Consolidated investment income increased 4.3% during 2001 and decreased 4.0% during 2000. The increase in 2001 was affected by an increase in the invested asset base due to deposits on a new annuity coinsurance agreement in 2001 and positive cash flows from operations, offset, in part, by a drop in the invested asset yield due to a decline in prevailing interest rates and the write-off of accrued investment income associated with the write-down of impaired securities. The decrease during 2000 was affected by the reduction in invested assets related to the recapture of the funding agreement business by General American on September 29, 1999. The cost basis of invested assets increased by $0.6 billion, or 13.0% in 2001 and increased $0.6 billion, or 14.9% in 2000. The increase in the cost basis of invested assets during 2001 was primarily a result of proceeds from the Company's capital raising efforts in December 2001, in addition to the factors previously discussed. The increase in invested assets during 2000 was primarily a result of positive operating cash flows and new reinsurance transactions involving asset-intensive products. The average yield earned on investments was 6.79% in 2001, compared with 7.30% in 2000, and 7.10% in 1999. The average yield will vary from year to year depending on a number of variables, including prevailing interest rate fluctuations, changes in the mix of asset-intensive products, and yields related to funds withheld at interest. Investment income is allocated to the segments based upon average assets and related capital levels deemed appropriate to support the segment business volumes.
agreement in 2001 coupled with a higher asset base. The growth in 2001 was somewhat offset by lower investment income related to one specific annuity agreement. However, this reduction in investment income was mostly offset by a corresponding decrease in interest credited. The average asset-intensive investment balance was $1.4 billion and $1.2 billion for 2001 and 2000, respectively. The increase in total revenue in 2000 compared to 1999 can primarily be attributed to the realized losses incurred as a result of the liquidation and termination of the funding agreement business in 1999.
RGA has repurchased shares in the open market in the past primarily to satisfy obligations under its stock option program. Currently, the board of directors has approved a repurchase program authorizing RGA to purchase up to $50 million of its shares of stock, as conditions warrant. As of December 31, 2001, RGA had not repurchased any shares under the program. RGA purchased approximately 0.7 million shares of treasury stock in 2000 at an aggregate cost of $20.0 million. No shares were repurchased in 1999.
Market risk is the risk of loss that may occur when fluctuation in interest and currency exchange rates and equity and commodity prices change the value of a financial instrument. Both derivative and nonderivative financial instruments have market risk so the Company's risk management extends beyond derivatives to encompass all financial instruments held that are sensitive to market risk. RGA is primarily exposed to interest rate risk and foreign currency risk.
The amortized cost, gross unrealized gains and losses, and estimated fair values of investments in fixed maturity securities at December 31, 2001 and 2000 are as follows (in thousands):
The Company's full time U.S. employees may participate in a defined benefit profit sharing plan. The plan also has a cash or deferred option under Internal Revenue Code section 401(k). The Company's contributions, which are partially tied to RGA's operating results and employee 401(k) contributions, were approximately $1.3 million in 2001.The Company also provides certain health care and life insurance benefits for retired employees. The health care benefits are provided through a self-insured welfare benefit plan. Employees become eligible for these benefits if they meet minimum age and service requirements. The retiree's cost for health care benefits varies depending upon the credited years of service. The Company recorded benefits expense of approximately $0.5 million, $0.3 million, and $0.3 million for 2001, 2000 and 1999, respectively, related to these postretirement plans. The projected obligation was approximately $3.5 million and $2.2 million as of December 31, 2001 and 2000, respectively.
During 2001, two clients accounted for more than 10% of the Canada operation's gross premiums, consisting of C$93.3 and C$39.9 million, or 30.1% and 12.9%, respectively, of the Canada operation's gross premiums in 2001. During 2001, two clients, one each in Australia and Hong Kong, generated approximately $54.1 million, or 39.9% of the total gross premiums for the Asia Pacific operations. During 2001, two clients of the Company's UK operations generated approximately $56.2 million, or 58.4% of the total gross premiums for the Europe & South Africa operations.
In connection with annual audits, independent certified public accountants perform an audit in accordance with auditing standards generally accepted in the United States of America, which includes the consideration of the system of internal control to the extent necessary to form an independent opinion on the financial statements prepared by management.