Asset Allocation Guide

Transcription

1 Asset Allocation Guide Intelligent Variable Annuity Intelligent Life Variable Universal Life Insurance Intelligent Life Survivorship Variable Universal Life Insurance

2 Contents A breadth of choices. A depth of experience. 1 Allocating assets to match your investment style 2 A choice for allocating your assets 8 Investment options by asset class 10 Investment management firms 12 Please keep in mind that there are inherent risks associated with investing in securities. Investment products are not FDIC insured, may lose value and are not bank guaranteed. As with all securities, your accumulations can increase or decrease depending on how well the underlying investments perform over time. We do not guarantee the performance of the underlying investments. You should consider the investment objectives, risks, charges and expenses carefully before investing. Please also note the following: Funds that invest in foreign securities are subject to special risks, including currency fluctuation and political and economic instability. Investing in noninvestment-grade securities presents special risks, including significantly higher interest rate and credit risks. Funds that invest in fixed-income securities are not guaranteed and are subject to interest rate, inflation and credit risks. Small-cap and mid-cap stocks may have limited marketability and may be subject to more abrupt or erratic market movements than large-cap stocks. Real estate securities are subject to various risks, including fluctuations in property values, higher expenses or lower income than expected, and potential environmental problems and liability. W W This brochure must be accompanied or preceded by a current prospectus for the product you purchased and the current prospectuses for the underlying funds.

3 A breadth of choices. A depth of experience. This brochure is designed to help you evaluate your investment needs and build an asset allocation that s right for your unique investment goals. As your investment preferences and goals change, keep in mind that you can adjust your allocation at any time. You can also set up an account rebalancing program with your TIAA-CREF Life Insurance Company (TC Life) variable contract that will automatically realign your weightings based on your current allocation instructions. The first step is assessing your risk tolerance (see questionnaire on page 2). Once you know your risk score, the next step is understanding how the number of years you plan to invest and your risk tolerance work together to help you select your asset allocation mix (see page 7). The combination of these scores will advance you to the next step, where you can make your selections from among TIAA-CREF Investment Management Group s (IMG s) thoroughly researched, suggested portfolio options, or you can choose your own allocation mix. Please keep in mind that the value of your assets may go up or down based on the performance of the underlying investments. The research behind the recommendations The suggested portfolio choices were chosen by the IMG investment professionals to offer solutions that can help you build your portfolio and address your investment needs. Their disciplined process of vetting the options made available to you will help you maximize your assets through meticulous coordination of two key elements: construction: Shaping a portfolio begins with a thorough analysis of needs and goals. Based on this analysis, the IMG team provides a choice of recommendations based upon the various risk tolerance profiles for allocation of your assets so you can begin to potentially build your portfolio. The ultimate allocation decision is up to you after you consider investment information that is important to your circumstances. Investment due diligence: This critical step helps us identify active manager biases across market fluctuations and can have a substantial impact on the recommendations we make. Our due diligence allows you to make more informed decisions as to where you allocate your assets. IMG also oversees the research, selection and ongoing coverage of the investment options so that we have the utmost confidence in choices we make available to you. These crucial elements are founded on a two-stage research process: Quantitative evaluation employs proprietary research tools to identify investment manager biases and eliminate investment options that do not meet our risk, return and client preference criteria; and Qualitative evaluation: We research portfolio strategy, investment philosophy and operational capabilities of a select group of investment managers who pass the first, quantitative stage. Ongoing review and assessment IMG regularly monitors the investment options made available in the TC Life variable insurance and annuity products to ensure they continue to meet our exacting standards. For example, all investment options used to build strategies are reviewed at least quarterly with a minimum of one fund manager call annually. This research process was founded on core principles including evidence-based analyses as well as leveraging the first-hand research of our highly skilled and experienced team of investment managers. Thoughtful integration of the above elements helps ensure a more distinctive, high-quality investment experience upon which you can potentially build your portfolio. Asset Allocation Guide 1

4 Allocating assets to match your investment style Your portfolio s performance is largely dependent on your asset allocation how much you invest in equities, bonds and other asset classes. This guide was developed to help you accomplish two important goals: 1) to identify the investment portfolio that matches your needs, and 2) to select the investment accounts within your portfolio that best suit your objectives. To provide you with this information, we are using data and a questionnaire created by Ibbotson Associates a leading authority on asset allocation that combines research and knowledge to give investors practical, real-life solutions. For more information regarding the underlying investment options, please read the Variable Product Funds prospectus. For a complete explanation of the features and benefits, please read the product guides and the product prospectuses. Step one: Determine your risk tolerance. Start by using this questionnaire to determine your overall risk tolerance, which is based primarily on two factors: time horizon and attitude toward risk. In most cases, the shorter the investment period, the less risk the investor can afford to take. And, while many people feel more comfortable with less exposure to risk, it s important to note that there is a definite relationship between risk and return, with potentially higher returns coming from riskier investments. Time Horizon Scoring 1. When do you expect to begin withdrawing money from your investment account? a. Less than one year (0 Points) b. 1 to 2 years (1 Point) c. 3 to 4 years (3 Points) d. 5 to 7 years (7 Points) e. 8 to 10 years (9 Points) f. 11 years or more (11 Points) Once you begin withdrawing money from your investment account, how long do you expect the withdrawals to last? a. I plan to take a lump-sum distribution. (0 Points) b. 1 to 4 years (2 Points) c. 5 to 7 years (4 Points) d. 8 to 10 years (5 Points) e. 11 years or more (6 Points) 2. Time Horizon Score = (sum of scores from questions 1 and 2) 2 Asset Allocation Guide

