There’s more to the Automobile Club of Southern California than just its emergency roadside assistance.
Besides insurance and services for credit cards and vehicle registration, it also offers travel services, which is an area of “tremendous growth opportunity,” according to Auto Club Chief Executive and President Greg Backley.
“We’re a unique company in the sense that we offer a pretty broad range of products and services to members,” Backley told the Business Journal. “One of our goals is to increase the awareness of our travel agency so that when members are thinking about taking a trip, they’ll think about us.”
Backley said that demand for travel services has “leveled off,” but remains higher than pre-pandemic levels due to “revenge travel,” an uptick in travel to make up for lost time resulting from global lockdown restrictions. Cruising, in particular, is popular right now, he noted.
The Auto Club has a full-service travel agency that helps members book flights, hotel accommodations and vacation packages. Currently, they are developing new experiences and packages for niche segments of the market, such as solo travelers or people interested in golf or luxury excursions, Backley said.
“People are looking for unique experiences now,” he said.
Its travel arm is reportedly the largest leisure travel agency in Southern California, operating in more than 80 branch travel agencies and booking more than 1.5 million trips annually.
Costa Mesa-headquartered Auto Club is the largest member of the American Automobile Association (AAA) federation of motor clubs, serving the 13 southernmost counties in California, stretching from San Luis Obispo to San Diego.
Despite its name, the company has expanded nationally. In the late 1990s, it acquired sister auto clubs in Texas, New Mexico and Hawaii. It went on to affiliate with several more clubs, including AAA Alabama and AAA Missouri, leading to the creation of Auto Club Enterprises (ACE) in 2002.
ACE, a business entity of the Auto Club of Southern California, is an umbrella organization of AAA clubs serving more than 18.6 million members.
As of 2024, ACE Auto and other insurance policies generated about $7.6 billion while travel services brought in another $1.1 billion.
In April of 2024, the company completed the acquisition of the Wawanesa General Insurance Co., the U.S. subsidiary of the Wawanesa Mutual Insurance Company, one of Canada’s largest mutual insurers. Wawanesa Insurance is a direct-to-consumer insurance company that provides customer service in California and Oregon.
That acquisition and investment income were the big reasons its 2024 revenue jumped 40% to $10.6 billion, making it the fourth largest private company in Orange County.
Backley, previously the chief operating officer of the Auto Club, took over from John Boyle last year, who retired after 35 years with the company, including seven years as CEO and president.
A Tragic Event
AAA is dealing with the aftermath of the January Los Angeles fires, which destroyed more than 16,000 structures and burned more than 50,000 acres.
“The wildfires in January were tragic and was certainly the most catastrophic event that the Auto Club has ever experienced,” Backley said.
He said that the claims team has a “catastrophe playbook” to help map out how to respond in such instances.
“I’m really proud of how we’ve responded,” he said. “Our claims team, in particular, was impacted the most. We’ve been preparing for something like this for quite some time.”
The Auto Club responded with increased claims access, free roadside service for first responders and donations, committing $800,000 to the United Way of Greater Los Angeles and $200,000 to the American Red Cross.
The issues with wildfires “continue to be challenging for us,” Backley said.
“We’ve been very busy, as you can imagine, working with our members and our policyholders to try to help them.”
Whereas other insurance companies have complained that state regulators haven’t allowed them to increase premiums to cover risks such as wildfires, these issues haven’t recently affected AAA, Backley said.
125th Anniversary
For the second consecutive year, the Auto Club of Southern California has been ranked No. 1 in the J.D. Power U.S. Auto Insurance Study for overall customer satisfaction among auto insurers in California, according to a June announcement by the market research company.
Founded in 1900, the Auto Club is marking its 125th anniversary this year.
“The past 125 years our mission has been to create members for life, and we’re looking forward to the next 125 years,” Backley said.
Backley’s entry into the insurance industry was a job straight out of college, processing renewal applications for a health insurance broker, before a friend introduced him to someone who worked for the Auto Club.
Growing up, he recalled going to the Hollywood Auto Club branch with his dad.
“It looked like I was going somewhere important whenever he took me there, and that kind of stuck with me,” Backley said.
A significant portion of Backley’s career has been spent at the Auto Club, spanning over 30 years.
He began his career at the company in 1991 as a membership and insurance sales agent at a branch in the San Fernando Valley, eventually moving up to higher leadership positions.
He was promoted to vice president of insurance product management in 2008 and senior vice president of insurance operations in 2018.
More recently, he served as executive vice president of insurance operations in 2022, before being appointed COO in 2023.
Push for Tow Truck Driver Safety Initiatives
Since becoming CEO last year, Backley has focused on the company’s long-term strategy by continuing to grow its three largest segments.
“We’re a financially strong company, and it’s really critical that continues because we want to offer competitive products at competitive prices,” he said.
One recent initiative Backley has helped lead is tow truck driver safety, an issue that he said is overlooked in the industry.
“Last year, 46 emergency responders, including tow truck drivers, lost their lives while helping people at the roadside,” he said.
The Auto Club sponsored Assembly Bill 390, which expands the state’s existing “slow down, move over law” to require drivers to slow down and vacate the closest lane to all vehicles stopped on the side of the road. The law previously only applied to marked Caltrans vehicles.
The bill passed this year and will take effect in January, according to Backley.
The Auto Club has also developed a variable message board intended to be installed on the top of tow trucks that displays the message “slow down, move over” to passing drivers.
“Our ultimate goal would be to have every single AAA tow truck equipped with one of these safety features,” Backley said.
