Change in option value of equity-indexed products and market value adjustments on total return strategy annuities.
We also distribute term products of ILICO through strategic alliances with private label partners. Under private label arrangements, ILICO designs and issues products that are distributed through other life insurance companies, our private label partners. ILICO reinsures a portion of the risks on those products which we refer to as our private label sales. We have three private label partners that are actively writing new business. During the second quarter of 2002, we ceased recruiting new private label partners.
We recognize premiums on traditional life insurance policies as revenues when the premiums are due. Amounts received as payments for universal life and equity-indexed life insurance policies are not recorded as premium revenue, but are instead recorded as a policyholder liability. Revenues from the universal life and equity-indexed life policies consist of product charges for the cost of insurance, policy administration and policy surrender. All revenue is reported net of reinsurance ceded. Insurance premium revenue and product charge revenue increased in 2002 and 2001 as compared to the respective prior years primarily due to the acquisition of ILICO.
The investment spread on deferred fixed annuities increased 4 basis points to 204 basis points in 2002 compared to 2001. The investment spread decreased 3 basis points to 200 basis points in 2001 compared to 2000. Crediting rates were lowered in the fourth quarter of 2001 and throughout 2002 to correspond with the decline in investment yields caused by lower rates on new and reinvested funds. At December 31, 2002, the account value of deferred fixed annuities totaled $7.1 billion of which $1.0 billion did not have a differential between the credited rate and minimum guarantee rate and as such could not be lowered. Additionally, deferred fixed annuities with account values totaling $1.3 billion have multi-year interest rate guarantees for which the credited rate cannot be decreased until the end of the multi-year period. At the end of the multi-year guarantee period, we will have the ability to lower the crediting rate to the minimum guaranteed rate by an average decrease of approximately 200 basis points. Also, at December 31, 2002, account values of equity-indexed annuities totaled $3.7 billion which provide guaranteed rates based on a cumulative floor over the term of the product. Due to these limitations on the ability to lower interest crediting rates and the potential for additional credit defaults and lower reinvestment rates on investments, we could experience spread compression in future periods.
Our Board of Directors approved a stock purchase program effective August 9, 2002, under which we may purchase up to three million shares of our common stock at such times and under such conditions, as we deem advisable. The purchases may be made in the open market or by such other means as we determine to be appropriate, including privately negotiated purchases. The purchase program supercedes all prior purchase programs. We plan to fund the purchase program from a combination of our internal sources, dividends from insurance subsidiaries and Revolving Credit Agreement. We repurchased shares in the first six months of 2002 under prior purchase programs. During the first six months of 2002, 2.5 million shares were repurchased and were primarily funded by approximately $59 million from the OCEANs offering and approximately $30 million from the Revolving Credit Agreement. During the last six months of 2002, approximately 0.7 million shares were repurchased and were primarily funded by approximately $23 million from the Revolving Credit Agreement.
We establish internal targeted capital and surplus levels for our insurance subsidiaries, which are in excess of regulatory requirements. As a result of high annuity product sales and related regulatory requirements on statutory capital and surplus, additional capital contributions were provided for at the end of 2002 to certain of our insurance subsidiaries to maintain these levels. Approximately $50 million was drawn on the Revolving Credit Facility to fund these capital contributions during the first quarter of 2003.
Below-investment grade fixed maturity securities as of December 31, 2002, included the securities of 252 issuers representing 6.8% of total invested assets, with the largest being a $21.2 million investment.
mortgage loans consist primarily of fixed-rate mortgage loans. As of December 31, 2002, we held 710 individual commercial mortgage loans with an average balance of $1.2 million.
We followed the purchase method of accounting for our acquisition of ILICO in May 2001. Under the purchase method, we were required to determine the fair value of the acquired assets and liabilities. The fair value of the assets and liabilities were determined as follows: