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The United Services Automobile Association (USAA) is an American financial services company providing insurance and banking products exclusively to members of the military, veterans and their families. It was founded in 1922 in
San Antonio San Antonio ( ; Spanish for " Saint Anthony") is a city in the U.S. state of Texas and the most populous city in Greater San Antonio. San Antonio is the third-largest metropolitan area in Texas and the 24th-largest metropolitan area in the ...
,
Texas Texas ( , ; or ) is the most populous U.S. state, state in the South Central United States, South Central region of the United States. It borders Louisiana to the east, Arkansas to the northeast, Oklahoma to the north, New Mexico to the we ...
, by a group of 25 U.S. Army officers as a mechanism for mutual
self-insurance Self insurance is a risk management method in which an organization that is liable for some risk does not take out any third-party insurance, but rather chooses to bear the risk itself. When used prudently, the organization that self insures sets ...
, when they were unable to secure auto insurance because of the perception that they, as military officers, were a high-risk group. USAA is headquartered in northwest San Antonio, occupying a former horse farm. USAA Federal Savings Bank, which provides banking services, is headquartered on a campus in Phoenix,
Arizona Arizona is a U.S. state, state in the Southwestern United States, Southwestern region of the United States, sharing the Four Corners region of the western United States with Colorado, New Mexico, and Utah. It also borders Nevada to the nort ...
as of April 2024. USAA has since expanded to offer banking and insurance services to past and present members of the Armed Forces, officers and enlisted, and their families. The company ranked No. 96 in the 2020
Fortune 500 The ''Fortune'' 500 is an annual list compiled and published by ''Fortune (magazine), Fortune'' magazine that ranks 500 of the largest United States Joint-stock company#Closely held corporations and publicly traded corporations, corporations by ...
list of the largest United States corporations by total revenue and appeared on Fortune's 2021 Blue Ribbon list of companies, placing No. 355 on the Fortune Global 500, No. 94 on the Fortune 500, No. 55 on the 100 Best Companies to Work For and World's Most Admired Companies. At the end of 2020, it had more than 13 million members.


History

The organization was originally called the United States Army Automobile Association. In 1924, the name was changed to United Services Automobile Association, when commissioned officers of other U.S. military services became eligible for membership. The company was formed based on a meeting of 25 United States Army officers on June 20, 1922, at the Gunter Hotel in San Antonio, Texas, to discuss the procurement of reliable and economical auto insurance. Despite initial success, by the late 1920s, a dispute between competing factions for control of the company threatened its long-term viability. The issue was resolved when feuding members agreed to hire a leader from outside, resulting in the 1928 appointment of Major General Ernest Hinds as general manager and secretary-treasurer. Hinds provided stability and remained in the position until his death in 1941. USAA is a pioneer of the concept of
direct marketing Direct marketing is a form of communicating an offer, where organizations communicate directly to a Target market, pre-selected customer and supply a method for a direct response. Among practitioners, it is also known as ''direct response ...
; most of its business is conducted over the Internet or telephone using employees instead of agents. Until the 1960s, the bulk of its business was conducted via mail. In the late 1960s, USAA began a transition from mail to phone-based sales and service. It launched a toll-free number in 1978, and Internet sales and service in June 1999 via its website. USAA offered restricted membership to civilians between September 2009 and August 2013. This membership provided access to USAA's investment products, most bank deposit products and life insurance. Auto and property insurance policies were not included for non-military members due to eligibility restrictions. In 2015, USAA employed more than 32,000 people at its offices throughout the world. On July 26, 2019, the
Charles Schwab Corporation The Charles Schwab Corporation is an American multinational Financial institution, financial services company. It offers banking, commercial banking, investing and related services including consulting, and wealth management advisory services ...
announced it would acquire USAA's investment management and brokerage accounts for $1.8 billion. The deal with Charles Schwab closed on May 26, 2020.


Lines of business


Property, casualty, and life insurance

USAA offers a range of personal property and casualty (P&C) insurance, including automobile insurance, homeowner insurance,
renters' insurance Renters' insurance, often called tenants' insurance, is an insurance policy that provides some of the benefits of homeowners' insurance, but does not include coverage for the dwelling, or structure, with the exception of small alterations that a t ...
, as well as
umbrella An umbrella or parasol is a folding canopy supported by wooden or metal ribs that is mounted on a wooden, metal, or plastic pole. It is usually designed to protect a person against rain. The term ''umbrella'' is traditionally used when protec ...
and personal property insurance. In addition to P&C insurance, USAA provides whole life insurance, term life insurance, and
annuities In investment, an annuity is a series of payments made at equal intervals based on a contract with a lump sum of money. Insurance companies are common annuity providers and are used by clients for things like retirement or death benefits. Examples ...
. USAA's life insurance policies, while not unique in the industry, are different from most offerings since they do not include a war-exclusion clause.


