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Lemonade Insurance: Why You Should Get This Digital Insurance

lemonade insurance review

Insurance is one of those must-haves in life that can be difficult to understand—how, then, do we start purchasing it to safeguard ourselves? Lemonade Insurance aims to simplify the process and remove the difficulty, offering convenient insurance with integrity.


What Is Lemonade Insurance?

Lemonade insurance
Screenshot from Lemonade

Lemonade Insurance mainly offers insurance plans to homeowners and renters that are easily accessible through a digital platform. It eliminates all the middlemen and red tape that customers of traditional insurance companies have to go through. Instead, it leads you directly to them through the use of their mobile app. This ensures that you’ll get the best rates for your insurance. You also don’t have to wait for days to finish orders, quotes, and claims as you can expect quick and easy deliveries thanks to Lemonade’s mobile app. 

Moreover, aside from insurance for renters and the home, Lemonade has also branched out to offer other kinds of insurance, such as life insurance. It even offers pet insurance if you’re interested in protecting your pet dog or cat as well.

Lemonade also stands out because not only can you keep yourself insured but you can also give back to a good cause. That’s through Lemonade’s Giveback Program, allowing you to donate to charities of your choice.

Overall, Lemonade is a great insurance provider for covering the basics of homeowners and renters. It’s especially useful since more and more landlords require renters to be insured before they sign with anyone. With one app download, you too can stay safe with Lemonade.


How Lemonade Insurance Works

Let’s get into the details of how Lemonade works. Like other insurance companies, it offers plans that will cover any costs incurred from loss or damage. For example, they’ll help you repair your home and even pay for your belongings in case of a disaster. To insure more valuable items, you can look into getting an additional tier with Lemonade. 

So far, Lemonade works almost exactly like other insurance companies, but what makes it special? Well, the basic structure Lemonade uses is different from other insurance companies. That’s because it uses a peer pooling method instead of the usual profit-based model.

Confusing? Don’t worry. The peer pooling model is pretty simple. It works by putting together the payments made by various insurance customers into a fund. This fund is the source from which Lemonade withdraws money when someone makes a claim. Lemonade only earns by taking a 20% flat fee from this fund. The rest of the money is reserved for claims and donations.


Giveback Program

Giveback Program
Screenshot from Lemonade YT Channel

Now, we said that Lemonade Insurance has a Giveback Program that lets you donate to charities. This is done by using the excess money left over from the fund for the donations by the year’s end.

What’s great about Lemonade is that it’s certified by B Lab for meeting proper standards. It’s thus a certified transparent, environmentally friendly, socially responsible, and accountable organization. In this way, insurance holders can ensure that unused payments go to good causes instead of the company itself. Moreover, the Giveback Program allows you to pick the charities your money goes to, providing you with peace of mind. 

Lemonade’s Giveback Program might be a little new, but it has made a significant mark. When it first started in 2017, the company was able to give back $53,174 to charities. In 2018, that number rose to $162,135 — nearly triple the amount from 2017. Later on, in 2019, Lemonade tripled the amount again, showing the company’s trustworthiness and growth.

Of course, this doesn’t mean that Lemonade is especially better than other insurance companies. That’s because not all insurance companies stuff unused payments straight into their pockets. However, it does mean there’s a stronger air of accountability, honesty, and social responsibility when using Lemonade.


Filing Claims

Filing Claims
Screenshot from Lemonade YT Channel

One of the most important parts of considering an insurance company is the ease of filing claims. Thankfully, like its order process, Lemonade’s filing process is also digital. Hence, you don’t need to arrange for a Lemonade employee to make a house visit to check the damages. Instead, you can file, process, and receive payments directly through the app. 

To handle filed claims, Lemonade shifts the industry standard by using an AI called Jim. Through Jim, Lemonade can process, review, approve, and payout claims immediately. However, Jim can’t handle everything, as many other claims still need human assistance. Nonetheless, it’s a handy feature to lower personnel costs and increase efficiency.

In 2018, Jim paid out $1 million worth of insurance claims without human assistance. By late 2020, around 30% of insurance claims didn’t pass through humans. All of this couldn’t have happened without Lemonade’s 18 different anti-fraud programs in place. 

There are a few claims and files that tend to be a bit more complicated, making it harder for a simple AI to manage. To counter this, Lemonade has in place a special team (of humans) to monitor and manage payments. Through this, you can still rely on human professionals when you need to file complex insurance claims.

Perhaps the only downside to the way you file claims is that you need to have the Lemonade app. You can’t file claims through their website on a computer when your smartphone is broken. It’s thus imperative for you to have a mobile phone on hand to use Lemonade.


Lemonade Insurance: Insurance Coverage & Pricing

Let’s move on to the insurance policies and coverage themselves to see whether Lemonade is right for you.

lemonade pricing
Screenshot from Lemonade


Lemonade Renters Insurance

The first type of insurance is renters insurance. This type of insurance is usually cheap, but rates will vary depending on location. Starting from as low as $5 monthly, renters insurance provides coverage for a range of things, including theft and damage to personal items, temporary living costs for unlivable homes, and liability coverage.

