author-profile
ByMaggie Overholt Contributor

Maggie is a former senior content strategist at Reviews. She’s covered everything from smart hubs and stand mixers to home insurance and mortgages.

Lemonade Homeowners Insurance Review

Lemonade is an all-digital, app-based homeowners insurance company geared toward younger homeowners and renters in urban areas. Unlike traditional insurance companies, Lemonade relies on AI to set rates and evaluate claims — it doesn’t operate any physical agencies. As a result, it’s able to offer exceptionally low rates and speedy claims payments for certain customers (coverage and rates vary widely from person to person).

Lemonade also adds an extra level of transparency to the insurance process by showing where every premium payment goes. The company takes a flat fee to cover operating costs, uses what’s necessary to pay claims, and donates anything leftover to charity.

Get the full story on how Lemonade insurance works here

Whether or not Lemonade is right for you depends on your coverage needs, location, and (of course) personal preference. It’s worth keeping in mind that while Lemonade makes home insurance exceedingly simple, it’s almost exclusively digital. Customers who prefer to talk through their insurance needs in person or over the phone won’t have that option.

The Claim

Lemonade Insurance is “fast, easy, and unconflicted, meaning no conflict of interest in paying claims,” says Yael Wissner-Levy, Lemonade’s VP of Communications. “[It] lets you support charities you love, simply through your insurance policy! You may just fall in love with your insurance company.”

Is it true?

There’s definitely a lot to love about Lemonade. No other insurer we’ve reviewed is as approachable or makes policy management so simple. Lemonade’s prices are also very competitive for many customers. These perks can be especially appealing to people buying home insurance for the first time, which is a big part of the reason why Lemonade is popular among apartment dwellers and young homeowners.

“Many landlords now require tenants to carry renters insurance, and Lemonade makes it quick and easy for tenants to sign up for a policy within minutes,” says Jennifer Okhovat, a Realtor at Compass in Los Angeles, California. Okhovat herself is a Lemonade policyholder and confirms that she’s been “very pleased” with her rates and coverage.

However, one company is never best for everyone. Depending on location, age, and value of your home, Lemonade may end up being more expensive than other popular companies. Its coverage is also a bit less customizable, with many coverage levels coming preset and fewer endorsements available as you might see from a big-name insurer.

The other potential drawback is Lemonade’s lack of human customer support. “One thing that can be frustrating is not having a ‘live representative’ or a phone number to call into,” says Okhovat. But she adds, “So far, I have not had that issue. I love the responsiveness of the app and the pricing that I am offered. It's all a personal preference.”

Product Overview

  • In business since: 2016
  • Financial strength rating: NR (not rated)
  • B-corp certified: Transparent, accountable, socially and environmentally sound
  • Policy types: Homeowners, renters, condo, and co-op insurance
  • Pros: User-friendly, generally affordable, donates unused premiums
  • Cons: Not available everywhere, coverage upgrades are limited

Features

Lemonade homeowners insurance
Lemonade renters insurance
Lemonade condo insurance
Lemonade co-op insurance
Cost
Starting at $25/mo.
Starting at $5/mo.
Starting at $25/mo.
Starting at $25/mo.
States available
AZ, CA, CO, CT, DC, GA, IA, IL, IN, MD, MI, NJ, NV, NY, OH, OK, OR, PA, TN, TX, VA, WI
AR, AZ, CA, CO, CT, DC, GA, IA, IL, IN, MD, MI, NJ, NM, NV, NY, OH, OK, OR, PA, RI, TN, TX, VA, WI
AZ, CA, CO, CT, DC, GA, IA, IL, IN, MD, MI, NJ, NV, NY, OH, OK, OR, PA, RI, TN, TX, VA, WI
AZ, CA, CO, CT, DC, GA, IA, IL, IN, MD, MI, NJ, NV, NY, OH, OK, OR, PA, RI, TN, TX, VA, WI
Learn what Lemonade insurance covers (and what it doesn't)

What Lemonade Insurance Covers

  • Theft and vandalism
  • Fire and smoke damage
  • Burst pipes or leaky appliances
  • Injured guests on your property
  • Alternate lodging during repairs
  • Other (coverage can vary by location)

