Why will this fail?

[ElDucky]

Maybe they want lying to make it easier to deny claims, which is their main focus!

[tommie frazier]

it is hard to say which is lying. the reported miles are different based on where the attestation appeared. who is to say which is more accurate? and if the bias of the answers have been consistent over time I agree that there is no reason to change anything - the measure is working fine.

[NAMAK]

https://techcrunch.com/2016/09/21/le...-do-insurance/

this should be interesting...... I imagine they get a ton of premium.... and losses!!

[therealsylvos]

Hm, so they plan to write off underwriting profit? I wonder how those RBC ratios are gonna look after year 1.

[therealsylvos]

At Lemonade, the hypothesis is that policyholders are less likely to make fraudulent claims if they know their money is going to be paid out to a charity that they’ve selected themselves.

[therealsylvos]

But thanks to guaranty funds, may as well get your homeowners cheap for a year or three

[therealsylvos]

Originally Posted by therealsylvos

Hm, so they plan to write off underwriting profit? I wonder how those RBC ratios are gonna look after year 1.

Oh wait, NVM.

And it’s making its money in a pretty traditional way — by taking a 20% cut of all of the money paid into policies.

[SlowMotionWalter]

Originally Posted by therealsylvos

My response as well. Just defraud the company for a new roof and donate $50 to habitat for humanity. Clear conscience.

[examsarehard]

Each year, any money leftover from the insurance policy (called the “underwriting profit” in industry terms) is donated to a cause during what Lemonade calls its annual “giveback” period.

And it’s making its money in a pretty traditional way — by taking a 20% cut of all of the money paid into policies.

If they are making any money off of the 20% cut, it is by definition, part of the underwriting profit. It seems that they've conveniently redefined the terms to exclude the profit they plan to make.

The alternative is that they are taking a 20% commission and not assuming any of the risks of loss... but then they wouldn't be able to guarantee that any of the "underwriting profit" gets donated to charities.

And there already is a mechanism to return profit to the consumers...it's called policyholder dividends.

[SlowMotionWalter]

Originally Posted by examsarehard

If they are making any money off of the 20% cut, it is by definition, part of the underwriting profit. It seems that they've conveniently redefined the terms to exclude the profit they plan to make.

The alternative is that they are taking a 20% commission and not assuming any of the risks of loss... but then they wouldn't be able to guarantee that any of the "underwriting profit" gets donated to charities.

And there already is a mechanism to return profit to the consumers...it's called policyholder dividends.

shh. you'll blow up their spot.