<PAGE> 1
[NATIONWIDE LOGO(R)]
NATIONWIDE(R)
VLI SEPARATE
ACCOUNT-3
ANNUAL REPORT
TO
CONTRACT OWNERS
DECEMBER 31, 1995
NATIONWIDE LIFE INSURANCE COMPANY
HOME OFFICE: COLUMBUS, OHIO
<PAGE> 2
[NATIONWIDE LIFE INSURANCE LOGO]
NATIONWIDE LIFE INSURANCE COMPANY
ONE NATIONWIDE PLAZA, COLUMBUS, OHIO 43216
[PHOTO OF PETER F. FRENZER]
PRESIDENT'S MESSAGE
Nationwide Life Insurance Company is pleased to bring you the 1995 annual report
of the Nationwide VLI Separate Account-3.
Both equity and fixed income investments turned in a stellar performance during
1995. The major market indices ended the year fully one-third or more higher
than their levels at the beginning of the year. These results equate directly to
the returns enjoyed by our variable annuity participants and contract owners.
Low interest rates and modest inflation should provide a continued favorable
environment for stocks and fixed income investments during 1996. Slowing levels
of economic activity and uncertainty about corporate profits may, however,
dampen a repeat of the strong 1995 market performance. The diverse offering of
investment options within your contract should enable you to take advantage of
changing market conditions.
The year 1995 was a record-setting sales year for our variable investment
products. For this we thank you, our valued customer, for your confidence in the
Nationwide Insurance Enterprise and in our products. Please do not hesitate to
let us know how we can better serve your financial planning and retirement
needs.
/s/ Peter F. Frenzer
Peter F. Frenzer, President
3
<PAGE> 3
================================================================================
NATIONWIDE VLI SEPARATE ACCOUNT-3
STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS' EQUITY
DECEMBER 31, 1995
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investments at market value:
The Dreyfus Socially Responsible Growth Fund, Inc. (DrySRGro)
1,175 shares (cost $19,722) .......................................... $ 20,334
Dreyfus Stock Index Fund (DryStkIx)
6,026 shares (cost $97,709) .......................................... 103,651
Fidelity VIP - Equity-Income Portfolio (FidEqInc)
3,771 shares (cost $69,019) .......................................... 72,665
Fidelity VIP - Growth Portfolio (FidGro)
4,895 shares (cost $147,327) ......................................... 142,939
Fidelity VIP - High Income Portfolio (FidHiInc)
1,099 shares (cost $12,824) .......................................... 13,247
Fidelity VIP - Overseas Portfolio (FidOSeas)
515 shares (cost $8,514) ............................................. 8,777
Fidelity VIP-II - Asset Manager Portfolio (FidAsMgr)
4,090 shares (cost $61,030) .......................................... 64,579
Fidelity VIP-II - Contrafund Portfolio (FidContP)
2,604 shares (cost $35,749) .......................................... 35,887
Nationwide SAT - Capital Appreciation Fund (NWCapApp)
251,487 shares (cost $2,811,872) ..................................... 3,390,050
Nationwide SAT - Government Bond Fund (NWGvtBd)
139,623 shares (cost $1,535,161) ..................................... 1,586,120
Nationwide SAT - Money Market Fund (NWMyMkt)
408,352 shares (cost $408,352) ....................................... 408,352
Nationwide SAT - Small Company Fund (NWSmCoFd)
213 shares (cost $2,349) ............................................. 2,432
Nationwide SAT - Total Return Fund (NWTotRet)
859,561 shares (cost $8,971,057) ..................................... 9,919,331
Neuberger & Berman - Balanced Portfolio (NBBal)
65,727 shares (cost $997,222) ........................................ 1,151,530
Neuberger & Berman - Growth Portfolio (NBGro)
1,415 shares (cost $36,869) .......................................... 36,582
Neuberger & Berman - Limited Maturity Bond Portfolio (NBLtdMat)
500 shares (cost $7,109) ............................................. 7,351
Neuberger & Berman Advisers Management Trust - Partners Portfolio (NBPart)
1,365 shares (cost $17,070) .......................................... 18,055
Oppenheimer - Bond Fund (OppBdFd)
618 shares (cost $7,177) ............................................. 7,312
Oppenheimer - Global Securities Fund (OppGlSec)
425 shares (cost $6,485) ............................................. 6,368
Oppenheimer - Multiple Strategies Fund (OppMult)
141 shares (cost $2,014) ............................................. 2,045
Strong VIP - Strong Discovery Fund II (StDisc2)
