Lemonade is one company that’s taking the homeowners and renters insurance industry by storm.
A newer player in the renters insurance game, Lemonade strips insurance down to the basics, providing uncomplicated coverage at cut-rate costs.
It does so using an innovative technological platform, a remarkable level of transparency, and a peer-to-peer approach.
In this Lemonade renters insurance review, we’ll break down how Lemonade insurance works and walk through its coverage options, costs, and limits to help you sort through the details.
Table of Contents:
About Lemonade Renters Insurance
Lemonade Insurance Company began offering its innovative insurance policies in 2016, when founders Daniel Schreiber and Shai Wininger decided to shake up the standard structure of homeowners and renters insurance.
Most insurance companies are built around profits. If no claims are filed, or your claims get denied, the company pockets the money you paid in premiums.
That isn’t the case with Lemonade. Instead, Lemonade pulls a flat fee from your monthly payments for business expenses and reinsurance, and everything else is designated for paying out claims. Period.
When you sign up for a Lemonade policy, you get to choose a nonprofit that’s close to your heart.
Once a year, Lemonade will add up all the money left over from your premium payments and those of people who chose to support the same cause as you. They then donate that balance, up to 40%, to the nonprofit you selected, turning lemons into lemonade.
Online Renters Insurance
Lemonade also stands out for its technological approach to insurance. Rather than housing brick-and-mortar offices, Lemonade is 100% online.
That means you can buy coverage, adjust your policy, make claims, and ask questions from the comfort of home via the website or app.
While some situations are a bit more complicated, Lemonade’s claims-processing is mostly automated. When you upload a video of a basic claim, you’re likely to get near-instant approval and payment.
This AI approach streamlines the claims process and allows Lemonade to lower costs, keeping the need for living, breathing employees at a minimum (although they’re there if you need them).
Though the newcomer isn’t rated by A.M. Best yet, they do have an “A” rating from Demotech, a reputable source of ratings for specialty insurers like Lemonade.
Lemonade also has positive customer service ratings, with a low NAIC complaint ratio and an “A-” from the Better Business Bureau.
They’re a certified B-corp as well, exemplifying their commitment to social impact.
Lemonade Renters Insurance Coverage
Lemonade offers four types of home insurance:
We’ll take a look at the coverage offered by their policies below.
Lemonades’ policies come with the basic coverages listed below that you might expect from any renters or homeowners policy, as well as a few extras we’ll discuss later.
- Dwelling: If you’re a homeowner rather than a renter, this coverage helps to rebuild your home if it gets damaged or destroyed.
- Personal property: If your stuff is stolen, damaged, or destroyed, it’s protected up to your coverage limit.
- Personal liability: If someone decides to take you to court over an injury that occurs at your home, this coverage helps with legal fees and medical bills.
- Medical payments to others: Likewise, this coverage is designated for medical bills if someone gets hurt on your property.
- Loss of use: If you can’t live in your home due to a covered event, your policy will pay to temporarily house you elsewhere, also helping with living expenses.
What’s Not Covered:
Lemonade covers loss or damages from the same list of named perils that are standard across the homeowners and renters insurance industry.
Meanwhile, it excludes damage or loss of personal property resulting from:
- Governmental Action
- Ordinance or law
- Power Failure
- Neglect or intentional loss
- Nuclear Hazard
While there may be additional exclusions based on your particular policy and where you live, these are the basic limits to coverage.
Note that you can likely purchase additional coverage for flooding and earthquakes.
Lemonade’s homeowners and renters policies cover you and your spouse and kids but do not extend to any other roommates.
Additional Coverage Options
Beyond the basics, Lemonade offers a couple of unique coverage options.
Lemonade describes its Zero Everything policy best: “No deductibles. No increase in pricing. Nothing.”
If you opt for the Zero Everything plan, you get the full replacement value amount of your stolen or damaged items, with no deductible to worry about.
You also won’t have to worry about your rates increasing because you file a claim (or multiple ones) big or small.
Scheduled Personal Property Coverage
Bikes, cameras, instruments, pieces of art, and jewelry can get expensive.
If these items are over $1,000, ($1,500 for jewelry) you can purchase extra coverage for their replacement cost, without any deductible.
Just note this option is only for personal items, not including those you use professionally.
To add this coverage, you’ll need to submit a receipt or recent appraisal, picture of the item, and some basic info about it.
Where Can You Get Lemonade Renters Insurance?
Lemonade’s policies aren’t available everywhere.
At the time of the publishing of this article, you can purchase a Lemonade insurance policy in the following states:
- New Jersey
- New Mexico
- New York
- Rhode Island
- District Of Columbia
Lemonade policies are also available to residents of Germany and the Netherlands, though they’re working to branch out nationwide in the US and to several more European countries.
The company’s landlord policies are currently available in California, Illinois, New Jersey, New York, Pennsylvania, Texas, and the District of Columbia.
How Much Does Lemonade Renters Insurance Cost?
How much you pay for Lemonade renters or homeowners insurance depends on the level of coverage and deductible amounts you choose.
It can also be impacted by any security features installed in your home.
You can choose to pay between $250 and $2,500 deductibles, with higher deductibles resulting in lower rates.
You can also pick from the following amounts of coverage:
- Loss of use: $3,000 to $200,000
- Medical payments: $1,000 to $5,000
- Personal liability: $100,000 to $500,000
- Personal property: $10,000 to $250,000
Lemonade states that its renters policies start at $5 a month, with its homeowners options beginning at $25.
You could save on premiums with Lemonade’s discounts for:
- Good credit
- Fire alarm
- Security system
- Proximity to police and/or fire department
Pros and Cons
Below, we’ll break down the benefits and the drawbacks of insuring your personal property with Lemonade.
- Affordability: On average, Lemonade’s policies are among the lowest priced anywhere, thanks to its innovative peer-to-peer and AI-focused approach.
- Flexible options: You can choose from a wide range of deductibles and coverage amounts.
- Additional coverage: You can easily build on your policy with Extra Coverage or the Zero Everything plan.
- Social impact: You can feel good about buying insurance from Lemonade as it donates hundreds of thousands in excess premium payments to nonprofits each year.
- App: You can file claims and get paid instantly, as well as easily manage your policy in the Lemonade app.
- Availability: Lemonade still hasn’t made its way to several states in the US, so you might not be able to get a policy.
- Customer service: Connecting with a person over the phone might be easier said than done as Lemonade’s preferred methods of communication are the website and app.
- Bundling: One downside of partnering with a company that doesn’t offer multiple lines of insurance is the lack of opportunity to bundle policies and save.
Alternatives to Lemonade Renters Insurance
Lemonade is a great choice for renters insurance, but you may want to consider other top-tier providers, too.
The best way to guarantee the lowest rates on homeowners or renters insurance is to shop around.
To compare a few more options, take a look at these alternatives to Lemonade:
Is Lemonade Renters Insurance for You?
Lemonade really is a refreshing addition to the insurance industry.
Everything from their advanced AI claims filing to their commitment to making a positive social impact with Giveback is praise-worthy.
Their coverage is equally sweet, with ample coverage choices and add-ons that allow you to customize your policy.
If you live in one of the states where Lemonade is in business, you won’t regret getting a quote from the cutting-edge provider.
Lemonade Renters Insurance
- Demotech: A
- BBB: A-