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Lemonade Home Insurance Review

Lemonade Insurance, just like Hippo, is a new homeowners insurance provider. They don’t have insurance brokers, they are using chatbots and artificial intelligence to deliver homeowners insurance policies and handle claims to their customers instead, which is gaining popularity in today’s world. They operate as a Benefit (B) Corporation chartered to do business focusing on ecological and social betterment. If you’re considering to apply for home insurance to this company, here are more information about them to help you decide if their policies are suitable for your needs.

Brief History Of Lemonade Insurance Company


Daniel Schreiber and Shai Wininger, founders of Lemonade Inc., launched their insurance company in 2016 in New York. This American property and casualty insurance company created a new business model based on technology and behavioral economics by using chatbots and artificial intelligence to communicate with their customers, manage filed claims, and provide the right home insurance policy to each customer. They are a Benefit Corporation, which means they have similarities with nonprofits, doing social good by giving back to the community every year. They underwrite their own policies and are reinsured by Lloyd’s of London, which is a reinsurance and an insurance market located in the United Kingdom. Today, Lemonade is already serving 20 states: ArkansasArizonaCaliforniaConnecticut, Washington D.C., GeorgiaIowaIllinoisIndianaMarylandMichiganNew JerseyNew MexicoNevadaNew York, Ohio, Oregon, Pennsylvania, Rhode Island, Texas, and Wisconsin. They are planning to expand and offer their services to other states in the future.


The Truth


If you are looking for an instant and cheap home insurance coverage, Lemonade can be a great choice for you; however, their policies are fairly standard and only offer basic coverages, which means they don’t offer a lot of specialized coverage, unlike other insurance companies. Like Hippo, they also don’t have in-person customer support. You can only talk to them on their website as they’re using chatbots and artificial intelligence to communicate with their customers. Another good thing about Lemonade is the Giveback feature, so if you want your excess insurance premiums to be donated to nonprofits, this company is good for you.


Lemonade’s Claim


Lemonade claims that they pay claims super fast, take a flat fee, and give back what’s left to causes that their customers care about. They also claim to make everything transparent and simple for their customers.


Is Their Claim True?


Yes, their claims are true according to the customer feedback they are getting. You can pay as low as $5 each month for your premium, depending on your needs and where you live, which is a very low home insurance rate compared to other companies. Their policies are transparent and simple, making it easier for their customers to understand everything included in their policy. They are also transparent about their setup, wherein they take a 20% fee off your premium to cover all operational costs, such as running costs, salaries, and technology replacements. The rest of it will go to insuring the customers and if there’s still excess money at the end of June, they will donate it to nonprofit organizations that their customers will choose.


Other than that, filing and paying out claims in Lemonade is fast and convenient. You will just simply use their mobile app, upload a video of the damages happened in your home, and wait for them to review your claim. Once approved, they will send the payout for your claim on your account so you can have the property’s damages repaired or replace the item that was lost.


The only drawback for this company is that you will only be talking to their chatbot online and they have no in-person customer support. Other than that, they only offer basic coverage, which is not ideal for homeowners that are looking for policy add-ons and many endorsement options. If your home just needs basic coverage at an affordable rate, then this company can be your best choice.


Lemonade Home Insurance Coverage


Here are the following types of coverage they are offering:


  • Liability – Offers coverage for property damage and injury sustained by others for which you are responsible or other covered members of your home insurance.
  • Reconstruction Costs – This will cover the repair costs if damages happen to your home.
  • Personal Property Damage – Destruction of any personal items or damaged properties will be covered by this.
  • Loss of Use – If you’re forced to leave your home because it needs repairs, this will cover your hotel stay and the food you will be consuming.
  • Personal Property Theft – If your personal properties/belongings are stolen, you will be reimbursed because of this coverage.

As mentioned above, they only offer a few endorsements that you can add to your home insurance policy. These include earthquake coverage and valuable personal property coverage.


Lemonade Home Insurance Discounts


Lemonade doesn’t offer a lot of discounts on their home insurance. Their rates are very affordable already; however, if you really want to save more, you have to install alarm systems, home monitoring system, and smoke detectors in your home.


Lemonade Home Insurance Ratings


When it comes to Lemonade’s financial stability, Demotech gave them an A or Exceptional rating, which means they have the ability to pay out the claims filed by their customers. They still don’t have a rating from A.M. Best since they’re still new to the industry. Other than that, they still don’t have a customer satisfaction rating in J.D. Power.


However, based on 201 customer reviews on Clearsurance, Lemonade got 4.71 stars out of 5, which is a great score. About 85% of the reviews have 5-star ratings and customers are really satisfied with the services offered by this company. Customers with positive feedbacks say that the process is smooth, fast, and their mobile app is user-friendly. Only 2% of the customers gave 1 star with complaints about the chatbot. They say that it’s not equipped to handle real needs.


The Pros And Cons

Pros

  • Transparent about their setup and their policies
  • Policies are easy-to-understand
  • User-friendly mobile app
  • Rates are very affordable
  • Get your payout claims fast
  • Cons

  • Few discounts, add-ons, and endorsements
  • Only available in 20 states
  • Cannot be bundled to other insurance since they only offer renters and homeowners insurance policies
  • No in-person customer support available
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