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What to Expect From Lemonade's Q3 Earnings

By Neil Rozenbaum – Nov 8, 2021 at 11:00AM

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Investors should be looking for continued growth across the board.

Lemonade (LMND 2.96%) is reporting Q3 earnings on November 8. So as always, I will recap what happened with Lemonade in this quarter. We're going to have a look at their Q2 numbers and some of the company's activities during the quarter. You can find the video below, but here are some highlights. 

Earnings recap

In force premium (IFP) growth accelerated to 91% year over year with IFP of $297 million and about 1.2 million customers, up 48% YOY. Premium per customer increased 29% YOY to $246. Gross earned premium increased 90% YOY to $67 million. 

A year ago, Lemonade transitioned to a quota share reinsurance program. The company agreed to cede 75% of the premium to a panel of partners, thus retaining 25% of the risk on the balance sheet. Last quarter it announced that it is reducing that to 70%, which will have a positive effect in future quarters. 

What to look for

Very simple: continued growth across the board. Any extra insights into how well or badly life insurance has been doing since the launch would be great, as well as developments in the European market. 

The company recently launched car insurance. This launch greatly enhances Lemonade's bundling ability, which is highly popular in the insurance industry. It is very unlikely we will hear something regarding that segment, but maybe we'll get a little insight into how the launch went. Car insurance revenue is not part of Lemonade's forward-looking guidance at this time, which could lead to a raise in guidance for the next quarter. 

For the full insights, do watch the video below, and consider subscribing. 

*Stock prices used were the closing prices of Nov. 5, 2021. The video was published on Nov. 7, 2021.

Neil Rozenbaum owns shares of Lemonade, Inc. The Motley Fool owns shares of and recommends Lemonade, Inc. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.

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