708 shares (cost $9,271) ............................................. 9,510
Strong VIP - Strong Special Fund II, Inc. (StSpec2)
2,018 shares (cost $33,076) .......................................... 34,394
TCI Portfolios, Inc. - TCI Advantage (TCIAdv)
124,250 shares (cost $670,471) ....................................... 769,107
TCI Portfolios, Inc. - TCI Balanced (TCIBal)
981 shares (cost $6,835) ............................................. 6,907
TCI Portfolios, Inc. - TCI Growth (TCIGro)
3,323 shares (cost $40,499) .......................................... 40,073
TCI Portfolios, Inc. - TCI International (TCIInt)
56 shares (cost $291) ................................................ 300
Van Eck - Gold and Natural Resources Fund (VEGoldNR)
422 shares (cost $6,064) ............................................. 6,087
Van Eck - Worldwide Bond Fund (VEWrldBd)
45 shares (cost $498) ................................................ 500
Van Kampen American Capital - Real Estate Securities Fund (VKACRESec)
38 shares (cost $403) ................................................ 410
Warburg Pincus - International Equity Portfolio (WPIntEq)
246 shares (cost $2,565) ............................................. 2,621
Warburg Pincus - Small Company Growth Portfolio (WPSmCoGr)
4,081 shares (cost $44,454) .......................................... 51,056
-----------
Total assets ................................................... 17,918,572
ACCOUNTS PAYABLE ......................................................... 14,179
-----------
CONTRACT OWNERS' EQUITY .................................................. $17,904,393
===========
</TABLE>
4
<PAGE> 4
<TABLE>
<CAPTION>
Contract owners' equity represented by: Units Unit Value
----- ----------
<S> <C> <C> <C>
The Dreyfus Socially Responsible Growth Fund, Inc. ...... 1,412 $ 14.401809 $ 20,335
The Dreyfus Stock Index Fund ............................ 7,526 13.775382 103,674
Fidelity VIP - Equity-Income Portfolio .................. 3,343 22.215745 74,267
Fidelity VIP - Growth Portfolio ......................... 6,753 21.256059 143,542
Fidelity VIP - High Income Portfolio .................... 639 20.852993 13,325
Fidelity VIP - Overseas Portfolio ....................... 644 13.645033 8,787
Fidelity VIP-II - Asset Manager Portfolio ............... 4,040 15.982529 64,569
Fidelity VIP-II - Contrafund Portfolio .................. 3,236 11.099135 35,917
Nationwide SAT - Capital Appreciation Fund............... 230,417 14.713230 3,390,178
Nationwide SAT - Government Bond Fund.................... 105,852 14.984933 1,586,185
Nationwide SAT - Money Market Fund ...................... 34,837 11.714295 408,091
Nationwide SAT - Small Company Fund ..................... 213 11.420759 2,433
Nationwide SAT - Total Return Fund....................... 545,254 18.192762 9,919,676
Neuberger & Berman - Balanced Portfolio ................. 81,338 14.157643 1,151,554
Neuberger & Berman - Growth Portfolio ................... 2,305 15.962482 36,794
Neuberger & Berman - Limited Maturity Bond Portfolio .... 564 13.096811 7,387
Neuberger & Berman - Partners Portfolio ................. 1,328 13.591346 18,049
Oppenheimer - Bond Fund ................................. 482 15.164813 7,309
Oppenheimer - Global Securities Fund .................... 555 11.542134 6,406
Oppenheimer - Multiple Strategies Fund .................. 128 16.100377 2,061
Strong VIP - Strong Discovery Fund II ................... 582 16.514850 9,612
Strong VIP - Strong Special Fund II, Inc. ............... 1,891 18.408627 34,811
TCI Portfolios, Inc. - TCI Advantage .................... 32,338 13.112917 424,046
TCI Portfolios, Inc. - TCI Advantage (Depositor)......... 25,000 13.802855 345,071
TCI Portfolios, Inc. - TCI Balanced ..................... 524 13.155049 6,893
TCI Portfolios, Inc. - TCI Growth ....................... 2,481 16.149061 40,066
TCI Portfolios, Inc. - TCI International ................ 31 10.477472 325
Van Eck - Gold and Natural Resources Fund ............... 390 15.612002 6,089
Van Eck - Worldwide Bond Fund ........................... 39 13.253457 517
Van Kampen American Capital - Real Estate Securities Fund 38 10.792212 410
Warburg Pincus - International Equity Portfolio ......... 238 10.687672 2,544
Warburg Pincus - Small Company Growth Portfolio ......... 2,686 12.461074 33,470
======= ========= -----------
$17,904,393
===========
</TABLE>
See accompanying notes to financial statements.
