About Lemonade Insurance

By Derek Lakin
HighYa Staff Published on: Aug 13, 2017

Positioning themselves as a go-to source for urban-dweller renters and homeowners policies, Lemonade Insurance claims to help you easily and quickly obtain amazing coverage to protect your stuff at killer prices, all in 90 seconds from the comfort of your smartphone.

And if you have to file a claim, the website indicates it could take as little as three minutes to get paid.

Compared to traditional insurers, the company claims to only takes a flat 20 percent fee for operational costs, to pay claims super fast, at the give back to causes that matter most to you at the end of the year. Furthermore, no brokers are involved, and the savings are passed along to consumers.

According to their website, 31 percent of Lemonade’s customers come from Assurant, Farmers, Homesite, and Progressive (among others), while another 19 percent come from Allstate.

Whether or not anything of these is your current carrier, can the company really save you money? Even then, are they worth the switch? Let’s kick things off by discussing the fundamentals.

Insurance Basics: What Are the Major Differences Between Renter’s & Homeowner’s Coverage?

Unless you’re in the industry, the reality is that most people find the topic of insurance to be painfully boring, whether related to property, auto, liability, or anything else. Here, we’ll make it pain-free by quickly addressing some core concepts.

Writing for Investopedia, Alexander Ruport of Laurel Tree Advisors in Cleveland, OH tells us that the primary difference between a homeowner’s (form HO-3) and a renter’s (form HO-4) is that the former “covers the actual building you live in (and other structures, such as garages), while renter's insurance does not.”

Another way to think of it is that these policies cover only what you own. And since renters almost never have a financial interest in the property they’re leasing, policies largely only cover personal property.

With these basics in mind, let’s drill down a little more and take a look at the specific coverage provided by Lemonade’s policies.

What Kinds of Coverage Will You Find Under a Lemonade Insurance Policy?

Outside of these fundamental differences, the website emphasizes that Lemonade’s renters and homeowners insurance only covers you and the property that you legally own, at replacement cost (vs. actual cash value). By default, the policy also covers all residents of your household who are related to you by marriage, blood, or adoption.

This includes personal property anywhere in the world, including theft on or off premises, along with:

“…16 bad things, or perils, and also covers extra living expenses, if one of those covered things happens. For example, if a kitchen fire forces you out of your apartment or condo, or your upstairs neighbor leaves a faucet running all day and it’s now raining inside your apartment - you may need to get a hotel. Make sure to review your policy to understand the amount of coverage that you have, because there is a lot going on in there!”

These “16 bad things” include coverage for fire and smoke damage, damage caused by bad weather, crime and vandalism, water damage, liability and medical payments to others, and even vicious dog attacks, as long as your dog isn’t classified by the company as a high risk (whether due to breed or bite history). All covered claims are less applicable deductibles.

Liability limits ranged between $100K and $500K for renters and homeowners policies. Earthquake coverage was specifically excluded, although we were instructed that this could be added by contacting the company directly.

Are There Any Stipulations?

Even for items that might initially be covered, certain stipulations can apply. For example, according to Lemonade’s FAQ, laptops are covered, but not for loss or breakage if you drop it.

Furthermore, fine art, jewelry, watches, and some other types of personal property are covered under these policies, but come with special sub-limits.

What’s Excluded Under a Lemonade Insurance Policy?

While specifics can vary based on state and policy type, coverage for earthquake, flood, and roommate’s personal property and personal injuries is typically excluded.

Pro tip: Per their FAQ video, your significant other will need to be added as an additional insured, which could entail an additional fee. In some instance, they note that it could be simpler (or easier) to get your own separate policies.

In answer to an extraordinarily common question, as someone who spent nearly a decade as a personal lines insurance underwriter; yes, Lemonade can add a landlord as an interested party, at no additional charge.

Do these coverage options sound appealing? Next, we’ll find out how you can apply for a Lemonade policy.

How Does the Lemonade Insurance Application Process Work?

Important note: As of 8/11/17, their FAQ indicated that Lemonade currently only offered renters, condo, and homeowners insurance in NY, CA, and NJ. Additionally, IL renters policies were coming soon, will additional states rolling out later in the year.

With this in mind, we found the application process simple and straightforward. We started by entering first and last name, address, and whether we were interested in renters or homeowners.

From there, we indicated if we had any roommates, fire/burglar alarms, dogs on the premises (and whether or not they had a bite history), any valuable jewelry (or cameras, bikes, or fine art), and if we currently had coverage in place.

After entering our email address and date of birth, we were presented with a quote, which only took a couple of minutes to complete.

