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Lemonade files S1

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Re: Lemonade files S1

#141

Post by JMTQp8lwXL »

michaelmior wrote: post #138
HeavenFox wrote: post #126

I use lemonade for my renters insurance, since it’s cheaper than the alternatives. I have to say their UX is a classic example of form over function. - To buy and manage a policy, you have to install their mobile app. They have a website, but to do anything substantial they redirect you to the app. - I canceled the credit card I use for the premium. To update the credit card, I have to use the virtual chat bot, which…

The worst for me was when I needed an overlap between my old and new policies, I was told I needed to open a second account with a different email.

Being scrappy and avoiding anything other than happy path allows businesses to grow faster.

Re: Lemonade files S1

#142

Post by gen220 »

petra wrote: post #75
deeg wrote: post #41

Earlier quoted context omitted.

I'm tangentially involved in the insurance space and I believe Lemonade is trying to use machine learning to process claims because: - Processing claims with humans is expensive; every step that can be accomplished by a computer will probably be cheaper. - A claim processed via ML will probably be handled fast. A fast response = happy customer, which helps with retention. This is a big one. - A claim that is processe…

So from your insider vantage point, how will the insurance job market look in 5-10 years ? What jobs, if any, would be left ?

I think we’ll see the insurance market transform in a similar way that we’ve seen the financial services market transform. Although, it will go in slow motion, since the gains in insurance aren’t as immediately-accruing as they were in equity and credit trading.

You’ll see the same kind of jobs that exist today, but they will be smaller in number, and way less paper-oriented.

Re: Lemonade files S1

#143

Post by 55555 »

Does anyone know why they chose to offer renters/casualty insurance?

I understand how their model is a bit different from other insurance companies, and I think that's cool. But I'm still left wondering why they thought this form of insurance (as opposed to auto, life, etc) was the easiest to attack.

Re: Lemonade files S1

#144

Post by michaelmior »

JMTQp8lwXL wrote: post #141
michaelmior wrote: post #138

Earlier quoted context omitted.

The worst for me was when I needed an overlap between my old and new policies, I was told I needed to open a second account with a different email.

Being scrappy and avoiding anything other than happy path allows businesses to grow faster.

This is true and it probably was a reasonable decision on their part since my case was certainly not the common one.

Re: Lemonade files S1

#145

Post by iscrewyou »

HeavenFox wrote: post #126

I use lemonade for my renters insurance, since it’s cheaper than the alternatives. I have to say their UX is a classic example of form over function. - To buy and manage a policy, you have to install their mobile app. They have a website, but to do anything substantial they redirect you to the app. - I canceled the credit card I use for the premium. To update the credit card, I have to use the virtual chat bot, which…

I disagree. It was the easiest ease of mind purchase I've ever made. They tell showed me what it covers, what it can cover with add-ons and the price updated in a click. I had to talk to no one. It started the next day with the contract sitting for me in my email.

I don't think they could've done a better job solving a problem through software (an app).

I tried cancelling it to make sure it will be easy. The steps seem super easy and straight forward all the way up to the confirm option.

Re: Lemonade files S1

#146

Post by PascLeRasc »

HeavenFox wrote: post #126

I use lemonade for my renters insurance, since it’s cheaper than the alternatives. I have to say their UX is a classic example of form over function. - To buy and manage a policy, you have to install their mobile app. They have a website, but to do anything substantial they redirect you to the app. - I canceled the credit card I use for the premium. To update the credit card, I have to use the virtual chat bot, which…

I'll take that over my policy I have now, where anything after 2 clicks on the website ends up with "We're not telling you that information unless you call us". I'll take some UX quirks if it means the old companies with no competition will die out faster. I'd even pay more for this.

edit: I just found out that their policy framework is open-source on Github (https://github.com/lemonade-hq/policy-2.0). That's huge to me.

And they use regular English to explain everything with real examples like how they'd cover an Airbnb if you had a fire, and what a deductible is. Meanwhile I couldn't find my policy on State Farm's site and had to dig through Dropbox to see that the its line items are furs, silverware, and waterbed damage. What year is it?

Re: Lemonade files S1

#148

Post by koolba »

tootie wrote: post #130
HeavenFox wrote: post #126

I use lemonade for my renters insurance, since it’s cheaper than the alternatives. I have to say their UX is a classic example of form over function. - To buy and manage a policy, you have to install their mobile app. They have a website, but to do anything substantial they redirect you to the app. - I canceled the credit card I use for the premium. To update the credit card, I have to use the virtual chat bot, which…

Those kind of patterns sound like they are business-motivated and not form over function. Look at sites like Facebook or Reddit that are perfectly suited to mobile web but aggressively push users to apps. Apps make for a walled-in experience and more engagement. And they let companies push more and more features you didn't ask for.

Facebook wants you to use the app so that they can deliver an all encompassing ecosystem. It’s a gateway to more functionality ina controlled environment.

Reddit just wants you see ads. The percentage of Reddit users that block ads must be astronomical.

Re: Lemonade files S1

#149

Post by phonon »

gen220 wrote: post #134
phonon wrote: post #131

Earlier quoted context omitted.

In their most recent quarter-- Net earned premium 25.3 Net investment income 0.9 ------------------------------------- Total revenue 26.2 Expense Loss and loss adjustment expense, net 18.2 Other insurance expense 3.3 Sales and marketing 19.2 Technology development 3.5 General and administrative 18.2 ------------------------------------- Total expense 62.4 Loss before income taxes (36.2)

18.2 / 25.3 ain’t bad. Sales and marketing at 19.2 seems a bit high, but I guess they’re doubling down on growth, and it implies they have a long runway. The administrative costs is the one that you’ll want to see grow logarithmically, as 25.3 goes up, and it’s not unbelievable that it will.

> 18.2 / 25.3 ain’t bad.

It's somewhat worse than average, but trending in the right direction. Will give a qualified "OK".

> Sales and marketing at 19.2 seems a bit high, but I guess they’re doubling down on growth, and it implies they have a long runway.

It's very high, relative to written premium. You can always buy market share in insurance by increasing commissions and/or increasing marketing, and it's okay to overspend in the beginning for branding/momentum purposes, but it's not sustainable. They raised $500 MM, and spent $200 MM (and much of the remaining $300 MM is needed for statutory surplus) so who knows how much longer they can sustain that.

Administrative and tech I'm somewhat sanguine about, as long as they keep moving upmarket to Homeowners' insurance. Renters' insurance is never going to have a great margin. Tech is at least decent, and hopefully the kernel for expanding easily into other markets.

Re: Lemonade files S1

#150

Post by [deleted] »

harryh wrote: post #76
xfour wrote: post #12

In parallel to this growth of topline and increasing efficiencies, our gross loss ratio declined steadily from 161% in 2017, to 113% in 2018, to 79% in 2019 and to 72% for the three months ended March 31, 2020. See "Management's Discussion and Analysis of Financial Condition and Results of Operations — Key Operating and Financial Metrics." Seems like a struggle to get to profitability. With the ratio of closing the g…

It sounds like you don't know what "loss ratio" means in the context of an insurance company. Loss ratio is the % of premiums collected that are paid back out in claims. If the number is below 100%, then your core insurance business is profitable Of course, this doesn't mean your company is. Insurance companies have many expenses beyond paid claims. But loss ratio should never get to 0% and, by definition, can't be n…

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