Mutual fund giant Fidelity Investments and insurance underwriter Nationwide Financial Services Inc. have beefed up the variable annuity products they sell through financial intermediaries.

The companies have begun offering 13 choices in mutual funds, up from the six that were previously offered.

Fidelity manages the underlying portfolios in the variable annuities, which range from international funds to growth and income and bond portfolios. Nationwide underwrites the insurance portion and markets the product.

Nationwide has been one of the fastest growing sellers of variable annuities through banks, second in sales only to the Hartford. Nationwide's sales have jumped from $240 million in 1994 to about $1 billion in 1996, according to Nationwide's Richard Karas, senior vice president of sales.

Mr. Karas projected $1.5 billion in sales in 1997.

"The growth in bank sales of variable annuities has somewhat mirrored that of mutual fund companies," he said.

Fidelity said that six Fidelity Advisor annuity funds, which have $25.3 billion in assets under management, have been replaced by the new lineup.

Assets in the annuities administered and underwritten by Nationwide stood at $672 million at the end of 1996.

"This line expansion is in response to our clients who are asking for more diversification within the Advisor Annuity," said John J. Mulherin, chief operating officer, Fidelity Investments Institutional Services.

Nationwide, which is based in Columbus, Ohio, holds $68 billion in assets and distributes its funds through banks, financial planners, pension plans, brokers, and its own fleet of agents.

The 13 funds now available are: VIP Overseas, VIP Growth Managed, VIP II Contrafund, VIP III Growth Opportunities, VIP II Index 500, VIP III Growth & Income, VIP Equity-Income, VIP II Asset Manager, VIP III Asset Manager, VIP III Balanced, VIP High Income, VIP II Investment Grade Bonds, VIP Money Market.

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