated and generally involve
greater volatility of price and risk of principal and income than securities in
the high rating categories. Capital growth, if any, is a consideration
incidental to the investment objective of high current income. Massachusetts
Financial Services Company serves as the Fund's investment adviser.
MORGAN STANLEY INSTITUTIONAL FUND, INC. - EQUITY GROWTH PORTFOLIO - CLASS B
The investment objective of the Portfolio is to seek long-term capital
appreciation by investing in growth-oriented equity securities of medium and
large capitalization companies. Equity securities include common and preferred
stocks, convertible securities and rights and warrants to purchase common
stocks. Under normal circumstances, the Portfolio will invest at least 65% of
the value of its total assets in equity securities. Morgan Stanley Dean Witter
Investment Management, Inc. serves as the Portfolio's investment adviser.
NATIONWIDE(R) FUND - CLASS D
The investment objective of the Fund is to seek total return through a flexible
combination of current income and capital appreciation. The Fund invests
primarily in common stocks, but also in convertible securities, other equity
securities, bonds and money market obligations. Nationwide Advisory Services,
Inc. serves as the Fund's investment adviser.
NATIONWIDE(R) MONEY MARKET FUND - PRIME SHARES
The investment objective of the Fund is to seek as high a level of current
income as is consistent with the preservation of capital and maintenance of
liquidity. The Fund invests in high-quality money market instruments maturing in
397 days or less. Nationwide Advisory Services, Inc. serves as the Fund's
investment adviser.
NATIONWIDE S&P 500(R) INDEX FUND - CLASS Y
The investment objective of the Fund is to provide investment results that
correspond to the price and yield performance of publicly traded common stocks
as represented by the Standard & Poor's 500 Composite Stock Price Index (the
"Index"). The Fund attempts to be fully invested at all times in stocks that
comprise the Index and stock index futures, and in any event, at least 80% of
the Fund's net assets will be invested in stocks comprising the Index.
Nationwide Advisory Services, Inc. serves as the Fund's investment adviser and
The Dreyfus Corporation is the Fund's sub-adviser.
"S&P 500(R)" has been licensed for use by Nationwide Advisory Services, Inc. The
Fund is not sponsored, endorsed, sold or promoted by Standard & Poor's and
Standard & Poor's
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<PAGE> 39
makes no representation regarding the advisability of investing in the Fund.
NATIONWIDE SEPARATE ACCOUNT TRUST - NATIONWIDE SMALL COMPANY FUND
The investment objective of the Fund is long-term growth of capital by investing
primarily in equity securities of domestic and foreign companies with market
capitalizations of less than $1 billion at the time of purchase. The
subadvisers, Dreyfus Corporation, Neuberger & Berman, L.P., Lazard Asset
Management, Strong Capital Management, Inc. and Warburg Pincus Asset Management,
Inc., were chosen because they utilize a number of different investment styles
when investing in small company stocks. By utilizing different investment
styles, the Fund's adviser, Nationwide Advisory Services, Inc., hopes to
increase prospects for investment return and to reduce market risk and
volatility.
NEUBERGER BERMAN PARTNERS TRUST
The investment objective of the Fund is to seek capital growth. The Fund invests
using a value-oriented approach to the selection of individual securities. The
Fund manager seeks capital growth through an investment approach that is
designed to increase capital with reasonable risk. Neuberger Berman Management,
Inc. serves as the Fund's investment adviser.
OPPENHEIMER GLOBAL FUND/VA - CLASS A
The investment objective of the Fund is to seek capital appreciation. The Fund
emphasizes investment in foreign and domestic securities considered by the
Fund's investment manager to have appreciation possibilities, primarily common
stocks or securities having investment characteristics of common stocks (such as
convertible securities) of "growth-type" companies. As a matter of fundamental
policy, under normal market conditions, the Fund will invest its total assets in
securities of issuers traded in markets in at least three different countries
(which may include the United States). The portfolio may also emphasize
securities of cyclical industries and "special situations" when the Fund's
manager believes that they present opportunities for capital growth.
OppenheimerFunds, Inc. serves as the Fund's investment adviser.
PRESTIGE BALANCED FUND - CLASS Y
The investment objective of the Fund is to provide a high total return from a
diversified portfolio of equity and fixed income securities. The Fund seeks to
provide a total return that approaches the total return of the universe of
equity securities of large and medium sized companies and that exceeds the
return typical of a portfolio of fixed income securities. Under normal market
conditions, the Fund will invest approximately 60% of its assets in equity
securities and 40% in fixed income securities. The equity securities will
primarily be securities of large and medium sized companies included in the
Standard & Poor's 500 Composite Stock Price Index, and the fixed income
securities will cover a range of fixed income sectors and securities, including
government, corporate, asset-backed and mortgage-backed securities. Nationwide
Advisory Services, Inc. serves as the Fund's investment adviser and J.P. Morgan
Investment Management Inc. is the Fund's sub-adviser.
PRESTIGE INTERNATIONAL FUND - CLASS Y
The investment objective of the Fund is capital appreciation. The Fund seeks to
accomplish its investment objective by investing primarily in equity securities
of non-United States companies that, in the opinion of its subadviser, are
inexpensively priced relative to the return on total capital or equity. The Fund
invests primarily in equity securities of non-United States companies. Under
normal market conditions, the Fund will invest at least 80% of the value of its
total assets in the equity securities of companies within at least three
different countries (not including the United States). Nationwide Advisory
Services, Inc. serves as the Fund's investment adviser and Lazard Asset
Management is the Fund's sub-adviser.
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<PAGE> 40
PRESTIGE LARGE CAP GROWTH FUND - CLASS Y
The investment objective of the Fund is long-term capital appreciation. The Fund
seeks to achieve its investment objective from a broadly diversified portfolio
of equity securities of large capitalization companies that are expected to have
better prospects for earnings growth than the growth rate of the general
domestic economy. Dividend income is a secondary objective. A large
capitalization company is a company with a market capitalization and industry
characteristics that are similar to companies in the Russell 1000(R) Growth
Index, which currently have market capitalizations that range from $1.4 billion
to $272 billion. Nationwide Advisory Services, Inc. serves as the Fund's
investment adviser and Goldman Sachs Asset Management is the Fund's sub-adviser.
PRESTIGE LARGE CAP VALUE FUND - CLASS Y
The investment objective of the Fund is to maximize total return, consisting of
both capital appreciation and current income. The Fund seeks to achieve its
investment objective by investing in U.S. equity securities that are currently
undervalued as determined by its subadviser. Under normal market conditions,
substantially all, but in no event less than 65% of the Fund's total assets will
be invested in equity securities of large capitalization U.S. companies,
including foreign companies whose securities are traded in the United States and
who comply with U.S. accounting standards. A large capitalization company is a
company with a market capitalization and industry characteristics that are
similar to companies in the Russell 1000(R) Value Index, which currently have
market capitalizations that range from $1.4 billion to $272 billion. Nationwide
Advisory Services, Inc. serves as the Fund's investment adviser and Brinson
Partners, Inc. is the Fund's sub-adviser.
PRESTIGE SMALL CAP FUND - CLASS Y
The investment objective of the Fund is long-term capital appreciation. The Fund
seeks to accomplish its investment objective from a broadly diversified
portfolio of equity securities issued by U.S. companies that have small market
capitalizations. Under normal market conditions, the Fund will invest at least
65% of its total assets in equity securities of companies whose market
capitalizations at the time of investment do not exceed 110% of the largest
company in the Russell 2000(R) Small Stock Index; these companies currently have
market capitalizations that range from $222 million to $1.4 billion. Nationwide
Advisory Services, Inc. serves as the Fund's investment adviser and INVESCO
Management & Research, Inc. serves as the Fund's sub-adviser, providing daily
portfolio management for the Fund.
PUTNAM INVESTORS FUND - CLASS A
The investment objective of the Fund is long-term growth of capital and any
increased income resulting from such growth. The Fund is designed for investors
seeking long-term growth of capital from a portfolio consisting primarily of
common stocks. The Fund's management emphasizes investment in quality growth
stocks. Putnam Investment Management, Inc. serves as the Fund's investment
adviser.
