Have you ever heard of Lemonade? No, not the drink (although, being that it’s summer, I could really go for some right now), the insurance company! If you haven’t, that’s okay; it’s only been in existence for a few years now.
For those of you reading this, are you looking for a new insurance company to use, maybe Lemonade, with some of its interesting features that most other companies don’t offer, will be perfect for you…or, it might not! To find out which one is the case for you, just keep reading! First, however, a little background information:
What is Lemonade?
Basically, Lemonade is an American property and casualty insurance company that offers renters and home insurance policies for homes, apartments, co-ops and condos in the United States, as well as in Germany and the Netherlands. Something of note is that the company raised roughly $320 million in its IPO and has a market value of $1.6 billion.
What Makes Lemonade Different?
Something I’ve noticed as an adult that, yes, uses insurance, is that a lot of established companies like Geico, Progressive, and Allstate use similar models. Many have brick-and-mortar locations or agents that you visit/talk to, for example. This isn’t a bad thing, per say. In fact, most businesses tend to run this way. Is it convenient, though? I would say…no. In a society that thrives on convenience, that might be seen as a con. They’re also known for being…well, boring. The average person doesn’t exactly like getting insurance.
Enter Lemonade. Lemonade’s mission is to “Harness technology and social impact to be the world’s most loved insurance company.” Lemonade is leveraging its unique design to make purchasing homeowner’s and renter’s insurance easy, dare I say fun, and attract the next generation of home-owners and renters.
How so? Let’s take a look at some examples:
- The Use of Artificial Intelligence and Technology – Lemonade has really embraced technology and artificial intelligence. Prospective customers can chat with their AI Maya bot who can help them sign up for insurance. When a customer needs to file a claim they can do so by chatting with their AI Jim bot who Lemonade claims helps pay claims in as little as three seconds. It’s fast, and so convenient that you can do it in your pajamas!
- Their Giveback Program – Lemonade also taps into the millennial generation’s desire to make an impact by donating excess premiums to nonprofits chosen by its customers every year as a part of its Giveback program. Each year, “leftover” money or excess premium money that the company doesn’t need is donated to nonprofits. In 2019, they donated over $600,000 to 26 nonprofits.
- Affordability – Lemonade charges its customers a premium every month in exchange for insuring their home or apartment. They offer renter’s insurance starting at $5 a month and homeowner’s insurance starting at $25 a month. They do this by offloading excess claims to re-insurers, something that many other insurance companies also do, and this helps keep Lemonade’s revenue and profits more consistent without being at the whim of the weather (i.e. hurricanes, tornadoes, etc.)
Of course, Lemonade is still a very new company in the grand scheme of things (5 years since creation, and even less since it actually went up and running) so it’s understandable that many people may still be wary about actually using it themselves. Even so, I think it’s clear to see that what they’re doing (at least so far) may very well just be the beginning of a new era of insurance companies.
So, what do you think? Do you think Lemonade is/will be worth it?
Thanks for reading,