While Allstate’s CEO Tom Wilson named GEICO and Progressive when asked a
bout the ability to grow auto insurance in 2025 as competitors do the same, no one on Allstate or Progressive’s earning calls addressed competition from Lemonade.
This article is one of a four-part series about personal lines insurer strategies fo
r growth in 2025.
Additional articles in the series are:
Data Insight: Who’s Growing in Personal Lines?
Progressive: Policie
s Grow Faster Than Workforce
Allstate: How Can You Save on
Auto Insurance?
The insurtech recently announced the launch of Lemonade Car in the state of Colorado. At the same time, the company announced a significant milestone in its history—surpassi
ng $1 billion in in force premiums across all lines. In force premium is a measure of annualized premiums that the insurtech tracks on a regular basis. During a fourth-quarter earning
s conference call in late February, Lemonade executives guided toward $1.2 billion of in force premiums by year-end 2025, or a 28% jump over last year.
Related: Lemonade CEO Declares ‘Best Quarter Ever,’ Posts Narrowed Q4 Loss of $30M
Lemonade Car will play a key role in the company’s accelerating growth
plan, which will explode the level of in force premiums to $10 billion within roughly the same time frame it took Lemonade to get to $1 billion, executives said an Investor Day event in Novembe
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r last year. They also noted that car insurance would represent 40%—$4 billion of the $10 billion total premiums—when they get there by 2035.
“We reached this [$1 billion] milestone 8.5 years after launch (<10 years from founding). For context: incumbents like Allstate, Farmers, GEICO, Liberty Mutual, Progressive,
the equivalent figure (inflation adjusted),” wrote Lemonade Chief Executive
Officer Daniel Schreiber in a LinkedIn post, celebrating Lemonade’s entrance to the “Tres Comma Club.”
Ambitiously, the post refers to the possibility that Lemonade Car will someday help drive the company toward “Cuatro Commas.”
For now, however, Lemonade’s launch of car insurance in Colorado brings Lemonade’s availability to roughly 40% of the U.S. car ins
urance market. “Coloradans spend about $7 billion on car insurance annually, with Lemonade’s existing Colorado customers spendin
g hundreds of millions a year on car insurance, making the state a promising market for Lemonade Car,” the announcement said.
Still, hundreds of millions are a fraction of a U.S. market where Progressive and GEICO wrote $60.9 billion and $42.9 billion in net premiums across the nation last year. And while Lemonade executives used part of its Investor Day and fourth-quarter earnings calls to express their attraction 10X-ing the overall business, they also stressed the need for restraint on auto insurance as they move ahead.
“We’ve seen a tremendous amount of pent-up demand for our car product,” Schreiber said during a February earnings conference call, responding to an analyst who wanted to know more how Lemonade is responding to 700,000 customers the company previously said were on a waitlist for Lemonade Car insurance.
