When entering the Navy, the instructor as part of our orientation to military life, said we should join two organizations: USAA for auto insurance and the local military credit union for checking accounts.
His advice has caused our family to use USAA for auto, and later home insurance, for over 50 years.
We receive two bonus checks annually as part of this relationship.
The first for $412 was the annual distribution (dividend) from the Subscriber’s Account, a portion of the capital base for this mutual insurance company. USAA stated that the amount was partly from the sale of their asset management company as well as from their overall net income.
That equates to three to four months of my combined auto/home premium payments.
The Senior Bonus
But there is more to come. The senior bonus paid in mid-February is for those with at least 40 years of membership. It is a partial distribution of the capital in the Subscribers Account held in my name. It will be an even larger payout than the annual dividend based on prior year’s payouts.
A growing number of credit unions are paying special dividends, interest rebates and holiday bonuses to members when 2019’s annual results are well in hand.
One of the vital strengths of the cooperative model is their relationships with their member-owners. These year-end special payments acknowledge the owner’s stake in the cooperative.
USAA’s 40-year senior bonuses show their recognition and the importance of long-term loyalty. Is there a parallel for credit unions in this example?