Insurtech startup Lemonade reported gross profit of $ 11.7 million for the third quarter of 2021, up $ 4.4 million from the third quarter of 2020.
This increase is due to the increase in gross earned premiums, partially offset by a higher net loss ratio.
Lemonade reported a gross earned premium of $ 79.6 million, up from $ 42.9 million in the third quarter of 2020, due to the increase in in-force earned premiums during the quarter.
Total third quarter revenue of $ 35.7 million increased $ 17.9 million or 101% from the same period last year.
This is primarily due to the increase in gross earned premiums during the quarter, increased net investment income and commission income, and a modest reduction in the scope of its quota program.
The insurer also reported a loss of $ 66.4 million from $ 30.9 million in the third quarter of 2020.
For the next quarter, Lemonade expects a gross earned premium of $ 88-89 million, with revenue of $ 39-40 million.
Lemonade also said, “Our Q3 21 gross loss rate was 77%, up from 72% a year ago, despite our new products showing improved loss rates. 5 Our business mix has changed considerably over the past year, with tenants representing 53% of the portfolio, compared to 70% a year ago.
“The business sectors that have captured this share (home and pets) have higher loss rates than our portfolio of more mature and more stable tenants.
“However, we are seeing an improvement in loss ratios especially in homes and pets. Based on the accident period, our pet loss rate improved by 4 percentage points. sequentially while our owner loss rate improved by 52 percentage points year over year.