Lemonade Auto Insurance Review 2022 – Forbes Advisor | Business Insurance

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About Lemonade Auto Insurance

Lemonade’s auto insurance is primarily sold online through their website or mobile app. Drivers need to download the app to manage their policies, get help from Lemonade, or file a claim. The app also uses location-based technology (also known as telematics or usage-based car insurance) to quote your policy based on how much you drive and your driving behavior.

How Lemonade Auto Insurance Works

When drivers sign up for Lemonade, car insurance rates are calculated based on standard factors like your driving record, claims history, credit, location, and driving experience. Once the app is downloaded and location services are enabled, drivers are eligible for an immediate participation discount.

The location-based technology of the Lemonade app allows you to monitor your specific driving habits. At renewal, your driving score and other factors, such as your claims history, are used to set the price of the policy. A good safe driving score should result in lower premiums.

Claims are submitted through the Lemonade app. You may be required to submit a video depicting the incident as part of the claim process. Once a claim is approved, payment is deposited directly into your bank account (minus any applicable deductible).

Lemonade Telematics Program (Usage Based Auto Insurance)

Lemonade believes that basing rates on your driving behavior will result in more fairly priced coverage. You download the Lemonade app and give it permission to track your driving, which is used to determine rates on your first renewal and in the future.

The telematics program monitors where and how you drive to create a driver safety score. Items taken into account for a score include:

  • total mileage
  • Time of day you drive
  • weather conditions
  • Roads
  • Braking
  • Smooth acceleration and braking
  • curves
  • Using the phone while driving

lemonade car insurance coverage

Like other auto insurance companies, Lemonade offers the following typical auto insurance coverages:

Liability insurance: Bodily injury and property damage liability insurance pays for injuries and damages to others if you are at fault in a car accident. Liability insurance also pays for attorneys’ fees, court settlements, and judgments related to car accidents you caused.

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Uninsured and Underinsured Motorist Coverage: Uninsured motorist coverage pays for medical expenses if you or your passengers are injured in a car accident caused by a driver who doesn’t have insurance or doesn’t have enough coverage to pay their bills. It is required in 22 states and optional in others.

Personal Injury Protection (PIP): PIP coverage pays for your medical expenses, as well as lost wages and replacement services, such as child care, if you are unable to perform the task. Personal Injury Protection (PIP) is mandatory in 15 states.

Medical payments coverage: Helps pay medical expenses for injuries to you and your passengers as a result of a car accident, regardless of fault. It is required in some states and optional in others.

Collision and all risk insurance: Collision auto insurance pays to repair or replace your car if it is damaged in a car accident, regardless of fault. It’s also worth it if you hit an object, like a railing or fence. Comprehensive auto insurance covers theft and damage to your car due to vandalism, fire, flood, hail, falling objects or hitting an animal.

Comprehensive and collision coverage pays the actual cash value of your vehicle if it is declared a total loss, less your deductible. Both are optional, but if you have a lease or loan, your lender or leasing company will likely require you to have comprehensive and collision coverage.

Lemonade Accident and Roadside Assistance Services

If you have comprehensive and collision coverage, Lemonade provides these benefits for free, as long as you have location tracking enabled in the app:

Emergency assistance in case of accident: Lemonade is alerted if you are in an accident and can contact you to see if you are injured or if emergency services need to be dispatched to the scene of the accident. The Lemonade app identifies the crash site.

Roadside assistance: If your car breaks down, you can use the Lemonade app to request roadside assistance. This service helps with towing, battery jump-starts, flat tires, fuel delivery and more.

You are eligible for up to three free services for each car listed on your policy during a six-month period. After that, you can still apply for help, but you have to pay for it.

More auto insurance options at Lemonade

Some optional coverages you can choose for a Lemonade auto insurance policy include:

Temporary transportation coverage

If you have comprehensive and collision coverage and add this to your policy, it reimburses rental, public transportation or rideshare costs for up to 30 days if you are unable to drive your vehicle due to an issue covered by your policy, such as a car accident. . (This coverage is often called auto rental reimbursement coverage.) You can sign up for daily redemption limits of $40, $50, or $60.

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Extended glass and windshield coverage

If you have comprehensive insurance, it covers you if glass (such as windows or windshields) is damaged or broken. If you have comprehensive and collision coverage, this “extended” coverage allows you to choose a lower deductible or no deductible for glass or windshield claims.

gap insurance

Gap insurance can help you pay off your car loan or lease if your car is totaled or stolen and you owe more than the vehicle is worth.

