We believe our capital and financial positions are strong. At December 31, 2019, the RBC ratio for our traditional U.S. insurance subsidiaries, calculated on a weighted average basis using the NAIC Company Action Level formula, was approximately 365 percent, which is in line with our expectations. During 2019, we repurchased 12.3 million shares of Unum Group common stock under our share repurchase program, at a cost of approximately $400 million. Our weighted average
•Discount rate assumptions are based on our current and expected net investment returns.
1.The discount rate, which is used in calculating both policy reserves and incurred and IBNR claim reserves, is the interest rate that we use to discount future claim payments to determine the present value. A higher discount rate produces a lower reserve. If the discount rate is higher than our future investment returns, our invested assets will not earn enough investment income to support our future claim payments. In this case, the reserves may eventually be insufficient. We set our assumptions based on our current and expected future investment yield of the assets supporting the reserves, considering current and expected future market conditions. If the investment yield on new investments that are purchased differs from the investment yield of the existing investment portfolio, the discount rate assumption on claims may be adjusted to reflect the impact of the new investment yield.
The weighted average pound/dollar exchange rate for our Unum UK line of business was 1.279, 1.336, and 1.290 for the years ended 2019, 2018, and 2017, respectively. If the 2018 and 2017 results for our U.K. operations had been translated at the 2019 exchange rate, our adjusted operating revenue by segment would have been lower by approximately $28 million and $5 million in 2018 and 2017, respectively. Additionally, our adjusted operating income would have been lower by approximately $5 million and $1 million in 2018 and 2017, respectively. However, it is important to distinguish between translating and converting foreign currency. Except for a limited number of transactions, we do not actually convert pounds into dollars. As a result, we view foreign currency translation as a financial reporting item and not a reflection of operations or profitability in the U.K.
Net investment income was slightly lower in 2019 relative to 2018 due to lower miscellaneous investment income and a decline in the yield on invested assets, partially offset by an increase in the level of invested assets. Net investment income in 2018 was generally consistent with 2017, with an increase in the level of invested assets and higher miscellaneous investment income, offset by a decline in the yield on invested assets.
Commissions increased year-over-year in 2019 and 2018 driven primarily by sales growth. The deferral of acquisition costs was lower during 2019 relative to 2018 due primarily to a shift in product mix that resulted in lower first-year commissions and a lower corresponding deferral of acquisition costs in the Unum US supplemental and voluntary product line. The deferral of acquisition costs was higher in 2018 relative to 2017 driven primarily by overall sales growth. Growth in the level of the deferred asset in our Unum US and Colonial Life segments resulted in higher amortization of deferred acquisition costs year-over-year in 2019 and 2018. Also contributing to the increase in the amortization of deferred acquisition costs in 2019 was a higher level of policy terminations experienced in the Unum US voluntary benefits product line and the impact of the prospective unlocking for future experience relative to assumptions in certain of our Colonial life products.
Cost related to early retirement of debt includes costs associated with the purchase and retirement of $433.1 million aggregate liquidation/principal amount of our outstanding capital and debt securities. Interest and debt expense increased year-over-year in 2019 and 2018 due primarily to a higher level of outstanding debt. See Note 8 of the "Notes to Consolidated Financial Statements" contained herein in Item 8 for further discussion.
Commissions and the deferral of acquisition costs were higher compared to 2018 due to sales growth. The amortization of deferred acquisition costs increased relative to 2018 due to growth in the level of the deferred asset. Our other expense ratio for 2019 increased compared to 2018 due primarily to an increase in operational investments in our business and growth in our fee-based service products, which was balanced with our continued focus on expense management and operating efficiencies.
Benefits experience for the individual disability product line compared to 2017 was less favorable due to a reserve release of $19.5 million resulting from our 2017 annual reserve adequacy update that did not recur and unfavorable 2018 claims activity, partially offset by favorable mortality experience. Benefits experience for voluntary benefits was favorable compared to 2017 due primarily to the previously discussed 2017 reserve increase for unclaimed death benefits. Excluding this reserve increase, benefits experience was favorable across most of our voluntary product lines. Benefits experience for the dental and vision product line was favorable compared to 2017 and was within our expectations.
Commissions and the deferral of acquisition costs were higher compared to 2017 due primarily to sales growth. The amortization of deferred acquisition costs increased year over year due to growth in the level of the deferred asset. Our other expense ratio improved relative to 2017 due to growth in premium income and our continued focus on expense management and operating efficiencies balanced with an increase in operational investments in our business.
subsidiaries may take the form of dividends, operating and investment management fees, and/or interest payments on loans from the parent to a subsidiary.
See "Critical Accounting Estimates" contained herein in this Item 7 and Notes 3, 4, 6, 8, 9, and 15 of the "Notes to Consolidated Financial Statements" contained herein in Item 8 for additional information on our various commitments and obligations.
Investing cash inflows consist primarily of the proceeds from the sales and maturities of investments. Investing cash outflows consist primarily of payments for purchases of investments. Our investment strategy is to match the cash flows and durations of our assets with the cash flows and durations of our liabilities to meet the funding requirements of our business. When market opportunities arise, we may sell selected securities and reinvest the proceeds to improve the yield and credit quality of our portfolio. We may at times also sell selected securities and reinvest the proceeds to improve the duration matching of our assets and liabilities and/or re-balance our portfolio. As a result, sales before maturity may vary from period to period. The sale and purchase of short-term investments is influenced by proceeds received from issuance of debt, our securities lending program, and by the amount of cash which is at times held in short-term investments to facilitate the availability of cash to fund the purchase of appropriate long-term investments, repay maturing debt, and/or to fund our capital deployment program. Our cash flows for 2018 include cash outflows, net of cash acquired, of $145.4 million related to all of our acquisitions during the year.
