Lemonade User Experience

I had a great experience recently with Lemonade insurance. I am in the process of buying a new house and my mortgage company task list on Better.com noted I needed to buy the compulsory homeowners insurance. On the drop down menu, it already had Lemonade listed as the cheapest option vs the competition and it was on the top of the list. I downloaded the app on my phone and in a few clicks, I was able to purchase coverage for only 50 bucks a month on my new home. I then signed up for Lemonade on my current primary residence (soon to be a rental property) and it came out to 48 bucks a month vs. The 102 bucks a month I am currently paying. So, now I am paying 98 bucks a month for coverage on 2 houses vs 102 bucks a month for 1 house and the coverage is virtually the same. The chat bot also offered to cancel my old insurance hassle free. The whole process was as quick, easy, and frictionless as I’ve experienced. My only complaint is that Lemonade does not offer earthquake insurance, but I’m hoping they will expand their offerings as they mature.

I also got a quote on pet insurance as the family dog is almost 8 years and it is probably about time. It was only 28 bucks a month with the bundling discount. However. what I’m really excited about as both a customer and a shareholder, is the opportunity to purchase car insurance from Lemonade, hopefully later this year.

Auto insurance is a huge industry, estimated to be a $300 billion market. With over 1 million customers and counting, the opportunity to cross sell is a tasty one. Lemonade estimates that its current customers are spending over $1 billion a year on auto insurance. According to MF analyst Matt Frankel, if they can convert just 14% of their current customers to Auto Insurance, the companies in-force premiums will double. I’m betting the conversion rate will be much higher.

Lemonade does not have all of the amazing metrics of a SaaS company and it had a rough quarter due to the Texas Freeze but the story, the opportunity, and the disruption, are undeniable. Lemonade has a Net Promoter Score (NPS), which measures how likely customers are to recommend a business to a friend, of 70. That compares to an industry average of 20. Its combination of AI and blockchain lead to lower prices and better customer service in a 1.2 trillion dollar industry that is traditionally slow, cumbersome, and not always tech friendly.

-Long Lemonade (1%)


But, I did same thing like you the fee easy higher than All State. Mine is a condo at 6 floors of 10 or 12(not so sure). That building night at downtown without any accident happened and just built at 2007. So I still use All State with simple text to agent. And so do my portfolio.


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Lower premiums, especially half is not necessarily good for the insurer.
This is obvious but worth explicitly stating.


A big part of the investment thesis is that “AI bots remove layers of costs, labor, and customer inconvenience by removing the deep network of agents that are intertwined into the model of traditional insurance companies.” This rule breaking model allows Lemonade to charge lower premiums.

This seeking alpha article from May, which i quoted above does a pretty good job explaining the business model for those who want to go deeper.

Lemonade: Why The Juice Is Worth The Squeeze (NYSE:LMND) | Seeking Alpha