Insurtech company Lemonade reported a smaller net loss for the third quarter of 2025, with a loss of about $37.5 million compared to $67.7 million in the same period last year. This improvement comes alongside a boost in revenue and gross profit, which rose 42% and 113% respectively compared to Q3 2024.
Despite these gains, Lemonade’s operating expenses climbed 13%, increasing by $16.7 million to reach $141.2 million. The company’s in force premium, the total value of active insurance policies, grew 30% to nearly $1.2 billion. Lemonade’s car insurance business is also doing well, with premiums in force hitting $163 million, marking around 40% growth compared to last year.
Lemonade highlighted how its use of artificial intelligence has nearly tripled the efficiency of handling claims. This has helped reduce the loss adjustment expense ratio, which measures claim handling costs against premiums earned, to 7% in Q3. The company aims to cut this ratio in half moving forward.
After nine months of 2025, Lemonade’s net loss stood at $143.8 million, down from $172.2 million during the same timeframe in 2024. The insurer emphasized that it has managed to keep claims handling costs more stable, treating an expense that once varied widely as nearly fixed.
Based in New York, Lemonade offers car, home, renters, and pet insurance. The company continues to push ahead with its plans to grow, using technology to cut costs and improve customer service along the way.