For a discussion of the accounting pronouncements that we have recently adopted, please refer to Note A to our consolidated financial statements.
For the year ended December 31, 2003, policy fee and other income was $24.9 million, an increase of $8.4 million or 50.9%, as compared to $16.5 million of fee income in the prior year. The increase in fee income was due to increases in policy service fees, partially offset by a decline in issuing carrier fees. For the year ended December 31, 2003 policy service fee income was $22.0 million, and increase of $10.9 million compared to $11.1 million in policy service fee income in the prior year. The increase in policy service fees principally a result of increases in fee income of the non-standard automobile business produced by our underwriting agencies in Texas and Florida and written by the insurance companies. We also collected issuing carrier fees of approximately $2.9 million for the year ended December 31, 2003, as compared to $5.4 million in 2002. The decrease in issuing carrier fees was primarily attributable to the decrease in gross premiums written through an unaffiliated underwriting agency in California that we terminated in the fourth quarter of 2002.
In 2002, implemented rate increases to address emerging loss trends and to protect our net written premium relative to expenses, or underwriting margin. During 2002, we implemented 21 rate increases in our standard automobile business line, which represented an average premium increase of approximately 11.6%. In 2002, we also implemented 23 rate increases in our standard residential property line, which represented an average increase of approximately 13.5%.
In 2002, our life insurance segment generated approximately $51.7 million in revenue, or 9.0% of consolidated revenue, excluding realized gains and losses. Realized losses in 2002 consist primarily of a write-off of approximately $27 million of collateral loans (see discussion below).
• Agency profit sharing commissions are recorded at the end of the underwriting year and at the time when estimates of ultimate loss ratios become probable as determined by our internal actuaries.
At December 31, 2003, we have recorded goodwill and other intangible assets with indefinite lives for each reporting unit as follows: (a) homeowners’ insurance operations - $57.7 million; (b) life insurance operations - $10.8 million; and (c) non-standard automobile agency operations - $75.3 million. Additionally, we have recorded net other intangible assets with definite lives for each reporting unit as follows: (a) homeowners’ insurance operations - $1.7 million; (b) life insurance operations - $0.; and (c) non-standard automobile agency operations - $4.3 million. With respect to our continuing operations reporting units, we have concluded that there was no impairment as of December 31, 2003.
A schedule of fixed maturities available for sale and fixed maturities - trading by contractual maturity at December 31, 2003 is shown below. Amounts related to fixed maturities available for sale are reflected on an amortized cost basis and on a fair value basis while amount related to fixed maturities classified as trading are reflected on a fair value basis. Actual maturities could differ from contractual maturities due to call or prepayment provisions.
The hearing in the NRMA arbitration began on October 20, 2003 and was adjourned on October 31, 2003. In January, 2004, the NRMA hearing concluded and on March 1, 2004 the NRMA panel ruled in favor of NRMA. As a result, the Company incurred a charge of $33.5 million to its 2003 fourth quarter earnings. While the NRMA ruling does not set a binding precedent regarding Vesta’s other arbitrations and while there are distinct facts and circumstances underlying and affecting our disputes with the other participants, for financial reporting purposes, the Company incurred a charge to its recoverable from the other treaty participants of $30.1 million for the fourth quarter of 2003. On March 4, 2004, Vesta filed a motion to vacate this arbitration award in the United States District Court for the Northern District of Alabama, Southern Division. The grounds for this motion are the evident partiality of the neutral umpire. Additionally, the recording of this charge does not impact our intention to actively arbitrate the Alfa and Dorinco matters.
During 2003, we redeemed $2.2 million face amount of Deferrable Capital Securities in exchange for approximately 402 thousand shares of common stock resulting in a gain of $.6 million. Pursuant to the provisions of SFAS No. 150, the gain is reflected as a component of income from continuing operations.
excercisable only if a person or group acquires a beneficial ownership of 10% or more of the common stock. The Rights entitle the holder to purchase one one-hundreth of a share of a new series of preferred stock at an exercisable price of $30.00 and will expire on June 15, 2010.
During the year ended December 31, 2002, we extinguished $23.9 million of our Senior Debentures for 1.1 million shares of common stock and approximately $9.4 million plus accrued interest. As a result of the early redemption of this long term debt, we recorded a pre-tax gain of $9.5 million. During the year ended December 31, 2001, we extinguished $7.0 million of our Senior Debentures for 569 thousand shares of common stock. As a result of the early redemption of this long-term debt, we recorded a pre-tax gain of $1.4 million.