. Nationwide IUL Web Ex Series Introduction to IUL: Part 2 Learn to Embrace Indexed UL 1For Insurance professional use only LAM-1921AO

Disclosure Life Insurance issued by Nationwide Life Insurance Company and/or Nationwide Life and Annuity Insurance Company. Guarantees are subject to the claims paying ability of Nationwide. As your clients' personal situations change (i.e., marriage, birth of a child or job promotion), so will their life insurance needs. Care should be taken to ensure this product is suitable for their long-term life insurance needs. They should weigh any associated costs before making a purchase. Life insurance has fees and charges associated with it that include costs of insurance that vary with such characteristics of the insured as gender, health and age, and has additional charges for riders that customize a policy to fit their individual needs. Riders may be known by different names in different states, may not be available in every state and have an additional charge associated with them. Indexed universal life insurance policies are not stock market investments, do not directly participate in any stock or equity investments, do not receive dividend or capital gains participation. Past index performance of an index is no indication of future crediting rates. Not a deposit Not FDIC or NCUSIF insured Not guaranteed by the institution. Not insured by any federal government agency May lose value © 2012 Nationwide Financial Services, Inc. All rights reserved 2 For Insurance Professional Use Only - Not for distribution with the public LAM-1921AO

Nationwide YourLife ® Indexed UL 3 3 S & P 500® is a trademark of Standard & Poor's and has been licensed for use by Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company. Nationwide YourLife® Indexed UL is not sponsored, endorsed, sold or promoted by Standard & Poor's and Standard & Poor's makes no representation regarding the advisability of investing in the Product. NASDAQ ®, OMX ®, NASDAQ OMX ®, NASDAQ-100 ®, and NASDAQ-100 Index ® are registered trademarks of The NASDAQ OMX Group, Inc. (which with its affiliates is referred to as the "Corporations") and are licensed for use by Nationwide Life Insurance Company or Nationwide Life and Annuity Insurance Company. Nationwide YourLife® Indexed UL has not been passed on by the Corporations as to their legality or suitability. Nationwide YourLife® Indexed UL is not issued, endorsed, sold, or promoted by the Corporations. The Corporations make no warranties and bear no liability with respect to the product. The "Dow Jones Industrial Average SM " is a product of Dow Jones Indexes, the marketing name and a licensed trademark of CME Group Index Services LLC ("CME"), and has been licensed for use. "Dow Jones®", "Dow Jones Industrial Average SM " and "Dow Jones Indexes" are service marks of Dow Jones Trademark Holdings, LLC ("Dow Jones") and have been licensed for use for certain purposes by Nationwide Life Insurance Company or Nationwide Life and Annuity Insurance Company. Nationwide YourLife® Indexed UL based on the Dow Jones Industrial Average SM is not sponsored, endorsed, sold or promoted by CME Indexes, Dow Jones or their respective affiliates, and CME Indexes, Dow Jones and their respective affiliates make no representation regarding the advisability of trading in such product(s). For Insurance Professional Use Only - Not for distribution with the public LAM-1921AO

All competitive information is believed to be current May Information was compiled from the latest company software. American General WinFlex Rev ; AXA AEGIS 7.9.3; Prudential 43.00; AVIVA ; Lincoln 16.0; Pacific Life ; John Hancock and Minnesota Life’s web based software. All information presented is reliable as at the date of comparison and Nationwide has made every effort to make sure it is reliable; however, its possible that there are differences between the products compared which are not reflected and/or of which we are unaware. For this reason, its completeness and accuracy cannot be guaranteed. These are mere hypothetical scenarios and not intended to represent any specific client or situation. IMPORTANT BENCHMARKING INFORMATION

Agenda Annual Point to Point & Monthly Averaging Holding Account Sweep Dates Guaranteed Floor vs. Cumulative Guarantee Understanding IUL Statements Illustrating IUL Typical Client Scenarios: Alternative to GUL, Alternative to Current Assumption, Accumulation & Income and also LTC Rider Nationwide’s YourLife Indexed UL Strengths 5For Insurance professional use only

