Average client asset values. Average client asset values increased in 2016 from 2015 largely due to favorable market performance throughout the year and continued net positive inflows.
The average number of fee-generating positions increased in 2015 from 2014 primarily due to the addition of a mutual fund provider on our recordkeeping and custodial services platform during the first quarter of 2015 as well as growth in our mutual funds and managed accounts business.
Deferrable acquisition costs for Canadian segregated funds are amortized over the life of the policies in relation to the present value of estimated gross profits expected to be realized over the life of the underlying policies. The gross profits and resulting DAC amortization will vary with actual and anticipated fund returns, redemptions, commissions and expenses. DAC from our Canadian segregated funds reflects approximately 3% of our total DAC, and DAC amortization on these segregated funds reflects approximately 3% of our total DAC amortization for the year ended December 31, 2016.
We cannot determine with precision the ultimate amounts that we will pay for actual claims or the timing of those payments.
Total benefits and expenses. Total benefits and expenses increased in 2016 from 2015 reflecting growth in premium-related expenses, which include benefits and claims, amortization of DAC and insurance expenses. Also contributing to the increase in insurance expenses and other operating expenses was higher spending of approximately $10.4 million for our proprietary sales force support system’s mobile application as well as accommodating increased capacity for the growth in subscribers, higher employee-related costs of approximately $4.3 million, and costs related to preparing for the implementation of the DOL Fiduciary Rule of approximately $3.3 million. These increases were partially offset by the decline in interest expense incurred on our 10% coinsurance agreement which is discussed further in Note 6 (Reinsurance) to our consolidated financial statements included elsewhere in this report.
Total Benefits and Expenses. Total benefits and expenses increased in 2016 from 2015 primarily due to higher employee-related costs in other operating expenses of approximately $4.4 million, which includes the full-year effect of reallocated employee-related expenses of approximately $3.3 million between segments in the second quarter of 2015 as described earlier in the Term Life Insurance segment discussion. The increase was partially offset by the reduction in the interest expense incurred on our 10% coinsurance agreement. For more information on the interest expense incurred on our 10% coinsurance agreement, see Note 6 (Reinsurance) to our consolidated financial statements included elsewhere in this report.
expenses, and income taxes, as well as repurchases of shares outstanding. During 2016, our life insurance underwriting companies declared and paid ordinary dividends of $117.0 million to the Parent Company. See Note 15 (Statutory Accounting and Dividend Restrictions) to our consolidated financial statements included elsewhere in this report for more information on insurance subsidiary dividends and statutory restrictions. In addition, our non-life insurance subsidiaries declared and paid dividends of approximately $72.5 million to the Parent Company in 2016. At December 31, 2016, the Parent Company had cash and invested assets of approximately $68.0 million.
Financing activities. Net cash used in financing activities during 2016 decreased compared to 2015 as we utilized the additional $50 million of capacity authorized in our share repurchase programs in 2015 compared with 2016.
Ceded premiums are treated as a reduction to direct premiums and are recognized when due to the assuming company. Ceded claims are treated as a reduction to direct benefits and are recognized when the claim is incurred on a direct basis. Ceded policy reserve changes are also treated as a reduction to benefits and claims expense and are recognized during the applicable financial reporting period.
Future Application of Accounting Standards. Recent accounting guidance not discussed is not applicable, is immaterial to our financial statements, or did not or will not have an impact on our business.
Derivatives. Embedded conversion options associated with fixed-maturity securities are bifurcated from the fixed-maturity security host contracts and separately recognized as equity securities. The change in fair value of these bifurcated conversion options is reflected in realized investment gains (losses), including OTTI losses. As of December 31, 2016 and 2015, the fair value of these bifurcated options was approximately $4.3 million and $5.4 million, respectively.
We periodically assess the exposure related to these contracts to determine whether any additional liability should be recorded. As of December 31, 2016 and 2015, an additional liability for these contracts was deemed to be unnecessary.
In connection with our corporate reorganization, we entered into a tax separation agreement with Citigroup, whereby Citigroup agreed to indemnify the Company against any consolidated, combined, affiliated, unitary or similar federal, state or local income tax liability related to any taxable period ending on or before April 2010. As of December 31, 2016, the Company had a Citigroup tax indemnification asset of $0.7 million.
As of December 31, 2016 and 2015, we had no material capital leases.
In management’s opinion, the following quarterly consolidated financial information fairly presents the results of operations for such periods and is prepared on a basis consistent with our annual audited consolidated financial statements. Financial information for the quarters presented was prepared on a consolidated basis.