AI Changing the Game for Insurance

Insurance company Lemonade are turning the financial services industry head with their AI processes.

SHARE

US insurance company Lemonade are continuing their rise to the top using Artificial Intelligence, after revealing their research which shows they are gaining a large share of the New York market.

The organisation only opened their doors to applications 8 months ago, and have quickly caught traction with customers as they put the user experience above all else.

Lemonade’s unique catch is that their insurance is powered off of AI and behavioural economics, removing the annoying and unnecessary paperwork and providing almost immediate approvals.

Their Google Surveys revealed that in less than a year, Lemonade has captured almost 5% of the market share in renters insurance. Their ascent is even more incredible when considering that the average market share for the top 10 homeowners insurance is 6.3%, while being in business for 104 years.

Furthermore, Lemonade has truly captured the attention of new entrances into the market, where they boast 27% of the market share. This is most likely from younger crowds, who would be attracted to the fast and simple process when renting their own properties.

“Attaining 4% market share in a few months, in such a competitive category, is without precedent,” said Peter Diamandis, founder and executive chairman of the XPRIZE Foundation, and co-founder of Singularity University.

“As remarkable as this achievement is, however, it actually understates the Lemonade phenomenon. The vast majority of the ‘market’ bought their policy before Lemonade existed, so the more telling number is the share amongst consumers who entered the market since Lemonade did. Lemonade’s top-ranking amongst first-time-buyers is a wake-up call for the entire industry.”

Lemonade’s CEO, Daniel Schreiber, says that there is more to come and their growth will only continue.

“In the two months since Google ran these surveys, our customer base has more than doubled, and we expect that acceleration to continue,” he said.

This diagram shows how Lemonade have captured new entrances into the renters insurance market “But even if we just maintained the status quo — within a few years our overall market share would automatically come to match our ‘brand new’ market share. That’s what ‘brand new’ market share means, and that’s why it’s probably the single most telling metric of all.”

Not only are Lemonade looking to transform the insurance industry, they also do their part for the community. Only taking a flat fee from customers and donating any unclaimed cash to social causes means that Lemonade are forward thinking when it comes to society, as well as a business.

Just a few months ago, Lemonade announced their own ‘record-breaking claim’, approving an application within three seconds.