The following table summarizes key information for Individual Products which we believe are our important drivers and indicators of future profitability:
Total AIP benefits and expenses increased 4.5% in 2001 versus 24.6% in 2000. Policy benefits, which are mainly comprised of interest credited to policyholder accounts, as a percentage of average policyholder fund balances were 5.6% in 2001 and 5.4% in 2000 and 1999. Total AIP expenses decreased 12.4% in 2001 and increased 63.7% in 2000. The 2001 decrease is due primarily to the lower commission expenses of JPSC as well as a decrease in amortization expense as we reflect the effect of lower surrenders in adjustments to amortization rates of DAC and VOBA and as older products with higher amortization rates are replaced with newer products which have less associated DAC. The 2000 expense growth was due to an increase in concessions related to JPSC operations, similar to the increases in concession and other income, and an increase in amortization of DAC due to higher surrenders. Effective spreads on fixed annuities declined to 1.96% in 2001 from 2.14%, primarily due to continued strong sales of our lower commission five-year products. These products carry a lower spread requirement based on commission rates that are approximately 50% of full commissions. The lower commission has the eventual effect of decreasing expenses through reduced DAC amortization. Of the year-to-date 18 basis points spread compression, approximately one-third represents economic spread contraction that occurs in declining interest rate environments and affects earnings, while the remaining two-thirds is related to the lower commission products and does not affect earnings.
Revenues from Sports operations decreased 8.5% and 16.7% in 2001 and 2000. The 2001 decline reflects the impact of weak demand for advertising due to the slowing economic conditions. Sports advertising is typically sold with three to six month lead times and economic activity was slowing during the prime Sports selling season. We have commitments of $402 to pay rights fees to the ACC and SEC conferences. We have offsetting commitments of $300 by various other broadcasters to repurchase some of those rights, and we have a 50/50 partner in ACC Basketball to mitigate some of the exposure. We expect advertising contracts that we sell to produce profits on each product; however, sales contracts typically have a term of three years or less. Thus, there are currently no sales contracts on our books to offset exposure in later years under the conference agreements. See Note 19 which is incorporated by reference.
At December 31, 2001 and 2000, we had $150 and $139 of Exchangeable Securities outstanding, reflecting the Mandatorily Exchangeable Debt Securities (MEDS). We repaid the $150 MEDS in cash in January 2002. We had $300 of guaranteed preferred beneficial interest in subordinated debentures (Capital Securities) outstanding at December 31, 2001 and 2000 at an average interest rate of 8.2%, maturing in 2046 but redeemable at our option beginning in 2007.
Reinsurance receivables include amounts related to paid benefits and estimated amounts related to unpaid policy and contract claims, future policy benefits and policyholder contract deposits. The cost of reinsurance is
JPFIC reinsures 100% of the Periodic Payment Annuities (PPA), COLI and Affiliated credit insurance business written prior to 1995 with affiliates of Household International, Inc. on a coinsurance basis. Balances are settled monthly, and the reinsurers compensate JPFIC for administrative services related to the reinsured business. The amount due from reinsurers in the consolidated balance sheets includes $914 and $948 due from the Household affiliates at December 31, 2001 and 2000.
The fair values of commercial paper and revolving credit borrowings approximate their carrying amounts due to their short-term nature. Similarly, the fair value of the liability for securities sold under repurchase agreements approximates its carrying amount, which includes accrued interest. With respect to the Exchangeable Securities, the fair value of the MEDS, which are not publicly traded, is estimated based on the value holders would have received had the MEDS been redeemable as of year-end based on the market price of BankAmerica stock.
In connection with a previous acquisition, the Company acquired a closed block of business that was financed by a loan program collateralized by pledged mutual fund shares of the Company's policyholders. In late 1997, the acquired company entered into an agreement with an unaffiliated third party that provides for the initial and periodic purchase of the majority of its collateralized loans receivable. This agreement is renewable on an annual basis. If the agreement is not renewed, JP can issue debt to fund the amounts or terminate the entire program. The amount of loans outstanding at December 31, 2001 was $33. JP has no other off balance sheet arrangements of a financing nature.