Lemonade’s Q3 shows the obvious: insurance is done better by algorithms than by humans

Using AI in insurance is, in many ways, a no-brainer. The industry is built on statistics, risk assessment, and behavioral data exactly what AI excels at.

Lemonade is one of the few companies that has truly built its entire model around this, and in the Q3 2025 report the effects are becoming very clear. The company is growing rapidly, with a premium portfolio up thirty percent to just over $1.15 billion, and revenue climbing more than forty percent. At the same time profitability is improving significantly, with gross margin rising from 27 to 41 percent, and claims-handling costs nearly cut in half over just a few years thanks to AI-driven claims automation.

This allows Lemonade to handle more customers and more claims without building a larger organization something traditional insurers have never been able to achieve, right?!

Now we’re at just over $70, and I’m expecting $100+ after Q4 2025.

What do you think about the stock heading into and following Q4?