USAA expands eligibility requirements for membership

Many of you know that I am a USAA member and an employee. Many of you here on CF.net are already memebers. This is a huge deal for us. We currently have 7.3 million members and with the expanded eligibility, we are opening ourselves up to take on another 35 milliion.

If you are anyone you know are now eligible, please pass along as the benefits of being a USAA member can be finicailly beneficial.

This news has already been broken on alot of major media outlets. Just wanted to pass along in case anyone was interested.



http://bucks.blogs.nytimes.com/2009/11/05/usaa-an-insurance-club-that-just-got-bigger/

http://www.chron.com/disp/story.mpl/ap/business/6704875.html

http://www.mysanantonio.com/military/69256017.html

USAA to double customer pool

by William Pack

San Antonio-based USAA hopes to make a giant leap today toward becoming the preferred provider of insurance and financial services for all the nation's military personnel and their families.

A little more than a year after scrapping some of the qualifications that limited eligibility, USAA is simplifying membership guidelines by telling officers and enlisted personnel that no matter when they served or how long they've been out of the military, they can join USAA as long as they were honorably discharged.

“This is pretty monumental for USAA,” Joe Robles, the company's president and CEO, said of the rules the company plans to outline today. “It's our mission to be the provider of choice for the military community. This will absolutely fulfill our mission statement.”

In the process, the diversified financial services firm that was formed in 1922 by 25 U.S. Army officers tired of being characterized as too risky for traditional insurance companies will have its pool of potential members more than double in size.

That pool is expected to grow, based on Veterans Affairs estimates, from 25.5 million people today to nearly 61 million active, retired and honorably discharged military personnel, their spouses and unremarried former spouses, adult children, widows, widowers and students in training for an officer's commission.

“This is by far our biggest add-on since we started,” Robles said.

The company currently has 7.3 million members who have acquired about 30 million USAA products.

Robles said his board wanted assurances that the company could take on the additional members without diminishing the service existing members have come to expect. After hearing the staff's assurances, the board voted overwhelmingly in August in support of the changes.

USAA has not been ready to handle the wave of interest expected to be generated by the changes until today.

“We're very strong financially and economically capable, so it's time for us to put our best foot forward for our military families,” Robles said.

He believes, using the growth resulting from last year's eligibility changes, that about 100,000 people will join USAA annually for several years as a result of the new rules.

The company's staff of about 22,000 workers should be able to handle up 400,000 new members without much new hiring, Robles said.

Now might seem like a challenging time for a company — particularly a financial services firm — to take on a major expansion with the economy still struggling.

But USAA hasn't taken the hits other companies have, and Robles, in best military fashion, wants to take advantage of that.

“A good company attacks when things are bad for their competition,” he said. “That's the strategy.”

Robles said 2009's results are better than 2008 and more growth is expected next year.

USAA's mid-year report, counting activity through June 30, showed net income had rebounded from last year and was approaching the level reached in 2007. Net worth as of mid-year had grown by more than $1 billion from 2008 to $15.8 billion.

Lynn Santimauro, senior product manager for SNL Financial, said USAA is strong financially and may be looking to take business away from weaker firms. While the expansion sounds like a good idea, its success will hinge on how well it is executed, she said.

Robles said USAA repeatedly has demonstrated it understands the needs of the military and is eager to show potential members the value it can bring them even when the economy is struggling.

His interest in the expansion stems in part from having to tell too many veterans and their families that they weren't eligible for USAA membership. Robles estimated more than 40,000 people a year ask to join a year but are turned down.

“This is about doing what's right,” said Robles.

USAA employs about 14,000 people in San Antonio with room at its headquarters to expand. Hoping to put to rest lingering questions about the company's interest in moving its headquarters, Robles said it would not be a consideration at least as long as he was in charge.

“We have a great city and a great labor force. It's where our roots are,” Robles said. “It's Military City USA — what better place for us to be?”