5 Risk Tolerance 3. Inflation, the rise in prices over time, can erode your investment return. Long-term investors should be aware that, if portfolio returns are less than the inflation rate, their ability to purchase goods and services in the future might actually decline. However, portfolios with long-term returns that significantly exceed inflation are associated with a higher degree of risk. Which of the following portfolios is most consistent with your investment philosophy? a. A seeks to exceed long-term inflation by a large margin and has a high degree of risk. b. B seeks to exceed long-term inflation by a moderate margin and has a high to moderate degree of risk. c. C seeks to exceed long-term inflation by a small margin and has a moderate degree of risk. d. D seeks to match the rate of long-term inflation and has a low degree of risk. (18 Points) (12 Points) (6 Points) (0 Points) Scoring Historically, portfolios with the highest average returns also tend to have the highest chance of short-term losses. The table below provides five hypothetical scenarios. Each of these scenarios offers a different degree of risk and reward over a one-year holding period. Please select the option with which you are most comfortable.* Hypothetical results at the end of one year Potential gain Potential of a at the end loss at the end of one year of one year a. A 5.8% 22% (0 Points) b. B 7.1% 25% (5 Points) c. C 8.4% 27% (9 Points) d. D 9.7% 29% (14 Points) e. E 11.1% 30% (18 Points) 4. * The maximum gain or loss on an investment is impossible to predict; results based on actual investments will vary. The ranges shown in the table are hypothetical and are designed solely to help determine an investor's risk tolerance. Asset Allocation Guide 3

6 Risk Tolerance (continued) 5. Investing involves a trade-off between risk and return. Which statement best describes your investment goals? a. Protect the value of my account. In order to minimize the chance for loss, I am willing to accept the lower long-term returns provided by conservative investments. b. Keep risk to a minimum while trying to achieve slightly higher returns than the returns provided by investments that are more conservative. c. Long-term growth is equally as important as managing portfolio risk. d. Maximize long-term investment returns. I am willing to accept large and sometimes dramatic fluctuations in the value of my investments. (0 Points) (5 Points) (10 Points) (15 Points) 6. Historically, markets have experienced downturns, both short-term and prolonged, followed by market recoveries. Suppose you owned a well-diversified portfolio that fell by 20% (i.e., $1,000 initial investment would now be worth $800) over a short period, consistent with the overall market. Assuming you still have 10 years until you begin withdrawals, how would you react? a. I would not change my portfolio. (15 Points) b. I would wait at least one year before changing to options that are more conservative. c. I would wait at least three months before changing to options that are more conservative. d. I would immediately change to options that are more conservative. (10 Points) (5 Points) (0 Points) Scoring Asset Allocation Guide

7 Risk Tolerance (continued) Scoring 7. The following graph shows the hypothetical best and worst results of five sample portfolios over a one-year holding period. Note that the portfolio with the highest upside also has the largest potential downside. Which of the portfolios below would you prefer to hold?* 60% 50% 54% RETURN (%) 40% 30% 20% 10% 0% 10% 20% 30% 32% 45% 25% 36% 19% 28% 14% 21% 9% 40% PORTFOLIO A PORTFOLIO B PORTFOLIO C PORTFOLIO D PORTFOLIO E a. A (19 Points) b. B (14 Points) c. C (9 Points) d. D (5 Points) e. E (0 Points) 8. I am comfortable with investments that may frequently experience large declines in value if there is a potential for higher returns. Does this describe you? a. Agree (15 Points) b. Disagree (8 Points) c. Strongly Disagree (0 Points) Risk Tolerance Score = (sum of scores from questions 3 to 8) * The maximum gain or loss on an investment is impossible to predict; results based on actual investments will vary. The ranges shown in the table are hypothetical and are designed solely to help determine an investor's risk tolerance. Asset Allocation Guide 5

8 Step two: Understanding your scores The scores you earned will help determine which portfolio suits you best. Time Horizon measures your risk tolerance based on the length of time for which you can invest. Typically, the shorter your time frame, the more conservative your recommended portfolio will be. The Risk Tolerance score quantifies your temperament for facing risk. Ibbotson Associates combines these two measures to form a total score that points to a recommended portfolio, as indicated in this scoring grid. To find your, plot your Time Horizon score from page 2 and your Risk Tolerance score from page 5 on the grid below. For example, if your Time Horizon score is 15 and your Risk Tolerance score is 56, your is 3. Scoring Grid Time Horizon Score Risk Score Used with permission Ibbotson Associates, Inc., a wholly owned subsidiary of Morningstar, Inc. All rights reserved. 6 Asset Allocation Guide