================================================================================
5
<PAGE> 5
================================================================================
NATIONWIDE VLI SEPARATE ACCOUNT-3
STATEMENTS OF OPERATIONS AND CHANGES IN CONTRACT OWNERS' EQUITY
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
1995 1994 1993
------------ ---------- ----------
<S> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested capital gains and dividends ........... $ 1,084,513 494,868 145,831
------------ ---------- ----------
Gain (loss) on investments:
Proceeds from redemptions of mutual fund shares 2,252,228 4,179,645 3,254,854
Cost of mutual fund shares sold ............... (2,113,393) (4,147,943) (3,222,467)
------------ ---------- ----------
Realized gain (loss) on investments ........... 138,835 31,702 32,387
Change in unrealized gain (loss) on investments 2,274,433 (556,146) 107,861
------------ ---------- ----------
Net gain (loss) on investments ................ 2,413,268 (524,444) 140,248
------------ ---------- ----------
Net investment activity ................... 3,497,781 (29,576) 286,079
------------ ---------- ----------
EQUITY TRANSACTIONS:
Purchase payments received from contract owners .. 4,661,075 8,317,542 6,745,862
Surrenders (note 2d) ............................. (427,125) (172,813) (114,800)
Death Benefits (note 4) .......................... (11,836) (17,276) --
Policy loans (net of repayments) (note 5) ........ (212,115) (85,214) (6,841)
------------ ---------- ----------
Net equity transactions ................... 4,009,999 8,042,239 6,624,221
------------ ---------- ----------
EXPENSES:
Deductions for surrender charges (note 2d) ...... (71,008) (59,849) (44,036)
Redemptions to pay cost of insurance charges
and administrative charges (notes 2b and 2c) .. (2,073,851) (2,524,466) (1,065,559)
Deductions for asset charges (note 3) ............ (119,641) (80,632) (24,233)
------------ ---------- ----------
Total expenses ............................ (2,264,500) (2,664,947) (1,133,828)
------------ ---------- ----------
NET CHANGE IN CONTRACT OWNERS' EQUITY ............... 5,243,280 5,347,716 5,776,472
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ......... 12,661,113 7,313,397 1,536,925
------------ ---------- ----------
CONTRACT OWNERS' EQUITY END OF PERIOD ............... $ 17,904,393 12,661,113 7,313,397
============ ========== ==========
</TABLE>
See accompanying notes to financial statements.
================================================================================
6
<PAGE> 6
================================================================================
NATIONWIDE VLI SEPARATE ACCOUNT-3
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995, 1994 AND 1993
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Organization and Nature of Operations
The Nationwide VLI Separate Account-3 (the Account) was established
pursuant to a resolution of the Board of Directors of Nationwide Life Insurance
Company (the Company) on August 8, 1984. The Account has been registered as a
unit investment trust under the Investment Company Act of 1940. On August 21,
1991, the Company (Depositor) transferred to the Account 50,000 shares of TCI
Portfolios, Inc.-TCI Advantage, for which it was credited with 25,000
accumulation units. The value of the accumulation units purchased by the Company
on August 21, 1991 was $250,000.
The Company offers Modified Single Premium and Flexible Premium Variable
Life Insurance Policies through the Account. The primary distribution for the
contracts is through Company Agents; however, other distributors may be
utilized.
