I have an M1 mac with the T2 HW encryption, but without filevalut. When I setup the mac, there was no prompt or option to enable filevault. if you read the Apple security information, it leads you to believe that you dont need filevault. This is incredibly dangerous mis-information from Apple. to access the contents of the SDD on an M1 Mac with HW SSD encryption, simply start the mac in recovery mode, select share disk, connect any other machine to the mac with a cable, and the second machine has full access to the files without any password or authentication. I could not believe this, so tried it myself and its true. So by default, Apple have no protection from someone stealing your mac, then stealing everything on the mac unless you enable filefvalut. see
https://blog.kolide.com/modern-macs-still-need-filevault-d5e2f55c083b