PUTNAM VOYAGER FUND - CLASS A
The investment objective of the Fund is capital appreciation. The Fund invests
primarily in common stocks believed by the Fund's Investment Manager, Putnam
Management, to have potential for capital appreciation significantly greater
than the market average. The Fund is designed for investors willing to assume
above-average risk in return for above-average capital growth potential. Putnam
Investment Management, Inc. serves as the Fund's investment adviser.
SELIGMAN GROWTH FUND, INC. - CLASS A
The investment objective of the Fund is longer-term growth in capital value and
an increase in future income. Fund assets have been invested primarily in common
stocks with the inherent investment risks tempered by portfolio diversification.
J. & W. Seligman & Co.,
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Incorporated serves as the Fund's investment adviser.
TEMPLETON FOREIGN FUND - CLASS A
The investment objective of the Fund is long-term capital growth through a
flexible policy of investing in stocks and debt obligations of companies and
governments outside the United States. Any income realized will be incidental.
Templeton Investment Counsel, Inc. serves as the Fund's investment adviser.
T. ROWE PRICE INTERNATIONAL STOCK FUND(R)
The Fund's objective is long-term growth of capital through investments
primarily in common stocks of established, non-U.S. companies. T. Rowe Price
Associates, Inc. serves as the Fund's investment adviser.
WARBURG PINCUS EMERGING GROWTH FUND
The investment objective of the Fund is maximum capital appreciation by
investing in equity securities of small-to-medium sized companies in the United
States with emerging or renewed growth potential. Warburg Pincus Asset
Management, Inc. serves as the Fund's investment adviser.
THE FOLLOWING UNDERLYING MUTUAL FUND IS NOT AVAILABLE TO NEW PLANS ESTABLISHED
ON OR AFTER JUNE 30, 1998:
FIDELITY CONTRAFUND
The investment objective of the Fund is capital appreciation by investing in
securities that its manager believes are undervalued due to an overly
pessimistic appraisal by the public. Although the Fund will usually be invested
primarily in common stocks and securities convertible into common stock, the
percentage of its assets invested in other securities may vary. Fidelity
Management & Research Company serves as the Fund's investment adviser.
THE FOLLOWING UNDERLYING MUTUAL FUND IS NOT AVAILABLE TO NEW CONTRACTS ISSUED ON
OR AFTER OCTOBER 1, 1997:
FIDELITY MAGELLAN (R) FUND
The investment objective of the Fund is capital appreciation by investing
primarily in common stock and securities convertible into common stock. The Fund
may also invest in foreign securities, which involves additional risks. The Fund
may also invest in stock index futures and options both of which can be volatile
investments. Fidelity Management & Research Company serves as the Fund's
investment adviser.
THE FOLLOWING UNDERLYING MUTUAL FUNDS ARE NOT AVAILABLE TO ALL CONTRACT OWNERS
ON OR AFTER JANUARY 1, 1994:
THE BOND FUND OF AMERICA(SM), INC.
The Fund's investment objective is to provide as high a level of current income
as is consistent with the preservation of capital. The Fund invests
substantially all of its assets in marketable corporate debt securities, U.S.
Government securities, mortgage-related securities, other asset-backed
securities and cash or money market instruments. Normally, at least 65% of the
Fund's assets will be invested in bonds.
THE GROWTH FUND OF AMERICA(R), INC.
The investment objective of the Fund is growth of capital. The realization of
current income will not be a consideration. The Fund seeks to achieve its
objective by investing in a diversified portfolio consisting primarily of common
stocks. However, assets may also be held in securities convertible into common
stocks, cash or cash equivalents, straight debt securities (including U.S.
Government securities), or nonconvertible preferred stocks. The Fund will
maintain at least 65% of the value of its total assets in growth-type securities
under normal market conditions.
THE INCOME FUND OF AMERICA(R), INC.
The investment objective is to emphasize current income while secondarily
striving to
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<PAGE> 42
attain capital growth. The Fund believes that a portfolio with relatively high
current income can also generate growth of capital.
THE FOLLOWING UNDERLYING MUTUAL FUND IS NOT AVAILABLE FOR NEW CONTRACTS ISSUED
ON OR AFTER AUGUST 1, 1993:
DELAWARE GROUP DECATUR FUND, INC.-DECATUR INCOME FUND
The investment Objective of the Fund is to achieve the highest possible current
income by investing primarily in common stocks that provide the potential for
income and capital appreciation without undue risk to principal.
THE FOLLOWING UNDERLYING MUTUAL FUND IS NOT AVAILABLE FOR NEW CONTRACTS ISSUED
ON OR AFTER JANUARY 1, 1987:
FIDELITY CAPITAL & INCOME FUND (FORMERLY FIDELITY HIGH INCOME FUND)
The investment objective of the Fund is to seek to provide a combination of
income and capital growth by investing primarily in debt instruments and common
and preferred stocks, with a focus on lower-quality debt securities and
securities of companies with uncertain financial positions.
Effective on and after May 1, 1991, Nationwide shall no longer permit contract
owners or participants to make additional purchase payments or to exchange
contract values into the Fidelity Capital & Income Fund (formerly Fidelity High
Income Fund) sub-account. However, contract values held in the Fidelity Capital
& Income Fund (formerly Fidelity High Income Fund) sub-account as of May 1, 1991
may continue to be invested in that sub-account. Unless Nationwide is notified
otherwise, any purchase payments or exchanges which the contract owner or
participants directs Nationwide to invest in the Fidelity Capital & Income Fund
(formerly Fidelity High Income Fund) sub-account on and after May 1, 1991 shall
instead be automatically invested in the Nationwide Money Market Fund
sub-account.
Nationwide has determined that further investment in the Fidelity Capital &
Income Fund (formerly Fidelity High Income Fund) sub-account is not in the best
interests of the contract owners and participants in view of the Fund's
adoption, effective for shares purchased on and after February 1, 1991, of a
redemption fee equal to 1.5% of the net asset value of any Fund shares redeemed
which are held less than twelve months. Any redemption fees which the Fund may
assess against Fund shares held by Nationwide in the variable account which were
purchased from February 1, 1991 to May 1,1991 shall be paid by Nationwide from
surplus and shall not be paid, directly or indirectly, by contract owners,
participants or the variable account.
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APPENDIX B
The information shown below illustrates different accumulation unit values for
each tier (current as of December 31 of the preceding year.) Additional
information is maintained in the Statement of Additional Information for this
prospectus. A Statement of Additional Information, as well as specific
information concerning the accumulation unit values for any particular plan, may
be obtained by calling Nationwide at 1-800-545-4730 or by writing to P.O. Box
16766, Columbus, Ohio 43216.