(b) The Contracts
Only contracts with a front-end sales load, a surrender charge and
certain other fees have been purchased. See note 2 for a discussion of policy
charges and note 3 for asset charges.
Contract owners may invest in the following funds:
The Dreyfus Socially Responsible Growth Fund, Inc. (DrySRGro)
Dreyfus Stock Index Fund (DryStkIx)(formerly Dreyfus Life and Annuity
Index Fund, Inc. (DLAI))
Portfolios of the Fidelity Variable Insurance Products Fund (Fidelity
VIP);
Fidelity VIP - Equity-Income Portfolio (FidEqInc)
Fidelity VIP - Growth Portfolio (FidGro)
Fidelity VIP - High Income Portfolio (FidHiInc)
Fidelity VIP - Overseas Portfolio (FidOSeas)
Portfolios of the Fidelity Variable Insurance Products Fund II
(Fidelity VIP-II);
Fidelity VIP-II - Asset Manager Portfolio (FidAsMgr)
Fidelity VIP-II - Contrafund Portfolio (FidContP)
Funds of the Nationwide Separate Account Trust (Nationwide SAT) (managed
for a fee by an affiliated investment advisor);
Nationwide SAT - Capital Appreciation Fund (NWCapApp)
Nationwide SAT - Government Bond Fund (NWGvtBd)
Nationwide SAT - Money Market Fund (NWMyMkt)
Nationwide SAT - Small Company Fund (NWSmCoFd)
Nationwide SAT - Total Return Fund (NWTotRet)
Portfolios of the Neuberger & Berman Advisers Management Trust (Neuberger
& Berman);
Neuberger & Berman - Balanced Portfolio (NBBal)
Neuberger & Berman - Growth Portfolio (NBGro)
Neuberger & Berman - Limited Maturity Bond Portfolio (NBLtdMat)
Neuberger & Berman - Partners Portfolio (NBPart)
Funds of the Oppenheimer Variable Account Funds (Oppenheimer);
Oppenheimer - Bond Fund (OppBdFd)
Oppenheimer - Global Securities Fund (OppGlSec)
Oppenheimer - Multiple Strategies Fund (OppMult)
7
<PAGE> 7
Funds of the Strong Variable Insurance Products Funds (Strong VIP);
Strong VIP - Strong Discovery Fund II (StDisc2)
Strong VIP - Strong International Stock Fund II (StIntStk2)
Strong VIP - Strong Special Fund II, Inc. (StSpec2)
Portfolios of the TCI Portfolios, Inc. (TCI Portfolios);
TCI Portfolios - TCI Advantage (TCIAdv)
TCI Portfolios - TCI Balanced (TCIBal)
TCI Portfolios - TCI Growth (TCIGro)
TCI Portfolios - TCI International (TCIInt)
Funds of the Van Eck Worldwide Insurance Trust (Van Eck) (formerly Van
Eck Investment Trust);
Van Eck - Gold and Natural Resources Fund (VEGoldNR)
Van Eck - Worldwide Bond Fund (VEWrldBd) (formerly Van Eck - Global
Bond Fund (VEGlobBd))
Fund of the Van Kampen American Capital Life Investment Trust (Van Kampen
American Capital);
Van Kampen American Capital - Real Estate Securities Fund (VKACRESec)
Portfolios of the Warburg Pincus Trust (Warburg Pincus);
Warburg Pincus - International Equity Portfolio (WPIntEq)
Warburg Pincus - Small Company Growth Portfolio (WPSmCoGr)
At December 31, 1995, contract owners have invested in all of the above
funds except Strong VIP - Strong International Stock Fund II (StIntStk2). The
contract owners' equity is affected by the investment results of each fund,
equity transactions by contract owners and certain policy charges (see notes 2
and 3). The accompanying financial statements include only contract owners'
purchase payments pertaining to the variable portions of their contracts and
exclude any purchase payments for fixed dollar benefits, the latter being
included in the accounts of the Company.
(c) Security Valuation, Transactions and Related Investment Income
The market value of the underlying mutual funds is based on the closing
net asset value per share at December 31, 1995. The cost of investments sold is
determined on a specific identification basis. Investment transactions are
accounted for on the trade date (date the order to buy or sell is executed) and
dividend income is recorded on the ex-dividend date.
