Lemonade Insurance Review: Easy and Affordable Homeowners, Renters and Pet Insurance
As the self-proclaimed first peer-to-peer insurance company in the United States, Lemonade has introduced a revolutionary yet simplified approach to low-cost insurance for your home, belongings, and even your pets. Furthermore, Lemonade donates leftover money to the charities of your choosing. But is Lemonade as sweet as it seems, or are you signing up for, well… a big lemon?
You’re about to find out in the Lemonade insurance review below.
Quick Feature Highlights
- Peer-to-peer business model
- Simple to use online system
- Giveback program
- Renters, homeowners, and pet insurance
- Auto insurance – Coming soon!
What Does Lemonade Insurance Cover?
As well as offering low rates and near-instant payouts, Lemonade donates any leftover money from payouts to meaningful, customer-chosen causes.
Here’s a breakdown of its main insurance policies:
Lemonade Homeowners Insurance
Lemonade’s homeowners insurance is noticeably cheaper than a lot of other popular insurance providers. Through the app, customers can get the coverage they need with just one tap and monitor their flat-rate monthly subscription.
Lemonade pays out for a range of incidents. These include:
- Reconstruction costs: Lemonade covers any repair costs that are needed in light of property damage
- Personal property damage: customers are also covered for damaged personal items
- Personal property theft: in the unfortunate event of a theft, Lemonade’s customers are covered regardless of where the stolen items are
- Other person liability: Lemonade pays out if another person is injured and you’re held responsible or if the injury happens on your property
- Loss of use: if you can’t use your home for any of the reasons covered in your policy, Lemonade will cover your living expenses during that time
As well as these main payout situations, Lemonade also covers a range of other events. These include payouts for water backup damage, damage incurred by earthquakes or other natural disasters, extended reconstruction costs, and valuables coverage for high-ticket items such as jewelry and art.
Homeowners insurance discounts are available if your home is made of fire-resistant materials, if you have protection equipment in place, or if you live in a gated community.
Starting at $25/month, Lemonade allows you to customize your coverage to get what you need at a price you can afford.
Lemonade Renters Insurance
Like its homeowners insurance, Lemonade offers affordable rates for renters who need insurance. While policies come with the usual coverages, including personal property, liability, and loss of use, they also come with a couple of extras you can’t get from other providers.
Lemonade renters insurance ‘Zero Everything’ feature provides a policy modification option that lets customers select a $0 deductible for a higher rate. It’s only available in certain areas, so check that you’re eligible before you apply.
There’s also the option to add extra coverage. This means you can insure individual items that are worth more than $1,500 – for example, high-value jewelry, art, or tech equipment.
Lemonade insures renters for:
- Personal property costs: for the total value of items you own
- Personality liability: if someone gets hurt or injured on your property
- Medical payments: for guests that get injured on your property
- Loss of use: if you’re unable to stay in your home due to one of the reasons covered in your policy
Other numbers worth noting include:
- Damage or theft of personal belongings: the base policy pays a maximum of $2,500 per item and $10,000 total.
- Temporary living expenses: up to $2,500.
- Liability: up to $100,000
Lemonade Pet Insurance
As well as home and renter insurance, Lemonade also provides pet insurance to its customers. The digital nature of the app means you can pay vet bills instantly and get covered in seconds if your pet falls ill.
Lemonade pet insurance covers pet owners for:
- Diagnostics and tests: needed after an accident or in the case of an illness
- Procedures: including outpatient appointments, hospitalization, and surgery
- Medication: including injections and prescription meds
Lemonade also gives pet owners peace of mind by covering annual routine care, such as wellness exams, bloodwork, heartworm tests, and routine vaccinations.
Lemonade Car Insurance
Lemonade has announced that they will begin offering car insurance, “Lemonade Car”, to their customers.
Although there isn’t too much information available yet about this new insurance, customers are already being encouraged to start signing up as the product will most likely be launched “within the year”.
Like any car insurance, Lemonade needs the insurance department of each state in the USA to give them permission to insure there, so it is still unclear which states will be participating.
According to the company’s COO and Co-Founder, Shai Wininger, Lemonade Car will differentiate itself from the competition because it “will use technology to handle emergencies and pay claims fast, will offer great prices to safe drivers, and will be especially attractive to drivers of EVs [electric vehicles] and environment-friendly cars.”
You can sign-up for updates about “Lemonade Car” to stay up to date, here.
How Does Lemonade Insurance Work?
You may be asking yourself: “is Lemonade a legit insurance company?” Understanding how it works will wipe away any doubt. There are a number of reasons Lemonade stands out, especially amongst the “typical” insurers out there.
To start, the Lemonade online system allows you to secure coverage within a matter of minutes. This is in contrast to traditional insurance companies with a long, complex application process.
When it comes time to answer the question “is Lemonade insurance a good choice,” the following details should help.
Lemonade is based on a peer-to-peer model. In fact, they boast the title of the first P2P insurance company on the market.
While the business model is actually closer to “crowdfunding” than “peer-to-peer,” the premise remains the same: Lemonade is supported by the premiums paid by its members. These are all combined to create a claim-paying pool of funds, from which everyone dips when needed.
Technology is Everything
Lemonade really appeals to the younger generation, which is especially evident in its automated approach. You can get the entire “Lemonade experience,” as the company calls it, through their iOs or Android app. Via smartphone, you can purchase a policy, view your documents, pay your premiums, contact someone from the company, or file a claim–all with just a few taps.