9 Step three: Finding your target allocation Your target allocation is described in this section by both a pie chart which illustrates a breakdown of suggested asset classes and a short explanation of the target allocation goals. Please keep in mind that the portfolios below, provided by IMG, were not created specifically for you, and may not take into account your particular goals or preferences. The ultimate allocation decision is up to you after you consider investment information that is important to your circumstances. 1 Conservative 2 Moderate - Conservative 3 Moderate W 19% Domestic Stocks W 8% International Stocks W 71% Bonds/Fixed Income W 0% Real Estate Stocks 2% Cash Equivalents W The Conservative portfolio is designed to potentially provide stability and protection from loss to investors who either have a short time horizon and/or a primary goal of avoiding potential loss. The stability of this portfolio comes at the expense of achieving potentially higher long-term returns. 4 Moderate-Aggressive W 29% Domestic Stocks W 15% International Stocks W 55% Bonds/Fixed Income W 0% Real Estate Stocks 2% Cash Equivalents W The Moderate-Conservative portfolio primarily attempts to avoid short-term loss, but still seeks somewhat higher returns over the long term. To achieve higher potential returns, some fluctuations in investment value are to be expected. 5 Aggressive W 34% Domestic Stocks W 20% International Stocks W 41% Bonds/Fixed Income W 4% Real Estate Stocks 1% Cash Equivalents W The Moderate portfolio is designed for those who are equally concerned with risk and return. The planned objective for this portfolio is to provide returns that outpace inflation over the long term. Those investing in this portfolio should be comfortable with fluctuations in the portfolio s value and occasional short-term loss. Please note that no strategy can eliminate or anticipate all market risks and losses can occur. W 45% Domestic Stocks W 20% International Stocks W 29% Bonds/Fixed Income W 5% Real Estate Stocks 1% Cash Equivalents W The Moderate-Aggressive portfolio is designed for investors seeking greater accumulation over intermediate to long-term horizons. Those investing in this portfolio must be comfortable with more-than-average volatility and potential short-term losses to achieve the desired higher returns. W 53% Domestic Stocks W 24% International Stocks W 17% Bonds/Fixed Income W 5% Real Estate Stocks 1% Cash Equivalents W The Aggressive portfolio is designed for investors seeking the potential for even greater returns over a long-term horizon. Those who invest in this portfolio must be comfortable with experiencing frequent short-term loss and extreme volatility in portfolio value in exchange for potentially higher returns over the long term. Asset Allocation Guide 7

10 A choice for allocating your assets Once you ve completed the Risk Tolerance Questionnaire in the Asset Allocation Guide, you re ready to select your investment options and allocation percentages. To assist with this process, please review the portfolios below for each of the five risk profiles, which range from Conservative to Aggressive. These portfolios do not reflect an investor s individual circumstances. You can use these portfolios or choose your own. The decision is yours. s Conservative Moderate- Conservative Moderate Moderate- Aggressive Aggressive W Equity W Equity W Equity W Equity W Equity Fund Name W Fixed Income W Fixed Income W Fixed Income W Fixed Income W Fixed Income ClearBridge Variable Aggressive Growth -Class I 7.0% 7.0% 10.0% 12.0% 14.0% PVC Equity Income Account 7.0% 11.0% 11.0% 15.0% 17.0% Vanguard VIF Mid-Cap Index 3.0% 3.0% 6.0% Neuberger Berman AMT Mid Cap Intrinsic Value Class I 5.0% 7.0% 7.0% 9.0% 10.0% Vanguard VIF Small Company Growth 3.0% 3.0% Delaware VIP Small Cap Value Std Class 4.0% 3.0% 3.0% 3.0% Delaware VIP International Value Equity Std Class 4.0% 4.0% 10.0% 10.0% 12.0% DFA VA International Small 4.0% 5.0% 5.0% 5.0% 5.0% John Hancock Emerging Markets Value Trust 5.0% 5.0% 5.0% 7.0% Vanguard VIF REIT Index 4.0% 5.0% 5.0% TIAA-CREF Life Bond 11.0% 9.0% 6.0% 6.0% 4.0% Vanguard VIF Total Bond Market Index 11.0% 9.0% 6.0% T. Rowe Price Limited-Term Bond 11.0% 6.0% 9.0% 4.0% DFA VA Short-Term Fixed 11.0% 5.0% PIMCO VIT Emerging Markets Bond 4.0% 4.0% 4.0% 5.0% 4.0% PIMCO VIT Real Return Institutional Class 15.0% 14.0% 12.0% 11.0% 6.0% Vanguard VIF High Yield Bond 8.0% 8.0% 4.0% 3.0% 3.0% TIAA-CREF Life Money Market* 2.0% 2.0% 1.0% 1.0% 1.0% % % % % % Although asset allocation is intended to mitigate investment risk, implementation does not guarantee a profit or protect against a loss. Investment options and allocation percentages may change over time and may be different from previous models. Performance returns depicted are calculated based on the current models revised as of 01/12/16. Performance does not reflect previous model allocations. * An investment in this Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund. 8 Asset Allocation Guide

