Freeway Insurance CEO Envisions Becoming National Provider of Nonstandard Auto

As he begins his tenure as chief executive officer of Freeway Insurance, Joe Waked envisions the provider of nonstandard automobile insurance, and its parent company, Confie Seguros, becoming the largest national distributor of nonstandard auto insurance in the country.

Every major metropolitan area has an underserved nonstandard community, Waked said, and these customers need convenience and guidance.

"Our type of consumer wants personal attention and contact," Waked said. The former attorney, who has been with Freeway Insurance since its inception in 1987, succeeds John Klaeb, who has been named chairman and will focus on strategic planning, including mergers and acquisitions (BestWire, July 6, 2011).

Buying insurance is not like buying an airline ticket, Waked said, adding the process is inherently complicated for some consumers who want professionals to walk them through the process.

Asked about that strategy of providing personal attention at a time when Allstate Corp. announced plans to acquire Esurance and Answer Financial in a $1 billion deal (BestWire, May 18, 2011), Waked acknowledged his company's online presence has to expand as well. He thinks many consumers gather information and do some price comparing online, but still want personal interaction with an agent.

The greatest challenge the company faces is expanding its talent pool, Waked said, adding that the company's employees have to mirror its consumer base, and Freeway is always looking for bilingual agents who communicate well with its customers.

"We can only grow and get stronger and expand as talent keeps up with us," Waked said.

Waked and Klaeb partnered with San Francisco-based private-equity firm Genstar Capital in 2008 to form Confie Seguros, which has been expanding. Most recently, the company acquired Royale Insurance and First Americano Insurance Agency in New Jersey (BestWire, May 23, 2011). In April, the company acquired NII Brokerage, which has 26 locations in New York (BestWire, April 5, 2011). In October, Confie Seguros acquired Sacramento-based Cost-U-Less Insurance in a combination that expanded the company's geographical reach in northern California (BestWire, Oct. 5, 2010).

The company has its sights on expansion into Nevada, Florida, Illinois, Georgia, and the Carolinas as it strives to reach its goal of annual revenue of $250 million in the next two years.

About 95% of Confie Seguros' sales are generated from nonstandard auto insurance. The market consists of people with little or no credit history, people with little or no driving record, and people with poor driving records. The majority of Confie Seguros' customers fall into the first two categories (BestWire, Oct. 5, 2010).

(By Diana Rosenberg, senior associate editor, BestWeek)