Lemonade taps Bestow for life insurance offerings, expanding marketplace

Lemonade, which offers insurance for renters, homeowners, and pets, is tapping fellow insurtech Bestow on a life insurance product offering that will allow Lemonade customers to apply for instant life insurance coverage in minutes via Bestow’s Protect API.

Why should we care?
Lemonade, which went public last summer, is on a path to diversify revenue streams in a quest to become profitable. To do so, it’s expanding its partner ecosystem. The company crossed the 1 million customer milestone in December, outpacing incumbents who took decades to reach that figure. The company is able to keep costs down through an AI-driven experience that takes the pain out of a typically paper-heavy process. It operates through a reinsurance model, with 75 percent of the premiums collected going toward reinsurance contracts to cover losses. With life insurance through Bestow, Lemonade stands to gain a piece of a $733B market. Bestow, which entered into an agreement to acquire nationally-licensed life insurer Centurion last year, uses third-party data to determine eligibility and pricing in seconds, eliminating the need for a medical exam. Lemonade reached a $2B valuation in 2020, while Bestow, which has raised more than $100M in funding, operates as a full-stack life insurance carrier.