Lemonade, the insurance company that uses artificial intelligence and behavioral economics, plans to add auto insurance to its current renters, homeowners, pets and life insurance offerings in the United States .
The insurtech has announced that it is preparing what it calls Lemonade Car for a launch in the year. He invites customers to register early.
This is the company’s third expansion into a major new insurance category in less than 12 months. The company started with products for homeowners, adding pet insurance in the second half of 2020 and term life insurance in the first half of 2021.
Last July, Lemonade launched insurtech’s first major IPO, raise over $ 300 million.
The switch to auto insurance was expected. Announcing his life insurance agency last fall, CEO Daniel Schreiber acknowledged that analysts regularly asked her when she would sell a car and hinted that she would arrive.
The company plans to offer customers the option of bundling their home, pet and life insurance policies with their auto insurance.
The U.S. auto insurance industry is estimated to be around $ 300 billion, or 70 times the size of the renters and pet insurance markets. Lemonade said that a “vast majority” of its existing customers are car owners, and they already spend around $ 1 billion on auto insurance each year.
Shai Wininger, COO and co-founder of Lemonade, said Lemonade Car “will use technology to handle emergencies and resolve claims quickly, offer favorable prices for safe drivers and be particularly attractive to drivers” of electric vehicles.
Lemonade has defended the use of artificial intelligence in insurance against claims that it may be unfairly biased against gender, racial and ethnic minorities. Schreiber argued last year that “Algorithms We Can’t Understand May Make Insurance Fairer” in a blog post titled “AI can overcome prejudiceAnd developed his views in comment reposted by Carrier Management.
According to Schreiber, everyone wants to be assessed as an individual, not based on racial, gender or religious markers. “If AI treats us that way, as humans, then it’s fair. If I’m being charged more for my habit of lighting candles, that’s as it should be… ”he wrote.
Lemonade currently operates as a carrier in the United States and Germany, the Netherlands and France.
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