For theft and damage, this only applies to personal belongings. Hence, your TV, laptop, phone, and other personal items should be covered. If you get the base policy, you’re covered for a maximum of $10,000 overall. The base policy also provides $2,500 on a per-item basis. 

And if your home becomes unlivable, you can claim up to $2,500. This should help you cover your daily costs if your home is under repair. 

Lastly, liability insurance can cover you for up to $100,000. Liability coverage simply means that you’re covered when you damage someone else’s property or injure someone else. 

Of course, the previous three are only the basics included in any renters insurance policy. On top of these basics, Lemonade also provides additional coverage that is purely optional. This includes specific personal items such as fine art, jewelry, bikes, cameras, and instruments. However, this differs from the basic policy in that it does not take from your insurance deductible.

On the flip side, extra coverage options also offer water backup in case sewage drains spout water. Moreover, there’s also the option to insure yourself in case you damage your landlord’s property. This applies to accidental damages, whether water or pets cause the damage. 


Lemonade Homeowners Insurance

How Lemonade Insurance works
Screenshot from App Store

Like renters insurance, Lemonade’s homeowner’s insurance covers all the basics. These include repair payments, theft, liability towards others (legal & medical fees), living costs for unlivable homes, and more. 

On top of the basics, Lemonade home insurance also has offerings for extra coverage. This includes water backup similar to what they offer in the renter’s insurance policies. Furthermore, there’s also an optional extended replacement coverage that comes into play when the cost to fix your damaged home becomes unexpectedly high.

Above all, Lemonade’s homeowner’s insurance policies can be pretty cheap. Rates start at $25 monthly for the basic policy depending on your area. If you want to ask for a quotation, you can quickly do so via their app or website.


Lemonade Life Insurance

Lemonade Life Insurance
Screenshot from Google Play Store

Life insurance is one of the most important insurance policies to have on hand. And this policy falls under one of Lemonade’s offerings, covering people from 21 to 55 years of age. 

In essence, Lemonade offers two types of policies: Term Life and Whole Life. Term Life covers you for 10 or 20 years while Whole Life covers you until death. Whole Life is more favorable than Term Life if you want a policy that will grow in cash value. However, its monthly fee does grow pricier over time, so do take note.

What’s great about Lemonade’s life insurance policy is that it doesn’t require a medical exam. That means you can instantly get coverage within just a few minutes. Just talk to Maya, their AI bot, to let them know of your health and lifestyle to get started. 

Like Lemonade’s other insurance policies, their life insurance offering can start fairly low. It can go as low as $9 monthly, depending on your age, lifestyle, location, and health profile. However, their Term Life insurance only covers a maximum of $1 million. If you think it’s not for you, you can easily cancel at any time. If you cancel within the first 30 days, you can even get a full refund. 

Sadly, Lemonade’s life insurance policy does block people with major health issues from applying. While you may fit Lemonade’s age range, you can’t get insured if you have a record of life-threatening diseases. This includes cancer, heart problems, and others. 


Lemonade Pet Insurance

pet insurance
Screenshot from Google Play Store

Finally, we have Lemonade’s cutest offering, Lemonade Pet Insurance. This, like Lemonade’s other offerings, allows you to cover your pet within minutes. It covers all the basic medical costs for pets including tests, operations, and medicines. Moreover, it also covers your pet in case of sickness or accidents. 

If you want a bit more than that, Lemonade also offers an optional wellness package. This includes coverage for yearly costs like wellness exams, heartworm tests, stool tests, blood tests, and vaccination. It also offers a medical advice chat service to help owners with questions or concerns. 

Lemonade Pet Insurance also comes with Lemonade’s low prices, which start at $10 monthly. However, if you’re already a Lemonade home insurance customer, you can get an additional 10% discount.


Lemonade Insurance: Reliability & Stability

Customers naturally need to know if an insurance company is financially stable and trustworthy before signing with them. That’s because insurance companies may go bankrupt or scam insurance holders of their money. Hence, it’s important to do a background check to keep yourself safely insured. The same is true for Lemonade Insurance.

Fortunately, Lemonade is financially stable as an insurance company. It’s rated A by Demotech, a financial analysis company. This means they have the third-highest rating a company can get for financial stability. Thus, you can safely trust Lemonade Insurance to last long enough to receive your claims. 


The Bottom Line

Is Lemonade insurance good? Most definitely. Lemonade Insurance not only provides a fast and easy process but also quality insurance offerings for you. It’s easy, safe, and fairly cheap depending on your location and circumstances. Lemonade also allows you to give back to your preferred charities.

Of course, Lemonade Insurance still isn’t for everybody because its prices also vary. Like any other insurance company, Lemonade charges homeowners and renters insurance based on various factors. That’s why if you’re considering Lemonade, be sure to do your homework and check out other options as well. 

Furthermore, Lemonade might not cover everything you need. For example, there’s no available option for Lemonade car insurance at the time of writing. Hence, while Lemonade is actively adding more variety to its insurance offerings, it’s not comprehensive. It’s important to check in with other insurance companies for things Lemonade doesn’t provide.

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