Incorporated June 17, 2015
Founded April 2015
- Founders:
Daniel Schreiber, CEO
Shai Winiger, COO [1]
Lemonade Insurance is the innovation behind turning insurance into a consumer friendly tool to include added fraud protections which utilize AI, a mobile app and tech-centric methods.
Insurance has been an untapped industry regarding tech disruption despite being a protection everyone uses. [4]
The current total funding amount for Lemonade Insurance is 480 Million sourced from 7 funding rounds with the latest funding raised July 2019 from a secondary market fund. Funded by 17 investors, with Asian Cowboy and G Squared being the most recent investors.[4]
The insurance industry has been limited by slow response for services available to its policyholders. This means a lack of digitization and automation creates lags in payouts, and appraisals for claims.[5]
Lemonade focuses on the policyholder's experience to update the infrastructure and workflow patterns of the company to be aligned with modern financial technologies.[4]
Tim Bixby, Lemonade's CFO doesn't intend to eliminate the human element of insurance entirely; a better policyholder insurance product will invlove a lot of automation combined with digital agility.[5]
Lemonade Insurance is set to serve customers who are looking for faster claims response, payments and appraisals.[5] Global investment into the insurtech space has climbed to 6.7bn within 2019 making up almost a third of all historic funding in this field.[5]
Lemonade diversifies the insurance landscape by extending into areas like pet, personal and life insurance.
The insurance industry relies upon information in order to measure risk. Tech has an incredible opportunity for synergizing financial data and systems with the insurance process.
The insurance industry has existed for thousands of years, while digital infrastructures are significantly young with regard to financial technology pertaining to insurance. Introducing FinTech and InsurTech into the existing insurance structure enables particpation in the value chain; prioritizing the consumer needs and access to specialized and money saving coverages.[6]
Lemonade currently employs 27 technology products to inlude HTML5, Google Analytics, and Google Fonts; Lemonade's website is actively using 66 technologies to include Viewport Meta, IPhone/Moble Compatible, and Google Analytics.[4]
Lemonade is unique in that is built from the ground up and departs from the challenge of "legacy baggage". Legacy baggage is a result of outdated infrastructures and workflow patterns which resist changes or modernization.[5] Lemonade updates the insurance industry with both innovation in processes as well as fluidity for evolving with the customer despite legacy modeled insurance systems.
A very exciting and innovative feature of Lemonade Insurance brings the human relationship into the insurance equation by introducing a third party charitable structure for surplus claim funds.[5] With the implementation of AI, mobile apps and data maximization in combination with the client designed policy Lemonade has grown into a leader for property insurance.[9]
Lemonade is considered a Unicorn FinTech/InsurTech because it's inclusion of a third party charitable incentive utilizes unclaimed premiums, declaring it a major innovator in the insurance industry.
As a major disruptor in the insurance industry based upon the departure from traditional, legacy based insurance models--Lemonade intends to maintain the client's personalization in tandem with profit minded innovations. [7] Expedition of claims payments, increased fraud protections, and maximizing data analytics are major changes to the insurance industry aimed to reflect the consumer's mobile app based use trends.[8]
Key Performance Idicator (KPI) is a metric used to monitor an insurance company's performance and efficiency.[9] KPI's are utilized to compare companies against one another regarding investment. Top 5 KPI's include 1. Revenue per client; 2. Average Class Attendence; 3. Client Retention Rate; 4. Profit Margin; 5. Average Daily Attendence.[10] True to the personality of the company, Lemonade utilizes Click Through Rate based on homepage performance as a measure for average daily attendence.[9] Client Retention Rate is another area where Lemonade chooses alternative measures by offering a feature called Switching. Switching offers a refund incentive for users to leave a current carrier and buy an new one from Lemonade. Core values like Transparency and Honesty are at the root of the InsurTech's product line, the intention based in a transition from the traditional brick and mortar (aka slow) style insurance experience to the automated, mobile 'Agent'.
The competitors pool is still growing in the digital insurance industry. The major players playing to different needs in the InsurTech domain, Lemonade leads as the best for home insurance. MetroMile dominates in the low mileage auto insurance area while Insurify maintains a hold on best digital insurer for auto insurance quotes.[11]
Lemonade could benefit from a scaled approach to specialized insurance coverage much like Root Insurance's auto app. The app tracks driving habits in order to calculate insurance rates. Complex algorithms can distinguish between the client's travel state from driving to biking.[11]
Following suit with Lemonade's innovative approach to personal insurance, limiters which customize the client's experience will align with the core values of transparency and honesty as vehicles for getting the best value to the policyholder.
Data collection maximization for existing and potential policyholders is a root motivator for the concept of Lemonade Insurance.[9] Changing the insurance industry's
traditional presence as a profit driven, slow paying, and cumbersome business into a consumer designed and centric service brings insurance into modern times.[7]
Addendum for FinTech Company Lemonade, Inc.
1 https://www.sec.gov Form S-1 registration statement under the SEC act of 1933 2 https://www.forbes.com/sites/jeffkauflin/2019/05/02/lemonade-fintech-insurance-unicorn/#7969ce046cde 3 https://www.forbes.com/sites/kristinstoller/2019/04/11/fintech-insurer-lemonade-valued-at-more-than-2-billion-after-300-million-funding-deal/#417962dd2ee1
4 https://www.crunchbase.com/organization/lemonade/company_financials
5 https://www.pymnts.com/innovation/2020/lemonade-cfo-on-insurance-innovation-dilemma
7 Podcast: HowFintech Unicorn Lemonade is Disrupting Insurance Banking Transformed with Jim Marcus http://podcasts.google.com
9 https://www.lemonade.com/blog/lemonade-launch-metrics-exposed/
10 https://fit-pro.com/article-4227-Top-5-Key-Performance-Indicators-(KPIs).html
11 https://www.thebalance.com/best-digital-insurance-4160643