Lemonade Auto Insurance Review (2022)

If you’re looking for a Lemonade auto insurance review, you should know this company does not sell auto insurance policies. Lemonade sells homeowners, renters, and pet insurance across 24 states. Using a peer-to-peer insurance policy, 20 percent of your premiums pay for company costs. The remaining 80 percent goes towards paying client claims. Any remaining balance at the end of June goes to a charity chosen by Lemonade customers. Lemonade claims to charge up to 80 percent less than its competitors. Scroll down to learn if Lemonade is right for you.

UPDATED: Sep 22, 2022Fact Checked

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Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

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Written by Rachel Bodine
Feature Writer Rachel Bodine

Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that ex...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent Daniel Walker

UPDATED: Sep 22, 2022

Advertiser Disclosure

It’s all about you. We want to help you make the right coverage choices.

Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

UPDATED: Sep 22, 2022

Advertiser Disclosure

It’s all about you. We want to help you make the right coverage choices.

Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.

UPDATED: Sep 22, 2022Fact Checked
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Lemonade Insurance

Average annual rate for good drivers:

N/A

A.M. Best rating:

N/A

Complaint level:

Low

When you hear the word “lemonade,” you may not think of insurance. Lemonade, however, is the name of an up-and-coming insurance company. If you’re hoping for a Lemonade auto insurance review, you should know that this provider does not offer auto insurance.

With such an original name, you might ask yourself: is Lemonade a legit insurance company? For the past few years, Lemonade has been making a name for itself in the industry. 

What coverage options are available through Lemonade? While Lemonade cannot offer you a cheap auto insurance policy, the company is known for its homeowners, renters, and pet insurance.

First, we’ll go over Lemonade’s history, current structure, and how Lemonade insurance claims works. Then, we’ll share the best way to get a quote for the policies they do offer.

You can’t buy a Lemonade auto insurance policy, but if you’re ready to get an auto insurance quote right now, you can enter your five-digit ZIP code into our FREE quote tool above.

Is Lemonade Insurance Company a Good Choice?

Where is Lemonade insurance available?

The company was founded in New York City but has since expanded across the United States.

Today, renters, condo, and homeowners insurance policies are available in 24 states.

This provider also offers renters and condo insurance in Rhode Island and renters insurance in Arkansas and New Mexico.

Its landlord insurance is available in New York, California, Texas, Illinois, Pennsylvania, Washington D.C., and New Jersey. However, policies have only recently been made available in these states.

In late 2019, Lemonade insurance programs were brought to Massachusetts and Missouri. The company has stated that it plans to roll out insurance coverage in additional states in the future.

Lemonade does not offer walk-in agencies or locations. Instead, all of Lemonade's features are accessed through the company's mobile app and website. 

That includes proof of insurance, which will be sent to your mortgage company directly.

What Is The Company History and Ratings?

Lemonade was launched in 2016 by tech entrepreneurs Daniel Schreiber and Shai Wininger. Schreiber and Wininger, who previously led Powermat Industries and Fiverr, wanted to create a tech insurance company based on behavioral economics, transparency, and promoting social good. 

Using seed funding from Sequoia Capital and Aleph, the two partners set up Lemonade's innovative business model.

Unlike traditional insurers, Lemonade relies heavily on artificial intelligence and web interfaces. Customers sign up for policies digitally and file claims using chatbots and mobile apps. This has made Lemonade very popular among younger insurance holders. 

According to Forbes, in 2018, 75 percent of Lemonade's customers were under 30 years old and 90 percent were purchasing homeowners or renters insurance for the first time.

Artificial insurance is also responsible for underwriting Lemonade's insurance policies. This helps Lemonade collect about 100 times more data points per customer than traditional insurers.

Lemonade keeps 20 percent of the revenue it makes from insurance premiums. The remaining 80 percent is used to pay Lemonade insurance claims, purchase reinsurance, and fund Lemonade's Giveback program.

Lemonade's Giveback program is its most unique feature. Every year, any company revenue that hasn't been used to pay claims and purchase reinsurance is donated to causes that Lemonade's policyholders care about.

Here's a look at Lemonade's market share in the home insurance industry compared to the top five home insurance companies as listed by the Insurance Information Institute.