(d) Federal Income Taxes
Operations of the Account form a part of, and are taxed with, operations
of the Company, which is taxed as a life insurance company under the provisions
of the Internal Revenue Code.
The Company does not provide for income taxes within the Account. Taxes
are the responsibility of the contract owner upon termination or withdrawal.
(e) Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles may require management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities, if any, at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates.
(2) POLICY CHARGES
(a) Deductions from Premium
On flexible premium life insurance contracts, the Company deducts a
charge for state premium taxes equal to 2.5% of all premiums received to cover
the payment of these premium taxes. Additionally, the Company deducts a
front-end sales load of up to 3.5% from each premium payment received. The
Company may at its sole discretion reduce this sales loading.
(b) Cost of Insurance
A cost of insurance charge is assessed monthly against each contract. The
amount of the charge is based upon age, sex, rate class and net amount at risk
(death benefit less total contract value).
8
<PAGE> 8
(c) Administrative Charges
For flexible premium contracts, the Company currently deducts a monthly
administrative charge of $25 during the first policy year and $5 per month
thereafter (may deduct up to $7.50, maximum) to recover policy maintenance,
accounting, record keeping and other administrative expenses. Additionally, the
Company deducts an increase charge of $2.04 per year per $1,000 applied to any
increase in the specified amount during the first 12 months after the increase
becomes effective.
The above charges are assessed against each contract by liquidating
units.
(d) Surrenders
Policy surrenders result in a redemption of the contract value from the
Separate Account and payment of the surrender proceeds to the contract owner or
designee. The surrender proceeds consist of the contract value, less any
outstanding policy loans, and less a surrender charge, if applicable. The amount
of the charge is based upon a specified percentage of the initial surrender
charge which varies by issue age, sex and rate class. For flexible premium
contracts, the charge is 100% of the initial surrender charge in the first year,
declining to 30% of the initial surrender charge in the ninth year.
No surrender charge is assessed on any contract surrendered after the
ninth year.
The Company may waive the surrender charge for certain contracts in which
the sales expenses normally associated with the distribution of a contract are
not incurred. No charges were deducted from the initial funding, or from
earnings thereon.
(3) Asset Charges
The Company deducts a charge equal to an annual rate of .80%, with
certain exceptions, to cover mortality and expense risk charges related to
operations. This charge is assessed through the unit value calculation.
(4) Death Benefits
Death benefits result in a redemption of the contract value from the
Separate Account and payment of the death benefit proceeds, less any outstanding
policy loans and policy charges, to the legal beneficiary. The excess of the
death benefit proceeds over the contract value on the date of death is paid by
the Company's general account.
(5) Policy Loans (Net of Repayments)
Contract provisions allow contract owners to borrow 90% of a policy's
cash surrender value. The contract is charged 6% on the outstanding loan and is
due and payable in advance on the policy anniversary.
At the time the loan is granted, the amount of the loan plus interest, if
any, is transferred from the Account to the Company's general account as
collateral for the outstanding loan. Collateral amounts in the general account
are credited with the stated rate of interest in effect at the time the loan is
made, subject to a guaranteed minimum rate. Interest credited is paid by the
Company's general account to the Account. Loan repayments result in a transfer
of collateral back to the Account.
(6) SCHEDULE I
Schedule I presents the components of the change in the unit values,
which are the basis for contract owners' equity. This schedule is presented in
the following format:
- Beginning unit value - Jan. 1
- Reinvested capital gains and dividends
(This amount reflects the increase in the unit value due to capital
gains and dividend distributions from the underlying mutual funds.)
- Unrealized gain (loss)
(This amount reflects the increase (decrease) in the unit value
resulting from the market appreciation (depreciation) of the
underlying mutual funds.)
- Asset charges (This amount reflects the decrease in the unit value
due to the charges discussed in note 3.)
- Ending unit value - Dec. 31
- Percentage increase (decrease) in unit value.
