USAA at 100: ‘A very simple formula’

CEO looks back, ahead at company’s growth, mission

As USAA President and CEO Wayne Peacock prepared for the company’s 100th anniversary, he opened a time capsule that was planted in 1976 by one of his most well-known predecessors with instructions to open it at USAA’s century mark.

In it was a note from retired Air Force Brig. Gen. Robert McDermott to his 2022 successor that offered not advice on how to run USAA — “I wouldn’t be presumptuous,” he wrote — but rather “hope and aspiration” for the iconic San Antonio company that has since grown from an automobile insurance company for military officers into a diversified, multibillion-dollar financial services provider catering to the military community.

Peacock, who in February 2020 became USAA’s first CEO without military experience, took McDermott’s message as a call to “continue to serve military families really, really well.”

“The trust that they put in us,” he said, “is very special and something that we have to continue to earn every single day.”

The company that would become USAA emerged 100 years ago Monday from a meeting at the Gunter Hotel, where a group of U.S. Army officers discussed how they could get affordable, dependable automobile insurance at a time many locally owned insurance companies

were hesitant to cover a population that often moved.

The officers created the United States Army Automobile Insurance Association, pooling money into a fund to protect the value of their cars. They later changed the name to the United Services Automobile Association.

The company grew over time and opened membership to Navy, Marine Corps, Air Force, Coast Guard, National Guard and Reserve officers, retired officers of all service branches, children of military officers, enlisted personnel, and all who honorably served in the military and their family members. It has added financial products, including homeowners coverage, life insurance, mutual funds and banking, and it opened a commercial real estate arm that was later spun off.

The company opened its first offices at Kelly Field and later moved to Fort Sam Houston, then to an office building at Broadway and Hildebrand Avenue. And under the leadership of McDermott, who took the reins in 1969, the company bought about 286 acres on the Northwest Side and built its massive headquarters.

Today, the company has more than 13 million members. It is one of San Antonio’s largest private employers, with about 19,000 of its 37,000 employees based in the San Antonio area. On Thursday, USAA reported net worth of $40.1 billion last year, down slightly from an all-time high of $40.4 billion in 2020. The company’s net worth — assets minus liabilities — had not declined since 1999.

Reflecting on “the founders’ story and the sense of optimist, of persistence, of entrepreneurship that these Army officers had back then,” Peacock said USAA’s mission to help members “build and support their financial security” has not changed.

“The idea that they could do something special to take care of their own — those themes continue to stay with us 100 years later,” Peacock said. “And I think it’s what makes a difference here at USAA today.”

Peacock recently sat to discuss the company’s major milestones, focuses and role in San Antonio’s economic development, among other topics. The

USAA’s headquarters traces the history of the company, which started 100 years ago when Army

officers who needed affordable, dependable automobile insurance pooled their funds.

following has been edited for brevity and clarity.

Q: What business lines and services has USAA added that its founders might never have envisioned?

A:

I think when you go all the way back, they knew they had a great opportunity to take care of military families. At the time they were very focused on what was near to them, which was the emergence of the automobile and its role in their lives and in the economy.

They very much had an insurance-centric view, so I would make the argument that things like banking and investments and planning for retirement more broadly might not have been in their scope when they conceptualized the need to meet that need of auto insurance.

Q: What would you cite as USAA’s biggest accomplishments over the last 100 years?

A: I think you come back to why we exist, which is to take care of military families. The impact that we have had on generations of military families has been profound in helping them to build and support their financial security.

Right here in our hometown of San Antonio, you think about the job creation and the number of people who have worked at USAA. What we have contributed back to this community to build up its strength has had a profound impact on the city and this part of Texas as well.

I think about this in three areas: how do we take care of members and the impact we’ve had on the military community more broadly; the impact we’ve had on employees; and the impact on the communities where we work and live.

Q: USAA has expanded membership eligibility over time, most recently in 2009, when the company included all who are serving or have served in the military and their families. Is there more

Jerry Lara/Staff photographer Wayne Peacock took over as USAA CEO in February 2020.

Kin Man Hui / Staff photographer