Cash used to repurchase shares of Unum Group's common stock during 2019, 2018, and 2017 was $400.3 million, $356.2 million, and $401.8 million, respectively. During 2019, 2018, and 2017 we paid dividends of $229.2 million, $215.6 million, and $196.0 million, respectively, to holders of Unum Group's common stock.
Policy Loans: Policy loans are presented at unpaid balances directly related to policyholders. Interest income is accrued on the principal amount of the loan based on the loan's contractual interest rate. Included in policy loans are $3,490.6 million and $3,449.3 million of policy loans ceded to reinsurers at December 31, 2019 and 2018, respectively.
Our investments in private equity partnerships are passive in nature and represent funds that are primarily invested in private credit, private equity, and real assets. We account for our investments in these partnerships using either the equity method or at fair value through net income depending on the level of ownership and the degree of our influence over partnership operating and financial policies. For investments in partnerships accounted for under the equity method, we report our investments at our share of the partnership's net asset value (NAV) and record our portion of partnership earnings as a component of net investment income. For investments in partnerships accounted for at fair value through net income, we also report our investments at our share of the partnership's NAV as a practical expedient for fair value with increases or decreases recorded as a component of net investment income. Distributions received from the funds arise from income generated by the underlying investments as well as the liquidation of the underlying investments and there is generally not a public market for these investments.
Premium Tax Expense: Premium tax expense is included in other expenses in the consolidated statements of income. For the years ended December 31, 2019, 2018, and 2017, premium tax expense was $170.1 million, $155.8 million, and $158.0 million, respectively.
(b)Private Equity - The limited partnerships described in this category employ various strategies generally investing in controlling or minority control equity positions directly in companies and/or assets across various industries (including manufacturing, healthcare, energy, business services, technology, materials, and retail), primarily in private markets within North America and, to a lesser extent, outside of North America. As of December 31, 2019, the estimated remaining life of the investments that do not allow for redemptions is approximately 34 percent in the next 3 years, 21 percent during the period from 3 to 5 years, 42 percent during the period from 5 to 10 years, and 3 percent during the period from 10 to 15 years.
Policy Loans: Fair values for policy loans, net of reinsurance ceded, are estimated using discounted cash flow analyses and interest rates currently being offered to policyholders with similar policies. Carrying amounts for ceded policy loans, which equal $3,490.6 million and $3,449.3 million as of December 31, 2019 and 2018, respectively, approximate fair value and are reported on a gross basis in our consolidated balance sheets. A change in interest rates for ceded policy loans will not impact our financial position because the benefits and risks are fully ceded to reinsuring counterparties.
The unrealized losses on investment-grade fixed maturity securities principally relate to changes in interest rates or changes in market or sector credit spreads which occurred subsequent to the acquisition of the securities. Below-investment-grade fixed maturity securities are generally more likely to develop credit concerns than investment-grade securities. At December 31, 2019, the unrealized losses in our below-investment-grade fixed maturity securities were generally due to credit spreads in certain industries or sectors and, to a lesser extent, credit concerns related to specific securities. For each specific security in an unrealized loss position, we believe that there are positive factors which mitigate credit concerns and that the securities for which we have not recorded an other-than-temporary impairment will recover in value.
As of December 31, 2019, the carrying amount of our variable interest entity investments that are not consolidated in our financial statements was $675.1 million, comprised of $58.4 million of tax credit partnerships and $616.7 million of private equity partnerships. At December 31, 2018, the carrying amount of our variable interest entity investments that are not consolidated in our financial statements was $575.3 million, comprised of $91.5 million of tax credit partnerships and $483.8 million of private equity partnerships. These variable interest entity investments are reported as other long-term investments in our consolidated balance sheets.
As of December 31, 2019, we expect to amortize approximately $76.2 million of net deferred gains on derivative instruments during the next twelve months. This amount will be reclassified from accumulated other comprehensive income into earnings and reported on the same income statement line item as the hedged item. The income statement line items that will be affected by this amortization are net investment income and interest and debt expense. Additional amounts that may be reclassified from accumulated other comprehensive income into earnings to offset the earnings impact of foreign currency translation of hedged items are not estimable.
The rate of compensation increase assumption for our U.K. pension plan is generally based on periodic studies of compensation trends.
At December 31, 2019 and 2018, the annual rates of increase in the per capita cost of covered postretirement health care benefits assumed for the next calendar year are 6.50 percent and 7.00 percent, respectively, for benefits payable to both retirees prior to Medicare eligibility as well as Medicare eligible retirees. The rates are assumed to change gradually to 5.00 percent by 2024 for measurement at December 31, 2019 and remain at that level thereafter. The annual rates of increase in the per capita cost of covered postretirement health benefits do not apply to retirees whose postretirement health care benefits are provided through an exchange.
Certain of our traditional U.S. life insurance subsidiaries cede blocks of business to Northwind Re and Fairwind Insurance Company (Fairwind), both of which are affiliated captive reinsurance subsidiaries (captive reinsurers) domiciled in the United States, with Unum Group as the ultimate parent. These captive reinsurers were established for the limited purpose of reinsuring risks attributable to specified policies issued or reinsured by our life insurance subsidiaries.