1 year Annual Point to Point 66 For Insurance professional use only A good fit for clients who anticipate steady growth in the near future Market timing risk because only comparing 2 points in time Over time the indexed interest strategy becomes less relevant and the returns converge because some years Annual Point-to-Point credits higher, and some years Monthly Averaging credits higher

Monthly Averaging 77 For Insurance professional use only May work better for clients who are wary of market volatility and believe it will continue in near future Less Market timing risk using 12 points in time Less Opportunity for higher crediting in consistently rising markets Over time the indexed interest strategy becomes less relevant and the returns converge because some years Annual Point-to-Point credits higher, and some years Monthly Averaging credits higher

Annual Point to Point with Dollar Cost Averaging is Different from Monthly Averaging Annual Point-to-Point with DCA Helps minimize market timing risk Always only comparing 2 points in time (will have more segments) Monthly Averaging vs. Annual Point-to-Point with DCA With DCA the indexed interest strategy Cap rates can change while waiting With DCA less of your money is in the indexed interest strategy Impact of “Time ” : Over time the indexed interest strategy becomes less relevant and the returns converge because some years Annual Point-to-Point credits higher, and some years Monthly Averaging credits higher Impact of Base Policy: Nationwide’s IUL base product low cost charge structure is critical advantage to performance irrespective of strategy or future changes to caps & pars Note: Nationwide does Not offer Dollar Cost Averaging 8For Insurance professional use only

“Holding” Account Requirements What are Fixed Account Requirements also known as Holding Accounts? Requirement for money to be held here prior to being “Swept” into the Indexed Interest Strategy Fixed Account can be traditional Fixed account premium allocations, or a special Fixed account with a different rate 9For Insurance professional use only

Example: Holding Account Requirements At Nationwide: Minimum Required Fixed Account Allocation “Holding” Account or Fixed Account Requirements: Some companies including Nationwide hold back enough premium in the Fixed Interest Account to cover estimated policy charges and deductions for the next 12 months Nationwide: Only net premium in excess of the Minimum Required Fixed Interest Strategy value (MRFISA) can be allocated from the Fixed Interest Account to the Indexed Interest Strategy Example: Both Companies use End Point Crediting (only pay indexed interest credit on money at segment maturity) $10,000 Premium, $2,000 Policy Charges; Index growth 12%, Participation Rate 100%; 4% Fixed *Note policy charges are deducted monthly, and interest is applied daily (so would not get 4% on entire $2,000) Note: Having this requirement can be helpful to the policy holder as seen above. But, if they do not pay premium in excess of MRFISA (a projected 12 months worth of current policy charges), then they will not be allocated to the Indexed Interest Strategy Accounts. 10For Insurance professional use only Dollar allocated to Fixed Acct Percent Credited Fixed Interest Account Dollar Allocated to Indexed Interest Strategy Amount Credited Indexed Acct Company A (No Holding Requirement for Policy charges) $0.000%$10,00012% to $8,000 Nationwide $2,0004% to $2,000*$8,00012% to $8,000

What are Sweep Dates? Sweep Dates: Is the day or days of the month that premium is transferred from the Fixed Interest Account (or Holding account) into the Indexed Interest strategy(s). This day marks the start date of the Indexed Interest Strategy. 11For Insurance professional use only Usually 1 day per month Sometimes More than 1 day Where is Money Held in the interim? Sweep Dates15 th 11 th & 26 th Or 28th Fixed Account Holding Account

Cumulative Guarantee vs. Guaranteed Floor They are Not the Same Guaranteed Floor Minimum amount credited at each Segment Maturity Usually 0%. Could be: 0.75%, 1% or 2% Cumulative Guarantee (aka: “True Up” on Surrender or Alternate Policy Value) Minimum amount credited upon Death, Surrender or Policy Maturity Does Not apply credit at Segment Maturity Could be 1%, 2%, 3% Example: Underlying Index Growth 0% at Segment Maturity 12For Insurance professional use only TypePercent Applied at Segment Maturity Guaranteed Floor 1%1% Cumulative Guarantee 3%0%