What Lemonade Insurance Doesn’t Cover

  • Water damage caused by flooding
  • Lost or broken belongings
  • Broken appliances or power failures
  • Libel, slander, or identity theft
  • Foreseeable or intentional damages
  • Animal or pest infestations
  • Other (coverage can vary by location)

You Can Buy Extra Coverage From Lemonade For

  • Valuable belongings and electronics
  • Hail, snow, wind, and heavy rain
  • Earthquakes
  • Water backup
  • Other (coverage can vary by location)

User-friendly insurance interface

Researching and buying insurance with Lemonade is ultra-simple. It handles all quotes and applications online, without ever putting you on the phone with an agent, which means you can get covered in just a few minutes. “Order a cup of coffee, start the Lemonade process, and by the time your coffee is ready, you’re insured,” says Wissner-Levy. Lemonade also eschews the traditional, often-confusing insurance lingo in favor of direct language shoppers can readily understand. This makes it easier to learn what your policy does and doesn’t cover and what you might want extra protection for.

Generally affordable

When asked about the benefits of insuring with Lemonade, Hamill says that “Lemonade insurance is inexpensive. Renters insurance starts at $5 per month, while homeowners policies start at $25 per month.” $25 per month comes out to $300 per year for homeowners insurance. By contrast, the average rate for home insurance in the U.S. is just over $1,100, according to the National Association of Insurance Commissioners. Remember that prices vary a lot by customer — but if Lemonade’s other perks appeal to you, it’s worth getting a quote to see whether this company could help you save.

Donates unused premiums

One of the key differences between Lemonade and other insurers is its Giveback program. Giveback donates leftover premiums — the amount not used for overhead costs or claims — to a charity of the policyholder’s choice. This gives customers clarity about where their payments are going and also eliminates any incentive for Lemonade not to pay out on home insurance claims. In theory, this means that the claims process will be faster and less frictional that it might be with another company.

Potential drawbacks

Not available everywhere

Lemonade is currently only available in select states. However, it’s expanding rapidly with plans to cover more states within the year. You can track Lemonade's availability here.

Coverage upgrades limited

Lemonade’s coverage is a little less flexible than that of many big-name insurance companies. There are not a ton of add-on coverage options; for example, earthquake insurance is limited to two states, and we didn’t see add-ons for things like green home rebuilding materials.

“If I were buying insurance, I would take a close look at the coverage limits,” says Virginia Hamill, Senior Insurance Analyst at FitSmallBusiness.com. “The quote I received included $100,000 for personal liability … A lawsuit could go through that pretty quickly, so it might not be enough coverage in some situations."

Be sure to carefully review Lemonade’s policy options against your coverage needs and make sure it offers enough protection for you before buying.

The Competition

  Lemonade Hippo State Farm Geico
Our review Our review
A.M. Best financial strength rating
N/A A- A++ A++
Customer complaints*
Fewer complaints than average More complaints than average* Fewer complaints than average Fewer complaints than average
24/7 claims support
Get a quote Get a quote Get a quote Get a quote

*Customer complaints recorded by the NAIC and weighted according to companies’ market share. Two of Hippo’s three underwriting companies have more customer complaints than the national median.

Lemonade vs. Hippo

Lemonade and Hippo are both bent on modernizing homeowners insurance, but they’re taking different approaches. Lemonade focuses on mobile tech to facilitate shopping, claims, and service, while Hippo specializes in smart tech as a way to prevent claims.

Most Hippo insurance policies come with a free smart sensor kit, meant to help homeowners identify and fix issues like leaks and break-ins before they ever become cause for a claim. Hippo’s coverage is also a little more tech-friendly, with specialized protection for things like home office equipment, appliances, electronics, and smart home upgrades.

Service-wise, Lemonade is digital-first, while Hippo relies on good-old-fashioned customer support. Instead of handling claims through an app, like Lemonade, Hippo uses the traditional method of assigning a human insurance professional to each case. Your preference for digital versus in-person interaction might help determine which of these companies is a better choice for you.

Note that Hippo only offers homeowners and condo insurance. Lemonade rounds out offerings with renters and co-op insurance, making it a little more widely available. Both companies currently operate in select states, so be sure to check Lemonade’s availability and Hippo’s availability before settling on either one. As always, it’s also smart to compare quotes and see which company offers better value on the coverage you need.

