Effective July 31, 2000, a wholly-owned subsidiary of the Company sold all of its outstanding shares of UMMG for a purchase price in the amount of $25,000 in cash, with an additional amount of up to $2.0 million payable over the next five years, contingent upon the performance of the business. The purchaser is an entity controlled by the former President of UMMG. UMMG formerly provided marketing, administrative and
Effective June 30, 2000, HealthAxis.com sold to Digital Insurance, Inc. ("Digital") certain assets used in connection with HealthAxis.com's retail website, including the retail website user interface, all existing in-force insurance policies, certain physical assets, and rights under certain agreements, including, but not limited to portal marketing agreements and agreements related to HealthAxis.com's affiliate partner program. As part of the consideration received by HealthAxis.com in the transaction, Digital issued to HealthAxis.com 11% of the outstanding shares of common stock of Digital (on a fully diluted basis).
HealthAxis.com generated revenues of $43.7 million, $46.2 million and $41.2 million in 2000, 1999 and 1998, respectively, of which 63%, 58% and 58% were derived from information systems and software development services provided to UICI and its insurance company affiliates.
Revenues. UICI's revenues increased to $1,051.4 million in 2000 from $1,013.2 million in 1999, an increase of $38.2 million, or 4%, primarily as a result of an increase in other interest income and the gain on sale of the HealthAxis.com shares in the amount of $26.3 million, offset by a $27.6 million reduction in health and life premium income.
Interest expense. Interest expense on corporate borrowings increased to $7.4 million in 1999 from $3.1 million in 1998, an increase of $4.3 million. The increase was due primarily to the increased level of borrowings outstanding during 1999. Interest expense on student loan obligations increased to $57.5 million in 1999 from $19.2 million in 1998, an increase of $38.3 million. The increase was due primarily to AMS's increased student loan origination volume.
HealthAxis.com, Inc. (formerly Insurdata). Insurdata reported operating income of $2.3 million in 1999 compared to operating income of $3.3 million in 1998. Revenue for Insurdata increased to $46.2 million in 1999 from $41.2 million in 1998, an increase of 12%. Insurdata revenue derived from other divisions and operating units of the Company were $24.4 million and $21.1 million in 1999 and 1998, respectively. These revenues and costs are eliminated in consolidating the Company's operations.
Effective July 31, 2000, UCS sold all of its outstanding shares of UMMG for a purchase price in the amount of $25,000 in cash, with an additional amount of up to $2.0 million payable over the next five years, contingent upon the performance of the business. The purchaser is an entity controlled by the former President of UMMG. UMMG is a Lakewood, Colorado-based provider of marketing, administrative and support services for the Company's credit card programs. In addition, on July 31, 2000, UICI signed a credit agreement with the purchaser, pursuant to which it has agreed to lend to the purchaser up to $1.0 million on a revolving basis. As of December 31, 2000, the Company had advanced to UMMG $1.0 million under the credit agreement.
As of December 31, 2000 and 1999, $779.4 million (or 96%) and $826.6 million (or 96%), respectively, of the fixed maturity securities portfolio was rated BBB or better (investment grade) and $35.0 million (or 4%) and $35.0 million (or 4%), respectively, of the fixed maturity securities portfolio was invested in below investment grade securities (rated less than BBB). A quality distribution for fixed maturity securities at December 31, 2000 is set forth below: