Lemonade: Delighting Insurance Customers with AI

Lemonade Inc. offers renters' insurance, homeowners' insurance, pet insurance and term life insurance in the United States as well as contents and liability policies in Germany, and the Netherlands, and renters insurance in France. The company is based in New York City.

Lemonade: Delighting Insurance Customers with AI

This case explores InsurTech start-up Lemonade's disruptive new business model aimed at creating and delivering a 'shockingly great user experience' around a 'lovable brand' - in an industry plagued by low customer satisfaction. The digital disruptor leverages principles of behavioural economics to address conflicts of interest and mistrust which prevail in the existing industry.

It uses digital technologies to automate, accelerate and manage an impressive amount of work - with few employees - thereby reducing customer effort and , increasing customer satisfaction to achieve cost-effective service excellence. The effortless experience is aggressively priced and relies on a flexible subscription-based pricing model.

Artificial intelligence (AI), data and machine learning are key in the race to achieving data parity with incumbents. The case culminates in Lemonade's filing for an initial public offering (IPO) and asks where growth should come from next: incremental improvements, further expansion across the United States, global expansion beyond Germany and the Netherlands, or from new types of property.