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

lemonade.com

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

#171

Earlier quoted context omitted.

That might be a cut and paste TOS, with a little CTRL-H for flavor. Otherwise, that TOS hopefully is intended to apply to the website only. If anyone has gotten far enough with them, I'd love to see their actual insurance contract. I'm too lazy to go pull their state filings. EDIT: Here's the part that troubles me more - "GIVEBACK ... our stated intention is to calculate the amount of leftover money by subtracting fr…

SmellTheGlove you're right. What joosters pasted is our website's TOS... You can definitely build a profitable insurance business with a 20% expense ratio. Our expenses are much lower than traditional insurers, plus we're not planning on buying any private jets :). We're here for turning insurance into a social good, as it was 400 years ago. Thanks for your support!

You can, but there are very few P&C insurers currently doing it, and I've not seen an insurance startup willing to operate the way they do it. In the short run, you're only writing NY insurance, and 20% is completely possible. Scale is going to hurt initially, but if you do it right, it is possible to bring expenses back down. Legal and compliance, as well as handling claims, is going to be expensive on the way to 50 states.

My unsolicited advice, which may be worth exactly the zero that it's costing you, is to establish lean management and process control up front, and take a very hard look at the expenses you add in growth mode and evaluate whether you still need all of that once you've established 50 state operations and presumably can leverage internal economies of scale. That's one hell of a run on sentence.

And fix your website TOS to make it unambiguous that it does not apply to the insurance product or contract. You never know when some regulator is going to take issue.

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

#172

Why does Lemonade ask its users to record a video during the claims process? The FAQ doesn't give a good answer...

Probably one of their "disruptions" to the current market comes from not rolling an adjuster out to your home for as many claims as possible. Send a video of your covered loss and they can evaluate your claim from anywhere in the world.

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

#173
Are you guys getting a tax write off for the charitable donations from the surplus pool? If so, wouldn't that give Lemonade a financial incentive to decline payouts in favor increasing your bottom line and therefore negate the idea of having no stake in paying out legitimate claims?

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

#174

Earlier quoted context omitted.

Hey, this is Maya from Lemonade, we believe people are inherently good and when faced with the option of embellishing their claim and pocketing more money or claiming what they deserve and make sure their cause receives the extra money left- most people (we hope) will choose the latter.

Maya, You did not answer my inquiry. Why is giving extra money to charity MORE of a deterrent to fraudulent claims than giving extra money back to the consumer?

Hey, It's not necessarily more a deterrent than giving cash back. 1. we are not yet legally allowed to give money back to our users (but we're working on it) 2. some behavioral economic theories actually suggest that cash is less an incentive than other more altruistic incentives. Once our give back to consumers will be active- I'll guess we'll be able to put our theories to the test- hope this answers your question

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

#175

Earlier quoted context omitted.

Maya, You did not answer my inquiry. Why is giving extra money to charity MORE of a deterrent to fraudulent claims than giving extra money back to the consumer?

Hey, It's not necessarily more a deterrent than giving cash back. 1. we are not yet legally allowed to give money back to our users (but we're working on it) 2. some behavioral economic theories actually suggest that cash is less an incentive than other more altruistic incentives. Once our give back to consumers will be active- I'll guess we'll be able to put our theories to the test- hope this answers your question

Hi Maya,

Mutual insurance companies exist in New York. Are you not legally allowed to give money back solely because you decided to incorporate as a benefit corporation?

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