The power brokers of Hell are considered royalty—those who were angels long ago and served as Lucifer's commanders in his rebellion against Heaven. Scholars speculate that approximately a third of the original angels joined the rebellion, and if these scholars are to be believed, that's well over a million angels. Most of these fallen became lesser demons, though all of the fallen are considered of a higher order than those creatures spawned in Hell's pits.
Angels are created rather than born, but the monarchs of Hell consider themselves siblings. This is most likely a form of validation of power rather than family feeling. A demon either belongs to the family or they don't. Monarchs do breed and occasionally will opt to claim and raise one of their spawn, according to temperament of parent and heritage of said spawn. Acknowledged spawn are recognized as royalty. Those who are not, fend for themselves.
This is how Shax and Verin, despite having similar ancestry, end up with such different social standings. The following family tree is a sampling of those demons Shax refers to as "Aunt" and "Uncle."