This is great when you need to make changes to your policy (they take effect immediately), report an incident, or just view your coverage. Everything is always right at your fingertips.
Lemonade claims that it only takes 90 seconds on the app to get insured. Filing a claim? Forget waiting months–you could be paid in as little as 3 minutes!
Denied Claims Don’t Equal Profits
For most insurance companies, profits are determined by the money that’s leftover at the end of the year. Insured customers pay their premiums, file claims (or not) that are approved (or not), and the company keeps whatever is leftover. In all honesty, it’s not in their best interests to pay out all of the claims that are filed or to pay out high amounts. After all, whatever they don’t approve/payout is kept in the company’s pocket.
This company is different.
With Lemonade, a certain percentage of all premiums automatically goes toward operating costs, right off the top. This ensures that salaries can be paid and the company can buy “reinsurance.” Whatever is left over goes into a pot, from which approved claims will be paid. However, this is where Lemonade differs from everyone else: if there is money left over in that pot at the end of the year, it doesn’t go back to the company and it doesn’t boost profits. It goes to charity (what they call the Giveback).
This means that Lemonade isn’t incentivized to deny or delay your claims, or nickel-and-dime you on the payout. The money is there and waiting for customers’ claims; if it doesn’t all get used, it simply gets donated to a good cause.
Does Lemonade insurance pay claims? The answer is yes. But what they don’t know is looking for ways to profit by denying claims.
Small Claims Matter
Deductibles deter many customers from ever filing claims, even if they suffer a loss. After all, the cost of the deductible can be close to, or even more than, the item itself.
That’s why Lemonade introduced the Zero Everything option. With Zero Everything, you can submit claims for even the smallest items, without having to worry about deductibles or rate hikes. Lose your headphones or laptop charger? No problem. You won’t have to pay a deductible to get your items replaced.
How Much Does Lemonade Insurance Cost?
It’s difficult to say exactly how much Lemonade coverage will cost you, as there are far too many variables at play. Each person’s policy and coverage will be unique, so the premiums they pay will be unique, too.
However, what I can say is that Lemonade starts out significantly cheaper than all the other insurance companies out there. In fact, you can insure your stuff for as little as $5 a month.
If you’re renting a home, apartment, condo, or co-op, you can protect your items up to whatever total value you choose. The cost will start at $5 a month, going up depending on how much coverage you need. Own a home and also need the dwelling covered? You’re looking at as low as $25 a month.
As for pet insurance, it starts at $10/month. If you also insure your home with Lemonade, you will receive a 10% discount on your monthly premium.
Lemonade Insurance Pros and Cons
As you can see by now, there’s a lot to like about Lemonade insurance. But of course, every good Lemonade insurance review comes with a list of pros and cons. Let’s start with the benefits:
- Easy to Use – In addition to its online system, the Lemonade mobile app is a work of art. It’s simple to navigate, no matter if you’re adding coverage, filing a claim, or asking a question.
- It’s Fast to Apply – Within a matter of minutes, you can provide your information and secure the type of coverage you’re seeking.
- It’s Fast to File a Claim and Receive Funds – Does Lemonade insurance pay claims? Of course! And not only that, but it’s fast and efficient to file a claim and receive funds. Waiting times are kept to a minimum.
- Affordable Rates – Traditional insurance companies overcharge for home, renters, and pet insurance. With Lemonade, you’ll soon realize that its pricing structure is designed with you—the consumer—in mind.
- The Lemonade Giveback Program – Any leftover money is donated to a charity of your choice. It’s nice to know that leftover money—after fees and payouts—goes toward charity instead of in the company’s pocket.
From everything here, Lemonade seems pretty perfect. However, there are some downsides to this revolutionary new insurance approach.
- No Live Help – If you want to contact Lemonade customer service, you can send them a message through the app or via email. However, if you’re thinking about getting a policy and just want to chat with a customer service agent, you’re out of luck. Lemonade doesn’t offer to let you chat with a live person.
- Not Truly P2P – While Lemonade is touted as the first peer-to-peer insurance company, that’s actually a bit of a misnomer. The company doesn’t really operate on a true peer-to-peer model, but rather a crowd-funded one.
- Pooled Premiums – Similar to health sharing plans, premiums are pooled for everyone to use. However, there is never any direct funding from one peer to another.
- Only Available in Some States – Lemonade isn’t available everywhere just yet. So even if it sounds like the perfect insurance option for you, you might not have it as an option.
The Future of Lemonade Insurance
In addition to homeowners, renters, and pet insurance, Lemonade has plans to expand its offerings in the near future.
Next in line are auto insurance and term life insurance.
If you’re still asking yourself “is Lemonade a legit insurance company,” its plans for the future should help you realize that the answer is yes.
Is Lemonade Worth the Hype?
So, there you have it. It’s our hope that this Lemonade insurance review provides the direction you’re seeking.
If you’re looking for an easy-to-get, easy-to-use, and low-cost way to insure your home, pets and property, Lemonade might be perfect for you. It provides you with an affordable way to protect your house and belongings. It also makes it easy to change your policy, make claims, and even get paid in minutes.
For many customers, buying from Lemonade could give you all the peace of mind you need. After all, it’s a revolutionary insurance product that doesn’t benefit when you lose. Rather than leaving a sour taste in your mouth after filing an insurance claim, Lemonade sweetens the entire process.