Banking

Banking services can be accessed in person, by mail, by phone or through the internet. USAA Federal Savings Bank provides members with the ability to deposit checks to their accounts using mobile applications on the
Apple An apple is a round, edible fruit produced by an apple tree (''Malus'' spp.). Fruit trees of the orchard or domestic apple (''Malus domestica''), the most widely grown in the genus, are agriculture, cultivated worldwide. The tree originated ...
iPhone The iPhone is a line of smartphones developed and marketed by Apple that run iOS, the company's own mobile operating system. The first-generation iPhone was announced by then–Apple CEO and co-founder Steve Jobs on January 9, 2007, at ...
and
iPad The iPad is a brand of tablet computers developed and marketed by Apple Inc., Apple that run the company's mobile operating systems iOS and later iPadOS. The IPad (1st generation), first-generation iPad was introduced on January 27, 2010. ...
and mobile devices with Google's Android operating system. Major banking competitors include
Bank of America The Bank of America Corporation (Bank of America) (often abbreviated BofA or BoA) is an American multinational investment banking, investment bank and financial services holding company headquartered at the Bank of America Corporate Center in ...
-Military Bank, Pentagon Federal Credit Union and Navy Federal Credit Union.


Investing and financial planning

USAA members are referred to its strategic partners,
Charles Schwab Corporation The Charles Schwab Corporation is an American multinational Financial institution, financial services company. It offers banking, commercial banking, investing and related services including consulting, and wealth management advisory services ...
and Victory Capital, for other investment services such as brokerage and trading,
mutual funds A mutual fund is an investment fund that pools money from many investors to purchase securities. The term is typically used in the United States, Canada, and India, while similar structures across the globe include the SICAV in Europe ('investmen ...
and ETFs.


Target market

USAA's mission statement indicates its focus to serve its
niche market A niche market is the subset of the market on which a product is appealed to a small group of consumers. The market niche defines the product features aimed at satisfying specific market needs, as well as the price range, production quality and the ...
, which consists of members of the U.S. military and their immediate families. To that end, the association has always marketed directly to members of the U.S. military. USAA membership is offered to officers and enlisted personnel, including those on active duty, those in the National Guard and Reserve, Officer candidates in commissioning programs (Academy, ROTC, OCS/OTS) and all those who have served in the aforementioned categories and who have retired or have been discharged honorably." Historically, only U.S. military officers (among certain other federally sworn officers) were eligible to join USAA, with descendants of USAA members able to purchase insurance from USAA-CIC. It did not matter if one was an active duty or retired officer; one could join at any time. In 1973, membership was opened to members of the National Guard and Reserves, and in 1996, eligibility was expanded to enlisted members of the armed services. As the number of persons who have served on active duty in an enlisted status in the U.S. Armed Forces is quite large, USAA chose to limit the establishment of eligibility to those who were currently on active duty or who had recently separated. The same time limit on establishment of eligibility was then applied to military officers. In 2008, USAA expanded membership eligibility to all military personnel and retirees, and all veterans who separated after 1996. For a short time, USAA also offered enrollment for federal law enforcement. In November 2009, USAA expanded eligibility requirements to offer coverage to anyone who has ever served honorably in the US Military. As of 2022, USAA has also extended membership to those who have a general discharge from the military. USAA also includes current and former employees from the following federal agencies: Defense Criminal Investigation Services (DCIS) Drug Enforcement Administration (DEA) Federal Bureau of Investigation (FBI) Naval Criminal Investigative Service (NCIS) Secret Service (SS) U.S. Air Force Office of Special Investigations (AFOSI) U.S. Army Criminal Investigation Command (ACIC) U.S. Department of State (DOS) - eligibility for USAA membership limited to Foreign Service Officers and certain Foreign Service Employees who are or were on permanent appointment. Merchant Marine Academy (USMMA) Staff and Faculty - eligibility for USAA membership limited to current staff and faculty holding a commission granted by the Marine Administration.