================================================================================
9
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================================================================================
NATIONWIDE VLI SEPARATE ACCOUNT-3 SCHEDULE I
SCHEDULES OF CHANGES IN UNIT VALUE
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
DrySRGro DryStkIx FidEqInc FidGro FidHiInc FidOSeas FidAsMgr FidContP
-------- -------- -------- ------ -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1995***
Beginning unit value - Jan. 1 $13.083801 12.456650 19.991986 21.077777 19.897254 13.633767 15.029765 10.655665
- ----------------------------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .396430 .239425 .229029 .000000 .000000 .000000 .000000 .143118
- ----------------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .967071 1.122261 2.063681 .249916 1.022818 .055055 1.003384 .336322
- ----------------------------------------------------------------------------------------------------------------------------------
Asset charges (.045493) (.042954) (.068951) (.071634) (.067079) (.043789) (.050620) (.035970)
- ----------------------------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $14.401809 13.775382 22.215745 21.256059 20.852993 13.645033 15.982529 11.099135
- ----------------------------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a) 10%(b) 11%(b) 11%(b) 1%(b) 5%(b) 0%(b) 6%(b) 4%(b)
==================================================================================================================================
1994
Beginning unit value - Jan.1 ** ** ** ** ** ** ** **
- ----------------------------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends
- ----------------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss)
- ----------------------------------------------------------------------------------------------------------------------------------
Asset charges
- ----------------------------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31
- ----------------------------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a)
==================================================================================================================================
1993
Beginning unit value - Jan. 1 ** ** ** ** ** ** ** **
- ----------------------------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends
- ----------------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss)
- ----------------------------------------------------------------------------------------------------------------------------------
Asset charges
- ----------------------------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31
- ----------------------------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a)
==================================================================================================================================
</TABLE>
* An annualized rate of return cannot be determined as:
(a) Asset charges do not include the policy charges discussed in
note 2; and (b) This investment option was not utilized for the
entire year indicated.
** This investment option was not available or was not utilized.
*** No other investment options were being utilized.
10
<PAGE> 10
NATIONWIDE VLI SEPARATE ACCOUNT-3 SCHEDULE I, CONTINUED
SCHEDULES OF CHANGES IN UNIT VALUE
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
NWCapApp NWGvtBd NWMyMkt NWSmCoFd NWTotRet NBBal
-------- ------- ------- -------- -------- -----
<S> <C> <C> <C> <C> <C> <C>
1995***
Beginning unit value - Jan. 1 $ 11.465403 12.720514 11.176411 10.000000 14.205723 11.531273
- ---------------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .653781 .903001 .629782 .017475 1.413734 .293664
- ---------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) 2.696528 1.472503 .000000 1.418968 2.703396 2.438125
- ---------------------------------------------------------------------------------------------------------------------
Asset charges (.102482) (.111085) (.091898) (.015684) (.130091) (.105419)
- ---------------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $ 14.713230 14.984933 11.714295 11.420759 18.192762 14.157643
- ---------------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a) 28% 18% 5% 14%(b) 28% 23%
=====================================================================================================================
1994
Beginning unit value - Jan.1 $ 11.662121 13.250482 10.845265 ** 14.167308 12.027618
- ---------------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .184927 .833925 .419275 .717782 .469287
- ---------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) (.289863) (1.261429) .000000 (.565055) (.872191)
- ---------------------------------------------------------------------------------------------------------------------
Asset charges (.091782) (.102464) (.088129) (.114312) (.093441)
- ---------------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $ 11.465403 12.720514 11.176411 14.205723 11.531273
- ---------------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a) (2)% (4)% 3% 0% (4)%
=====================================================================================================================
1993
Beginning unit value - Jan. 1 $ 10.725293 12.196370 10.639809 ** 12.875439 11.389202
- ---------------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .261975 .781559 .291848 .527331 .175648
- ---------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .761628 .376228 .000000 .873117 .555361
- ---------------------------------------------------------------------------------------------------------------------
Asset charges (.086775) (.103675) (.086392) (.108579) (.092593)
- ---------------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $ 11.662121 13.250482 10.845265 14.167308 12.027618
- ---------------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a) 9% 9% 2% 10% 6%
=====================================================================================================================
</TABLE>
* An annualized rate of return cannot be determined as:
(a) Asset charges do not include the policy charges discussed in
note 2; and (b) This investment option was not utilized for the
entire year indicated.