Auto Insurance Lemonade Special for Electric Vehicles, Hybrids

Emergency charge: If your electric vehicle (EV) is stuck with a dead battery, Lemonade will send you a charging truck.

Charger Coverage: If your wall or laptop charger is damaged, this coverage will help replace it.

Lemonade auto insurance discounts

Lemonade offers a variety of discounts to help drivers save money on auto insurance.

  • Package discount (multi-policy). Save when you have a Lemonade auto insurance policy and bundle it with any of your other products, including Lemonade homeowners, renters, life or pet insurance.
  • EV/Hybrid discount. Drivers of green cars such as electric or hybrid cars receive a reduction in their rates.
  • Low mileage discount. You’ll get lower rates if you drive less.
  • Discount without accidents. If none of the drivers on your policy has had an accident or loss in the last five years, you can get a discount.
  • Three-year safe driving discount. You can get a discount on car insurance from Lemonade if you have been free of car accidents and traffic violations for at least the last three years.
  • Discount for senior drivers. Also known as a mature driver discount, you can save if you’re 55 or older and have completed an approved defensive driving course within the last three years.
  • Discount for teen drivers. If you have a licensed driver under the age of 19 and your policy also qualifies for the “continuous insurance” discount, you may see savings.
  • Multicar discount. If you insure more than one car on your Lemonade auto insurance policy, you may receive a discount.
  • Anti-theft discount. If your car has anti-theft features, whether it’s original equipment or permanently installed replacement, you can receive a discount.
  • Smart technology discount. You can get this discount if your car is equipped with factory-installed blind spot warning or automatic emergency braking safety features.
  • Paid in full discount. If you choose Lemonade’s lump sum bill plan (pay full premium in advance), a discount will apply.
  • Continuous insurance discount. You can save if you’ve been covered continuously by auto insurance with no breaks in coverage.
  • Telematic participation discount. A discount applies if the Lemonade app is used continuously for the telematics program.
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Brief history of lemonade insurance

Founded in 2015 by Daniel Schreiber and Shai Wininger, Lemonade is based in New York. It started by selling Lemonade home insurance and renters insurance and expanded to include auto insurance in 2021.

Lemonade prides itself on having a different business model than other auto insurance companies. Auto insurance companies typically make a profit by keeping the money left over after paying claims and business expenses. Lemonade takes a fixed amount (or what it calls a flat rate) out of premiums for your benefit, pays claims and expenses, and donates what’s left to charity annually.

Lemonade Inc. is a public benefit corporation, which means that it is a for-profit business that must consider the interests of its workers, customers and communities, and not just the interests of owners and investors, when making decisions commercial. Public benefit companies also identify the public causes they support, and every two years they must report on the progress made.

Lemonade has also received a B Corp certification, which is awarded to companies that meet criteria for social and environmental performance, responsibility, and transparency.

Charitable Causes of Lemonade

lemonade return

Lemonade’s business model was created with charitable causes in mind. After you take out your flat fee and pay claims and expenses, any money left over (unclaimed money they call it) is given to charity under the Lemonade Giveback plan.

When you purchase an auto insurance policy from Lemonade, you select a nonprofit organization that you have an interest in helping. Then, once a year, Lemonade determines how much money is left and awards up to 40% of proceeds to nonprofits.

In 2021, the Lemonade Giveback program gave away more than $2 million dollars to more than 65 nonprofit organizations, including:

  • ACLU
  • american forest
  • Charity: Water
  • Citymeals on wheels
  • CURE childhood cancer
  • feeding america
  • habitat for humanity
  • Human society
  • malala background
  • march for our lives
  • Shatterproof
  • The Ali Forney Center
  • The American Red Cross
  • The Born This Way Foundation
  • Thorn
  • together we rise
  • women in need

Lemonade Tree Planting Program

Using information from the app, Lemonade calculates the amount of carbon dioxide emitted by your car each year from miles driven and other factors, and determines how many trees you need to plant to reduce your carbon footprint. For example, the company estimates that four trees would need to be planted for every 10,000 miles traveled in a gasoline-powered car that gets 25 mpg.

The company’s reforestation efforts are primarily in California redwood forests, the Oregon Santiam State Forest, and in watershed areas throughout the Pacific Northwest.