Lemonade Homeowners Insurance

Lemonade Homeowners Insurance Review

Lemonade is an InsureTech company with a different business model compared to traditional home insurance companies. The company cuts costs by using technology to compute premiums and get the ball rolling on claims quickly. Lemonade takes a flat fee from premiums and then donates what’s left after expenses to charities. Other insurance companies make a profit after expenses, which can create conflicts of interest when paying claims.

Along with homeowners insurance, Lemonade sells renters, condo, co-op, pet, health and life insurance in the U.S. and Europe. The company is fully licensed and regulated, and it handles all underwriting, pricing and claims processing for Lemonade Insurance policies.

Pros
  • Website is very transparent with company and policy information
  • Excess profits are donated to charity every year
  • Buying or changing a policy and filing a claim takes just a few minutes
  • Often pays claims in less than five minutes

Cons
  • Homeowners policies are not available in all states
  • Online quotes require the last four digits of Social Security number

Lemonade Insurance Keeps Things Simple

Unless you are moving into your first home, buying homeowners insurance doesn’t require a conversation with an agent. Lemonade drastically cuts the time you’ll spend buying coverage for your house, condo or housing co-op, and the company often offers a lower price.

Visit Lemonade’s website or use the mobile app to get an insurance quote and you’ll be greeted by Maya, the company’s AI assistant. The customer service bot walks you through your insurance options and gathers your information to generate a quote. If you don’t want to buy the policy immediately, you can save it.

AI Maya explains you’ll likely pay more for insurance if you filed multiple homeowners claims in the past. You’ll find this level of transparency throughout the information in the app and on the website.

Filing a Claim with Lemonade Homeowners Insurance

Filing a claim requires no phone call because AI Jim is always available in the app to take your information. Enter the claim details and add a photo or video, and you may immediately receive a payment to cover the damage. Human agents get involved with more complicated claims.

Lemonade’s state-of-the-art insurance platform uses artificial intelligence to “learn” from all the data gathered through customer interactions. This feature is at the heart of the app, allowing claims processing to continue improving over time.

Lemonade Homeowners Insurance Coverage
Dwelling Coverage A pays for damage to your home or replacing it if destroyed.
Other Structures Coverage B protects anything built on your property that’s not attached to the house.
Personal Property Coverage C covers your belongings in your home and beyond.
Loss of Use Coverage D pays for living expenses like hotel and meal costs if your home becomes inhabitable.
Personal Liability Pays legal fees and medical bills if someone gets hurt on your property.
Optional Extra Coverage Protects against accidental loss, damage and theft of items worldwide with no deductible. Lemonade offers earthquake coverage in some states.

Lemonade and Reinsurance

Several large insurance companies back Lemonade to share the risk all insurance companies must manage. Put simply, this drastically reduces the probability of Lemonade having too much exposure to costs associated with a disaster. Lemonade Insurance has no AM Best rating, but the companies providing reinsurance are rated A+ or A for financial strength.

How Does the Lemonade Giveback Work?

All Lemonade customers except life insurance policyholders can select a charitable cause for the Giveback program. Make your choice to join a pool of policyholders who want to donate to the same charity. Lemonade donates proportionally to multiple charities.

Lemonade starts with the total premiums from clients who chose a particular charity. The 25% flat fee, claims costs, emergency fund deposit and business expenses get deducted from that amount. The company donates the remaining funds, up to 40% of the group’s premiums.

Insurance regulations may affect the donation amount, and Lemonade has the discretion to amend or suspend the Giveback program. However, Lemonade’s total 2020 contribution amount was $1,128,109 after just four years in business. The first donation in 2017 was $53,174, so the company stays true to the Giveback commitment.

Lemonade Homeowners Insurance Cost

Lemonade homeowners policies start at $25 per month. However, insurance premiums vary a great deal depending on several factors, including your home’s age, construction and other details. Your credit score, the distance of the closest fire department, state regulations and other factors also affect premium costs.

Get a quote from Lemonade’s website or use the mobile app to see if you can lower your homeowners insurance.

Where to Buy Lemonade Homeowners Insurance

You can buy homeowners insurance and other policies using Lemonade’s website or mobile app. Customers use the app to manage their policy and file claims, which rules out those who don’t use smartphones.

Lemonade Insurance Complaints

Lemonade has a B rating with the Better Business Bureau. An A rating may be beyond reach due to the short time Lemonade has been selling insurance. Some consumers filed complaints with the BBB, but the number is low compared to the number of policies sold. Lemonade answered all complaints.

Ninety percent of consumer reviews on Clearsurance give Lemonade 5 out of 5 stars. ConsumerAffairs readers give the company 4.2 out of 5 stars, and DoughRoller 9.6 out of 10 stars. NerdWallet and Consumerism Commentary published positive reviews.

Lemonade Homeowners Insurance Q&A

  • What is the benefit of Lemonade Insurance’s Certified B Corp classification?

    Lemonade Insurance must meet stringent social and environmental performance standards to attain Certified B Corp status. The company also must remain accountable and transparent with business information. Lemonade Inc. is organized in Delaware as a public benefit corporation, and management can consider interests beyond profits in business operations.

  • Will Lemonade homeowners insurance premiums rise if I file multiple claims?

    Lemonade is different from other insurance companies, but your premiums can correlate with your claims history like with other providers. However, claims history is only one of several considerations Lemonade uses to calculate premiums.

  • How long does Lemonade take to pay a homeowners insurance claim?

    Lemonade Insurance pays most simple property claims almost instantly in the mobile app. Property damage and liability claims take a bit longer, but the company strives to pay quickly.

  • Can I change the charity I donate to with Lemonade’s Giveback program?

    You can change the organization to receive Giveback funds after Lemonade makes its annual contribution in June.

  • Does Lemonade Insurance offer a discount for bundling multiple policies?

    Insurance companies typically provide a discount if you bundle a homeowners policy with auto insurance. Lemonade did not offer car insurance when we published this review. However, you may qualify for a discount for bundling pet insurance with homeowners, renters, co-op or condo insurance.

Conclusion

Lemonade Insurance signed its 1 millionth customer in 2020 and donated over $1 million to charity. Both accomplishments are impressive over just a few years. Many consumer reviews mention excellent customer service and easy processes for selecting insurance or making dynamic changes to policies. Lemonade can simplify homeowners insurance, but it’s not the best choice if you prefer to communicate directly with an agent.

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