Lemonade Insurance Step One QuoteObtaining a quote through Lemonade’s quoting system involved answering relatively few questions, starting with the first and last name. Image credit: Lemonade Insurance Agency, LLC

With this said, we encountered several instances where Lemonade’s ‘Maya’ artificial intelligence system wasn’t able to provide us with a quote, although we were never provided additional details. As a result, we had to start the process all over again, without knowing if we’d trigger the same error again.

Lemonade Insurance Quote ErrorWhile Lemonade’s quoting system was easy to use overall, when experimenting with different variables, we often received ‘ineligible’ notifications for no stated reason, which we found a bit frustrating. Image credit: Lemonade Insurance Agency, LLC

What’s the Deal With Lemonade’s App?

Based on the description and screenshots posted online, Lemonade’s iOS and Android apps largely appeared to be an extension of their website. There, you’ll also be able to chat with support, obtain coverage, and so forth.

Lemonade Insurance Mobile App ChatLemonade’s website and app appeared to provide access to the same features, including quoting and instant messaging. Image credit: Apple Corporation

Now that we’ve covered all the basics, let’s address price.

How Much Does Lemonade Insurance Cost?

On their website, Lemonade advertised that they offered renters insurance for as little as $5/mo, along with homeowners from $25/mo.

With this said, their FAQ emphasized:

“Premiums are calculated individually for each policyholder and are based on a number of different factors including your credit history, recent claims and information about your property including its age, size, and construction quality. We also factor in the sensitivity of your home to windstorms, severe weather damage, and fires. We then provide discounts for protection equipment you may have installed, such as fire and burglar alarms.”

As with any other renters or homeowners policy, when quoting different options on the Lemonade site, we found that changing deductibles or other coverage could meaningfully impact price.

Lemonade’s Renters Policy Premium

For example, quoting a CA renter’s policy with minimum $10K personal property, $3K loss of use, $100K liability, $1K medical payments, a $250 deductible, and an addition $7K coverage for bikes, returned a $60 annual premium. Or, about $5 per month.

On the other hand, maxing coverage out at $250K personal property, $500K liability, $200K loss of use, $5K medical payments with the same deductible came in at a much higher $113.42/mo, or about $1,361 per year.

What About a Lemonade Homeowners Policy?

Minimizing coverage on an HO-3 quote for a similar location, coverage came in at $275K for the dwelling, $137,500 for personal property, $100K liability, $82,500 loss of use, $1K medical payments, and a $500 deductible.

Total premium? $45.17/mo, or a little less than $450/yr.

Again, maxing coverage out at $775K for the dwelling, $487,500 personal property, $500K liability, $232,500 loss of use, $5K medical payments, and a $250 deductible nearly tripled the monthly rate to $149.59. Annually, this works out to roughly $1,800.

Regardless of what you end up paying, you can cancel your Lemonade policy at any time through the app. Afterward, you’ll receive a refund for the remaining period you’ve paid.

If you decide to take out a Lemonade policy and are already insured, the company claims to take care of the switching hassle.

Next, let’s find out if these prices are competitive.

How Do Lemonade’s Insurance Policies Compare?

While we didn’t find any statistics specifically related to California (the state used for all the quotes above), a 2014 Forbes article indicated that the average renter pays about $184 per month (about $2,200 annually) for insurance coverage. Conversely, more recently, ValuePenguin reported that Americans pay an average of $1,083 per year for homeowners coverage.

From this perspective, it seemed like Lemonade’s upper-end renters quotes came in considerably lower than this average, while upper-end homeowners returned meaningfully higher premiums.

Outside of this, perhaps the biggest differentiating factor is that Lemonade is filed as a B corporation, which the Harvard Business Review defines as “social enterprises verified by B Lab, a nonprofit organization. B Lab certifies companies based on how they create value for non-shareholding stakeholders, such as their employees, the local community, and the environment.”

Comparatively, the vast majority of insurance companies are filed as for-profit entities, many of which are openly traded on stock exchanges and beholden to shareholders. A select few are also classified as mutual companies, where dividends are paid out to policyholders at the end of the year.

What about from a customer satisfaction perspective?

Learning What Lemonade Insurance Policyholders Are Saying in Their Reviews

On SuperMoney.com, 10 Lemonade customers gave the insurance company an average rating of three stars at the time of our research. There, most compliments referenced competitive prices, ease of use, quick coverage, and the fact that all their money goes to good causes at the end of the year.

On the other hand, most complaints appeared to revolve around claims problems and less-than-stellar customer service.

NerdWallet also noted that Lemonade comes with a high financial strength rating, that no complaints had been filed to the National Association of Insurance Commissioners (NAIC), and that the quoting process can be completed in 90 seconds.

However, returning to our comment earlier about the company’s claim to specialize in urban dwellers, from a coverage perspective, InsNerds.com emphasized that “Lemonade is a standard insurance company. You pay premiums, and they pay claims from the general pool of funds.”