CONDENSED FINANCIAL INFORMATION
ACCUMULATION UNIT VALUES
(FOR AN ACCUMULATION UNIT OUTSTANDING THROUGHOUT THE PERIOD)
TIER I*
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.95%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
American Century: Growth 5.842997 7.915964 9,702,654 1998
Fund (formerly
Twentieth Century 4.562802 5.842997 23,886,079 1997
Growth) 4.005400 4.562802 12,224,812 1996
3.359891 4.005400 37,335,163 1995
3.443124 3.359891 41,134,943 1994
3.350122 3.443124 51,977,134 1993
3.533694 3.350122 58,356,370 1992
2.110582 3.533694 53,923,483 1991
2.216085 2.110582 67,311,152 1990
1.562983 2.216085 49,896,477 1989
American Century: Ultra Fund 2.524538 3.364568 70,804,264 1998
(formerly
Twentieth Century 2.069865 2.524538 132,438,228 1997
Ultra) 1.835553 2.069865 70,399,683 1996
1.345904 1.835553 105,140,475 1995
1.409710 1.345904 88,713,416 1994
1.168340 1.409710 68,551,255 1993
1.164722 1.168340 33,483,411 1992
1.000000 1.164722 11,412 1991
The Bond Fund 2.332586 2.429862 4,103,842 1998
of America(SM), Inc. 2.155739 2.332586 5,345,075 1997
2.039710 2.155739 3,518,054 1996
1.741422 2.039710 7,434,474 1995
1.850918 1.741422 7,880,903 1994
1.637181 1.850918 8,560,956 1993
1.484255 1.637181 6,077,266 1992
1.238222 1.484255 5,128,071 1991
1.208717 1.238222 5,102,901 1990
1.109668 1.208717 3,105,875 1989
</TABLE>
43
<PAGE> 44
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Delaware Group 2.935219 3.200994 68,865 1998
Decatur Fund, Inc. - 2.280210 2.935219 96,261 1997
Decatur Income Fund 1.910384 2.280210 78,578 1996
Institutional Class 1.449372 1.910384 100,636 1995
1.473401 1.449372 104,006 1994
1.289480 1.473401 281,500 1993
1.196471 1.289480 162,528 1992
0.991871 1.196471 106,856 1991
1.142606 0.991871 16,158 1990
1.000000 1.142606 0 1989
Dreyfus 3.532278 4.554448 42,486 1998
Third Century 2.756438 3.532278 10,221,038 1997
Fund, Inc. 2.238323 2.756438 3,824,949 1996
1.663803 2.238323 6,501,520 1995
1.814915 1.663803 6,965,653 1994
1.740666 1.814915 8,765,880 1993
1.723855 1.740666 9,137,872 1992
1.259983 1.723855 5,165,976 1991
1.228377 1.259983 4,118,236 1990
1.057519 1.228377 1,659,197 1989
Dreyfus S&P 500 Index 1.217658 2.683847 45,862 1998
Fund 1.000000 1.217658 15,653,811 1997
Evergreen 2.422617 2.380651 713,985 1998
Income and Growth 1.947502 2.422617 1,909,226 1997
Fund Class Y (formerly 1.741651 1.947502 1,146,375 1996
Evergreen Total 1.419467 1.741651 3,257,653 1995
Return Fund) 1.531292 1.419467 4,439,096 1994
1.368966 1.531292 7,948,202 1993
1.256090 1.368966 6,846,744 1992
1.031024 1.256090 7,328,719 1991
1.110904 1.031024 13,632,891 1990
0.959913 1.110904 10,256,138 1989
Federated U.S. 1.214470 1.300471 2,986,605 1998
Government 1.144380 1.214470 2,077,904 1997
Securities 1.115461 1.144380 1,214,422 1996
Fund: 2-5 Years - 0.991595 1.115461 1,877,483 1995
Institutional Shares 1.020623 0.991595 1,280,899 1994
1.000000 1.020623 696,793 1993
Fidelity Asset 1.517270 1.744805 3,453,740 1998
Manager(TM) 1.252704 1.517270 4,375,583 1997
1.121926 1.252704 2,611,685 1996
0.958564 1.121926 5,838,128 1995
1.036089 0.958564 3,916,306 1994
1.000000 1.036089 79,714 1993
</TABLE>
44
<PAGE> 45
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Fidelity Capital 4.654233 4.829318 86,372 1998
& Income Fund (formerly 4.096488 4.654233 294,820 1997
Fidelity High Income Fund) 3.712491 4.096488 125,230 1996
3.210584 3.712491 463,343 1995
3.397953 3.210584 561,985 1994
2.746533 3.397953 925,953 1993
2.165417 2.746533 1,032,492 1992
1.684020 2.165417 1,471,867 1991
1.768220 1.684020 4,160,164 1990
1.843890 1.768220 4,943,976 1989
Fidelity 2.509557 3.269491 67,920,295 1998
Contrafund 2.059778 2.509557 99,795,570 1997
1.705419 2.059778 56,288,590 1996
1.263308 1.705419 62,585,233 1995
1.289799 1.263308 40,927,857 1994
1.072342 1.289799 14,514,807 1993
1.000000 1.072342 186,872 1992
Fidelity 6.900916 7.691828 17,905,060 1998
Equity-Income 5.359692 6.900916 42,604,023 1997
Fund 4.471070 5.359692 18,493,235 1996
3.424310 4.471070 35,553,370 1995
3.448520 3.424310 34,056,352 1994
2.869860 3.448520 41,743,016 1993
2.526472 2.869860 36,410,831 1992
1.971024 2.526472 40,239,204 1991
2.314450 1.971024 65,533,870 1990
1.968876 2.314450 62,489,636 1989
Fidelity Magellan(R) 2.398961 3.175365 49,762,526 1998
Fund 1.913110 2.398961 95,356,893 1997
1.729361 1.913110 56,756,036 1996
1.275955 1.729361 92,049,788 1995
1.311856 1.275955 68,044,510 1994
1.062405 1.311856 43,203,753 1993
1.000000 1.062405 10,591,374 1992
The Growth 3.382686 4.415588 2,635,898 1998
Fund of 2.691979 3.382686 4,016,452 1997
America(R), Inc. 2.366626 2.691979 2,478,693 1996
1.840658 2.366626 6,716,573 1995
1.857739 1.840658 5,646,915 1994
1.638011 1.857739 5,353,392 1993
1.539692 1.638011 3,840,212 1992
1.144684 1.539692 1,551,711 1991
1.205372 1.144684 105,320 1990
1.000000 1.205372 0 1989
</TABLE>
45
<PAGE> 46
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
The Income 2.614863 2.835318 4,569,474 1998
Fund of 2.160929 2.614863 7,017,085 1997
America(R), Inc. 1.893327 2.160929 5,291,391 1996
1.480756 1.893327 8,645,811 1995
1.533299 1.480756 7,829,528 1994
1.357846 1.533299 7,258,704 1993
1.223786 1.357846 3,016,773 1992
0.998504 1.223786 631,336 1991
1.000000 0.998504 0 1990
INVESCO 2.102364 2.376817 7,930,211 1998
Industrial 1.678513 2.102364 10,884,376 1997
Income Fund, Inc. (formerly 1.451889 1.678513 7,428,110 1996
Financial Industrial Income 1.151056 1.451889 10,632,818 1995
Fund, Inc.) 1.208959 1.151056 8,239,738 1994
1.045472 1.208959 3,039,640 1993
1.000000 1.045472 17,289 1992
Janus Worldwide Fund 1.000000 1.241260 931,009 1998
MAS Funds Fixed 1.335173 1.413926 2,982,430 1998
Income Portfolio 1.229760 1.335173 1,990,827 1997
1.156444 1.229760 718,247 1996
0.980782 1.156444 366,064 1995
1.000000 0.980782 31,751 1994
Massachusetts 15.968069 22.143725 164,187 1998
Investors Growth 10.880822 15.968069 450,089 1997
Stock Fund - 8.942612 10.880822 164,786 1996
Class A 7.034148 8.942612 551,377 1995
7.613442 7.034148 604,020 1994
6.714892 7.613442 891,831 1993
6.368639 6.714892 914,534 1992
4.352449 6.368639 1,056,566 1991
4.612779 4.352449 1,577,501 1990
3.430876 4.612779 1,393,742 1989
MFS(R) Growth 9.012670 11.531693 419,655 1998
Opportunities 7.380232 9.012670 3,078,940 1997
Fund - Class A 6.114190 7.380232 843,158 1996
4.589533 6.114190 3,824,999 1995
4.834037 4.589533 4,635,532 1994
4.200054 4.834037 9,303,110 1993
3.936838 4.200054 10,600,796 1992
3.246855 3.936838 13,413,614 1991
3.427388 3.246855 23,047,089 1990
2.692907 3.427388 24,300,466 1989
</TABLE>
46
<PAGE> 47
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
MFS(R) High 6.168371 6.172749 146,644 1998
Income 5.518160 6.168371 633,922 1997
Fund - 4.949752 5.518160 164,395 1996
Class A 4.265493 4.949752 806,763 1995
4.422523 4.265493 877,250 1994
3.739642 4.422523 1,068,154 1993
3.225557 3.739642 1,036,507 1992
2.186959 3.225557 1,186,991 1991
2.651605 2.186959 2,159,639 1990
2.731036 2.651605 2,739,257 1989
Nationwide(R) 20.697282 26.722904 266,191 1998
Fund - Class D 14.964379 20.697282 3,635,254 1997
12.191058 14.964379 1,316,219 1996
9.468045 12.191058 2,905,460 1995
9.502760 9.468045 3,036,527 1994
8.985447 9.502760 3,690,273 1993
8.810680 8.985447 4,218,392 1992
