⚡ Quick Verdict
$1,380
Avg annual premium
A
Demotech (not AM Best)
10.09
NAIC complaint index
7 states
Auto availability
🚨 The Complaint Index Problem
Lemonade's NAIC complaint index is 10.09—meaning they receive 10 times more complaints than expected for a company their size.
USAA
0.51
Industry Avg
1.00
Lemonade
10.09
What this means: For every complaint USAA receives, Lemonade receives roughly 20. Common issues include poor customer service, unexpected rate increases, and claims denials.
Hype vs. Reality
🎯 The Marketing
- • "AI pays claims in seconds"
- • Sleek, modern app
- • B-Corp social mission
- • "Disrupting insurance"
- • Giveback program
📊 The Reality
- • 10x more complaints than expected
- • Limited to 7 states (auto)
- • No AM Best rating
- • Poor customer service reviews
- • Unexpected rate increases
How Lemonade Works
Pay-Per-Mile Model
Base monthly rate + per-mile charge. Good for low-mileage drivers, expensive for high-mileage.
AI Claims Processing
Lemonade claims ~40% of claims paid "instantly" by AI. Complex claims? That's where problems arise.
Giveback Program
Unused premiums donated to charities you choose. Nice concept, but doesn't help if your claim is denied.
⚠️ Very Limited Availability
Lemonade auto insurance is only available in 7 states:
Lemonade's renters and pet insurance are more widely available—but auto is very limited.
Who Might Consider Lemonade?
🤔 Maybe If You...
- • Drive very few miles
- • Live in an available state
- • Are very tech-comfortable
- • Have simple insurance needs
- • Value the social mission
❌ Avoid If You...
- • Value claims reliability
- • Drive significant miles
- • Have had claims issues before
- • Want established financial backing
- • Need customer service access
Our Verdict
Lemonade's sleek marketing can't hide the data: a 10.09 NAIC complaint index is alarming. That's 10x more complaints than expected. No AM Best rating, limited availability, and consistent reports of claims issues. The AI-driven model sounds innovative, but when things go wrong, customers struggle to get help. We can't recommend Lemonade auto insurance until they dramatically improve their complaint ratio.