Lemonade Car Insurance Review
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Want to drive legally in the United States? In every state except for New Hampshire, you’ll need at least basic personal liability car insurance. And you shouldn’t consider this to be a burden: Car insurance can offer you needed financial protection if you total your car in an accident or wreck another driver’s vehicle. Auto insurance will pay out, too, if you are sued by someone you injure in an accident or if you destroy someone else’s property.
Just think of the financial hit you might take if you had to cover expensive auto repairs or medical bills on your own. The monthly premium that comes with auto insurance doesn’t seem too much of a burden when you consider the hit to your savings that a major car accident can inflict.
This is especially true when you have lower-cost auto insurance options such as those provided by online insurance company Lemonade.
Lemonade offers a range of auto insurance policies to fit the needs of most drivers. The only downside? Lemonade only offers auto insurance in seven states: Arizona, Illinois, Ohio, Oregon, Tennessee, Texas and Washington. Our Lemonade insurance review will help you understand the ins and outs of the company.
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What is Lemonade auto insurance?
Lemonade car insurance works like the auto insurance offered by other insurance providers: Policyholders pay a monthly premium to keep your car insurance active. Say you get into an accident or a tree falls on your parked vehicle. Your auto insurance will help cover the costs of repairing it.
If your car is stolen, your auto policy, depending on the coverage you selected, will send you a check for an agreed-upon depreciated value of your car. If you're in an accident with an uninsured driver, your policy will pay out to cover the damage that this driver caused.
Car insurance, then, is an important financial safety net for drivers. Covering these costs on your own without the protection of insurance could drain your savings or add thousands of dollars of debt to your credit card.
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Coverage offered by Lemonade
Lemonade provides several types of coverage. This includes:
Collision coverage
This coverage pays out if you get into an accident that damages your car, usually if the accident is caused by you. If the accident is caused by the other driver, that motorist's collision insurance typically pays for the damages caused to your vehicle.
Comprehensive coverage
Comprehensive insurance covers damage from events that you can't control. This includes trees falling on your car, hail damaging your car, a vandal intentionally scratching the side of your vehicle or a fire destroying your auto. Comprehensive coverage also pays out if someone steals your car. How much it pays out in this situation depends on your policy. Most car insurance policies will pay for an agreed-upon depreciation amount, meaning that you won't get what you paid initially for your vehicle but something closer to what it is worth today.
Liability coverage
Liability coverage, which is required in every state except New Hampshire, pays out if you cause an accident that results in property damage or bodily injury to someone else. If someone sues you after an accident because you, say, destroyed a fence or caused serious injuries, liability coverage would help pay for your legal costs and whatever a court orders you to pay.
Temporary transportation coverage
This coverage reimburses you for the cost of renting a car or taking an Uber, Lyft or other rideshare if your car is not available to drive.
Extended glass and windshield coverage
This will pay for the costs you incur when hiring a company to repair or replace your car's windshield following an accident or act of vandalism. If you caused the accident or your car was targeted by a vandal, you'd need comprehensive coverage, not just collision coverage, to receive this benefit.
Uninsured/underinsured driver coverage
This pays out if you are in an accident caused by a driver who does not have car insurance. It also pays out if the driver doesn't have enough insurance coverage to cover the damages that they caused. It's important to note that Lemonade car insurance does not cover everything. It won't pay out for normal wear and tear on your car, damage caused by freezing temperatures, damage that you cause intentionally, damage to items inside your car – that will usually be covered by your homeowners’ insurance or renters’ insurance policy -- and accidents that happen when you are using your car for ridesharing.
Don’t forget the deductible
Many of these coverages charge a deductible. This is the amount you'll have to pay before your car insurance covers the rest of your claim. Say you slide on the ice and smash into another car. You file claims for $2,500 in damages to your car and $1,500 in damages to the other driver's vehicle. But you also have a deductible of $250. This means that you'll have to pay $250 while Lemonade will cover the remaining $3,750 of your claim.
Deductibles can vary, and you can choose the amount. The higher your deductible, the lower your monthly car insurance premium will be.
How does Lemonade auto insurance work?
Like many car insurance companies today, Lemonade relies on telematics when determining how much to charge you each month for your coverage. Depending on your policy, you’ll either receive a plug-in device or software that you download to your phone. Lemonade can then track your driving, with your permission, monitoring your speed, braking activity and how many miles you drive. If you log fewer miles and you consistently drive at a safe speed, Lemonade says it will reward you with a lower monthly premium.
Your Lemonade Car policy covers all the drivers and cars listed on it. Lemonade says that you can add up to seven drivers on your policy. You should include your spouse or partner in your policy and any licensed or permitted children in the household who are under 19.