6.830443 8.810680 3,906,633 1991
6.875188 6.830443 3,792,110 1990
5.187286 6.875188 2,756,965 1989
Nationwide(R) 3.854877 4.725203 945,925 1998
Growth Fund - Class D 3.083008 3.854877 2,582,538 1997
2.667201 3.083008 1,156,065 1996
2.092009 2.667201 3,668,270 1995
2.081399 2.092009 3,759,425 1994
1.887524 2.081399 5,928,120 1993
1.792687 1.887524 5,747,753 1992
1.330199 1.792687 5,108,711 1991
1.452973 1.330199 7,279,598 1990
1.276112 1.452973 4,762,338 1989
Nationwide(R) 3.003821 3.126448 239,031 1998
Money Market 2.884848 3.003821 18,830,414 1997
Fund*** 2.774433 2.884848 7,935,176 1996
2.654661 2.774433 20,350,850 1995
2.583387 2.654661 18,028,497 1994
2.542721 2.583387 20,122,594 1993
2.487178 2.542721 22,067,362 1992
2.377082 2.487178 33,612,374 1991
2.224557 2.377082 48,721,235 1990
2.062504 2.224557 43,599,432 1989
Putnam 18.110411 24.311753 571,765 1998
Investors 13.594501 18.110411 2,476,574 1997
Fund - 11.305164 13.594501 713,005 1996
Class A 8.297318 11.305164 3,422,356 1995
8.652501 8.297318 3,674,131 1994
7.410567 8.652501 4,311,483 1993
6.934213 7.410567 4,294,647 1992
5.445269 6.934213 4,745,398 1991
5.654203 5.445269 6,112,297 1990
4.262206 5.654203 5,893,052 1989
</TABLE>
47
<PAGE> 48
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Putnam Voyager 3.837109 4.715165 25,813,706 1998
Fund - Class A 3.074879 3.837109 35,911,119 1997
2.752130 3.074879 18,151,250 1996
1.982311 2.752130 21,036,155 1995
1.992379 1.982311 14,803,070 1994
1.698751 1.992379 11,820,145 1993
1.563079 1.698751 7,640,204 1992
1.049811 1.563079 4,622,048 1991
1.000000 1.049811 290,518 1990
Seligman 12.541848 16.801408 87,555 1998
Growth 10.720312 12.541848 227,045 1997
Fund, Inc. - 8.934609 10.720312 105,249 1996
Class A 7.020585 8.934609 277,527 1995
7.370495 7.020585 299,685 1994
6.989639 7.370495 513,220 1993
6.340967 6.989639 555,163 1992
4.611005 6.340967 685,494 1991
4.910683 4.611005 977,515 1990
3.714452 4.910683 916,525 1989
T. Rowe Price 1.843420 2.120702 7,543,129 1998
International 1.812062 1.843420 16,365,466 1997
Stock Fund(R) 1.577274 1.812062 8,220,403 1996
1.429428 1.577274 22,425,072 1995
1.454045 1.429428 18,673,315 1994
1.047655 1.454045 11,658,962 1993
1.095728 1.047655 4,370,293 1992
0.954695 1.095728 2,239,924 1991
1.000000 0.954695 441,232 1990
Templeton 1.874393 1.765910 0 1998
Foreign 1.774294 1.874393 43,044,777 1997
Fund - Class A 1.518092 1.774294 27,327,650 1996
1.378759 1.518092 32,915,364 1995
1.387073 1.378759 25,358,639 1994
1.023491 1.387073 6,636,629 1993
1.000000 1.023491 0 1992
</TABLE>
*For Plans converted to a Variable Account Annual Expense Fee of 0.95% of
average net assets on June 30, 1996.
***The 7-day yield on the Nationwide Money Market Fund as of December 31, 1997
was 3.74%.
****Unit information is not available for the year 1995.
48
<PAGE> 49
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER IIa*
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.90%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
American Century: Growth 5.846396 7.924525 3,294,508 1998
(formerly Twentieth Century 4.563176 5.846396 3,903,936 1997
Growth Fund) 4.005400 4.563176 4,398,109 1996
American Century: Ultra 2.526007 3.368207 19,448,936 1998
(formerly Twentieth Century 2.070035 2.526007 19,732,726 1997
Ultra) 1.835553 2.070035 18,056,950 1996
The Bond Fund 2.333980 2.432540 883,859 1998
of America(R), Inc. 2.155938 2.333980 844,897 1997
2.128763 2.155938 1,040,496 1996
Delaware Group 2.936925 3.204456 24,175 1998
Decatur Fund, Inc. - Decatur 2.280397 2.936925 15,400 1997
Income Fund 2.186556 2.280397 13,782 1996
Dreyfus S&P 500 Index Fund 1.218064 1.546121 6,127,205 1998
1.000000 1.218064 3,436,138 1997
Dreyfus 3.534332 4.559374 31,247 1998
Third Century Fund, Inc. 2.756663 3.534332 1,286,026 1997
2.699982 2.756663 967,536 1996
Evergreen 2.424026 2.383227 234,506 1998
Income and Growth 1.947661 2.424026 388,299 1997
Fund (formerly 1.875063 1.947661 470,751 1996
Evergreen Total Return
Fund)
Federated U.S. Government 1.215186 1.301894 748,333 1998
Securities Fund: 2-5 Years - 1.144477 1.215186 323,646 1997
Institutional Shares 1.140767 1.144477 342,284 1996
Fidelity Asset 1.518153 1.746693 666,704 1998
Manager(TM) 1.252806 1.518153 633,745 1997
1.214007 1.252806 671,795 1996
Fidelity Capital 4.656974 4.834602 26,735 1998
& Income Fund (formerly 4.096833 4.656974 36,724 1997
Fidelity High Income Fund) 4.015008 4.096833 77,649 1996
Fidelity 2.511017 3.273028 15,599,501 1998
Contrafund 2.059947 2.511017 15,968,503 1997
1.953469 2.059947 13,231,488 1996
Fidelity 6.904928 7.700147 6,047,814 1998
Equity-Income Fund 5.360130 6.904928 7,169,293 1997
5.110007 5.360130 6,443,316 1996
</TABLE>
49
<PAGE> 50
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Fidelity Magellan(R) 2.400356 3.178799 12,014,518 1998
Fund 1.913267 2.400356 11,589,048 1997
1.831563 1.913267 11,002,403 1996
The Growth 3.384653 4.420363 614,458 1998
Fund of America(R), Inc. 2.692199 3.384653 650,012 1997
2.519027 2.692199 553,730 1996
The Income 2.616384 2.838385 1,108,491 1998
Fund of America(R), Inc. 2.161106 2.616384 1,325,543 1997
2.072384 2.161106 1,137,681 1996
INVESCO 2.103587 2.379388 1,694,071 1998
Industrial Income Fund 1.678650 2.103587 1,917,268 1997
(formerly Financial 1.613178 1.678650 1,639,958 1996
Industrial Income Fund)
Janus Fund 1.950041 2.684144 6,455,407 1998
1.603421 1.950041 5,595,764 1997
1.550403 1.603421 4,109,624 1996
MAS Funds Fixed 1.335950 1.415456 320,011 1998
Income Portfolio 1.229861 1.335950 296,496 1997
1.215745 1.229861 193,871 1996
MFS(R) Growth 9.017913 11.544167 286,467 1998
Opportunities Fund-Class A 7.380837 9.017913 317,319 1997
7.065737 7.380837 361,634 1996
MFS(R) High 6.172004 6.179502 18,550 1998
Income Fund - Class A 5.518624 6.172004 25,730 1997
5.541012 5.518624 41,389 1996
Massachusetts 15.977352 22.167667 32,426 1998
Investors Growth 10.881713 15.977352 19,733 1997
Stock Fund - Class A 10.489691 10.881713 13,452 1996
Nationwide(R) 20.709316 26.751797 15,513 1998
Fund - Class D 14.965604 20.709316 509,179 1997
14.282052 14.965604 336,341 1996
Nationwide(R) 3.857119 4.730314 245,637 1998
Growth Fund - Class D 3.083261 3.857119 357,289 1997
2.916856 3.083261 386,199 1996
Nationwide(R) 3.005590 3.129869 0 1998
Money Market 2.885091 3.005590 6,441,740 1997
2.867462 2.885091 6,749,071 1996
Putnam 18.120944 24.338044 99,114 1998
Investors Fund - Class A 13.595614 18.120944 133,581 1997
13.246208 13.595614 153,709 1996
Putnam Voyager 3.839341 4.720266 5,838,788 1998
Fund - Class A 3.075131 3.839341 5,930,438 1997
3.055821 3.075131 5,117,342 1996
</TABLE>
50
<PAGE> 51
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Seligman Growth Fund, Inc. 12.549144 16.819578 3,139 1998
- - Class A 10.721190 12.549144 10,649 1997
10.356946 10.721190 17,582 1996
T. Rowe Price 1.844492 2.122997 1,638,194 1998
International Stock Fund(R) 1.812210 1.844492 1,859,130 1997
1.7255780 1.812210 1,718,457 1996
Templeton 1.875484 1.767822 0 1998
Foreign Fund - Class I 1.774439 1.875484 7,960,130 1997
1.678650 1.774439 6,594,135 1996
</TABLE>
*For Plans that converted from a Variable Account Annual Expense Fee of 0.95% of
average net assets to a Variable Account Annual Expense Fee of 0.90% of
average net assets on June 30, 1996.