11 Asset Allocation Guide 9

12 Investment options by asset class You have a variety of investment options to choose from ranging from conservative to aggressive. When you complete your application, you will select your investments and determine how your assets are allocated. You can change your asset allocation at any time. Classification of the investment options was made by Morningstar.* (For more on the investment companies, see page 14.) Domestic Equity Value Blend Growth Large-Cap PVC Equity Income Account Class I TIAA-CREF Life Large-Cap Value Fund DFA VA US Large Value Franklin Mutual Shares VIP Fund 1 Neuberger Berman AMT Large Cap Value I Class TIAA-CREF Life Social Choice Equity Fund W W TIAA-CREF Life Stock Index Fund W W Prudential Series Fund Value Class II Vanguard VIF Equity Index Janus Aspen Forty Institutional Shares MFS Growth Series 2 Initial Class Prudential Series Fund Jennison 20/20 Focus Class II ClearBridge Variable Aggressive Growth 3 Class 1 MFS Massachusetts Investors Growth Stock 4 TIAA-CREF Life Growth Equity Fund TIAA-CREF Life Growth & Income Fund Vanguard VIF Capital Growth Mid-Cap W W Neuberger Berman AMT Mid Cap Intrinsic Value I Class Janus Aspen Perkins Mid Cap Value Institutional Shares Matson Money U.S. Equity VI PVC MidCap Account 5 Class I Vanguard VIF Mid-Cap Index Franklin Small-Mid Cap Growth VIP Fund 6 W W Wanger Select Small-Cap W W Delaware VIP Small-Cap Value Series Standard Class DFA VA US Targeted Value W W Royce Capital Fund Micro-Cap Investment Class Royce Capital Fund Small-Cap Investment Class TIAA-CREF Life Small-Cap Equity Fund ClearBridge Variable Small Cap Growth 7 Class I Vanguard VIF Small Company Growth Wanger USA 1 Formerly known as Mutual Shares Securities Fund-Class 1. 2 Effective February 18, 2013, the MFS Growth Series is closed to new investors. 3 Formerly known as Legg Mason Variable Aggressive Growth. 4 Effective March 27, 2015, the MFS Investors Growth Stock Series-Initial Class merged with the MFS Massachusetts Investors Growth Stock. 5 Closed to new contract owners effective August 15, Formerly known as Franklin Small-Mid Cap Growth Securities Fund-Class 1 7 Formerly known as Legg Mason Variable Small Cap Growth. For help in understanding any of the terms used, completing your questionnaire or choosing your target allocation, talk with your advisor or call a representative at for Life; for Annuity. * 2015 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. 10 Asset Allocation Guide

13 International/Global Equity Value Blend Growth Large-Cap Delaware VIP International Value Equity Series Standard Class W W Templeton Developing Markets VIP Fund 1 TIAA-CREF Life International Equity Fund John Hancock Emerging Markets Value Trust Janus Aspen Overseas 2 Institutional Shares MFS Global Equity Series 3 Initial Class DFA VA International Value Mid-Cap Matson Money International Equity VI DFA VA International Small W W Wanger International 1 Formerly known as Templeton Developing Markets Securities Fund-Class 1. 2 Effective February 18, 2013, the Janus Aspen Overseas is closed to new investors. 3 Consists of both domestic and international equity. Fixed Income Short Term Intermediate Term Long Term High DFA VA Short-Term Fixed Matson Money Fixed Income VI TIAA-CREF Life Bond Fund DFA VA Global Bond Vanguard VIF Total Bond Market Index PIMCO VIT Real Return 4 Institutional Class PIMCO VIT Global Bond (Unhedged) Institutional Class Medium T. Rowe Price Limited - Term Bond Delaware VIP Diversified Income Series Standard Class PIMCO VIT Emerging Markets Bond Institutional Class Low Vanguard VIF High Yield Bond Western Asset Variable Global High Yield Bond 5 Class I 4 The PIMCO VIT Real Return is primarily invested in inflation-protected securities. 5 Formerly known as Legg Mason Western Asset Variable Global High Yield Bond. Other Balanced Sector Specific Other W W Calamos Growth & Income 6 DFA VA Global Moderate Allocation Franklin Income VIP Fund 7 W W PIMCO VIT All Asset Institutional Class TIAA-CREF Life Balanced Fund Credit Suisse Trust-Commodity Return Strategy VY Clarion Global Real Estate Class I MFS Utilities Series Initial Class PIMCO VIT Commodity Real Return Strategy Institutional Class Prudential Series Fund Natural Resources Class ll TIAA-CREF Life Real Estate Securities Fund T. Rowe Price Health Sciences I Vanguard VIF REIT Index TIAA-CREF Life Money Market Fund 8 6 Effective July 30, 2012, the Calamos Growth & Income is closed to new investors. 7 Formerly known as Franklin Income Securities Fund-Class 1. 8 An investment in this Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund. Money in the TIAA-CREF Life Fixed Account is part of the TIAA-CREF General Account and is managed by TIAA-CREF investment professionals. It is only available in Intelligent Life Variable Universal Life Insurance and Intelligent Life Survivorship Variable Universal Life Insurance. Funds earn a current interest rate, but never less than the guaranteed crediting rate stated in the policy contract. This guarantee is backed by the claims-paying ability of TIAA-CREF Life Insurance Company. The TIAA-CREF Life Fixed Account has not been analyzed by Ibbotson Associates. Asset Allocation Guide 11

14 A closer look at each investment option Building an asset allocation strategy that meets your needs requires information not only about you but about your investment options. You and your advisor can easily access performance history and a comprehensive Morningstar report for each investment option on our website. Understanding investment expenses An investment management fee will be deducted from each investment option you select. These fees are in addition to the policy charges. Fees are one consideration as you build your investment strategy. Investment options with lower fees put more money to work for you. However, lower fees do not guarantee higher returns. The table on the next page compiles the Net Total Annual Operating Expense for each investment option. This fee includes management fees, distribution (Rule 12b-1) fees, and other expenses and is charged by each portfolio as a percentage of average daily net assets for the fiscal year ended December 31, expenses are not fixed or specified under the terms of the policy, and may change periodically.* Get the details Comprehensive information about each investment option including current performance, portfolio composition, key statistics, top 20 holdings and total fund assets is available at or * Minimum and maximum total operating expenses charged by the currently available portfolios that you may pay periodically during the time you own the policy, both before and after any contractual fee waivers or reimbursements. Gross Total Annual Operating Expenses are 0.12% to 5.61%. Net Total Annual Operating Expenses are 0.09% to 1.42%. 12 Asset Allocation Guide