** This investment option was not available or was not utilized.
*** No other investment options were being utilized.
11
<PAGE> 11
NATIONWIDE VLI SEPARATE ACCOUNT-3 SCHEDULE I, CONTINUED
SCHEDULES OF CHANGES IN UNIT VALUE
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
NBGro NBLtdMat NBPart OppBdFd
----- -------- ------ -------
<S> <C> <C> <C> <C>
1995***
Beginning unit value - Jan. 1 $15.674452 12.612894 12.574475 14.319149
- ---------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .000000 .000000 .000000 .451093
- ---------------------------------------------------------------------------------------------
Unrealized gain (loss) .341270 .526078 1.059943 .442834
- ---------------------------------------------------------------------------------------------
Asset charges (.053240) (.042161) (.043072) (.048263)
- ---------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $15.962482 13.096811 13.591346 15.164813
- ---------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a) 2%(b) 4%(b) 8%(b) 6%(b)
=============================================================================================
1994
Beginning unit value - Jan.1 ** ** ** **
- ---------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends
- ---------------------------------------------------------------------------------------------
Unrealized gain (loss)
- ---------------------------------------------------------------------------------------------
Asset charges
- ---------------------------------------------------------------------------------------------
Ending unit value - Dec. 31
- ---------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a)
=============================================================================================
1993
Beginning unit value - Jan. 1 ** ** ** **
- ---------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends
- ---------------------------------------------------------------------------------------------
Unrealized gain (loss)
- ---------------------------------------------------------------------------------------------
Asset charges
- ---------------------------------------------------------------------------------------------
Ending unit value - Dec. 31
- ---------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a)
=============================================================================================
</TABLE>
<TABLE>
<CAPTION>
OppGlSec OppMult StDisc2 StSpec2 TCIAdv
-------- ------- ------- ------- ------
<S> <C> <C> <C> <C> <C>
1995***
Beginning unit value - Jan. 1 11.943012 15.453572 15.320395 17.177125 11.321934
- --------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .000000 .337996 .211565 .082118 .411556
- --------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) (.362402) .360634 1.035469 1.207608 1.477165
- --------------------------------------------------------------------------------------------------------------
Asset charges (.038476) (.051825) (.052579) (.058224) (.097738)
- --------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 11.542134 16.100377 16.514850 18.408627 13.112917
- --------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a) (3)%(b) 4%(b) 8%(b) 7%(b) 16%
==============================================================================================================
1994
Beginning unit value - Jan.1 ** ** ** ** $11.295721
- --------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .297670
- --------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) (.181209)
- --------------------------------------------------------------------------------------------------------------
Asset charges (.090248)
- --------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $11.321934
- --------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a) 0%
==============================================================================================================
1993
Beginning unit value - Jan. 1 ** ** ** ** $10.657984
- --------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .223352
- --------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .502395
- --------------------------------------------------------------------------------------------------------------
Asset charges (.088010)
- --------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $11.295721
- --------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value*(a) 6%
==============================================================================================================
</TABLE>
* An annualized rate of return cannot be determined as:
(a) Asset charges do not include the policy charges discussed in
note 2; and (b) This investment option was not utilized for the
entire year indicated.