**Unit information is not available for the year 1995.
51
<PAGE> 52
CONDENSED FINANCIAL INFORMATION (CONTINUED)
TIER III*
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.80%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
American Century Income & 1.000000 1.097595 109,503 1998
Growth Fund
American Century: Growth 5.853199 7.941675 3,767,251 1998
Fund (formerly 4.563925 5.853199 1,540,193 1997
Twentieth Century 4.555198 4.563925 1,586,526 1996
Growth Fund)
American Century: 1.000000 1.084264 83,975 1998
International Discovery
Fund
American Century: Ultra Fund 2.528946 3.375496 16,603,825 1998
(formerly Twentieth Century 2.070374 2.528946 11,990,091 1997
Ultra Fund) 2.055822 2.070374 9,866,856 1996
The Bond Fund 2.336766 2.437902 958,940 1998
of America(R), Inc. 2.156336 2.336766 379,522 1997
2.128822 2.156336 281,942 1996
Delaware Group 2.940341 3.211392 1,554 1998
Decatur Income Fund, 2.280770 2.940341 6,036 1997
Inc. - Decatur Income Fund 2.186573 2.280770 5,492 1996
Dreyfus Appreciation Fund 1.000000 1.080133 524,887 1998
Dreyfus Premier Midcap 1.000000 1.133283 10,469 1998
Stock - Class A
Dreyfus 3.538445 4.569241 5,543,237 1998
Third Century Fund, Inc. 2.757115 3.538445 912,241 1997
2.700004 2.757115 603,861 1996
Dreyfus S&P 500 Index 1.218878 1.548700 6,707,476 1998
Fund 1.000000 1.218878 2,297,690 1997
Evergreen Income and Growth 2.426846 2.388387 173,121 1998
Fund (formerly 1.947980 2.426846 79,190 1997
Evergreen Total Return Fund) 1.875078 1.947980 78,598 1996
Federated Bond Fund - Class F 1.000000 1.018687 55,483 1998
Federated U.S. Government 1.216616 1.304742 583,720 1998
Securities Fund: 2-5 Years - 1.144669 1.216616 188,738 1997
Institutional Shares 1.140779 1.144669 104,682 1996
Fidelity Advisor Growth 1.000000 1.089301 182,532 1998
Opportunities Fund - Class A
Fidelity Advisor High Yield 1.000000 1.064751 12,701 1998
Fund - Class T
Fidelity Asset 1.519919 1.750474 479,562 1998
Manager(TM) 1.253012 1.519919 299,273 1997
1.214017 1.253012 269,853 1996
Fidelity Capital 4.662457 4.845178 62,633 1998
& Income Fund (formerly 4.097522 4.662457 22,232 1997
Fidelity High Income Fund) 4.015052 4.097522 23,351 1996
</TABLE>
52
<PAGE> 53
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Fidelity 2.513939 3.280112 15,008,219 1998
Contrafund 2.060284 2.513939 9,637,261 1997
1.953485 2.060284 7,230,068 1996
Fidelity 6.912960 7.716814 4,932,169 1998
Equity-Income Fund 5.361008 6.912960 3,057,190 1997
5.110048 5.361008 2,555,440 1996
Fidelity Magellan(R) 2.403149 3.185678 8,905,129 1998
Fund 1.913580 2.403149 6,180,393 1997
1.831578 1.913580 5,622,628 1996
The Growth 3.388591 4.429930 516,513 1998
Fund of America(R), Inc. 2.692640 3.388591 496,036 1997
2.519048 2.692640 441,833 1996
The Income 2.619427 2.844529 945,389 1998
Fund of America(R), Inc. 2.161460 2.619427 490,571 1997
2.072401 2.161460 367,278 1996
INVESCO Dynamics 1.000000 1.172431 32,721 1998
Fund, Inc.
INVESCO Industrial Income 2.106034 2.384538 1,333,146 1998
Fund (formerly Financial 1.678925 2.106034 473,406 1997
Industrial Income Fund, Inc.) 1.613191 1.678925 309,576 1996
INVESCO Total Return Fund 1.000000 1.023668 53,415 1998
Janus Fund 1.952310 2.689953 8,036,789 1998
1.603684 1.952310 2,423,723 1997
1.550416 1.603684 1,634,700 1996
MAS Funds Fixed 1.337506 1.418521 552,980 1998
Income Portfolio 1.230062 1.337506 248,580 1997
1.215755 1.230062 87,227 1996
MFS(R) Growth 9.028407 11.569155 187,053 1998
Opportunities Fund - Class A 7.382046 9.028407 178,707 1997
7.065795 7.382046 181,406 1996
MFS(R) High Income Fund - 6.179271 6.193021 28,739 1998
Class A 5.519552 6.179271 6,564 1997
5.410180 5.519552 6,455 1996
Massachusetts 15.995935 22.215628 9,777 1998
Investors Growth 10.883496 15.995935 12,152 1997
Stock Fund - Class A 10.489775 10.883496 11,971 1996
Morgan Stanley Institutional 1.000000 1.106680 71,375 1998
Fund- Equity Growth
Portfolio - Class B
NSAT Nationwide Small 1.000000 1.022482 1,644,689 1998
Company Fund
Nationwide S&P 500 Index 1.000000 1.093550 299,188 1998
Fund-Class 4
Nationwide(R) 20.733404 26.809677 3,035,298 1998
Fund - Class D 14.968055 20.733404 329,293 1997
14.282168 14.968055 195,684 1996
</TABLE>
53
<PAGE> 54
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Nationwide(R) 3.861607 4.740553 308,068 1998
Growth Fund - Class D 3.083766 3.861607 93,047 1997
2.916880 3.083766 96,156 1996
Nationwide(R) 3.009129 3.136716 8,324,157 1998
Money Market 2.885576 3.009129 909,979 1997
2.867493 2.885576 901,408 1996
Neuberger & Berman Equity 1.000000 1.041831 40,394 1998
Trust Partners Trust
Oppenheimer Global Fund - 1.000000 1.106449 78,391 1998
Class A
Putnam Investors Fund - 18.142029 24.390710 75,040 1998
Class A 13.597842 18.142029 39,280 1997
13.246316 13.597842 38,905 1996
Putnam Voyager 3.843809 4.730485 5,319,237 1998
Fund - Class A 3.075635 3.843809 3,166,939 1997
3.055846 3.075635 2,559,117 1996
Seligman Growth Fund, Inc. - 12.563748 16.855977 16,244 1998
Class A 10.722947 12.563748 2,475 1997
10.357031 10.722947 2,396 1996
T. Rowe Price 1.846640 2.127594 1,798,986 1998
International Stock 1.812507 1.846640 1,036,525 1997
Fund(R) 1.725811 1.812507 931,357 1996
Templeton 1.877667 1.771651 21,282,916 1998
Foreign Fund - Class I 1.774730 1.877667 2,623,603 1997
1.678664 1.774730 2,061,896 1996
Warburg Pincus Emerging 1.000000 1.058940 26,076 1998
Markets Growth Fund
</TABLE>
* For Plans that converted from a Variable Account Annual Expense Fee of 0.95%
of average net assets to a Variable Account Annual Expense Fee of 0.80% of
average net assets on June 30, 1996.