15 Net Total Annual Operating Expense TIAA-CREF Life Stock Index Fund* 0.09% TIAA-CREF Life Money Market Fund* 0.15% Vanguard VIF Equity Index 0.16% Vanguard VIF Total Bond Market Index 0.19% TIAA-CREF Life Social Choice Equity Fund* 0.22% Vanguard VIF Mid-Cap Index 0.24% DFA VA Global Bond 0.25% Vanguard VIF REIT Index 0.27% DFA VA US Large Value 0.27% DFA VA Short-Term Fixed 0.27% Vanguard VIF High Yield Bond 0.29% TIAA-CREF Life Bond Fund* 0.35% DFA VA US Targeted Value 0.37% Vanguard VIF Small Company Growth 0.40% DFA VA Global Moderate Allocation * 0.40% Vanguard VIF Capital Growth 0.40% DFA VA International Value 0.46% Franklin Income VIP Fund 0.47% PVC Equity Income Account Class % TIAA-CREF Life Balanced Fund* 0.51% TIAA-CREF Life Growth & Income Fund* 0.52% TIAA-CREF Life Growth Equity Fund* 0.52% TIAA-CREF Life Large-Cap Value Fund* 0.52% Janus Aspen Overseas Institutional 0.53% Shares 4 PVC Mid-Cap Blend Account Class % PIMCO VIT Real Return Institutional Class 0.55% TIAA-CREF Life Real Estate Securities Fund* 0.57% TIAA-CREF Life Small-Cap Equity Fund* 0.57% Janus Aspen Forty Institutional Shares 0.57% DFA VA International Small 0.59% TIAA-CREF Life International Equity Fund* 0.60% Janus Aspen Perkins Mid Cap Value Institutional Shares Delaware VIP Diversified Income Series Standard Class 0.62% 0.67% T. Rowe Price Limited-Term Bond 0.70% Franklin Mutual Shares VIP Fund 0.73% Wanger Select 0.73% PIMCO VIT Global Bond (Unhedged) Institutional Class 0.76% MFS Growth Series Initial Class % PIMCO VIT Commodity Real Return Strategy Inst. Class* Net Total Annual Operating Expense 0.78% MFS Utilities Series Initial Class 0.79% ClearBridge Variable Aggressive Growth Class I Delaware VIP Small Cap Value Series Standard Class 0.80% 0.80% Franklin Small-Mid Cap Growth VIP Fund 0.80% MFS Massachusetts Investors Growth Stock 3 Western Asset Variable Global High Yield Bond Class I ClearBridge Variable Small Cap Growth Class I Prudential Series Fund Value Class II PIMCO VIT Emerging Markets Bond Inst. Class 0.80% 0.81% 0.82% 0.82% 0.85% VY Clarion Global Real Estate Class I* 0.89% Prudential Series Fund Natural Resources Class II 0.90% T. Rowe Price Health Sciences I 0.95% Wanger USA 0.96% MFS Global Equity Series Initial Class* 1.00% Neuberger Berman Advisers Management Trust Mid Cap Intrinsic Value I Class 1.02% John Hancock Emerging Markets Value Trust 1.03% Credit Suisse Trust-Commodity Return Strategy * Royce Capital Fund Small-Cap Investment Class 1.05% 1.05% Wanger International 1.05% Delaware VIP International Value Equity Series Standard Class PIMCO VIT All Asset Institutional Class* Neuberger Berman Advisers Management Trust Large Cap Value I Class 1.07% 1.08% 1.13% Matson Money Fixed Income VI 1.19% Prudential Series Fund Jennison 20/20 Focus Class II Royce Capital Fund Micro-Cap Investment Class 1.23% 1.31% Templeton Developing Markets VIP Fund 1.36% Calamos Growth and Income % Matson Money U.S. Equity VI 1.43% Matson Money International Equity VI 1.84% * A contractual fee waiver applies. See the prospectus for the fee waiver expiration date. 3 Effective March 27, 2015, the MFS Investors Growth Stock Series-Initial Class merged with the MFS Massachusetts Investors Growth Stock. 4 Effective February 18, 2013, the Janus Aspen Overseas - Institutional Shares and the MFS Growth - Initial Class are closed to new investors. 5 Effective August 15, 2013, the PVC Mid-Cap Blend Account is closed to new investors. 6 Effective July 30, 2012, the Calamos Growth & Income is closed to new investors. Asset Allocation Guide 13

16 Investment management firms The 20 investment management firms listed here bring you many different types of investment opportunities. While they vary by methodology, strategy and other characteristics, they are all highly regarded by experienced investors. And they share a common goal supporting your investment needs. Calamos Columbia Wanger Credit Suisse Trust About the firm Over 30 years in business Calamos Investments is a global investment firm committed to excellence in investment management and client services. W W A global investment platform with focused, experienced teams, specialized by investment discipline Serving the needs of institutional and individual investors for over 30 years Offering a range of global investment solutions to work with a client s asset allocation framework Equity Fixed Income Convertibles Alternatives Publicly listed, employee-owned business 364 employees,* 74 investment professionals Over 17 years in business W W Adherence to the Growth at a Reasonable Price (GARP) style has caused the firm to correctly react to valuation extremes in the market. W W Experienced team of professionals following a research-driven investment process that blends bottom-up and top-down analysis W W Consistent investment process since inception of Columbia Acorn Fund in 1970 W W The Advisor is a registered investment advisor and wholly owned subsidiary of Ameriprise Financial. $336.3 Billion Assets Under Management as of 12/31/14 Over 150 years in business W W Operates an integrated global platform that seeks to deliver Credit Suisse s best investment ideas to clients around the world W W Clients include governments, corporations, endowments, foundations and insurance companies. Offers a broad spectrum of asset classes tailored to clients needs W W Strives to deliver innovative, industryleading alternative asset class solutions $392.5 Billion Assets Under Management as of 12/31/14 $23.5 Billion Assets Under Management as of 12/31/14 Investment account W W Calamos Growth & Income W W Wanger International anger W Select anger W USA W W Credit Suisse Trust-Commodity Return Strategy 14 Asset Allocation Guide