Understanding IUL Statements Reflecting Index Credit on Statement Most companies do Not reflect credit applied to Indexed Interest Strategy for that year in the Annual Statement A few companies send out Monthly Confirmation Statements (including Nationwide) Example: January 4, 2013 Policy Issued January 15, 2013 Monies Swept from Fixed Account into Indexed Interest Strategy January 3, 2014 Statement Reporting Period 365 days (1/4/13 – 1/3/14) January 4, 2014 Statement Automatically Generated (but Indexed Interest Strategy hasn’t matured yet) January 15, 2014 Index Interest Strategy Segment Matures (too late for statement) 13For Insurance professional use only

Illustrating Indexed UL Illustrating IUL’s Companies assume Various Default Illustrated Rates Companies assume Various Look back Periods to determine Default Rate What rate should you use to illustrate IUL? Company’s Default Rate, or Flat rate: 6%, or 7% 14For Insurance professional use only TermDescriptionUsuallySometimes Default RateRate company uses to hypothetically project values in illustration 6% - 8%4.60% 10% Look Back PeriodNumber of preceding years used in formula to determine the default rate 20 – 30 yrs10 yrs 28 yrs 35 yrs

How to Illustrate Nationwide’s IUL? 15For Insurance professional use only

Illustrating Allocations at Segment Maturity 16For Insurance professional use only

Client Scenario: Alternative to GUL How Nationwide’s YourLife IUL* compares to Nationwide’s YourLife NLG-UL Expect IUL price to be higher. Could be between 5% to 30% or more Price between products are more aligned for Level Pay premium scenarios Price between products are more comparable: $250,000 Face amount and below Male age 45, $250,000 Face, NTP, NLG age 100 Male age 70, $250,000 Face, NT, NLG age 100 *Note: IUL assumes selection of optional Extended Death Benefit Guarantee Rider (EDBG) and an illustrated rate of 6.00% allocated to Indexed Interest Strategy 17For Insurance professional use only ProductPremium Cash Surrender Value Year 10 Target PremiumRolling Target’s? YourLife NLG UL$2,122$0.00$2,061No YourLife Indexed UL*$2,256$7,671$2,967Yes ProductPremium Cash Surrender Value Year 10 Target PremiumRolling Targets? YourLife Indexed UL*$9,312$10,621$9,834Yes YourLife NLG UL$9,688$0.00$9,454No

Compare Feature in Nationwide’s Software Input Screens 18For Insurance professional use only Comparing Nationwide’s IUL to GUL Male, 50, NT, $250,000 Face, NLG to age 100

Client Scenario: Alternative to Current Assumption UL ProductFace AmountInterest Rate NLG Duration Target Premium Rolling Target Premiums? John Hancock Protection UL $1,249, %Age 80$14,141No Nationwide YourLife IUL $1,110,724 N/A to guarantee Age 80$24,491Yes John Hancock Protection UL $ 736, %Age 87$ 8,427No Nationwide YourLife IUL $ 972,301 N/A to guarantee Age 87$19,724Yes Nationwide YourLife IUL $736,969 N/A to guarantee Age 98$13,464Yes Nationwide YourLife NLG UL $1.000,000N/A to Guarantee Age 101$11,820No Understanding the differences in Guaranteed Death Benefit Female, Age 55, $200,000 Single Premium; NTP, Solve for Initial Face Amount Note: For Current Assumption the No Lapse Guarantee (NLG) duration is the maximum life expectancy solve based on current interest rates as of May