On iTunes and Google Play, Lemonade’s iOS and Android apps had a combined average rating of about four stars. Most compliments appeared to revolve around ease of use and quick quotes, On the flip side, common complaints referenced bugginess and eligibility criteria.

From a company perspective, Lemonade Insurance was co-founded by CEO Daniel Schreiber and Shai Wininger in September 2016. Previously, Daniel worked as President of Powermat and SVP of SanDisk Mobile Network Operators, while Shai acted as founder, CPO, and CTP of Fiverr.com.

Alright, we’ve covered a whole lot of territory here, so let’s come to a final conclusion.

What’s the Bottom Line About Lemonade Insurance?

At the end of the day, Lemonade Insurance seemed to offer a lot of potential advantages at the time of our research:

  • Their policies appeared to be competitively priced (depending on state and specific coverage options, of course)
  • Their website and iOS and Android apps seemed to come with mostly positive online customer feedback
  • Based on what we learned from their FAQ, they appeared to offer many key coverage options customers are looking for
  • The company held an A (Exceptional) financial stability rating (this largely references their ability to pay claims)

However, based on what we learned from their website, they didn’t seem to offer any coverage necessarily targeted at urban dwellers (despite their marketing angle), and there are perhaps dozens of other companies out there that allow you to transact business completely online or via an app, or to obtain a quote from websites that use computer algorithms in lieu of live underwriters.

Another potential consideration is that, with a traditional renters or homeowners policy, consumers typically have the opportunity to speak with an agent or service representative, who can help counsel them on the most appropriate coverage. With automated systems like Lemonade, however, this largely goes by the wayside.

The good news is that if you’re looking to see how competitive Lemonade’s rates are, you likely won’t be out more than a few minutes of your time after running a quick online quote.

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101 Consumer Reviews for Lemonade Insurance

Average Consumer Rating: 4.4
Rating Snapshot:
5 star: 83 4 star: 3 3 star: 2 2 star: 0 1 star:  13
Bottom Line: 87% would recommend it to a friend
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  • Editor’s Note: It is our understanding that this company has been asking its customers to leave feedback on HighYa. We assure you that each of these reviews has still been subjected to the same verification & vetting process that all submitted reviews go through. Learn More Here
  • Feedback from a real customer and a real claim

    • California,
    • Jul 19, 2018
    • Verified Reviewer

    I have to say this is hands-down the best experience I’ve ever had with a property and casualty insurance company. Signing up is a breeze, although the process of uploading your items first is a bit cumbersome, the chat bot could be done away with as well. As someone who has been to the claims process it is really simple to get your claim started, with no issues on the user experience side, and then even further, which was a surprise, there is a human at the end of the line who handles your claims process. And if you were truly really organized and have all of your receipts and ducks in a row and no the coverage, you should not have any problems with this company.

    Bottom Line: Yes, I would recommend this to a friend

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  • Lemonade came through for me when my bike was stolen!

    • Oakland, CA,
    • Jul 19, 2018
    • Verified Reviewer

    One of my hobbies is building and upgrading "project bicycles." Recent my favorite bike, that I've put a ton of work and custom parts into, was stolen when locked up outside a friend's house for a few hours in broad daylight. It was terrible coming back to see my lock busted and my bike gone.

    I was worried that Lemonade wouldn't be able to fully reimburse me for it, given that I didn't buy it complete from a store and so didn't have one receipt indicating its value. They worked with me to itemize and document a list of parts that went into the bike, and even reimbursed me for my lock and helmet.

    I would strongly recommend them to anyone who owns a bike they value, customized or not. Their service was fast, friendly, and easy to use. Of course, they couldn't return the bike that I put many hours into, and have taken on many great rides, but they did help soften the blow. With the money they reimbursed me, I can start to build up a new project bike.

    Bottom Line: Yes, I would recommend this to a friend

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  • Lemonade Insurance is awesome

    • Houston, TX,
    • Jul 17, 2018
    • Verified Reviewer

    My apartment got flooded due to a valve bursting and thanks to Lemonade they helped us with getting a hotel while my apartment complex "did repairs" and even after gave money towards our damaged clothes to which helped tremendously. The team at Lemonade has been wonderful, just when I lost hope they came through again. Thank you Reese, my rep, and the Lemonade team for all that you did for my family.

    Bottom Line: Yes, I would recommend this to a friend

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  • Painless & Easy

    • San Diego, CA,
    • Jul 17, 2018
    • Verified Reviewer

    Our apartment storage unit was robbed. The lock was broken and plenty of valuables stolen from us. We filed a claim with Lemonade and they very quickly took care of us. Lemonade made a very frustrating situation into a situation where we felt like we were heard and taken care of.