**Unit information is not available for the year 1995.
54
<PAGE> 55
CONDENSED FINANCIAL INFORMATION
TIER IV*
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.70%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
American Century: Growth 5.860011 7.958862 0 1998
Fund (formerly Twentieth 4.564673 5.860011 758,360 1997
Century Growth Fund) 4.555235 4.564673 735,112 1996
American Century Income & 1.000000 1.097739 30,419 1998
Growth Fund
American Century 1.000000 1.084406 50,207 1998
International Discovery Fund
American Century: Ultra Fund 2.531889 3.382800 0 1998
(formerly Twentieth Centuy 2.070713 2.531889 4,964,637 1997
Ultra Fund) 2.055839 2.070713 3,956,021 1996
The Bond Fund 2.339554 2.443271 0 1998
of America(R), Inc. 2.156734 2.339554 55,496 1997
2.128881 2.156734 46,844 1996
Dreyfus Appreciation Fund 1.000000 1.080275 49,721 1998
Dreyfus Premier Midcap 1.000000 1.133431 5,430 1998
Stock - Class A
Dreyfus S&P 500 Index 1.219691 1.551283 0 1998
Fund 1.000000 1.219691 1,092,654 1997
Dreyfus 3.542562 4.579129 1,526,223 1998
Third Century Fund, Inc. 2.757567 3.542562 428,452 1997
2.700026 2.757567 244,163 1996
Evergreen 2.429669 2.393558 0 1998
Income and Growth 1.948299 2.429669 21,853 1997
Fund (formerly 1.875094 1.948299 27,416 1996
Evergreen Total Return
Fund)
Federated Bond 1.000000 1.018821 219,340 1998
Fund Class F
Federated U.S. Government 1.218047 1.307593 0 1998
Securities Fund: 2-5 Years - 1.144861 1.218047 114,003 1997
Institutional Shares 1.140792 1.144861 104,637 1996
Fidelity Advisor Growth 1.000000 1.089444 11,123 1998
Opportunities Fund - Class A
Fidelity Advisor High Yield 1.000000 1.064934 5,110 1998
Fund - Class T
Fidelity Asset 1.521688 1.754263 0 1998
Manager(TM) 1.253217 1.521688 538,872 1997
1.214027 1.253217 456,745 1996
Fidelity Capital 4.667941 4.855767 0 1998
& Income Fund (formerly 4.098210 4.667941 22,307 1997
Fidelity High Income Fund) 4.015097 4.098210 22,770 1996
</TABLE>
55
<PAGE> 56
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Fidelity 2.516865 3.287212 0 1998
Contrafund 2.060621 2.516865 4,750,222 1997
1.953501 2.060621 3,683,606 1996
Fidelity 6.921001 7.733517 0 1998
Equity-Income Fund 5.361886 6.921001 2,389,431 1997
5.110090 5.361886 1,989,159 1996
Fidelity Magellan(R) 2.405944 3.192571 0 1998
Fund 1.913894 2.405944 3,706,622 1997
1.831593 1.913894 3,295,811 1996
The Growth 3.392534 4.439517 0 1998
Fund of America(R), Inc. 2.693081 3.392534 170,540 1997
2.519069 2.693081 158,421 1996
The Income 2.622475 2.850687 0 1998
Fund of America(R), Inc. 2.161814 2.622475 294,406 1997
2.072418 2.161814 246,997 1996
INVESCO Dynamics Fund 1.000000 1.172584 505 1998
INVESCO Industrial Income 2.108484 2.389699 0 1998
Fund (formerly Financial 1.679200 2.108484 473,795 1997
Industrial Income Fund) 1.613204 1.679200 346,238 1996
INVESCO Total Return Fund 1.000000 1.023803 72,756 1998
Janus Fund 1.954582 2.695775 0 1998
1.603947 1.954582 2,404,760 1997
1.550428 1.603947 1,696,374 1996
MAS Funds Fixed 1.339063 1.421594 1998
Income Portfolio 1.230264 1.339063 91,023 1997
1.215765 1.230264 27,573 1996
MFS(R) Growth 9.038914 11.594198 0 1998
Opportunities Fund - Class A 7.383255 9.038914 5,735 1997
7.065853 7.383255 7,294 1996
MFS(R) High Income Fund - 6.186539 6.206555 0 1998
Class A 5.520479 6.186539 105 1997
5.410240 5.520479 130 1996
Massachusetts 16.014540 22.263692 0 1998
Investors Growth 10.885279 16.014540 285 1997
Stock Fund - Class A 10.489862 10.885279 280 1996
Morgan Stanley Institutional 1.000000 1.106825 5,955 1998
Fund - Equity Growth
Portfolio - Class B
LifeDesigns Series - The 1.000000 1.152311 2,046,802 1998
Aggressive Portfolio
LifeDesigns Series - The 1.000000 1.110341 289,939 1998
Conservative Portfolio
LifeDesigns Series - The 1.000000 1.145999 1,328,203 1998
Moderate Portfolio
</TABLE>
56
<PAGE> 57
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
LifeDesigns Series - The 1.000000 1.143522 806,901 1998
Moderately Aggressive
Portfolio
LifeDesigns Series - The 1.000000 1.131933 473,517 1998
Moderately Conservative
Portfolio
Nationwide(R) 20.757521 26.867683 803,944 1998
Fund - Class D 14.970505 20.757521 142,531 1997
14.282285 14.970505 54,398 1996
Nationwide(R) 3.866100 4.750814 0 1998
Growth Fund - Class D 3.084270 3.866100 339,294 1997
2.916904 3.084270 286,704 1996
Nationwide(R) 3.012668 3.143571 3,318,283 1998
Money Market 2.886060 3.012668 985,611 1997
2.867525 2.886060 1,141,686 1996
Nationwide S&P 500 1.000000 1.093694 22,552 1998
Index Fund
NSAT Nationwide Small 1.000000 1.023450 877,300 1998
Company Fund
Neuberger Berman 1.000000 1.041968 4,567 1998
Partners Trust
Oppenheimer Global Fund - 1.000000 1.106594 5,875 1998
Class A
Prestige Balanced Fund - 1.000000 1.061002 48,644 1998
Class Y
Prestige International Fund - 1.000000 1.092070 16,097 1998
Class Y
Prestige Large Cap Growth 1.000000 1.139564 52,478 1998
Fund - Class Y
Prestige Large Cap Value 1.000000 1.049429 7,620 1998
Fund - Class Y
Prestige Small Cap Fund - 1.000000 1.090386 31,273 1998
Class Y
Putnam Investors Fund - 18.163138 24.443490 0 1998
Class A 13.600069 18.163138 4,776 1997
13.246425 13.600069 4,735 1996
Putnam Voyager 3.848283 4.740725 0 1998
Fund - Class A 3.076140 3.848283 2,223,516 1997
3.055871 3.076140 1,979,411 1996
Seligman Growth Fund, Inc. - 12.578369 16.892454 0 1998
Class A 10.724703 12.578369 684 1997
10.357115 10.724703 684 1996
T. Rowe Price 1.848790 2.132200 0 1998
International Stock 1.812803 1.848790 783,958 1997
Fund(R) 1.725825 1.812803 881,585 1996
</TABLE>
57
<PAGE> 58
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Templeton 1.879853 1.775488 4,957,272 1998
Foreign Fund - Class A 1.775020 1.879853 1,763,615 1997
1.678677 1.775020 1,461,504 1996
Warburg Pincus Emerging 1.000000 1.059122 7,510 1998
Growth Fund
</TABLE>
* For Plans that converted from a Variable Account Annual Expense Fee of 0.95%
of average net assets to a Variable Account Annual Expense Fee of 0.70% of
average net assets on June 30, 1996.
