InsurTech

Lemonade launches in France, eyes continued global expansion

Company says it plans to continue to expand globally and state-by-state in the U.S.

Insurtech Lemonade has launched in France where it’s offering renters insurance, marking the third country in the European Union the company has entered, it announced on Tuesday.  

Since home insurance is often legally required in France, Daniel Schreiber, Lemonade CEO and co-founder said in a statement that launching in the country made it a “compelling opportunity.” Earlier this year, Lemonade launched in the Netherlands and in June 2019 it entered Germany. 

Lemonade is a New York-based insurance carrier that uses artificial intelligence and behavioral economics to offer renters, homeowners and pet health insurance.

Lemonade’s French product is based on the company’s Policy 2.0, which it describes as a “short, easy-to-understand, and transparent document designed for ordinary people.”

Although the company is launching in France, it won’t have any employees there, a factor that makes the expansion more feasible, Schreiber said at an event, according to previous reporting

Although there will be no Lemonade employees in France, some of the company’s employees are based in its European headquarters in Amsterdam, which is responsible for German, Dutch and French markets said Yael Wissner-Levy, VP of Communications at Lemonade in an email to FinLedger. 

“When we open new markets, we’re able to do so with code, not skyscrapers,” Wissner-Levy said in the statement.

“That’s one of the benefits of being built completely on a digital substrate- our bot Maya can sell insurance policies all day, from anywhere, 24/7.”

Background

Lemonade had its initial public offering in July and had priced it at $29 a share. It ended up soaring nearly 140% to close that day at $69 per share. At the end of market close on Monday, Lemonade was trading at $91.72 per share. 

Recently, Lemonade reported a decline in revenue to $17.8 million in its third-quarter earnings report, down from the $19 million it reported a year ago, Pymnts.com reported. The insurtech company said the decline in revenue was partly due to an accounting change in its third quarter earnings. Lemonade also reported a net loss of $30.9 million which was an improvement from the net loss of $31.1 million for the same quarter last year.

Lemonade’s first-year customer retention rate is about 75 percent, and Schreiber said the company is able to attract “consumers as they’re stepping onto the conveyor belt of life.”

The company has been “little impacted by the pandemic,” Wissner-Levy said. Although Lemonade started with “defensive footing,” it has been able to navigate these past couple of months since it is built on a digital substrate, she said.

Going forward, Lemonade plans to offer term life insurance in addition to its existing product lines as well as expanding geographically, Wissner-Levy told FinLedger. 

“We will continue to expand globally and state-by-state in the U.S.,” she added. 

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