Getting insurance quotes with Lemonade car insurance is easy. First, visit Lemonade’s auto insurance site here. Click the big “CHECK OUR PRICES” box.
That will bring up this screen:
Once here, enter your name and click "NEXT." You’ll then see this page:
Fill in your address and click "NEXT." That brings you to this page:
You’ll have to install the Lemonade app on your phone to purchase Lemonade car insurance. On this page, Lemonade asks you to agree to this. Click the “I’m in, let’s continue” button if you’re OK with this.
Lemonade will then identify how many cars and drivers you want to insure, bringing up a page that might look like this:
If you are happy with what Lemonade finds, click “NEXT.”
That brings up this page, in which Lemonade asks who you want to insure:
Once you’ve selected the drivers to insure, click “NEXT.”
That brings up this page:
I selected “Paid in Full,” which brought up this page:
Here, I clicked “NO.” Lemonade will then ask you a series of questions, including whether you’ve had any traffic accidents or violations in the last five years or if you are married.
Lemonade will also ask you whether your car is registered in the state in which you live. After you answer these questions, Lemonade will ask how much coverage you want and request that you choose your deductible before giving you a quote for your monthly auto insurance premium.
How much does Lemonade car insurance cost?
It’s not easy to calculate an average monthly premium for Lemonade auto insurance. That’s because your policy’s premium will vary depending on several factors, including your age, driving record, type of car, how much you drive and how much and what type of coverage you select.
Where you live plays an important role, too, in determining how much you’ll pay for auto insurance. Your auto insurance premium can even rise or fall depending on the strength of your credit.
Lemonade, citing data from ValuePenguin.com, says that the national average cost of car insurance in 2024 is about $693 or a year or $58 a month. You can take several steps to lower your monthly premium, though. You’ll pay less if you drive fewer miles and you boast a clean driving record free of accidents and speeding tickets.
You can cause your premium to rise or fall, too, by tweaking your deductible, the amount you pay out of pocket when filing a claim. With Lemonade, you can choose a deductible from $250 to $2,000. The higher your deductible, the lower your premium will be. Just make sure that you can afford to pay that deductible if you get into an accident, your car is damaged or you injure someone else in an accident.
Lemonade offers bundle discounts to customers who bundle their car insurance with other Lemonade policies such as renters', homeowners; or pet insurance. Depending on your state, you might even receive a discount if you buy an electric vehicle or hybrid vehicle.
Lemonade calculates its car policies in Arizona, Washington and Oregon on a monthly basis, with your monthly premium price determined largely by how much you drive. Lemonade charges a low price, usually a few cents, for each mile you drive and then adds this amount to your policy's base price to calculate your monthly total.
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Features of Lemonade car insurance
Medical payments coverage/Personal injury protection
Medical payments coverage, also known as MedPay, and personal injury protection, or PIP, can help cover the costs of any medical expenses you incur during a covered car accident. This includes ambulance fees, doctor visits, trips to the hospital and health insurance co-pays.
PIP differs from MedPay in that it can also cover a percentage of your lost wages, public transportation to and from medical appointments and the costs of essential services that you can't perform while you recover from your injuries.
You can get rewarded for your safe driving habits: When you take out a Lemonade car insurance policy, you’ll be required to install the Lemonade app on your phone. Depending on your policy, Lemonde will track your driving habits either with sensors in your phone or though a small plug-in device. If Lemonade detects that you are a safe driver – you don’t speed and you’re not constantly slamming on your brakes – you’ll be rewarded with lower premiums. If you drive fewer miles, too, your policy price might fall.
You can cancel at any time
You can cancel your Lemonade car insurance policy at any time without facing any penalties. You can cancel instantly through the Lemonade app. You’ll receive a refund for the coverage you’ve already paid for if you cancel before your monthly due date.
You can tweak your policy’s coverages and limits
You can add coverages and boost your coverage limits through Lemonade’s app. You don’t have to cancel your existing policy and take out a new one to change these coverages.
Pros and cons of Lemonade auto insurance
Pros
- Lemonade provides a variety of coverages, including collision, comprehensive and personal liability.
- You can customize your policy by adding such coverages as medical payments coverage, personal injury protection and extended glass and windshield coverage.
- You can lower your premiums if you boast a safe driving record, drive fewer miles and bundle a Lemonade car insurance policy with one of the company’s other insurance products.
Cons
- Lemonade only offers auto insurance in seven states: Arizona, Illinois, Ohio, Oregon, Tennessee, Texas and Washington.
- You must allow Lemonade to track your driving if you want discounts for safe driving habits
- You must download the Lemonade app to take out a car insurance policy.
