The news: In its Q4 and full-year 2025 earnings, P&C insurtech Lemonade announced revenues of $737.9 million, up from $526.5 million for the full year 2024. It ended 2025 with 2.98 billion customers and $1.24 billion in in-force premiums. It has consistently run at a loss since its founding in 2016, reporting $165.5 million in losses for the full year.

Why it’s worth watching: Lemonade is doubling down on AI across underwriting, pricing, claims, marketing, and cross-selling.

• Marketing: Its AI models help decide which customers to target and how much to spend to acquire them. In 2026, the company will invest in cross-sell, particularly to increase customers’ bundling of car and home insurance. Lemonade is also developing a more advanced pricing engine that adjusts rates and measures risk faster.
• Telematics: AI underpins telematics-based auto insurance pricing for both human-driven and autonomously driven miles. Lemonade launched autonomous car insurance in partnership with Tesla in January, incorporating data from Tesla’s Autopilot software.

Zooming out: Lemonade is now a $4.7 billion company by market cap and growing at a rapid clip. Its offerings include renter, auto, pet, and term life coverage. In-force premiums grew 31% YoY and revenues by 54%. It cut its net loss by 18%.

Implications for insurers: Most insurers are stuck in AI purgatory, with enterprisewide rollouts constrained by legacy systems and data fragmented across siloed systems or external sources. AI-native insurtechs like Lemonade have demonstrated that they can scale, but whether they can reach sustained profitability is another question.

Customers’ inertia has slowed disruption for now—but as younger, digitally native consumers choose policies, incumbents that fail to modernize will face greater competitive pressure.