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Originally Published: Apr 11, 2022
Editor:
Originally Published: Apr 11, 2022 Last Updated: Apr 25, 2022 11 min read
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If you’re looking for homeowners insurance that emphasizes simplicity in language and process, consider Lemonade, our pick for the best online homeowners insurance company. Lemonade offers a completely digital experience, allowing you to purchase coverage through its site and even submit claims through its app.

Lemonade Homeowners Insurance

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Pros

Unusually fast quotes and claim payments

You can get a quote online in minutes from Lemonade and, if you need to submit a claim, can receive reimbursement quickly. According to the company, its goal is to pay the majority of simple property claims nearly instantly.

Unused claims money is paid to a non-profit of your choice

Lemonade has a unique business model. It takes a flat fee for its services, but a large part of the remaining money it collects and does not disperse through claims it directs to a Giveback program. That initiative donates up to 40% of unused claim money to charities chosen by Lemonade customers.

Cons

Not available in all states

Lemonade homeowners insurance is available in only about half of states. As of February 2022, it sells policies in Arizona, California, Colorado, Connecticut, District of Columbia, Georgia, Illinois, Indiana, Iowa, Maryland, Massachusetts, Michigan, Missouri, Nevada, New Jersey, New York, Ohio, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Virginia, and Wisconsin.

More dog breeds excluded

Although many homeowners insurance companies exclude certain breeds from coverage, Lemonade includes some names not always seen on insurers’ lists, such as Akitas, Alaskan Malamutes, Great Danes, Siberian Huskies and all wolf-hybrids.

Claims process requires video submissions

Lemonade’s claims process works differently than other companies. Instead of talking to an agent or submitting a written statement, Lemonade asks you to submit a short video. Some people may find this step cumbersome or intrusive, but the company says it helps them process claims quickly.

Pros
  • Unusually fast quotes and claim payments
  • Extra coverage options available
  • Donations through the Giveback program
Cons
  • Not available in all states
  • Personal liability coverage excludes some dog breeds
  • Claims process requires video submissions

Lemonade Homeowners Insurance

Lemonade sells homeowners insurance in select states. Its policies provide the following coverage:

  • Dwelling: Dwelling coverage protects your actual home, meaning its structure and roof.
  • Other Structure: Other structure coverage is for fences, sheds, gazebos and driveway damage.
  • Personal Property: Personal property insurance pays for the replacement of your stuff, such as your electronics or furniture.
  • Loss of Use: If your house is damaged in a hurricane or fire and isn’t livable, loss of use coverage can cover your expenses to stay in a hotel or make other arrangements.
  • Liability: Liability insurance provides protection in case someone is injured on your property.
  • Medical Payments: Medical payment coverage will pay for medical bills that you incur if your guests are injured at your home.

Lemonade uses your home information to set your coverage minimums and maximums, and you can adjust your coverage amount within that given range.

You can choose a deductible that matches your needs; Lemonade’s deductibles range from $500 to $10,000.

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Additional coverage available

You can get additional coverage for items like fine art, jewelry, watches, cameras and musical instruments. To purchase coverage, you must submit pictures of each item, as well as a receipt or appraisal.

Extra coverage protects against accidental loss, damage or theft. Unlike your standard Lemonade policy, extra coverage doesn’t have a deductible. You can purchase additional coverage through Lemonade’s app.

Limitations

Lemonade only provides earthquake coverage as an add-on option to residents of California. If you live outside that state, you can’t add earthquake coverage to your policy.

Lemonade doesn’t offer flood insurance, even as an add-on, so your home and your personal possessions aren’t covered if they’re damaged by a flood.

Credentials

Lemonade is a publicly-traded company on the New York Stock Exchange (ticker symbol LMND). It underwrites its homeowner's policies itself, so your policy will be issued by Lemonade Insurance Company rather than a third-party insurer.

Lemonade is a relatively young company; it was launched in 2016, and its license initially only covered 20 million people. Today, the company’s licenses cover approximately 825 million.

In 2020, Lemonade collected $201 million in homeowners insurance premiums, approximately 0.18% of the U.S. market.

Financial stability

As a homeowner, you want to protect the house you intend to live in for years to come, so you want to know that the insurance company you choose will be around for the long haul. You can find out whether a company is likely to survive economic fluctuations by reviewing its financial stability ratings released by the major credit agencies, such as AM Best and Demotech.

Lemonade isn’t evaluated by AM Best, but it is rated by Demotech, a financial analysis firm that releases its own Financial Stability Ratings (FSRs).

In 2021, Demotech affirmed Lemonade’s “A” (Exceptional) rating. An A rating indicated that Demotech believes that the insurer will have a positive surplus regarding policyholders regardless of market conditions or downturns.