20 Client Scenario: Alternative to Current Assumption Differences in the Guaranteed Death Benefit 20 For Insurance professional use only NFM Current Assumption with Life Expectancy Guarantee: Do these products shift risk from Insurance Company to Consumers? Hopefully no in force rate increase to impact the current Death Benefit duration Hopefully no interest rate reduction to impact the current Death Benefit duration Hopefully pay illustrated persistency credit – to help keep policy in force Hopefully enough CV if policy holder lives past life expectancy – keep policy in force Hopefully advisor has monitored policy for all of the above Nationwide’s IUL with NLG (Extended Death Benefit Guarantee Rider) Even if in-force rate increases occur, this does Not impact the Guaranteed Death Benefit Interest credited to the Indexed Interest Strategies is not at sole discretion of Nationwide No persistency credit Option at issue for no lapse guarantee duration up to age 120 (CV does not impact NLG) Hopefully advisor monitored policy for paying scheduled EDBG premiums (Unlimited cumulative premium interest free catch up for Level Pay scenarios)

Client Scenario: Accumulation & Income Male, age 45, NTPP, 6% Rate, Minimum Non Mec, Option 1 Death Benefit $10,000 Premium Paid for 20 yrs; Solve for Maximum Monthly Income ages FLM-0802AO.2 For Insurance professional use only CompanyIncomeFace AmountCSV yr 10Target Premium Pacific Life Indexed Performer LT$23,349$504,973$85,861$9,938 Aviva Lifetime Builder III IUL$23,234$557,354$84,798$9,508 Nationwide Indexed UL$22,992$535,412$92,477$8,995 John Hancock Accumulation IUL$22,464$514,726$93,335$8,205 Axa Athena Indexed UL$21,796$542,884$88,104$7,818 Lincoln LifeReserve Indexed UL Accumulator$20,223$491,912$79,443$9,312 Minnesota Life Eclipse Indexed Life$19,986$539,822$91,082$9,209 Prudential Index Advantage UL$19,868$518,332$102,876$4,245

Client Scenario: Accumulation & Income Male, age 45, NTPP, 6% Rate, Minimum Non Mec, Option 2/1 “Switch” Death Benefit $10,000 Premium Paid for 20 yrs; Solve for Maximum Monthly Income ages FLM-0802AO.2 For Insurance professional use only CompanyIncomeFace AmountCSV yr 10Target Premium Aviva Lifetime Builder III IUL$28,352$213,759$115,297$3,647 Pacific Life Indexed Performer LT$27,414$217,414$107,633$4,000 John Hancock Accumulation IUL$25,946$208,367$108,663$3,986 Nationwide YourLife Indexed UL$25,896$252,340$106,066$4,239 Lincoln LifeReserve Indexed UL Accumulator$25,777$226,543$110,002$3,922 Minnesota Life Eclipse Indexed Life$24,982$214,456$114,973$3,659 Axa Athena Indexed UL$24,861$222,402$107,421$3,425 American General, Elite Global Plus$22,196$216,836$113,101$2,898

Comparing IUL’s with Indemnity Style Long Term Care Riders or Chronic Illness Riders 23 For Insurance professional use only Premium for Rider is due beginning Residual Death Benefit* Pays for Permanent Conditions Pays for Temporary Conditions Requires Proof of Loss Each Month Nationwide At issue Yes No AXA At issue Yes No Minnesota Life At issue Yes Transamerica At issue Yes Hartford At IssueNo Yes No Pacific Life At accelerationNo Yes No AVIVA At accelerationNo Yes No IUL Indemnity Style LTC and Chronic Illness Riders * Residual Death Benefit in Excess of Initial Face Amount

Nationwide’s IUL Strengths Nationwide YourLife IUL can be used for: Guaranteed Death Benefit (Optional Extended Death Benefit Guarantee Rider) Low cost when Solving for Level Premium (Session 3) Accumulation & Income, Insurance Based Retirement Planning Long Term Care Rider Nationwide Offers Policy Management Program Automated Premium Monitor to keep NLG on track (EDBG Rider) Automated Income Monitor to manage Income Stream 2/1 Switch Notification (for income scenarios) Simple Indemnity Design for LTC rider Claims 24For Insurance professional use only

What we will cover next time 25 For Insurance professional use only IUL Part 3: Commonly Misperceptions of IUL June 25, 2013 IUL Part 4: Advanced Planning Applications of IUL July 23, 2013