Leadership

Led by USAA Chairman of the Board Vice Admiral James M. Zortman (Ret.), USAA's board of directors named Wayne Peacock CEO-elect in January 2020 to succeed former CEO Stuart Parker. Peacock became CEO in February 2020 and is the first USAA CEO who is not a veteran of the armed forces. USAA has announced that on April 2, 2025, Juan C. Andrade will step in as the new CEO. USAA former CEOs include retired Air Force brigadier general Robert F. McDermott, who took the position in 1969. The USAA office building in San Antonio was constructed under his tenure, and McDermott was behind USAA's shift from service-by-mail to service-by-phone. He was succeeded as CEO in 1993 by retired Air Force General Robert T. Herres. It was under Herres that USAA expanded its services to enlisted members of the military and developed
Internet The Internet (or internet) is the Global network, global system of interconnected computer networks that uses the Internet protocol suite (TCP/IP) to communicate between networks and devices. It is a internetworking, network of networks ...
based financial services. Following General Herres as CEO as of 2000 was Robert G. Davis, a former Army officer who came to USAA with experience in a variety of financial services companies. Davis is said to have changed the culture at USAA; during his time at USAA, membership, assets and net worth grew significantly. His tenure, however, was not without controversy. Davis oversaw USAA's first layoffs and by some reports had a confrontational style of leadership. Davis had indicated to USAA employees that he intended to continue to lead USAA until 2010, however, he retired in December 2007. The nature of his retirement seems to have been precipitous, as USAA CEO Josue Robles has stated that upon assuming the role of CEO, "I thought I was just going to be a temporary CEO and (the board) said, 'Guess what? The permanent CEO is you'."


Locations

Besides its headquarters in San Antonio, USAA has a second major office in Phoenix. USAA also has offices in
Chesapeake, Virginia Chesapeake is an independent city in Virginia, United States. At the 2020 census, the population was 249,422, making it the second-most populous city in Virginia, the tenth largest in the Mid-Atlantic, and the 92nd-most populous city in the ...
;
Colorado Springs, Colorado Colorado Springs is the most populous city in El Paso County, Colorado, United States, and its county seat. The city had a population of 478,961 at the 2020 United States census, 2020 census, a 15.02% increase since 2010 United States Census, 2 ...
;
Plano, Texas Plano ( ; Spanish language, Spanish for "flat surface" /'plano/) is a city in the U.S. state of Texas, where it is the largest city in Collin County, Texas, Collin County. A small portion of Plano is located in Denton County, Texas, Denton Count ...
; and
Tampa, Florida Tampa ( ) is a city on the Gulf Coast of the United States, Gulf Coast of the U.S. state of Florida. Tampa's borders include the north shore of Tampa Bay and the east shore of Old Tampa Bay. Tampa is the largest city in the Tampa Bay area and t ...
. Internationally, USAA has offices in
London London is the Capital city, capital and List of urban areas in the United Kingdom, largest city of both England and the United Kingdom, with a population of in . London metropolitan area, Its wider metropolitan area is the largest in Wester ...
and
Frankfurt Frankfurt am Main () is the most populous city in the States of Germany, German state of Hesse. Its 773,068 inhabitants as of 2022 make it the List of cities in Germany by population, fifth-most populous city in Germany. Located in the forela ...
. The company has numerous office buildings in the Phoenix area. Their largest office buildings are on a 400-acre multi-use north Phoenix campus built in 2017, these buildings contain 4,500 workers. In May 2019 USAA opened another Phoenix office located at 25700 N Norterra Pkwy in north Phoenix that will eventually house 1,100 employees primarily software developers. On May 27, 2021, USAA announced that it will be adding an additional 750 employees to its 100-employee base in
Charlotte, North Carolina Charlotte ( ) is the List of municipalities in North Carolina, most populous city in the U.S. state of North Carolina and the county seat of Mecklenburg County, North Carolina, Mecklenburg County. The population was 874,579 at the 2020 United ...
. The company will be leasing of space in a new building in South End called The Square. Company employees started moving in at the end of 2021. In June 2022, USAA purchased The Square from developer Beacon Partners for $97 million. Currently the company has 500 employees in the building and they occupy 2 out of the 6 floors they originally agreed to lease of the 10 story building.


Bank secrecy violations

On March 17, 2022, The
Financial Crimes Enforcement Network The Financial Crimes Enforcement Network (FinCEN) is a bureau within the United States Department of the Treasury that collects and analyzes information about financial transactions to combat domestic and international money laundering, terrori ...
(FinCEN) announced a $140 million "civil money penalty" against USAA Federal Savings Bank for violations of the
Bank Secrecy Act The Bank Secrecy Act of 1970 (BSA), also known as the Currency and Foreign Transactions Reporting Act, is a U.S. law requiring financial institutions in the United States to assist U.S. government agencies in detecting and preventing money laun ...
.


See also

*
List of largest banks in the United States The following table lists the 100 largest bank holding companies in the United States ranked by total assets of September 30, 2024 per the Federal Financial Institutions Examination Council, along with the market capitalization of public banks. ...


References


External links

* {{authority control 1922 establishments in Texas American companies established in 1922 Auto insurance in the United States Banks based in Arizona Banks established in 1983 Companies based in Phoenix, Arizona Companies based in San Antonio Financial services companies established in 1922 Insurance companies based in Texas Life insurance companies of the United States Online financial services companies of the United States Privately held companies based in Arizona Privately held companies based in Texas