Lemonade is betting that its fast, AI-enabled process will appeal to millennials who are want a no-hassle, Amazon-like experience when buying insurance. (Photo: iStock).
A technology start-up that’s bringing innovation to the property and casualty insurance market is going nationwide.
, launched in 2015 with much fanfare, announced today that it has filed for licenses to sell homeowner’s and renter’s insurance in 47 states. Now doing business in New York, the company says in a press statement that it will disclose “in a couple of months” states where its products will initially be available.
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“In the last 3 months since our New York launch, we’ve had overwhelming demand coming in from all over the country to open up for business in more states,” Lemonade says. “This was very encouraging because it showed us hints of initial demand and product market fit to people and age groups which we never thought would be our early adopters.”
States from which the “most requests to launch” came, and where Lemonade intends to plant stakes in the coming year, include California, Michigan and Texas. Other major markets among the 47 announced states are Colorado, Florida, Massachusetts, Pennsylvania and Virginia.
In advance of the announcement, Lemonade secured venture capital to help fund its expansion plans. On December 6, the insurer closed on a third round of financing, securing $34 million from top VC firms, among them Google Ventures, General Catalyst and Sequoia.
That brings to more than $60 million total VC funding since the company’s launch. “We’re going to use this money to drive our expansion throughout the country and activate specific markets the way we did in New York,” Lemonade’s press statement says.
The national build-out could also generate more dollars for Lemonade’s philanthropic efforts, a central focus of the insurer. Lemonade registered in New York State last May as a public-benefit corporation, joining other technology start-ups — such as Techweek, Kickstarter and Wefunder — that are embracing a dual social impact and for-profit mandate. The start-up disburses funds not needed to satisfy claims (on average, less than 40 percent of premiums dollars) from a “Giveback” pool to policyholders' designated charities.
The company is betting that, as in New York, its speedy application process will appeal to prospects. Chief among them: millennials who want a no-hassle, Amazon-like experience when buying insurance.
Lemonade uses artificial intelligence to service policyholders and prospects. Applications for insurance and payment of claims, the company says, can be facilitated in minutes using its web portal and AI-enabled mobile app.
Lemonade also touts its AI technology as a cost advantage. By eliminating agents and other overhead, the company says, it’s able to pass savings onto consumers. The insurer’s homeowners’ policies start at $35 a month; renters' insurance starts at $5 a month.
Originally published on LifeHealthPro.com