Third-party ratings

In the 2021 J.D. Power U.S. Homeowner Insurance Study, Lemonade wasn’t ranked. The study evaluated and ranked 21 top homeowners insurance companies.

As part of the study, J.D. Power also rated companies that offer renter’s insurance. In that category, Lemonade was the top-ranked company for customer satisfaction.

Regulatory actions

Although Lemonade isn’t currently facing any regulatory action, it is dealing with a class-action lawsuit.

In August 2021, a lawsuit was filed over the insurer’s alleged collection and use of biometric data. As of December 2021, the lawsuit was stayed as both parties discussed a settlement.

Cost of Lemonade Homeowners Insurance

It’s essential to shop around and get personalized quotes for homeowners insurance as the pricing is dependent on many factors that are specific to you and your house. Things like your credit score, home’s value, location, the material used to build the home, when the roof was replaced, whether you have deadbolt locks and the availability of sprinkler systems can affect your premiums.

As a benchmark, the National Association of Insurance Commissioners reported that the average homeowners policy costs $1,396 per year, or $116 per month.

With Lemonade, we requested a quote for a sample property in Philadelphia, Pennsylvania with the following coverages and a $2,500 deductible:

  • $450,000 in reconstruction costs
  • $45,000 in other structures
  • $245,000 in personal property
  • $300,000 in personal liability
  • $135,000 in loss of use
  • $5,000 in medical payments

With a protective device discount for the home’s alarm system, the premium Lemonade quoted us was $154 per month, or $1,848 per year.

Accessibility

Unlike traditional insurance companies, Lemonade doesn’t work with insurance agents. Instead, you can purchase insurance entirely online, and you can even submit claims and get reimbursed without ever speaking to a person.

Customer service is available to help you via phone or email. Lemonade also has a sophisticated AI chat bot to answer questions and help you navigate the claims process.

Contact information

Contact customer support by calling 844-733-8666 Monday through Friday from 9:00 a.m. until 8:00 p.m. ET. Customer service can also be reached via email at help@lemonade.com.

User experience

Lemonade provides an entirely digital experience for customers. You can get quotes, purchase coverage, change your policy and submit claims through the company’s app. You will need a smartphone with video capability to use the app and submit claims.

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Customer Satisfaction

In general, Lemonade has a good reputation for customer service for its homeowners insurance segment, though reviews for other aspects of its business are less positive.

Customer reviews

Lemonade has strong customer reviews on some platforms. It had an “excellent” rating on TrustPilot, with a TrustScore of 4.3 out of five based on approximately 275 reviews. Positive Lemonade homeowners insurance reviews praised the rapid claims processing and easy application process.

Complaint index

When researching companies, checking an insurer’s complaint ratio with the National Association of Insurance Commissioners (NAIC) can give you an idea of how the company handles customer service. The complaint ratios reflect the number of complaints that customers submitted about a particular company relative to its share of the market.

Lemonade’s complaint ratio for its homeowners insurance segment was 0.88 in 2020, which is better than the industry standard of 1.0. In 2019, it was 2.75, so Lemonade significantly improved between 2019 and 2020.

In 2019, the majority of claims were about how claims were handled. However, Lemonade grew substantially as a company between 2019 and 2020, and it seems to have reduced the number of customer complaints.

Lemonade Homeowners Insurance FAQ
Is Lemonade a legit company?
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Although Lemonade is a young company, it's a legitimate insurer. It collected over $200 million in homeowners insurance premiums in 2020, and it's a publicly-traded company. You can view its financial statements and annual reports on its website.
How fast does Lemonade pay claims?
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In simple property claims, Lemonade says it aims to pay them almost instantly. You can submit a claim via the app and receive reimbursement within minutes. More complicated claims may require additional review.
What does Lemonade homeowners insurance not cover?
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Lemonade does not offer flood insurance, and it only offers earthquake coverage in California.

How We Evaluated Lemonade Homeowners Insurance

To evaluate Lemonade and other homeowners insurance companies, we looked at the following factors:

  • Availability
  • Coverage options
  • Optional coverage
  • Policy exclusions
  • Cost
  • Third-party ratings
  • Financial stability
  • Customer service

Summary of Money’s Lemonade Homeowners Insurance Review

Homeowners insurance is an essential form of protection. If you don’t want to go through the handle of purchasing a traditional policy through an agent, Lemonade offers a digital experience where you can buy coverage and submit claims online.

Lemonade offers comprehensive homeowners insurance, but it’s not available in all states, and it doesn’t provide flood insurance. If you live in a state where Lemonade isn’t licensed or live in an area prone to floods, you’ll have to get coverage from another company.

If you’re shopping for homeowners insurance, check out our picks for the best homeowners insurance companies of 2022.