A Place For Purpose? Recasting Insurance Through A Female Lens

Does the insurance industry offer opportunities for ‘purpose-driven’ entrepreneurs to drive social change? Stellar Insurance CEO Sam White thinks so. She aims to build brands that directly address women’s concerns across issues ranging from inadequate levels of protection to industry practices that ignore the dangers of domestic violence.

At least on the surface, auto insurance is a largely gender-neutral product.yes women tend to drive safer So, at least in theory, they should pay less for car insurance than men. But sadly here in the UK and across the European Union, equality legislation now prohibits insurers from setting premiums based solely on gender. Despite low accident rates, women do not receive insurance discounts.

That fact posed an interesting challenge for Sam White. The UK-based founder and current chairman of insurance company Freedom Services, her first choice when she decided to launch a brand that professed a woman-centric approach was was Australia. Sex – as a launch pad. Late last year, she brought the Stellar Insurance brand to the UK. When I spoke with her last week, she explained how she would build a women-focused business in the midst of perhaps her biggest potential selling point, cost savings, failing to materialize. I wanted to know what you meant.

Born in Cheadle in the north of England, White began his entrepreneurial career with an insurance claims management business that he started out of his sister’s conservatory. Sticking to her insurance, she founded Freedom Services Group and in 2020 in Australia she launched Stella Insurance. Bauer Media Group, Viper Capital and VC, Envest.

As she explains, Stella is not only women-centric, it is also positioned as a business with a social mission. “Purpose-driven businesses have the power to change the world,” she says.

But what does this really mean in the context of the insurance industry? Let’s be honest, few people think of car insurance as a humble necessity. We buy insurance to protect ourselves, protect others, and stay compliant with the law. And most people probably use comparison engines and try to pay as cheaply as possible. So where does purpose fit in this diagram?

women lens

White’s approach is to look at the market through a female lens. In her view, women’s needs seem particularly poorly met. She cites a car interior cover as an example.

“Traditionally, the cover for what you carry in the car wasn’t high enough,” she says. “It doesn’t reflect the value of the products women carry around.”

Then there’s the question of what kinds of interactions women like, or for that matter, don’t like. “Women don’t like being asked a lot of questions that aren’t necessary to determine the price of the cover, but they are being asked because the information may be used in the future,” she said. say.

Loyalty penalties — the practice of charging long-time policyholders more on renewal than first-time policyholders — are also frowned upon by women, but this is something the industry is already working on, said White. Admit it.

So even if you don’t take price into account, there is still room for more work to make your offer meet women’s expectations. Of course, you could argue that this is just good marketing. In other words, tailoring the product to the tastes of the target consumer. That probably falls well short of “definition of purpose”.

a deeper problem

But White said there is a more fundamental problem with auto insurance marketed to women. She points to a policy of denying claims if the damage done to the vehicle was done by someone the claimant knows. At first glance, this sounds like a fairly standard industry opt-out. But what if the complainant is a woman suffering from domestic violence?

This is the problem Mr. White is trying to address. At the same time, the company has developed a product that can be incorporated into auto insurance and will pay out in the event of domestic violence. “If you’re a victim, you can get the funds,” she says. The amount is a flat rate of £2,500 to £5,000 and is triggered by a domestic violence order.

In addition, Stella of Australia donated $5 (Australia). Women’s and Girls’ Emergency Center. Here in the UK, the company has partnered with the Flyaway Foundation to help women break the cycle of abuse. White believes this is an important part of the company’s ethos, even if it means slightly lower profit margins.

fundraising

So what does all of this sound like to financial backers? Before launching Stellar in Australia, White grew the business organically rather than seeking financing from VCs. Still, she has witnessed the problems women face when trying to raise money. Around the time she started her first business, her father had to pose as a director to secure her loans.

But doesn’t positioning it as a “purpose” business just because it confuses investors and lenders make things even more difficult? Say no. “A company without a purpose component could have an EBITDA of £130m. A comparable purpose-driven company could report £100m – but still £100m.” This means that you can still achieve good numbers while embedding objectives. “I believe in Stella and my numbers are good,” White added.

So, can the concept of “purpose-driven” gain a foothold in the insurance industry? There are opportunities to think creatively and take a customer-first approach. Big insurers may stick to their own ways, but entrepreneurs have room to find ways to better serve their target markets.