17 Delaware Investments Dimensional Franklin Templeton About the firm Over 75 years in business W W Delaware Investments traces its origins to an investment counseling service that was founded in We offer 80 years of investment management experience, covering many economic, political and market environments. W W Our first mutual fund was introduced in 1938 and since then, Delaware Investments has pioneered a number of investment strategies. In addition to our flagship Delaware Fund which focused on large-cap equity investing, Delaware Investments was among the first to offer small company stock funds, single-state municipal bond funds, high-yield corporate bond funds and short-to-intermediatematurity government bond funds. Delaware Investments has since become a significant manager of assets in each of the major categories with offerings and services covering all market capitalizations and all investment styles. W W Delaware Investments refers to Delaware Management Holdings, Inc. and its subsidiaries. Macquarie Group refers to Macquarie Group Limited and its affiliates and subsidiaries worldwide. Over 30 years in business Dimensional is a leading global asset management firm that serves institutions, financial advisors, retirement plans and other investors. * As of December 31, 2014, the firm managed $381 billion for clients worldwide. W W Dimensional builds and manages strategies to help clients pursue higher expected returns. Guided by a strong belief in markets, Dimensional works closely with leading financial academics to identify new ideas that may benefit investors. The firm applies a dynamic process that integrates advanced research with methodical portfolio design and careful implementation, while balancing investment tradeoffs. W W The firm has a long history of putting financial science to work for clients. Dimensional launched its first strategy in 1981 based on research documenting the stronger performance of US small-cap stocks. Over the past three decades, Dimensional has responded to new research and evolving client needs to create a full suite of global equity and fixed-income strategies. Over 60 years in business Franklin Templeton s distinct multimanager structure combines the specialized expertise of three world-class investment management groups Franklin, Templeton and Mutual Series. W W Franklin: Founded in 1947, Franklin is a recognized leader in fixed-income investing and also brings expertise in growth- and value-style U.S. equity investing. W W Templeton: Founded in 1940, Templeton pioneered international investing and, in 1954, launched what has become the industry s oldest global fund. Today, with offices in over 25 countries, Templeton offers investors a truly global perspective. Mutual Series: Founded in 1949, Mutual Series is dedicated to a unique style of value investing, searching aggressively for opportunity among what it believes are undervalued stocks, as well as arbitrage situations and distressed securities. $880.1 Billion Assets Under Management as of 12/31/14 $185.5 Billion Assets Under Management as of 12/31/14 Investment account Delaware VIP Diversified Income Series Standard Class W W Delaware VIP International Value Equity Series Standard Class W W Delaware VIP Small-Cap Value Series Standard Class $381 Billion Global Assets Under Management as of 12/31/14 * Dimensional refers to the Dimensional separate but affiliated entities generally, rather than to one particular entity. These entities are Dimensional Fund Advisors LP, Dimensional Fund Advisors Ltd., DFA Australia Limited, Dimensional Fund Advisors Canada ULC, Dimensional Fund Advisors Pte. Ltd., and Dimensional Japan Ltd. DFA VA Global Bond DFA VA Global Moderate Allocation DFA VA International Small DFA VA International Value DFA VA Short-Term Fixed DFA VA US Large Value DFA VA US Targeted Value Franklin Income VIP Fund Franklin Mutual Shares VIP Fund Franklin Small-Mid Cap Growth VIP Fund Templeton Developing Markets VIP Fund Asset Allocation Guide 15

18 Investment management firms (continued) Janus Jennison John Hancock Investments About the firm Over 40 years in business Janus Capital Group is a global investment firm founded in Headquartered in Denver, Colorado, JCG has offices around the world including London, Milan, Munich, Singapore, Hong Kong, Tokyo, Melbourne, Paris, The Hague, Zurich, Frankfurt, Dubai and Taipei. The firm offers differentiated investment solutions from three independent managers: Janus, INTECH and Perkins. JCG s multi-boutique approach provides clients with distinctive solutions across a broad range of asset classes including equities, fixed income, alternatives, asset allocation and income products. $183.1 Billion Assets Under Management as of 12/31/14 Over 40 years in business Commitment to Performance: Superior long-term investment returns for over 44 years. W W Investment Culture: Values individual impact and rewards team performance W W Consistent Philosophy: Internal Fundamental Research, bottomup stock selection and a highly interactive investment process W W Top-Caliber Investment Talent: Small, highly experienced investment teams exclusively focused on investing $184 Billion Assets Under Management as of 12/31/14 Over 150 years of promises kept John Hancock has helped individuals and institutions build and protect wealth since Today, they are one of America s strongest and most-recognized brands. John Hancock Investments provides asset management services to individuals and institutions through a unique manager-ofmanagers approach. They build funds based on investor needs, then go anywhere in the world to find specialized managers with proven track records in those strategies. As one of the longest-tenured manager of managers, they apply vigorous investment oversight to ensure that their funds continue to meet their uncompromising standards and serve the best interests of shareholders. This unique approach to investing has led to a diverse set of investments deeply rooted in investor needs, along with strong risk-adjusted returns across asset classes. $192 Billion Assets Under Management as of 12/31/14 Investment account W W Janus Aspen Forty Institutional Shares Janus Aspen Overseas Institutional Shares Janus Aspen Perkins Mid Cap Value Institutional Shares Prudential Series Fund Jennison 20/20 Focus Class II W W Prudential Series Fund Natural Resources Class II Prudential Series Fund Value Class II W W John Hancock Emerging Markets Value Trust 16 Asset Allocation Guide

