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“Our attitude to risk is dysfunctional”: Sam White, insurer, on the illusion of safety

The founder and CEO of Freedom Services Group on the life lessons that made her a force for change in the insurance industry.

By Will Dunn

Sam White will never forget the day her mother drove past her school in her TVR sports car. Her mother was drunk, as she often was, and the car – from which White’s mother had neglected to remove a waterproof cover – had just caught fire.

“I feel like my childhood prepared me quite well,” White told me, “for that sense of humiliation when things don’t go well… There’s been a number of occasions where things have got really, really tough, and I have been able to put it into perspective.”

While her childhood was “chaotic… We often didn’t have food in the house,” it was also defined by a lack of structure, something that White now sees as not entirely a bad thing. Her father – who sold fire safety systems, often abroad – “was away a lot with business and my mum was, you know, passed out. So I pretty much did whatever I wanted as a kid… I think it does create a mindset that doesn’t think in fixed terms.”

The lack of security would also lead to years in which panic attacks were common, and smoking and fast food became “coping strategies”. But White credits her upbringing with having equipped her to make the decision, aged 24, to go into business on her own.

In the space of a few months White had broken her leg, lost her job, and her mother had lost her battle with alcoholism. At that point, White said, “I just didn’t want to work for somebody else.” So she took the skills she had learned in her previous job in the insurance industry, and set up a desk in her sister’s conservatory. Just over a decade later, her business would be turning over £18m a year.

Entrepreneurialism is in her blood: both her grandfathers set up their own businesses, as had her mother before she became ill. When she was a teenager she worked at Greggs in Wythenshawe near Manchester, and one day the shop accidentally ordered 70 chocolate cakes, ten times the usual order. White asked if she could deal with it: “I sold them all in an hour and a half,” she remembered. “When my job was one thing, I would end up getting involved in other things.”

At first, growth was slow. White told me that she has only been able to raise finance for her businesses in the past couple of years, so to begin with “I had to make a pound to spend a pound”. But in 2005 – having taken a year off from the business to go travelling – White discovered a new niche within the motor insurance business. Insurers were failing to help many people that were making personal injuries claims through the process of doing so, and losing customers as a result. White’s company picked up the work of managing car accident claims for some major insurers and “created a new market within our market”, she told me.

From that point the business grew very quickly, and White – after visiting Los Angeles with her partner for IVF treatment – decided to move to the US, where she spent two years setting up another joint venture in California. She talks about her time in LA, she told me, as her “arsehole years”: she drove flash cars and had a house in the gated community of Mulholland Estates.

She now thinks she was motivated by the idea that she “still didn’t quite feel good enough… the idea that some kid from Stockport, who’d had the childhood challenges that I had, could live in Beverly Hills was very appealing to me… Of course, now I know it’s utter bollocks, and that these things mean very little.”

Then, in 2013, the government introduced new regulation that limited the legal fees that solicitors could charge insurance companies when they handled a claim. Her business was all but wiped out: “We lost 60 per cent of our income line within probably a four to six-week period.” White returned to the UK, restructured her business and set up as an insurer, offering motor insurance in the UK and then in Australia, where her Stella brand sells insurance “for women, by women”.

Under an EU law that still applies in the UK, insurers are not allowed to discriminate on gender, so women pay more than they should for insurance (their premiums are dragged up by men, who are worse drivers). “Insurance is inherently discriminatory,” White said. “We rate on postcode, we rate on people’s credit scores – there’s nothing about it that is not discriminatory. So then to say the only thing you’re not allowed to rate on is somebody’s gender just seemed insane to me.” She hopes to bring Stella to the UK soon.

White lives now in a village in Cheshire, with her partner, her two children and two dogs, one of whom – having briefly interrupted our interview – was introduced, affectionately, as “the B**tard” (one of those words that sounds much better in a northern accent). As the pandemic arrived in 2020, White was in the process of buying her house, and had to use the deposit to pay her employees’ wages.

The pandemic was a reminder that all businesses are temporary, but also of what White called the “completely dysfunctional” attitude to risk in our society. Having studied psychology at university, she remains fascinated by how decades of marketing have affected how people imagine risk: “We’re ten times more responsive to fear than we are to joy,” she said. “From an evolutionary viewpoint, that keeps us safe,” she explained, but this is also a “powerful opportunity to get people to buy stuff”. One “massive issue” in the world today is that so many people see risk more like a rolling news channel and less like an insurance company.

“We have access to so much information now,” White said, that “there is a false sense that we should have control over things that we probably will never have control over”. While the insurance industry has “a lot of work to do”, she said, with the right direction it could help to redress this balance. “It has a huge amount of power, to do a great amount of good”.

[See also: “The space economy will be huge”: the woman helping to keep Britain in the new space race]

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