**Unit information is not available for the year 1995.
58
<PAGE> 59
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER V*
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.65%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
American Century: Growth 5.866443 7.971577 8,602,720 1998
Fund (formerly Twentieth 4.567407 5.866443 6,244,941 1997
Century Growth Fund) 4.139808 4.567401 6,000,935 1996
American Century: Ultra Fund 2.534668 3.388204 35,694,678 1998
(formerly Twentieth Centuy 2.071951 2.534668 19,414,868 1997
Ultra Fund) 1.858002 2.071951 16,258,739 1996
The Bond Fund 2.342166 2.447231 1,599,096 1998
of America(R), Inc. 2.158056 2.342166 736,645 1997
2.057925 2.158056 471,875 1996
Decatur Income Fund - 1.000000 3.202651 169 1998
Institutional Class
Dreyfus S&P 500 Index Fund 1.000000 1.545632 5,191,876 1998
Dreyfus 3.546449 4.586444 2,794,245 1998
Third Century Fund, Inc. 2.759214 3.546449 2,302,999 1997
2.421004 2.759214 1,592,562 1996
Evergreen Income and Growth 2.432337 2.397384 431,682 1998
Fund (formerly 1.949465 2.432337 433,149 1997
Evergreen Total Return Fund) 1.797507 1.949465 494,994 1996
Federated U.S. Government 1.000000 1.301463 344,294 1998
Securities Fund: 2-5 Years -
Institutional Shares
Fidelity Capital & Income 4.673077 4.863557 85,411 1998
Fund (formerly Fidelity High 4.100654 4.673077 70,677 1997
Income Fund) 3.891882 4.100654 84,610 1996
Fidelity 2.519627 3.292464 16,051,389 1998
Contrafund 2.061853 2.519627 3,990,922 1997
1.834521 2.061853 1,600,079 1996
Fidelity Asset Manager 1.000000 1.745707 758,282 1998
Fidelity 6.928596 7.745874 11,315,425 1998
Equity-Income Fund 5.365090 6.928596 7,574,670 1997
4.792632 5.365090 6,613,425 1996
Fidelity Growth & 2.591531 3.303630 6,458,278 1998
Income Portfolio 2.003791 2.591531 3,435,213 1997
1.788691 2.003791 1,071,573 1996
Fidelity Magellan(R) 2.408585 3.197672 26,173,266 1998
Fund 1.915038 2.408585 16,840,881 1997
1.732300 1.915038 15,847,180 1996
</TABLE>
59
<PAGE> 60
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
The Growth Fund of America 1.000000 4.417868 397,583 1998
The Income Fund of America 1.000000 2.836785 403,926 1998
INVESCO Industrial Income 1.000000 2.378046 660,119 1998
Fund, Inc.
Janus Fund 1.000000 2.682628 4,344,666 1998
MAS Funds - Fixed Income 1.000000 1.414658 283,874 1998
Portfolio
MFS(R) Growth 9.048839 11.612729 2,162,443 1998
Opportunities Fund - Class A 7.387670 9.048839 1,999,203 1997
6.482021 7.387670 2,053,995 1996
MFS(R) High Income Fund - 6.193345 6.216512 664,163 1998
Class A 5.523771 6.193345 500,487 1997
5.237254 5.523771 466,255 1996
Massachusetts 16.032114 22.299259 262,889 1998
Investors Growth 10.891785 16.032114 271,730 1997
Stock Fund - Class A 9.620839 10.891785 270,135 1996
Nationwide(R) 3.870345 4.758406 1,367,643 1998
Growth Fund - Class D 3.086114 3.870345 658,443 1997
2.801588 3.086114 517,548 1996
Nationwide(R) 3.015983 3.148614 4,349,555 1998
Money Market 2.887782 3.015983 3,131,282 1997
2.848502 2.887782 3,694,679 1996
Neuberger Berman 1.601873 1.628931 923,269 1998
Guardian Fund, Inc. 1.367075 1.601873 614,486 1997
1.203016 1.367075 109,076 1996
Putnam 18.183069 24.482535 2,271,192 1998
Investors Fund - Class A 13.608194 18.183069 1,771,233 1997
12.172007 13.608194 1,571,300 1996
Putnam Voyager 3.852510 4.748304 6,536,365 1998
Fund - Class A 3.077980 3.852510 1,528,999 1997
2.937103 3.077980 990,216 1996
</TABLE>
60
<PAGE> 61
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Seligman 12.592179 16.919446 108,084 1998
Growth Fund, Inc. - Class A 10.731114 12.592179 113,689 1997
9.693645 10.731114 121,166 1996
T. Rowe Price 1.850821 2.135609 5,964,541 1998
International Stock 1.813888 1.850821 4,875,751 1997
Fund(R) 1.686337 1.813888 5,512,814 1996
Templeton 1.881918 1.778328 1,352,884 1998
Foreign Fund - Class A 1.776082 1.881918 1,092,861 1997
1.628310 1.776082 168,098 1996
</TABLE>
* For Plans that converted from a Variable Account Annual Expense Fee of 0.95%
of average net assets to a Variable Account Annual Expense Fee of 0.65% of
average net assets on June 30, 1996.
**Unit information is not available for the year 1995.
61
<PAGE> 62
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER VI
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.60%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
American Century 1.000000 7.951067 194,830 1998
Growth Fund
American Century Ultra Fund 1.000000 3.379488 1,072,286 1998
The Bond Fund of America, 1.000000 2.440904 82,948 1998
Inc.
Delaware Group Decatur Fund, 1.000000 3.215194 6,112 1998
Inc. Decatur Income Fund
Institutional Class
Dreyfus S&P 500 Index Fund 1.000000 1.550532 1,251,281 1998
Evergreen Income and Growth 1.000000 2.391215 2,788 1998
Fund - Class Y
Federated U.S. Government 1.000000 1.306298 71,515 1998
Securities Fund: 2-5 Years -
Institutional Shares
Fidelity Asset Manager 1.000000 1.752545 53,124 1998
Fidelity Contrafund 1.000000 3.283991 979,826 1998
Fidelity Equity Income 1.000000 7.725951 170,677 1998
Fund
Fidelity Magellan Fund 1.000000 3.189445 683,273 1998
The Growth Fund of America 1.000000 4.435169 162,774 1998
The Income Fund of America 1.000000 2.847897 153,954 1998
INVESCO Industrial Income 1.000000 2.387360 90,551 1998
Fund, Inc.
Janus Fund 1.000000 2.693134 627,794 1998
MAS Funds - Fixed Income 1.000000 1.420201 118,670 1998
Portfolio
LifeDesigns Series - The 1.000000 1.154520 310,655 1998
Aggressive Portfolio
LifeDesigns Series - The 1.000000 1.112468 66,069 1998
Conservative Portfolio
LifeDesigns Series - The 1.000000 1.148195 106,065 1998
Moderate Portfolio
LifeDesigns Series - The 1.000000 1.145713 259,760 1998
Moderately Aggressive
Portfolio
LifeDesigns Series - The 1.000000 1.134101 50,620 1998
Moderately Conservative
Portfolio
Nationwide Growth Fund 1.000000 4.746163 1,583 1998
Prestige Large Cap Growth 1.000000 1.139173 2,573 1998
Fund - Class Y
Prestige Small Cap Fund - 1.000000 1.090529 4,696 1998
Class Y
Putnam Investors Fund - 1.000000 24.419553 4,084 1998
Class A
</TABLE>
62
<PAGE> 63
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Putnam Voyager Fund - Class 1.000000 4.736081 454,607 1998
A
T. Rowe Price International 1.000000 2.130112 126,263 1998
Stock Fund
</TABLE>
63
<PAGE> 64
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER VII
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.55%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
American Century Income & 1.000000 1.097955 8,687 1998
Growth
American Century 1.000000 1.084619 6,011 1998
International Discovery Fund
The Bond Fund of America 1.000000 2.437786 82,138 1998
Dreyfus Appreciation 1.000000 1.080487 136,346 1998
Fund, Inc
Dreyfus Premier Midcap Stock 1.000000 1.133654 914 1998
- - Class A
Dreyfus S&P 500 Index Fund 1.000000 1.549323 153,801 1998
The Dreyfus Third Century 1.000000 4.557584 1,265,956 1998
Fund, Inc.
Evergreen Income and Growth 1.000000 2.388169 91,000 1998
Fund - Class Y
Federated U.S. Government 1.000000 1.304613 62,224 1998
Securities Fund: 2-5 Years
Institutional Shares
Fidelity Advisor Growth 1.000000 1.089659 87,134 1998
Opportunities Fund - Class A
Fidelity Asset Manager 1.000000 1.750311 28,644 1998
Fidelity Contrafund 1.000000 3.279805 557,635 1998
Fidelity Equity Income Fund 1.000000 7.716109 99,286 1998
Fidelity Magellan Fund 1.000000 3.185381 308,121 1998
The Growth Fund of America 1.000000 4.429517 28,933 1998
The Income Fund of America 1.000000 2.844269 49,186 1998
INVESCO Dyanamics 1.000000 1.172815 14,593 1998
Fund, Inc.