19 Legg Mason Matson Money MFS About the firm Over 110 years in business Global leadership, broad asset management capabilities W W Offers global leadership and broad asset management capabilities across a wide range of asset classes and styles W W Provides access to the specialized expertise of our independent investment managers, each known for their unique investment philosophies, strategies and capabilities Experienced portfolio managers, supported by teams of highly qualified investment professionals, with time-tested and proven investment processes W W A corporate culture that demands the highest level of service and integrity $709 Billion Assets Under Management as of 12/31/14 Investment account ClearBridge Variable Aggressive Growth Class I W W ClearBridge Variable Small Cap Growth Class I Western Asset Variable Global High Yield Bond Class I Over 20 years in business Established in 1991, (as Matrix Asset Allocation, Inc.) Matson Money s unique approach to investing is firmly grounded in Nobel-Prize winning financial and economic principles. Matson Money brings academic concepts used by institutional investors to Main Street, helping investors understand their investment approach, bring discipline to the investing process and build investor confidence. W W Over the last 20 years, Matson Money has brought investing education and coaching programs to thousands of financial professionals and investors nationwide. These programs focus on sharing the concepts of free markets, diversification, discipline and rebalancing to create a long-term approach to life-long endeavor. As of December 31, 2014, Matson Money manages $6 billion for thousands of investors in America through independent financial professionals. Through education and strong investment solutions, Matson Money helps individuals create the wealth they need to have the life they want. To that end, we are pleased to announce two new products we re offering in partnership with TIAA-CREF. We are bringing true no-load Variable Life and Variable Annuity products to the marketplace that also provide the investor with the diversification, discipline and solid economic theory that sets Matson Money apart from other investment firms. $6 Billion Assets Under Management as of 12/31/14 Matson Money Fixed Income VI Matson Money International Equity VI Matson Money U.S. Equity VI Over 88 years in business MFS invented the mutual fund in America s first fund made owning a diversified pool of stocks affordable for everyday investors. With its invention, more people could use the growth of America s corporations to help fund their dreams of retirement and educating their children. In 2002, Forbes magazine named the invention of the mutual fund one of the 85 innovations that changed the world, noting that it was a business breakthrough that changed our lives in a profound way. In the nine decades since the mutual fund was established, MFS has managed money through a depression, 15 recessions and six wars. No other mutual fund manager can match MFS history and longevity. MFS is a premier global asset manager with investment offices in Boston, Toronto, London, Mexico City, Sao Paulo, Singapore, Sydney, Hong Kong and Tokyo. Today, MFS offers a broad range of mutual funds, separate accounts and retirement planning products. MFS portfolios are also available as investment options in defined contribution, pension, variable annuity and 529 platforms. All the firm s products are sold exclusively through financial intermediaries. We employ an active, consistent approach through three core principles: Integrated research: Our proprietary method of evaluating securities is continuous and looks to identify high-quality investment opportunities in every major asset class around the world. Global collaboration: We think teams of people with different disciplines and varied perspectives reach better decisions by working together. Active risk management: Our goal is to deliver the greatest possible return within the risk guidelines of each portfolio. $431 Billion Assets Under Management as of 12/31/14 MFS Global Equity Series Initial Class MFS Growth Series Initial Class MFS Massachusetts Investors Growth Stock W W MFS Utilities Series Initial Class Asset Allocation Guide 17

20 Investment management firms (continued) Neuberger Berman PIMCO Principal Global Investors About the firm Over 70 years in business Neuberger Berman is an independent, employee-controlled investment manager. With approximately 2,000 professionals focused exclusively on asset management, Neuberger Berman is deeply grounded in original, fundamental research and offers an investment culture of independent thinking. Founded in 1939 by legendary investor Roy Neuberger, Neuberger Berman today provides solutions across equities, fixed-income and alternative investments. W W Neuberger Berman manages investments for individuals, families and institutions. $250 Billion Assets Under Management as of 12/31/14 Over 40 years in business W W PIMCO is an institutional money manager specializing in active fixed-income investment management. W W Deep bench of investment talent/sector specialist portfolio managers. W W Proprietary analytics/risk systems. W W Investment team led by CIO and co-founder Bill Gross, winner of Morningstar s 2010 Fixed-Income Manager of the Decade, as well as Fixed-Income Manager of the Year in 2007, 2000 and 1998 through W W PIMCO has grown into one of the most respected names in investment management, due in large part to its total return approach to bond investing. $1.68* Trillion Assets Under Management as of 12/31/14 * Effective March 31, 2012, PIMCO began reporting the assets managed on behalf of its parent s affiliated companies as part of its assets under management. PIMCO manages $1.68 trillion in assets, including $1.27 trillion in third-party client assets as of December 31, Over 130 years in business Principal Global Investors is a diversified asset management organization and a member of the Principal Financial Group ( The Principal ), a leading global financial institution. The Principal offers a wide range of financial products and services, with institutional asset management as part of its core business. The Principal was founded in 1879 and began managing retirement assets in As of December 31, 2014, Principal Global Investors has more than $333.1 billion in assets under management and manages assets for institutions in over 70 countries, trading in daylight hours in every time zone around the world. Investment capabilities encompass a range of equity, fixed-income and real estate investments, as well as specialized investment strategies. $519.3 Billion Assets Under Management as of 12/31/14 Investment account W W Neuberger Berman AMT Large Cap Value I Class W W Neuberger Berman AMT Mid Cap Intrinsic Value I Class PIMCO VIT All Asset Institutional Class PIMCO VIT Commodity Real Return Strategy -Institutional Class PIMCO VIT Emerging Markets Bond -Institutional Class W W PIMCO VIT Global Bond (Unhedged) Institutional Class W W PIMCO VIT Real Return Institutional Class PVC Equity Income Account Class I PVC MidCap Account Class I 18 Asset Allocation Guide