Lemonade's Market Share Compared to the Top Five Biggest Home Insurance Companies
CompaniesMarket Share (Home Insurance)
State Farm18%
Allstate8.4%
USAA6.6%
Liberty Mutual6.5%
Farmers Insurance5.7%
Lemonade0.1%
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The company has been rated "A – Exceptional" by Demotech, Inc. and was one of the Wall Street Journal's top 25 companies to watch in 2017. 

Lemonade reviews with the Better Business Bureau (BBB) are positive, with nearly 5 stars overall. The BBB gives them an A- rating.

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Lemonade Insurance Company Coverage Options

Does the Lemonade Insurance Company sell auto insurance?

If you own a car, you may be wondering about the different types of auto insurance coverage options offered through Lemonade. Unfortunately, Lemonade does not sell auto insurance of any kind. However, the Lemonade Insurance Company does offer property coverage.

Lemonade’s property insurance covers a number of perils, including electrical and water damage. You can also get Lemonade fire insurance and they insure personal property damage. That means you can even get Lemonade bike insurance.

In the table below, take a look at the starting monthly rates for homeowners insurance, renters insurance, and pet insurance offered through Lemonade. 

Lemonade Monthly Starting Prices by Policy Type
Lemonade Insurance Policy TypeStarting Monthly Rates
Homeowners Insurance$5
Renters Insurance$25
Pet Insurance$10
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The company also claims you’ll save money by switching to its services. In the table below, check out how much users on average have saved from going from a major national company to Lemonade. 

Lemonade Average Annual Percent Saved by Switching Providers by Company
CompaniesPercent of Average Savings by Switching to Lemonade
Progressive31%
Allstate19%
Liberty Mutual10%
State Farm16%
Travelers14%
GEICO10%
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Now that you’ve seen its prices, you’re probably wondering why Lemonade’s insurance is so cheap. One of Lemonade’s biggest benefits is that it is significantly cheaper than its competitors. This is because it is a peer-to-peer insurance company. 

Lemonade charges less than average by cutting internal costs as much as possible.

According to the company website, you’ll be placed into a group with other customers. A base rate of 20  percent of your premiums will go directly towards paying for the salaries, running, and technology costs for the company. 

The other 80 percent of your premiums will go towards paying for customer claims. If there is any money left at the end of June, all remaining funds are donated to the charity chosen by your group. 

The Lemonade Insurance Company claims to charge 80 percent less than other insurers.

Because automobile accidents are so common, auto insurers have to pay out a lot of claims to their customers. This means that auto insurance has a lower profitability rate than other types of insurance. 

What an auto insurance specialist says about bundling rates is that for insurance companies to offer both home and auto insurance, it must raise home insurance premiums to offset any losses.

By not offering auto insurance, Lemonade is able to offer home insurance premiums that are lower than average.

Extra Coverage and Add-Ons

Lemonade allows you to add extra coverage at any time. The current list consists of musical instruments, bicycles, jewelry, and more. 

You will not need to purchase extra coverage for basic things, like garments and clothing. 

Lemonade gives ample instructions on its website about what to do to add extra coverage and will provide you with your new premium that will need to be paid. 

Storage Options

Any personal items that clients of Lemonade maintain in a self-storage unit, separate from where they live, are covered up to $1,000. In fact, the company claims to cover your property anywhere in the world. 

For some states, the policy covers possessions in a self-storage locker for up to a certain percentage and personal property limit. 

Family Coverage

While a roommate is not covered through renters insurance, Lemonade’s policy does cover residents living within the client’s household. Significant others are also covered. 

If you do not live with your significant other, the other individuals must be related to you, either adopted or by blood, in order to be protected by the Lemonade homeowners policy. 

On its website, Lemonade does claim that adding a significant other to your policy will come at an extra cost.

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Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

Full Bio →

Written by Rachel Bodine
Feature Writer Rachel Bodine

Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that ex...

Full Bio →

Reviewed by Daniel Walker
Licensed Auto Insurance Agent Daniel Walker

Reviews
for Lemonade Insurance Company

4.85 (2,233 reviews)
5
April 27, 2017

Misha221tg

Super duper great experience!

Lemonade Insurance Company covers so much and fixed my car after I crashed it with no trouble. Definitely do recommend!! 
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