Who is Lemonade car insurance best for?
- Safe drivers. Relying on either sensors in your phone or a plug-in device, Lemonade can monitor your driving to chart how many miles you log in an average month and whether you practice safe driving habits. You might then receive a discount based on how safe of a driver you are.
- Those who bundle. If you take out more than one type of Lemonade insurance, including car, renters’ or pet insurance, you’ll receive a discount on your policies.
- Those who want complete coverage. You can choose from several coverage levels with a Lemonade policy. The company offers collision, comprehensive and personal liability coverage. It also offers coverage that protects you if you get into an accident with an uninsured or underinsured driver and coverage that helps cover the cost of replacing or repairing your car’s windows and windshield.
- Those who like flexibility. You can tweak the size of your deductible, your coverages or your coverage limits to cause your monthly premium to rise or fall.
Who shouldn’t use Lemonade car insurance?
- Those who don’t live in a handful of states. The biggest negative of Lemonade car insurance is that it is offered in so few states. This insurance is only available to drivers in the states of Arizona, Illinois, Ohio, Oregon, Tennessee, Texas and Washington.
- Those who value their privacy. If you want the deepest discounts, you’ll need to give Lemonade permission to track your driving habits through your phone or a plug-in device. If you don’t want your insurer monitoring your driving, you might need to consider a different provider.
- You want that in-person touch. Lemonade’s car insurance program is run mostly online and through its app. If you prefer meeting with insurance agents to discuss your coverage needs, Lemonade might not be the right fit.
Lemonade vs. competitors
Insurer | Coverages offered | Additional coverages available | Where available? |
Lemonade | Comprehensive, collision, liability, underinsured/uninsured driver protection | Temporary transportation, windshield repair, medical payments coverage, personal injury protection | Lemonade car insurance is only available in seven states. |
Geico | Comprehensive, collision, uninsured motorist coverage, property damage coverage | Roadside assistance, mechanical breakdown insurance, rental reimbursement | All 50 states and the District of Columbia |
Progressive | Liability, comprehensive, collision, uninsured/underinsured motorist protection | Roadside assistance, medical payments, personal injury protection, loan/lease payoff, rental car reimbursement | All 50 states and h District of Columbia |
Geico car insurance
Unlike Lemonade, Geico offers its auto insurance policies to drivers in all 50 states. And because Geico is a major insurance provider, it also offers a more personal touch: You can meet with Geico agents in person or chat with them over the phone if you’d like.
Geico offers the breadth of insurance coverage that you would expect from a major carrier, too: comprehensive, collision, uninsured motorist coverage and property damage coverage. You can also add coverage for emergency roadside assistance and mechanical breakdowns. If you need to rent a car, Geico offers insurance to cover those costs, too.
Progressive car insurance
Another national provider, Progressive offers auto insurance in all 50 states and the District of Columbia. And like most major insurance providers, it offers a complete suite of auto insurance coverages: collision, liability, comprehensive and uninsured/underinsured motorist protection.
You can also choose from specialized coverages such as loan/lease payoff, in which Progressive will pay off the money you owe on your auto loan if your car is totaled or stolen; rental car reimbursement; and roadside assistance coverage.
FAQs
Have questions about Lemonade’s car insurance? Here are answers to some of the most common.
How do I report a claim?
You can file a claim on Lemonade’s website or through its app. If you
don’t have online access, you can reach Lemonade at 844-733-8666. You can also file a claim
by email by sending a message to carclaims@lemonade.com.
What happens after I file a claim?
Once you file, you’ll work with an insurance claims adjuster who will contact the other drivers involved in an accident, set up repairs to your car, find you a rental car if needed and determine the costs Lemonade needs to pay out to repair your vehicle or cover the costs related to any injuries or personal property damage.
How do I get paid for my claim?
Once Lemonade approves your claim, it will deposit your funds, minus your deductible, directly into your linked bank account.
How do you determine the value of my car when I file a claim?
Lemonade claims adjusters will consider your car’s year, make and model. The adjuster will also consider your vehicle’s trim level, safety features, upgrades and condition.
Save $1,604 (or more) per year on car insurance today.
- 2-minute quote
- State minimum coverage
- Full coverage
- Explore top brands
The bottom line
If you want to drive, you’ll almost always need to purchase at least personal liability auto insurance. Lemonade auto insurance is a good choice for drivers who want flexible coverage options, the ability to tweak their monthly premiums and the chance to receive discounts for safe driving.
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Writer
Dan Rafter is a freelance writer who has more than 20 years experience covering personal finance. He's written for the Chicago Tribune, Washington Post, Bankrate, CreditCards.com, Rocket Mortgage, NortonLifeLock and several others.
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