We delivered another strong quarter with operating earnings per share up 7% over the prior year period, excluding significant items and COVID impacts in both periods.
Total life and Health NAP was up 1% over the third quarter of 2020 and up 1% relative to 2019 levels.
We ended the quarter with an RBC ratio of 388% and $366 million in cash at the holding company.
This is after returning $131 million to shareholders through a combination of share repurchases and dividends.
Relative to 2019, life sales were up 22%.
Overall, health sales were essentially flat year-over-year but down 16% relative to 2019.
Total collected life and health premiums were down 2%.
Annuity collected premiums were up 17% year-over-year and up 2% relative to the third quarter of 2019.
Client assets in our brokerage and advisory grew 30% year-over-year to $2.7 billion, fueled by new accounts, which were up 16%, net client asset inflows and market value appreciation.
Sequentially, client assets grew 2%.
Fee revenue was up 41% year-over-year to $28 million, reflecting growth within our broker-dealer and registered investment advisor, higher fees generated by Web Benefits Design, our worksite technology platform and the inclusion of DirectPath results, which is our worksite enrollment and advisory services business.
Consumer segment life and health sales were down 2% over the prior period but up 8% over 2019.
Direct-to-consumer life sales were up 13% on top of 23% growth in the prior period.
Life sales generated by our exclusive field agents were down 15%.
Health sales were down 5%, largely reflecting continued weakness in Medicare Supplement sales.
We now have nearly 3,000 exclusive field agents certified to sell Medicare products, which is up 14% from last year, and we boosted our D2C capabilities through enhanced lead acquisition and sales capabilities.
As I mentioned, annuity collected premiums were up a healthy 17% as compared to the prior year and up 2% versus 2019.
The number of new accounts grew 6% and the average annuity policy rose 10%.
Client assets in brokerage and advisory grew 30% year-over-year to $2.7 billion in the third quarter.
Combined with our annuity account values, we now manage $13 billion of assets for our clients.
The number of agents that have been with us for at least three years has remained consistent through the third quarter and is up 1% year-to-date.
Productivity among these veteran agents is up 5% over the prior period and up 13% year-to-date.
Our producing agent count was down 5% year-over-year and down 11% sequentially due to the tight labor market.
Asian count remains down more than 45% from pre-COVID levels.
Our average client size in these businesses increased 15%, and our average per employee per month rates were up double digits.
Our robust free cash flow enabled us to return $131 million to shareholders in the third quarter, including $115 million in share buybacks.
We intend to deploy 100% of our excess capital to its highest and best use over time.
We generated operating earnings per share of $0.72 in the quarter, which is down $0.07 year-over-year as reported, down $0.05, excluding significant items and up $0.04 or 7% excluding significant items and adjusting for the net favorable COVID impacts on insurance product margin.
We had $3 million pre-tax or $0.02 per share of unfavorable significant items in the current period and none ended prior year period.
And we had $23 million or $0.14 per share of net favorable COVID impacts in the current period as compared to $42 million or $0.23 per share in the prior year period.
Over the last four quarters, we have deployed more than $400 million of excess capital on share repurchases, reducing weighted average shares outstanding by 9%.
The operating return on equity was 11.5% for the 12 months ending September 30, 2021.
Insurance product margin, excluding significant items, was down $21 million or 9% in the third quarter as compared to the prior year period, driven by the $19 million year-over-year change in COVID impacts.
Page 10 of our financial supplement summarizes those impacts by quarter.
The sequential decline in our annuity margin reflects volatility related to the indexed annuity FAS 133 accounting for our embedded derivative reserve, which had a favorable impact in the second quarter and an unfavorable impact in the third quarter.
Investment income not allocated to products, which is where the variable components of investment income flow through increased $7.2 million or 16%, reflecting solid performance within our alternative investment portfolio and higher prepayment income.
Our new money rate of 3.55% for the quarter was up 17 basis points sequentially, reflecting increased allocation to direct investments and an increase in market yields.
Our new investments comprised $849 million of assets with an average rating of A minus and an average duration of 13 years.
At quarter end, our invested assets totaled $28 billion, up 5% year-over-year.
Approximately 95% of our fixed maturity portfolio is investment-grade rated with an average rating of single A. This allocation to A-rated holdings is up 20 basis points sequentially.
The BBB allocation comprised 39% of our fixed income maturities, down 180 basis points year-over-year and 40 basis points sequentially.
During the quarter, we established a $3 billion funding agreement backed note program and in early October, we issued an inaugural $500 million funding agreement backing five-year notes.
We expect the FABN program will provide roughly 100 basis points of annualized pre-tax spread income, net of expenses on the notional amount of the notes outstanding.
We'll report the net spread income in NII, not allocated products, just as we currently report the net spread income associated with our Federal Home Loan Bank program on page 17 of our quarterly financial supplement.
We continue to generate strong free cash flow to the holding company in the third quarter with excess cash flow of $166 million to 179% of operating income, which reflects the solid operating results in the quarter, the continued up in quality bias in our investment portfolio and our decision to increase dividends out of the operating companies to bring the RBC ratio down into our targeted range.
At quarter end, our consolidated RBC ratio was 388%, which represents approximately $70 million of excess capital relative to the low end of our targeted range.
Our Holdco liquidity at quarter end was $366 million, which represents $216 million of excess capital relative to our $150 million minimum Holdco liquidity target.
As mentioned previously, that will reduce our RBC by approximately 16 points, all else equal, which translates to about $80 million of capital.
For the time being, we are not reducing our target RBC ratio, but we will manage the low end of the 3.75% to 400% target range.
And we will move closer to our $150 million minimum Holdco liquidity target.

Summary:
Our average client size in these businesses increased 15%, and our average per employee per month rates were up double digits.
We generated operating earnings per share of $0.72 in the quarter, which is down $0.07 year-over-year as reported, down $0.05, excluding significant items and up $0.04 or 7% excluding significant items and adjusting for the net favorable COVID impacts on insurance product margin.
At quarter end, our invested assets totaled $28 billion, up 5% year-over-year.