Lemonade vs. State Farm

If you’re looking for a more “established” homeowners insurance company than Lemonade, State Farm is a good place to start. State Farm is the biggest homeowners insurance company in the U.S., covering almost one-fifth of the nation’s homeowners. It also has a rock-solid financial rating (A++) from leading industry analyst A.M. Best.

As for claims handling, State Farm’s claims satisfaction score is only “average,” according to J.D. Power’s customer survey. Lemonade has not yet been rated by J.D. Power respondents, though it has almost no customer complaints filed with state insurance commissioners, which is unusual.

Lemonade might be a cheaper insurance option than State Farm for some homeowners and renters. However, State Farm has the advantage of being available nationwide, and it offers hands-on customer service at local agencies for customers who prefer face-to-face interaction.

Lemonade vs. Geico

Geico, like Lemonade, is known for being affordable. Customers who already insure their car through Geico might be able to get steep price cuts through bundling. However, there’s one big caveat: Geico doesn’t actually sell its own homeowners insurance. Instead, it repackages and sells policies underwritten by other insurers, like Travelers and Liberty Mutual. That means coverage options and discounts can vary widely for Geico customers.

Both Geico and Lemonade are digital-friendly. Although Geico doesn’t operate exclusively online or through apps, like Lemonade, it did earn the highest score in J.D. Power’s 2019 Digital Insurance Experience Study. That might make it a good compromise for customers who want a mobile-first experience but feel wary of a newfangled insurer like Lemonade.

Lemonade Homeowners Insurance FAQ

Is Lemonade insurance legit?

Lemonade looks and feels different than a normal insurance company, but rest assured that it’s legit. Lemonade offers the same basic homeowners and renters coverage as any big-name insurer. It can be relied on to pay claims, with a peer-to-peer model that offers strong financial backing. And if that should ever fail, Lemonade is reinsured by some of the industry’s biggest financial players to offer policyholders extra peace of mind. Check out Lemonade’s coverage yourself and get a quote to see whether this company is right for you.

What is peer-to-peer insurance?

Lemonade operates on a “peer-to-peer” (P2P) insurance model. Instead of the insurance company acting as an intermediary — collecting premiums for profit and paying out when necessary — Lemonade essentially lets homeowners insure one another. Premiums are pooled, with Lemonade taking about 20% off the top for operating costs. The rest of the pool pays for claims, and what’s leftover goes to a charity of the policyholder’s choosing.

There are a number of benefits to the P2P insurance model. The biggest is that Lemonade does not collect unpaid premiums as profit. Because it has a flat fee for operating costs, there’s no incentive not to pay claims. That means policyholders might have claims paid out quicker and more easily with Lemonade than with another insurer. There’s also the benefit of knowing that your unpaid premiums go toward a cause you care about.

Does Lemonade insurance have a phone number?

Lemonade does not have a customer support phone number. Instead, it handles all customer communications through its mobile app or email. “If you don’t mind going back and forth with your insurance company via email, and having everything accessible to you in a phone application, Lemonade a great solution for insurance,” says Jennifer Okhovat, a Los Angeles realtor. If digital communication isn’t your cup of tea, then Lemonade might not be your best bet.

Can you get Lemonade insurance without a smartphone?

You need to have a smartphone to use Lemonade insurance. Although customers can get a quote and purchase their policy online, claims can only be filed through the Lemonade mobile app. Policyholders also need the Lemonade app to select their preferred Giveback cause.

Can you cancel Lemonade insurance?

You can cancel your Lemonade homeowners or renters insurance at any time. If you cancel, the company will refund any unused premiums you’ve paid. Customers who want to cancel their Lemonade policy can do so through the company’s app.

Is Lemonade reinsured?

Lemonade is backed by a number of large reinsurance companies, which basically means it has insurer insurance — a second level of financial protection guaranteeing that the company will be able to make good on claims, no matter what. Lemonade’s backers include Berkshire Hathaway, the company that owns Geico, and Lloyd’s of London, a centuries-old insurance marketplace designed to share and mitigate risk among insurance companies.

The Bottom Line

Lemonade is a great choice if you have basic home insurance needs and prefer digital interaction — and if the company offers you a competitive rate. Prices vary depending on your home, location, and assets, so Lemonade won’t be the most affordable choice for everyone. Compare rates from a few different insurers to find the best value on the coverage you need.

You might also like