INVESCO Industrial Income 1.000000 2.384319 158,514 1998
Fund, Inc.
INVESCO Total Return Fund 1.000000 1.024005 2,474 1998
MAS Funds - Fixed Income 1.000000 1.418390 15,856 1998
Portfolio
Massachusetts Investors 1.000000 22.213562 1,109 1998
Growth Stock Index Fund -
Class A
MFS Growth Opportunities 1.000000 11.568078 16,642 1998
Fund - Class A
MFS High Income 1.000000 6.192408 2,329 1998
Fund - Class A
Morgan Stanley Equity Growth 1.000000 1.107043 7,861 1998
Portfolio - Class B
Nationwide Fund - Class D 1.000000 26.741341 940,065 1998
Nationwide Growth Fund - 1.000000 4.740115 31,4895 1998
Class D
</TABLE>
64
<PAGE> 65
CONDENSED FINANCIAL INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
Nationwide Money 1.000000 3.136406 3,511,177 1998
Market Fund
Nationwide S&P 500 Index 1.000000 1.093909 112,981 1998
Fund - Class Y
NSAT Nationwide Small 1.000000 1.007001 528,402 1998
Company Fund
Oppenheimer Global Fund - 1.000000 1.106811 11,480 1998
Class A
Putnam Investors Fund - 1.000000 24.388433 10,786 1998
Class A
Seligman Growth Fund, Inc. 1.000000 16.854407 1,971 1998
Class A
T. Rowe Price International 1.000000 2.127397 85,069 1998
Stock Fund
Templeton Foreign Fund - 1.000000 1.767129 5,105,892 1998
Class A
Warburg Pincus Emerging 1.000000 1.059668 21,363 1998
Growth Fund
</TABLE>
65
<PAGE> 66
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER VIII
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.45%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
LifeDesigns Series - The 1.00000 1.150582 211,944 1998
Aggressive Portfolio
LifeDesigns Series - The 1.000000 1.108677 80,765 1998
Conservative Portfolio
LifeDesigns Series - The 1.000000 1.144281 80,286 1998
Moderate Portfolio
LifeDesigns Series - The 1.000000 1.141807 155,701 1998
Moderately Aggressive
Portfolio
LifeDesigns Series - The 1.000000 1.130236 230,674 1998
Moderately Conservative
Portfolio
Prestige Balanced Fund - 1.000000 1.061351 3,404 1998
Class Y
Prestige International Fund - 1.000000 1.092427 1,317 1998
Class Y
Prestige Large Cap Growth 1.000000 1.139937 1,307 1998
Fund - Class Y
Prestige Large Cap Value 1.000000 1.049773 2,293 1998
Fund - Class Y
Prestige Small Cap Fund - 1.000000 1.090743 946 1998
Class Y
</TABLE>
66
<PAGE> 67
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER IX
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.40%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
American Century Income & 1.000000 1.098171 79,664 1998
Growth Fund
American Century Growth Fund 1.000000 7.923462 3,508 1998
American Century 1.000000 1.084832 26,496 1998
International Discovery Fund
Dreyfus Appreciation Fund, 1.000000 1.080700 27,993 1998
Inc.
The Dreyfus Third Century 1.000000 4.558760 737,042 1998
Fund, Inc.
Federated Bond Fund - Class F 1.000000 1.019222 12 1998
INVESCO Dynamics Fund 1.000000 1.173045 818 1998
INVESCO Total Return Fund 1.000000 1.024207 44 1998
MFS Growth Opportunities Fund 1.000000 11.542612 4,519 1998
- - Class A
Nationwide Fund - Class D 1.000000 26.748259 487,464 1998
Nationwide Money Market Fund 1.000000 3.130815 2,298,866 1998
Nationwide S&P 500 Index Fund 1.000000 1.094125 116,258 1998
NSAT Nationwide Small Company 1.000000 1.007261 384,544 1998
Fund
Oppenheimer Global Fund - 1.000000 1.107029 29,079 1998
Class A
Templeton Foreign Fund - 1.000000 1.767586 2,148,011 1998
Class A
Warburg Pincus Emerging 1.000000 1.059668 21,363 1998
Growth Fund
</TABLE>
67
<PAGE> 68
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER X
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.35%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
The Dreyfus Third Century 1.000000 4.581408 276,300 1998
Fund, Inc.
Nationwide Fund - Class D 1.000000 26.881104 104,750 1998
Nationwide Money Market Fund 1.000000 3.142446 175,079 1998
NSAT Nationwide Small Company 1.000000 1.024134 18,482 1998
Fund
Templeton Foreign Fund - 1.000000 1.776379 365,896 1998
Class A
</TABLE>
68
<PAGE> 69
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER XI
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.30%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
American Century Income & 1.000000 1.098315 4,917 1998
Growth Fund
American Century Growth Fund 1.000000 7.952673 261,146 1998
American Century Ultra Fund 1.000000 3.380172 717,400 1998
Dreyfus Appreciation Fund 1.000000 1.080842 4,977 1998
The Dreyfus Third Century 1.000000 4.575570 144,811 1998
Fund, Inc.
Janus Fund 1.000000 2.693678 597,789 1998
Morgan Stanley Equity Growth 1.000000 1.107406 3,268 1998
Portfolio
Nationwide Fund 1.000000 26.846869 53,286 1998
Nationwide Money Market Fund 1.000000 3.138391 294,839 1998
NSAT Nationwide Small Company 1.000000 1.025150 19,929 1998
Fund
Oppenheimer Global Fund - 1.000000 1.107174 1,060 1998
Class A
Templeton Foreign Fund - 1.000000 1.774115 232,860 1998
Class A
</TABLE>
69
<PAGE> 70
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER XII
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.25%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
LifeDesigns Series - The 1.000000 1.150978 68,325 1998
Aggressive Portfolio
LifeDesigns Series - The 1.000000 1.109060 83,356 1998
Conservative Portfolio
LifeDesigns Series - The 1.000000 1.144675 21,387 1998
Moderate Portfolio
LifeDesigns Series - The 1.000000 1.142200 43,931 1998
Moderately Aggressive
Portfolio
LifeDesigns Series - The 1.000000 1.130626 6,709 1998
Moderately Conservative
Portfolio
</TABLE>
70
<PAGE> 71
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER XIII
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.20%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
LifeDesigns Series - The 1.000000 1.155315 11,063 1998
Aggressive Portfolio
LifeDesigns Series - The 1.000000 1.113236 14,242 1998
Conservative Portfolio
LifeDesigns Series - The 1.000000 1.148987 43 1998
Moderate Portfolio
LifeDesigns Series - The 1.000000 1.146503 94,205 1998
Moderately Aggressive
Portfolio
LifeDesigns Series - The 1.000000 1.134884 7,860 1998
Moderately Conservative
Portfolio
</TABLE>
71
<PAGE> 72
CONDENSED FINANCIAL INFORMATION
(CONTINUED)
TIER XIV
VARIABLE ACCOUNT ANNUAL EXPENSE FEE........................................0.15%
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION NUMBER OF
UNIT VALUE UNIT VALUE ACCUMULATION UNITS
AT BEGINNING AT END OUTSTANDING AT THE
FUND OF PERIOD OF PERIOD END OF THE PERIOD YEAR
<S> <C> <C> <C> <C>
LifeDesigns Series - The 1.000000 1.155248 14,581 1998
Aggressive Portfolio
LifeDesigns Series - The 1.000000 1.113172 1,089 1998
Conservative Portfolio
LifeDesigns Series - The 1.000000 1.148920 8,670 1998
Moderate Portfolio
LifeDesigns Series - The 1.000000 1.146437 17,344 1998
Moderately Aggressive
Portfolio
LifeDesigns Series - The 1.000000 1.134818 4,278 1998
Moderately Conservative
Portfolio
</TABLE>
72
