Insurance 101 with USAA President & CEO Wayne Peacock
June 15, 2022
Creating customer value through insurance membership models with USAA President & CEO Wayne Peacock
Insurance experts Aaron Abrahms, of Jasper Ridge Partners and the Columbia University School of Wealth Management, and Ross Buchmueller, CEO of PURE Insurance, host Insurance 101 on SiriusXM’s Business Radio.
In each episode of the special limited-engagement series that aired in the spring of 2022, Abrahms and Buchmueller led discussions with some of the most accomplished names and CEOs in the industry. Here is our summary of their this episode with Wayne Peacock, President and CEO of USAA.
USAA began as an auto insurance provider to Army Corps members in 1922. In the century since, USAA has grown into a Fortune-500 company that offers property, casualty and life insurance; banking; investing; and financial planning.
Not your average policyholder
Similar to PURE, USAA’s customers aren’t just policyholders—they’re members. Both companies have a reciprocal structure, meaning they are designed to serve a specific customer with similar values, interests and needs. For PURE, the niche is high net worth individuals and families and for USAA, it’s active or former military service members and their families.
In many ways the reciprocal model enables the company to deliver more value to members, but the company also has a commitment to make decisions in the best interest of the broader membership. Peacock discusses it here.
The benefits of the reciprocal model
While there is no doubt that the cost of insuring risk is at a high, the reciprocal model encourages the carrier to select only the most responsible people for membership and places more focus on loss prevention. This, in turn, can help to reduce the severity and frequency of claims which benefits both the company and the membership as a whole. Buchmueller and Peacock discuss below.
A word on service
Ahead of its centennial, Peacock has had the opportunity to gain perspective on the success of USAA by looking back in time—literally. Peacock discusses digging into company archives only to be reminded, clearly and certainly, of USAA’s foundational purpose.
Keeping members at the core of the model means that service is the central focus, delivering the kind of experience policyholders seek. The levels of customer satisfaction and trust are what unite the likes of USAA and PURE and make the membership model stand out in the broader insurance landscape.