    The claim process through the app was extremely easy to use.

    This was the very first time I had to file a renter's insurance claim in my life (been renting for 5 years) and I'm glad I chose Lemonade as my insurance provider.

    Would highly recommend.

    Bottom Line: Yes, I would recommend this to a friend

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  • Sweet and refreshing

    You might think Lemonade is sour, but in this case I found it to be sweet and oh so refreshing. I lost my wedding ring (now that, that was a sour moment) and after breaking the news to my wife (also a sour moment) I had the sweetest and easiest experience filing the claim via the elegantly designed app/chatbot.

    A few weeks later, the claim has been processed, money is on its way, and my new wedding ring is ordered, all with a very minimal person to person interaction and with ease thanks to their very well designed user experience. SWEET!

    For a geek like me, this is the ideal way to deal with insurance. Now if I could only get life insurance with them…

    Bottom Line: Yes, I would recommend this to a friend

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  • Disappointed with the service

    • Chicago, IL,
    • Jul 15, 2018
    • Verified Reviewer

    I’m very disappointed with the service.

    I filed my claim on June 20th.

    It’s been almost 3 weeks and I feel like I’m still running around in circles with Lemonade’s chatbots and customer service reps.

    I sent in information that my Lemonade rep asked for, and later on, she asks me for the exact same information. Many times, 2-3 business days go by without any response.

    I’ve tried calling my rep on at least 3 different days and times, and I never receive any response.

    I signed up because I thought that Lemonade was different, or at least that’s what they claim to be. But as I did more research online, I found that many others have had the same experience.

    Based on the many good reviews (which is why I signed up in the first place), I hope that my experience isn’t typical.

    But as it stands, I cannot recommend Lemonade, and anyone who reads this review - you’ve been warned.

    Bottom Line: No, I would not recommend this to a friend

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  • Excellent Customer Service for Claim

    • Dallas, TX,
    • Jul 15, 2018
    • Verified Reviewer

    Unfortunately, lightening took out my computer even though I had a surge protector. I contacted Lemonade, completed the easy online steps and the next day they paid out my claim. It was so some. Every contact I've ever had with Lemonade has always been enjoyable. I recommend them to everyone. Great value for your money.

    Bottom Line: Yes, I would recommend this to a friend

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  • Thief and work equipment was stolen along with some personal belongings

    • Houston, TX,
    • Jul 10, 2018
    • Verified Reviewer

    Since I started my claim, to the needed necessary documents, to the end, Jen and the Lemonade family were very helpful and honest through the whole process. I am very thankful for them and glad that my claim got processed and approved in a timely manner and I would recommend them to anybody and future insurances that is needed for other family and friends.

    Bottom Line: Yes, I would recommend this to a friend

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  • Customer experience

    • Canoga Park, CA,
    • Jul 9, 2018
    • Verified Reviewer

    My theft claim through Lemonade was handled with extreme care and compassion. All the reps were great thru the whole process. Gavin was excellent. I highly recommend Lemonade to any new customer. My situation is proof they care.

    Bottom Line: Yes, I would recommend this to a friend

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  • Flood response

    • New York,
    • Jun 30, 2018
    • Verified Reviewer

    I came home on Friday eve to discover a hole in my ceiling and a ruined bed. It turns out my neighbor had left her aircon inside the window and it had flooded. I remembered I had Lemonade and went to redownload the app expecting endless forms, it be out of hours and weeks of uncertainty. I can't actually remember the last time I claimed anything on insurance. The interface for making claims was extraordinary, simple video upload, no 'legalese' just a straightforward dialogue and positive can-do attitude.

    Monday morning I get a call from a cheerful guy who says they have reviewed it and what happens next, by that afternoon, I'm approved, no drama, no quibble and we move on. I am genuinely amazed by the whole process. Also, I should add they faced complications because my damaged bed was British, hence different specs to a US bed, but they did the research and came back with an accurate valuation. Incredible really.

    I have recommended them all day and will continue to do so. I hope this is the future of insurance, an industry that has undersold its value and lost sight of customers. Lemonade has disrupted all that. Very happy.

    Bottom Line: Yes, I would recommend this to a friend

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  • Hard work with results.

    • Sacramento, CA,
    • Jun 29, 2018
    • Verified Reviewer

    The claim I had involved multiple levels of complexity. The police were utilized at several times not only to document what had occurred but to advise on how to proceed, which left the insurance agent and myself at the mercy of their timeline. That is the reason for the 4 star instead of 5-star rating as I thought it took a long time to come to a conclusion. The end result left me pleased with the company and well taken care of as a customer.

    Bottom Line: Yes, I would recommend this to a friend

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