Home insurance customers more aware of insurtech offerings: J.D. Power

The website home screen for Lemonade on a smartphone arranged in New York, U.S., on Thursday, Nov. 5, 2020. Lemonade Inc. is scheduled to release earnings figures on November 11. Photographer: Gabby Jones/Bloomberg
The website home screen for Lemonade on a smartphone arranged in New York on Nov. 5, 2020.
Gabby Jones/Bloomberg

Nearly one-fourth of home insurance customers are aware of insurtech offerings, according to the J.D. Power 2022 U.S. Home Insurance Study. 

Thirty-four percent of customers, who are not insured by Lemonade, and are familiar with the brand, say they "definitely will" or "probably will" purchase Lemonade if it is available in their state. The study is based on responses from 11,630 homeowners and renters via an online survey conducted from May to June.

Marty Ellingsworth, executive managing director, P&C Insurance Intelligence at J.D. Power says via email that "Lemonade specifically has been making a splash."

There has been a five percentage point increase of awareness year over year of Lemonade by bundlers. Among those likely to purchase policies from the insurtech, price savings is the most common reason.

"Price is not the only appeal of Lemonade, however, as bundlers are more likely than non-bundlers to consider purchasing from Lemonade due to liking the business model and the appeal of convenience of this type of insurance," says Ellingsworth.

Additionally, the rise in auto insurance premiums is leading policyholders to unbundle, according to the study. The once important customer retention and value strategy of bundling home and auto insurance may be a thing of the past.

"Sky-high auto loss costs and resultant auto premium increases are creating ripple effects throughout the insurance industry and, as a result, one area that is being severely disrupted is the home and auto insurance bundle," said Robert M. Lajdziak, director, global insurance intelligence at J.D. Power, in a statement. "Homeowners, and particularly bundlers, have traditionally been less price-motivated than the typical monoline auto customer, but we are beginning to see cracks in that foundation. That puts the focus for insurers squarely on the overall brand experience their customers are receiving—across all lines—and on understanding how changes in one area, such as telematics adoption in an auto policy, can affect the entire customer journey."

Overall customer satisfaction has declined six points, on a 1,000-point scale, and for renters it has decreased seven points. The study considers several factors like policy offerings, price, billing process and claims.

Amica Mutual ranks highest in homeowners insurance with a score of 849.

American Family ranks second with 842. 

The Hartford ranks third with 839.


Nationwide ranks highest in renters insurance with a score of 859.

Lemonade ranks second with 853.

Automobile Club of Southern California ranks third with 852.