Morningstar® Investment Profile™   Morningstar® Disclosure   Format for Print Franklin Small Cap Value VIP 2 Release date as of 2024-03-31. Data on page is subject to change. Snapshot Ratings & Risk Portfolio Nuts & Bolts

Morningstar Report Overall Morningstar Rating™ What is this? As of 2024-03-31 Out of 457 Small Value Funds Morningstar® Style Box™ What is this? As of 2024-02-29 Total Fund Assets ($ Mil) 1,142.43 View Historical Morningstar Star Ratings and Definitions

Investment Objective & Strategy   The investment seeks long-term total return. The fund invests at least 80% of its net assets in investments of small-capitalization (small-cap) companies. It generally invests in equity securities that the fund's investment manager believes are undervalued at the time of purchase and have the potential for capital appreciation. The fund invests predominantly in common stocks. It may invest up to 25% of its total assets in foreign securities.

Morningstar Category: Small Value Small-value portfolios invest in small U.S. companies with valuations and growth rates below other small-cap peers. Stocks in the bottom 10% of the capitalization of the U.S. equity market are defined as small cap. Value is defined based on low valuations (low price ratios and high dividend yields) and slow growth (low growth rates for earnings, sales, book value, and cash flow).

Investment Risks Small Cap Funds: Smaller companies typically have higher risk of failure, and are not as well established as larger blue-chip companies. Historically, the smaller company stocks have experienced a greater degree of market volatility than the overall market average.

Portfolio Profile Asset Allocation % of Net Assets U.S. Stocks 83.7 Non-U.S. Stocks 14.5 Bonds 0.0 Cash 1.8 Other 0.0 Data through 2024-02-29 Morningstar Equity Sectors % of Stocks Cyclical 49.84 Basic Materials 10.97 Consumer Cyclical 13.53 Financial Services 22.16 Real Estate 3.18 Sensitive 42.97 Communication Services 0.00 Energy 3.64 Industrials 26.48 Technology 12.85 Defensive 7.20 Consumer Defensive 2.68 Healthcare 3.61 Utilities 0.91 Data through 2024-02-29 Holding Status Total Number of Stock Holdings 84 Total Number of Bond Holdings 0 % of Net Assets in Top 10 Holdings 27.57 Turnover % (as of 2022-12-31) 12.59 30 Day SEC Yield % 1.08 Top Holdings Sector P/E % of Net Assets ACI Worldwide Inc 29.65 3.73 McGrath RentCorp 27.05 3.57 Crescent Point Energy Corp --- 3.12 The Hanover Insurance Group Inc 146.42 2.54 Regal Rexnord Corp --- 2.53 QinetiQ Group PLC --- 2.53 SouthState Corp 13.16 2.53 Glanbia PLC --- 2.36 UFP Industries Inc 15.24 2.34 Coherent Corp --- 2.32 Data through 2024-02-29

Principal Risks    Foreign Securities, Loss of Money, Not FDIC Insured, Value Investing, Active Management, Market/Market Volatility, Industry and Sector Investing, Other, Socially Conscious, Small Cap, Financials Sector, Real Estate/REIT Sector, Technology Sector Show Risk Definitions

Other Information Inception Date: 1999-01-06 Portfolio Manager(s) Steven B. Raineri   (2012-07-02) Steven B. Raineri, Vice President and Portfolio Manager of Franklin Advisory Services. Mr. Raineri joined Franklin Templeton in 2005. He has been in the investment industry for more than 20 years. Mr. Raineri began his career at Gabelli & Company, and has also worked for Dresdner Kleinwort Wasserstein and WoodAllen Capital Management. He also spent several years as a business valuation analyst for Arthur Andersen and J&W Seligman Valuations. Christopher Meeker   (2015-05-01) Christopher Meeker, CFA, Portfolio Manager/Research Analyst of Franklin Advisory Services. Mr. Meeker joined Franklin Templeton Investments in September 2012 as a research analyst. He has been in the investment industry for more than 15 years. Prior to joining Franklin Templeton, Mr. Meeker worked as a senior research analyst at Federated Global Investment Management. Mr. Meeker also has prior investment experience at Farr, Miller & Washington LLC, a boutique asset manager. Prior to his buy-side work, Mr. Meeker spent six years as an investment banker with Houlihan Lokey Howard & Zukin, Inc. and AMT Capital Advisors, LLC." Nicholas Karzon   (2019-12-31) Mr. Karzon has been a portfolio manager of the Small Cap Value Fund since December 2019. He joined Franklin Templeton in 2014. Investment Advisor(s) Franklin Mutual Advisers, LLC Issuer Franklin Templeton Investments Subadvisor(s) ---

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