28 Apr, 2021 Lemonade well-positioned to capitalize on motor insurance post-COVID-19 with its digital and value-first approach, says GlobalDataPosted in Insurance
Lemonade’s digital and value-first approach is well-suited to the post-pandemic world and provides an opportunity for the insurer to capitalize on the motor industry, says GlobalData, a leading data and analytics company.
GlobalData’s UK Insurance Consumer Survey found that a more flexible and digital motor insurance policy, like the one that Lemonade is likely to offer, is even more relevant in the wake of the pandemic. Over two thirds (69.4%) of respondents said they would drive less miles annually as a result of COVID-19. Consumers will benefit from the type of pay-per-mile insurance that the likes of By Miles and Metromile offer, and value and flexibility will become essential.
Ben Carey-Evans, Insurance Analyst at GlobalData, comments: “The US market is relatively competitive for digital and telematics-based motor insurance. Recent years have seen companies such as Root and Metromile receive vast amounts of funding in this area, making them both insurtech unicorns. However, the US motor market was worth $35,816m in GWP in 2020, according to GlobalData, meaning this represents a substantial opportunity for Lemonade.”
GlobalData’s consumer survey also highlighted that only 7% of UK consumers had heard of Lemonade. This is not an issue at present, as it is launching in the US, but it has made its intentions to move into Europe very clear over the last couple of years (it sells household insurance in Germany, France and the Netherlands). Brand awareness will be key as it looks to challenge established players in the market. However, significant backing makes that an obstacle it can overcome with marketing and its digital expertise should prove popular.
Carey-Evans adds: “Lemonade will be bringing a wide range of digital expertise and very strong customer service skills to the market. The launch of Lemonade Car is at early stages and although it hasn’t released a lot of detail yet, it has promised to provide instant claims and value, while also focusing on electric vehicles. It looks like a strong up-selling opportunity for Lemonade, a company that primarily sells quick and digital household policies to its customers.”