** This investment option was not available or was not utilized.
*** No other investment options were being utilized.
12
<PAGE> 12
NATIONWIDE VLI SEPARATE ACCOUNT-3 SCHEDULE I, CONTINUED
SCHEDULES OF CHANGES IN UNIT VALUE
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
TCIAdv+ TCIBal TCIGro TCIInt VEGoldNR
------ ------ ------ ------ --------
<S> <C> <C> <C> <C> <C>
1995**
Beginning unit value - Jan. 1 $ 11.822996 12.526705 15.745499 10.216142 15.406908
- ------------------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends 0.431938 .187655 .000000 .000000 .075481
- ------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) 1.547921 .482910 .457100 .294719 .180118
- ------------------------------------------------------------------------------------------------------------------------
Asset charges 0.000000 (.042221) (.053538) (.033389) (.050505)
- ------------------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $ 13.802855 13.155049 16.149061 10.477472 15.612002
- ------------------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value* (a) 17% 5%(b) 3%(b) 3%(b) 1%(b)
========================================================================================================================
1994
Beginning unit value - Jan.1 $ 11.701906 ** ** ** **
- ------------------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .309969
- ------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) (.188879)
- ------------------------------------------------------------------------------------------------------------------------
Asset charges .000000
- ------------------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $ 11.822996
- ------------------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value* (a) 1%
========================================================================================================================
1993
Beginning unit value - Jan. 1 $ 10.953160 ** ** ** **
- ------------------------------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .230690
- ------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .518056
- ------------------------------------------------------------------------------------------------------------------------
Asset charges .000000
- ------------------------------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $ 11.701906
- ------------------------------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value* (a) 7%
========================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
VEWrldBd VKACRESec WPIntEq WPSmCoGr
-------- --------- ------- --------
<S> <C> <C> <C> <C>
1995**
Beginning unit value - Jan. 1 $ 13.012850 10.203521 10.236484 10.233506
- -----------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends .245483 .092168 .077521 .000000
- -----------------------------------------------------------------------------------------------------
Unrealized gain (loss) .038021 .530496 .408042 2.264927
- -----------------------------------------------------------------------------------------------------
Asset charges (.042897) (.033973) (.034375) (.037359)
- -----------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31 $ 13.253457 10.792212 10.687672 12.461074
- -----------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value* (a) 2%(b) 6%(b) 4%(b) 22%(b)
=====================================================================================================
1994
Beginning unit value - Jan.1 ** ** ** **
- -----------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends
- -----------------------------------------------------------------------------------------------------
Unrealized gain (loss)
- -----------------------------------------------------------------------------------------------------
Asset charges
- -----------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31
- -----------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value* (a)
=====================================================================================================
1993
Beginning unit value - Jan. 1 ** ** ** **
- -----------------------------------------------------------------------------------------------------
Reinvested capital
gains and
dividends
- -----------------------------------------------------------------------------------------------------
Unrealized gain (loss)
- -----------------------------------------------------------------------------------------------------
Asset charges
- -----------------------------------------------------------------------------------------------------
Ending unit value - Dec. 31
- -----------------------------------------------------------------------------------------------------
Percentage increase
(decrease) in
unit value* (a)
=====================================================================================================
</TABLE>
* An annualized rate of return cannot be determined as:
(a) Asset charges do not include the policy charges discussed in
note 2; and (b) This investment option was not utilized for the
entire year indicated.
** This investment option was not available or was not utilized.
*** No other investment options were being utilized.
+ For Depositor, see note 1a.
See note 6.
================================================================================
13
<PAGE> 13
================================================================================
Independent Auditors' Report
The Board of Directors and Contract Owners of
Nationwide VLI Separate Account-3
Nationwide Life Insurance Company:
We have audited the accompanying statement of assets, liabilities and
contract owners' equity of Nationwide VLI Separate Account-3 as of December 31,
1995, and the related statements of operations and changes in contract owners'
equity and schedules of changes in unit value for each of the years in the three
year period then ended. These financial statements and schedules of changes in
unit value are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and
schedules of changes in unit value based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and schedules of
changes in unit value are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of December 31, 1995, by correspondence with the custodian and the
transfer agents of the underlying mutual funds. An audit also includes assessing
the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and schedules of changes in unit
value referred to above present fairly, in all material respects, the financial
position of Nationwide VLI Separate Account-3 as of December 31, 1995, and the
results of its operations and its changes in contract owners' equity and the
schedules of changes in unit value for each of the years in the three year
period then ended in conformity with generally accepted accounting principles.
KPMG Peat Marwick LLP
Columbus, Ohio
February 6, 1996
================================================================================
14
<PAGE> 14
[THIS PAGE LEFT BLANK INTENTIONALLY]
15
<PAGE> 15
NATIONWIDE LIFE INSURANCE COMPANY Bulk Rate
HOME OFFICE: ONE NATIONWIDE PLAZA - COLUMBUS, OHIO 43215-2220 U.S. Postage
P A I D
Columbus, Ohio
Permit No. 521
Nationwide(R) is a registered federal service mark of Nationwide Mutual
Insurance Company.
