Lemonade car insurance review for 2021
Digital support and AI-powered claims could drive down rates for safe drivers and electric car owners.
New car protection
|States served||Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming|
|New car protection||No|
|Pay schedule||12 months, monthly|
|Claims methods||app, Online|
- Low prices.
- Nearly instant claims.
- Stellar app and online experience.
- Unused premiums go to charity.
- No phone support, except for emergencies.
- Many customer complaints.
|Anti-theft device discount||No|
|Defensive driving discount||No|
|Good student discount||No|
|Safety device discount||No|
|Special employment discount||No|
|Other discounts||Lemonade’s only discount offers up to 10% if you bundle its home, renters, pet or life insurance policies.|
Lemonade car insurance rates
Based on Lemonade’s other available policies, you can expect Lemonade car insurance to undercut competitors’ rates. Typically, Lemonade’s insurance policies have slashed traditional premiums significantly, such as its home insurance policy that costs over 75% less than the average.
If Lemonade delivers on its promise of low rates for safe drivers, it should cost well under the average premium of $108 a month or $1,300 per year.
How to get a free quote for Lemonade car insurance
Lemonade Car isn’t available yet, so you’ll need to sign up for updates on when the new car insurance rolls out. When the policy rolls out, expect a streamlined online quoting process to get started.
Steps to sign up for updates:
- Go to Lemonade’s dedicated page for car insurance signups.
- Enter your email address and select Let’s ride.
- Watch your email for news on the car insurance policy rollout — expected within 2021.
What discounts can I get from Lemonade?
Lemonade’s only discount that we know about offers up to 10% off your premium if you bundle its home, renters, pet or life insurance policies.
What car insurance coverage can I get with Lemonade
Lemonade should offer the standard coverage you’d expect for your car insurance to get you on the road:
- Bodily injury liability. Pays for other people’s medical bills and pain and suffering for any injuries you cause in a car accident.
- Property damage liability. Provides peace of mind that you can cover repairs to or replacing someone else’s car if you’re at fault.
- Collision. Protects your car against damage in a collision with another car, pole or object.
- Comprehensive. Protects your car even if the damage is caused by theft, a storm, an animal running in front of you or any other noncollision situation.
- Uninsured/underinsured motorist. Provides the payout you deserve even if the at-fault driver doesn’t carry the minimum insurance required.
- Medical payments. Adds health coverage to pay medical bills for you and your passengers after an accident.
You may see other options and benefits to help poise Lemonade as a major player in car insurance.
“We’re seeing an overwhelming demand for a Lemonade car insurance product from our customers,” says Wininger. “And so, since last year, a large part of our team has been working on what we believe will become one of the best car insurance products on the market.”
What add-ons and extra benefits does Lemonade offer?
The annual Giveback program is one of Lemonade’s best features, letting customers choose a charity to give any unused premiums to at the end of the year.
Charities that Lemonade has given back to include:
- American Forests
- American Red Cross
- Black Lives Matter
- Born This Way / Foundation
- Charity: water
- Cure Childhood Cancer
- Direct Relief
- Malala Fund
- Teach for America
- The Trevor Project
Lemonade insurance reviews and complaints
Lemonade isn’t accredited by the Better Business Bureau as of April 2021, although it’s been in business for over five years. The company earns a C rating from the BBB because it hasn’t responded or closed several customer complaints. Customers complain about Lemonade’s claims process, including delayed or denied claims, and some report frustration when the app doesn’t work correctly
However, Lemonade received only nine complaints in 2020 filed with the National Association of Insurance Commissioners, low compared to other brands that may see hundreds of complaints per year. To balance out these ratings, over 200 customers give Lemonade 4 out of 5 stars on the BBB website. Positive reviews focus on the company’s cheap premiums and quick claims process for home or renters insurance.
Compare Lemonade to alternatives
Find out how these policies compare to Lemonade’s cheap rates and perks, then select Get quotes to see customized rates.
How is Lemonade car insurance different from other policies?
Lemonade stands out for its low costs, lightning-quick claims powered by AI and its Giveback program on available policies. We expect these features to carry over to Lemonade’s car insurance, which means it could be the first car insurer to pay unused premiums forward to a charity that you choose.
Lemonade also spreads out its insurance risk different from other companies. Rather than taking on some of the risk itself, Lemonade takes a flat 25% fee for profit and applies the other 75% toward buying reinsurance and paying claims. If there’s money left over that it didn’t use for claims, the company pays it forward to charities through its Giveback program.
However, Lemonade’s COO and co-founder Shai Wininger says that Lemonade car insurance will stand out in other ways too.
“Lemonade Car will use technology to handle emergencies and pay claims fast, will offer great prices to safe drivers, and will be especially attractive to drivers of EVs and environment-friendly cars,” Wininger said in a statement.
Currently, drivers of electric vehicles have been limited to traditional or luxury car insurance companies, which often charge EVs high rates. That’s because electrics have more technology and cost more to repair than gas-powered cars. Based on Lemonade’s statement, the company could sway the electric car insurance market in a different direction.
Pros and cons of Lemonade insurance
Lemonade’s car insurance won’t be available until later in 2021. So we don’t know whether it will be available nationwide or include the same benefits as other policies.
Based on how Lemonade works with its other policies, we expect low car insurance premiums and access to its unique donations feature, letting you contribute unused funds to a charity that you believe in.
- Low prices. Lemonade’s policies typically stay well below the industry’s average, though we don’t know its starting prices yet.
- Nearly instant claims. The company boasts that about a third of its claims are paid in minutes through the help of its intuitive AI.
- Stellar app and online experience. Customers give the app features high marks for ease of use.
- Unused premiums go to charity. Lemonade lets you choose the charity where you send any premiums that it doesn’t use for claims.
Like any other company, we expect a few downsides to Lemonade’s car insurance policy.
- No phone support, except for emergencies. Customer service is available in the app or through chat. You can call only during emergencies when you don’t have access to the app.
- Many customer complaints. A number of customers complain about delayed or denied claims for Lemonade’s other policies.