21 T. Rowe Price Royce TIAA-CREF About the firm Over 75 years in business In 1937, Thomas Rowe Price, Jr. founded our company based on a very simple business principle: What is good for the client is also good for the firm. To this day, T. Rowe Price adheres to the same principle. T. Rowe Price is an independent investment management firm helping institutional and individual investors worldwide reach their long-term goals. Building on a solid foundation: Organizational stability and a long-term orientation contribute to a proven business approach designed to produce strong performance. Disciplined by design: Fundamental, bottom-up research defines our investment approach and drives investment management excellence. Informed by multiple perspectives: Integrating the individual perspectives of talented, diverse professionals contributes to effective idea generation for client portfolios. Over 40 years in business For more than 40 years, Royce & Associates, investment advisor to The Royce Funds, has used a disciplined, value-oriented approach to select micro-cap and small-cap companies. Chuck Royce, the firm s founder and a pioneer of small-cap investing, enjoys one of the longest tenures of any mutual fund manager. There is approximately $32 billion in total AUM as of 12/31/2014 and a seasoned staff of 34 investment professionals. Our officers, employees and their affiliates have more than $185 million invested in The Royce Funds as of 12/31/2014. $32.1 Billion Assets Under Management as of 12/31/14 Nearly 100 years in business TIAA-CREF is a national financial services organization and leading provider of retirement services in the academic, research, medical and cultural fields. TIAA-CREF manages accounts in-house to control costs and maintain a consistent investment approach over long time periods. Each of TIAA-CREF s investment portfolios is managed by a team of professionals that integrates the focused expertise of analysts and researchers with the broad outlook of experienced portfolio managers. $618 Billion Combined Assets Under Management as of 12/31/14 $746.8 Billion Assets Under Management as of 12/31/14 Investment account T. Rowe Price Health Sciences I T. Rowe Price Limited-Term Bond Royce Capital Fund Micro-Cap Investment Class Royce Capital Fund Small-Cap Investment Class TIAA-CREF Life Balanced Fund TIAA-CREF Life Bond Fund TIAA-CREF Life Growth Equity Fund TIAA-CREF Life Growth & Income Fund TIAA-CREF Life International Equity Fund TIAA-CREF Life Large-Cap Value Fund TIAA-CREF Life Money Market Fund TIAA-CREF Life Real Estate Securities Fund W W TIAA-CREF Life Small-Cap Equity Fund W W TIAA-CREF Life Social Choice Equity Fund TIAA-CREF Life Stock Index Fund Asset Allocation Guide 19

22 Investment management firms (continued) Vanguard nt account Voya About the firm Nearly 40 years in business as the only client-owned mutual fund company in the world Founded on a simple but revolutionary idea that a mutual fund company should be managed in the sole interest of its investors. Since the beginning in 1975, Vanguard is committed to putting the interests of investors first. For nearly four decades, structured in the U.S. as a mutual mutual fund company, owned by the Vanguard funds and their investors. Unique ownership structure and client-first philosophy has driven many distinctive business decisions that set them apart. Long-standing commitment to providing an exceptional value: outstanding performance and service at low costs. Grown to become one of the world s largest investment management companies. Locations in the United States, Australia, the United Kingdom, Europe, Asia and the Americas. 40 years in business Active, research-driven investment solutions across asset classes and investment styles. Investment mission: find unrecognized value ahead of consensus through active management based on original insights on markets and companies, and a vision of investment potential that differs from the consensus view. Top 20 manager of U.S. Institutional tax-exempt and Defined Contribution assets 1 W W $213 billion in assets under management with $128 billion managed for external clients 2 W W $37 billion in Defined Contribution plan assets under management 3 Over 850 employees and 200 investment professionals $213 Billion Assets Under Management as of 12/31/14 $3 Trillion Assets Under Management as of 12/31/14 1 Pensions and Investments Magazine, The Largest Money Managers as of December 31, As of December 31, 2014, Voya IM assets of $213 billion include proprietary insurance general account assets of $85 billion calculated on a market value basis. Voya IM assets, as reported in Voya Financial, Inc. SEC filings, include general account assets valued on a statutory book value basis and total approximately $208 billion. 3 The $37 billion in DC assets excludes approximately $28 billion in assets under administration as of December 31, Investment account Vanguard VIF Capital Growth Vanguard VIF Equity Index Vanguard VIF High Yield Bond Vanguard VIF Mid-Cap Index Vanguard VIF REIT Index Vanguard VIF Small Company Growth Vanguard VIF Total Bond Market Index VY Clarion Global Real Estate Class I 20 Asset Allocation Guide