USAA 2008 Report to Members: Stronger Together

Top 5 catastrophe years2008 Hurricanes Ike and Gustav, Georgia wind/hail, Texas hailRecord-high 43 catastrophe eventsCalendar year losses (in millions)(net of reinsurance)$750$775$839$8662005 Hurricanes Katrina, Rita and Wilma$5101992 Hurricane Andrew2004 Hurricanes Ivan, Charley, Frances and Jeanne2003 Hurricane Isabel, Southern California fires, Texas hail20032004199220052008The many external accolades and awards during2008 bode well for the future. They includedBusinessWeek’s top “Customer Service Champ”for the second year in a row and Forrester’s“Highest in Customer Advocacy Ratings.” † And,USAA received the highest score in the “J.D. Powerand Associates 2008 National Auto InsuranceStudy ṢM ” Standard & Poor’s referred to USAA’senterprise risk management as “excellent, withindustry-leading risk-management practices” —no small feat in this industry or economy.In addition, numerous magazines recognizedUSAA as an excellent place to work, includingG.I. Jobs, Military Spouse, LATINA Style, andComputerWorld. We think this recognition isimportant because when we take good care of ouremployees, they take good care of our members.Stronger togetherOur 2008 results are remarkable given thecircumstances we faced then and which continueto confront us. The financial services industryoutlook is negative, it is highly leveraged withdecreasing net worth, and many financialservices companies have taken governmentbailouts. Conversely, your association’s outlookis stable, we have low debt and good liquidity,net worth is growing, and we have no need ordesire for a government handout.Whatever financial challenges are still to come,USAA offers you great value, outstanding personalservice from people who really care, and theconvenience of doing business when and whereyou want. Also, as a fully integrated financialservices company, USAA offers you free financialadvice from professionals who are not paid oncommission. Call them at (877) 314-2258. They arehere to help facilitate your financial security.Thank you for your membership and for yourtrust. We will continue to be good stewards ofyour association.Ultimately, USAA’s strength comes from threeessential components: a solid financialfoundation; our employees, who care deeplyabout our members; and you — the extraordinaryU.S. military and your families.The cover of this report pictures a mass militaryre-enlistment in Baghdad last July Fourth — a truedepiction of what it means to serve. Not unlikethese outstanding military men and womenstanding shoulder to shoulder, now more thanever, we are stronger together than we are apart.Sincerely,Josue (Joe) Robles Jr.Maj. General, USA (Ret.)President and Chief Executive Officer† ”Customer Advocacy 2008: How Consumers Rate Their Banks,Brokerages, and Insurers,” Forrester Research Inc., June 23, 2008.4 USAA 2008 REPORT TO MEMBERS