Lemonade’s gross revenue rises 90% as internet loss for 2024 narrows

Lemonade, a technology-driven insurance coverage firm providing house, tenants, pet and automobile protection, yielded its gross revenue at 90% year-on-year within the fourth quarter of 2024 and reached $ 64 million.

This displays a big enchancment in its monetary efficiency. Nonetheless, the corporate nonetheless reported a internet lack of $ 30 million for the quarter, though it was an enchancment in lack of $ 42.4 million within the fourth quarter of the earlier 12 months, powered by progress spending.

Lemonade’s underwriting precision and operational effectivity contributed to a big enchancment in its gross loss ratio, which dropped from 77% in This fall 2024 to 63% in This fall 2024.

The corporate’s general profitability metric confirmed vital enchancment. The web loss ratio dropped from 78% within the fourth quarter of 2023 to 62% in This fall 2024, reflecting the improved threat evaluation and claims administration. Gross revenue margin of the corporate expanded to 43percentover 12 months, whereas the adjusted gross revenue margin rose to 44percentfrom 31%.

It was the sixth consecutive quarter of successive enchancment within the gross loss ratio of twelve months (TTM), comparable to its lengthy -term objectives. Lemonade has credited its AI-powered underwriting mannequin, regulation charge approval and portfolio changes for attaining these outcomes.

The corporate doubled its progress funding in 2024, which rose from $ 55 million in 2023 to $ 122 million. Regardless of this, the administration of bills remained disciplined, with core working bills (exclusion of progress) with solely 2% 12 months after 12 months.

AI-powered methods for acquiring shoppers have helped keep a excessive return on funding, with the lemonade sustaining an LTV/CAC ratio above 3: 1 and a threefold CAC inner return charge (IRR).

Premium progress remained an necessary driver of Lemonade’s efficiency, with a premium in energy (IFP) reaching $ 944 million by the top of 2024, a 26% 12 months to 12 months enhance. Premium per consumer additionally rose from $ 369 in 2023 to $ 388 in 2024, which highlights the flexibility of the corporate to extend the worth of the shopper. The entire income has grown and reached $ 526.5 million for the complete 12 months.

Lemonade acknowledged the influence of the devastating wildfires in California in January 2025, which estimates about $ 45 million on gross losses and an influence of $ 20 million on adjusted ebitda. Nonetheless, the corporate emphasised that the monetary influence would have been 5 instances with out its diversified portfolio and underwriting changes.

For 2025, Lemonade expects continued progress, with IFP anticipated to quantity to between $ 938 million and $ 942 million. The corporate additionally predicts a adjusted ebitda lack of $ 160 million to $ 155 million for the complete 12 months.