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Show HN: Lemonade – the world's first P2P insurance company

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Re: Show HN: Lemonade – the world's first P2P insurance company

#141

Post by edc117 »

propter_hoc wrote: post #46
daschreiber wrote: post #21

Daniel from Lemonade here. Totally understand how P2P can be confusing as a term. What we mean by it is that we use each group's premiums to pay their claims, with leftover money going back to the group's common cause. To us P2P is a shorthand for: 'it's not our money'!

> What we mean by it is that we use each group's premiums to pay their claims, with leftover money going back to the group's common cause. So using pension plans as an analogy, it's more like a pay as you go pension scheme, like Social Security, than a fully funded scheme where the capital is invested and the returns from investment pay expected payouts. I guess the distinction is that since the leftover money is use…

Don't usually do this, but seconding this response because I'd really like to emphasize it and I'd love to hear some of these answers. Why not just return the extra as lower rates in the subsequent month or refunds instead of donating?

Re: Show HN: Lemonade – the world's first P2P insurance company

#143

Post by 6stringmerc »

h4nkoslo wrote: post #31
samfisher83 wrote: post #24

It looks like these are the companies that are really insuring you: Lloyd’s of London, Berkshire Hathaway’s National Indemnity, XL Catlin etc. Basically they are buying a policy from one of those companies adding 20% and selling it to you. A insurance company works by spreading risk over a large area. By selling everything in NY they are increasing their correlation which raises risk. One of the reasons for the sub p…

There's a difference between insurance and reinsurance. It looks like they're only reinsured through those companies, but the policy itself is underwritten by Lemonade. Reinsurance is basically insurance for the insurance co, for instance if a hurricane hits NYC and wipes out all of their policyholders at once. (It's a bit complicated because there actually are many insurance co's that only sell insurance underwritte…

Just noticed, yeah you're right on the difference. I'm curious to what AM Best might rate Lemonade. Or how their numbers line up against some peers. A small part of me wonders how AM Best would look at the fraud potential versus other approaches - make a difference? Maybe no, maybe yes. Just thinking out loud.

Re: Show HN: Lemonade – the world's first P2P insurance company

#144

Post by lucb1e »

edc117 wrote: post #140
lucb1e wrote: post #137

Earlier quoted context omitted.

Just an idea: give a very general, estimated quote and refine it as people go to the next step. Then people that randomly browse are happy, and people who actually want to know their quote are happy.

It's a good idea, and as a random browser it'd make me happy, but people wouldn't be too thrilled if the price went up from the initial quote. Also if the initial is too high, it may scare some people off.

Yeah I thought of that, but did not find an immediate solution. Anyway, just an idea.

Re: Show HN: Lemonade – the world's first P2P insurance company

#145

Post by 6stringmerc »

BillinghamJ wrote: post #69
samfisher83 wrote: post #62

Earlier quoted context omitted.

You are right I guess they could be covering a majority of the claim, but I would guess their reinsurance percentage is probably a high percentage. For example if the probability of fire is 1%, but due to their limited geographical focus they were covering an entire building of 30 apartment and their coverage is 100 dollars well their rate should be 1 dollar + x%, but if their is a fire their payout will be 3000 doll…

Reinsurance isn't generally done on a percentage basis. It's generally done on a "the value of any single claim above X amount" basis. "X" is commonly around 1 million dollars. The insurer pays 0-X, then the reinsurer (and their reinsurers respectively) pay X onwards.

What you've noted does exist, but the second line is more like building a 'tower' which is still in the primary layer. There's quite a bit of diversity in the reinsurance market so you're right about certain types, usually purchased by small businesses with large vehicles (cement mixers) who can't get enough in the primary.

But, in insurance companies buying insurance, there's some differences.

I'm not licensed but I do know the "Quota Share" structure is quite industry accepted for a few different lines (property being one, casualty, auto). So the % of risk retained versus ceded at various points to reinsurers is exactly the contract structure. Within that structure there are some limits and retentions that get hammered out during the contract and negotations ($XXX,XXX per occurrence of X, Y, Z, etc). But the point of this is that yes a company can retain XX% and reinsurers, usually several, split up dibs on the other XX%, sometimes in layers as well.

It's pretty interesting stuff and the numbers of what's out in the markets for underwriting is definitely an eye opener.

Re: Show HN: Lemonade – the world's first P2P insurance company

#146

Post by maya_lemonade »

nerdponx wrote: post #106

I happen to have been looking for renters insurance recently. I signed up immediately after reading the insurance policy terms. They are about as generous as the terms offered by Liberty Mutual, but LM wanted to charge me more than 3x as much, and I had a strange and frustrating conversation with a LM agent that left a bad taste in my mouth. Charity or no charity, it's a great deal. However I made two mistakes. First…

Hey nerdponx! This is Maya from Lemonade ; ) Please send us the correct email address you want us to use for your policy and we'll update it ASAP. Also- you can call Lemonade even if it's not an emergency and someone from our customer care team will answer and help you out. Hope this helps

Re: Show HN: Lemonade – the world's first P2P insurance company

#147

Post by maya_lemonade »

xerophyte12932 wrote: post #110

So I tried out Maya and I just gotta say, great stuff! You ask for the bare minimum stuff, deduce the rest yourself, let the user play around with the numbers and give them an instant quote. Insurance is something a lot of people find intimidating and hard to approach as customers, and you have made it as simple as possible, explaining each item in an easy-to-understand way, letting the user know exactly what they si…

Thanks xerophyte12932!!

Re: Show HN: Lemonade – the world's first P2P insurance company

#149

Post by gilsadis »

d2xdy2 wrote: post #92

Hmmm. I think the interaction where it says that it is not yet available in my area and to try again with a New York address could be improved a little. Go ahead and let me enter in my information and put me in some sort of potential new location queue-- get enough people near / around me, and you can start to decide where to support next. Just a thought.

@d2xdy2 great feedback. Thanks! And, added you to the queue ;)

Re: Show HN: Lemonade – the world's first P2P insurance company

#150

Post by avitzurel »

gilsadis wrote: post #61
avitzurel wrote: post #54

I read some of the comments about the funnel and I set out to try it myself. There are 8 steps to get a quote 1. First and last name 2. Full address 3. question (renter/owner) 4. roomates/alarm 5. current owner of insurance? 6. Jewelry over 1000$? 7. email, birthday 8. Quote, which seems highly generic and could be done without 6 of the 7 previous steps. I can't even imagine the conversion rate from just checking it…

Valid points all, but if you were getting insurance from the traditional companies, you'd have to answer many more questions, or alternatively, pay for coverage you don't necessarily need. Our funnel tries to get you a personalized quote in minutes, so you pay for what you need. Most of the time this will be considerably lower than traditional carriers.

You're probably right about traditional insurance companies but didn't you say you're doing things different.

If you need all the steps (and I doubt it) at first, at least do something like what TypeForm are doing with a progress bar, explain a bit about why you need it etc...

Say the insurance conversion rate is somewhat similar to healthcare average around 9%, I am guessing you lose at least 40% that could have converted means you are left with something around 5-6% conversion rate. Not a sustainable business at this scale (IMHO of course).

There's no doubt that in order to be responsible, you need all of the information. We are in agreement on that. What I'm saying is you need to think of better ways to show the value and hook me before I go through all of the steps. Something simple 1-2 steps, later you can change that. It's worth an A/B test at least.

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