New 12-month program lowers quota share cession to approximately 18% from approximately 20% while expanding catastrophe protection

Lemonade, Inc. (NYSE:LMND), the digital insurance company powered by AI and social impact, today announced the renewal of its reinsurance program, effective July 1, 2026.

Lemonade renegotiated the program to retain more of the economics from its growing business, while expanding protection against catastrophes and major weather events.

Under the renewed quota share agreements, Lemonade expects to cede approximately 18% of premium to reinsurers, down from approximately 20% previously. Lemonade will retain a larger share of the business's growing gross profit.

At the same time, the program increases coverage for higher-volatility and catastrophe-exposed risks, including additional tail catastrophe protection. Lemonade believes the economics of the renewed program are more attractive than those of the expiring treaty.

The program continues to cover Lemonade's global business. One new reinsurer is joining Lemonade's primary quota share panel alongside existing partners, broadening the company's reinsurance support.

"This renewal improves Lemonade's reinsurance economics, coverage, and capital efficiency at the same time," said Tim Bixby, CFO of Lemonade. "We are retaining more premium, adding protection against the volatility that matters most, and doing so on terms that are attractive on a risk-adjusted basis."

As part of the renewal, Lemonade also expects to update its ancillary reinsurance programs, including allowing its Property Per Risk (PPR) coverage to expire while expanding its European catastrophe excess of loss (XOL) program. The renewed program is expected to be in effect for a standard 12-month term.

About Lemonade

Lemonade offers renters, homeowners, car, pet, and life insurance. Powered by artificial intelligence and social impact, Lemonade’s full stack insurance carriers in the US and the EU replace brokers and bureaucracy with bots and machine learning, aiming for zero paperwork and instant everything. A Certified B-Corp, Lemonade gives unused premiums to nonprofits selected by its community, during its annual Giveback. Lemonade is currently available in the United States, Germany, the Netherlands, France, and the UK, and continues to expand globally.

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Cautionary Note Regarding Forward-Looking Statements

This press release and our earnings release and call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained in this press release are forward-looking statements.

These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements expressed or implied to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to the following: our financial outlook for the second quarter 2026, our financial outlook and results, our financial metrics, including our key performance indicators, our ability to acquire new business, including growth of products in new states and Europe, the expected benefits, accuracy and growth of our predictive and generative AI models, and their effects on handling loss ratios, LAE and other metrics, our anticipated growth, profitability, our industry, business strategy, plans, goals and expectations concerning our market position, future operations, reinsurance coverage, capital efficiency ratio, and other financial and operating information, our history of losses and that we may not achieve or maintain profitability in the future; our success and ability to retain and expand our customer base; the "Lemonade" brand may not become as widely known as incumbents' brands or the brand may become tarnished; the denial of claims or our failure to accurately and timely pay claims; our ability to attain greater value from each user; availability of reinsurance at current levels and prices; our exposure to counterparty risks; our limited operating history; our ability to manage our growth effectively; our proprietary artificial intelligence algorithms may not operate properly or as expected; the intense competition in the segments of the insurance industry in which we operate; our ability to maintain our risk-based capital at the required levels; our ability to expand our product offerings; the novelty of our business model and its unpredictable efficacy and susceptibility to unintended consequences; the possibility that we could be forced to modify or eliminate our Giveback; regulatory risks, related to the operation, development, and implementation of our proprietary artificial intelligence algorithms and telematics based pricing model; legislation or legal requirements that may affect how we communicate with customers; the cyclical nature of the insurance industry; our reliance on artificial intelligence, telematics, mobile technology, and our digital platforms to collect data that we utilize in our business; our ability to obtain additional capital to the extent required to grow our business, which may not be available on terms acceptable to us or at all; our actual or perceived failure to protect customer information and other data as a result of security incidents or real or perceived errors, failures or bugs in our systems, website or app, respect customers’ privacy, or comply with data privacy and security laws and regulations; periodic examinations by state insurance regulators; underwriting risks accurately and charging competitive yet profitable rates to customers; our ability to underwrite risks accurately and charge competitive yet profitable rates to our customers; potentially significant expenses incurred in connection with any new products before generating revenue from such products; risks associated with any costs incurred and other risks as we expand our business in the U.S. and internationally; our ability to comply with extensive insurance industry regulations; our ability to comply with insurance regulators and additional reporting requirements on insurance holding companies; our ability to predict the impacts of severe weather events and catastrophes, including the effects of climate change and global pandemics, on our business and the global economy generally; increasing scrutiny, actions, and changing expectations on environmental, social, and governance matters; our growth financing agreements with General Catalyst and with Hannover Re may not function as expected; fluctuations of our results of operations on a quarterly and annual basis; our utilization of customer and third party data in underwriting our policies; limitations in the analytical models used to assess and predict our exposure to catastrophe losses; potential losses could be greater than our loss and loss adjustment expense reserves; the minimum capital and surplus requirements our insurance subsidiaries are required to have; assessments and other surcharges from state guaranty funds; our status and obligations as a public benefit corporation; our operations in Israel and the current political, economic, and military instability, including the evolving conflict in Israel and surrounding region.

These and other important factors described under the caption "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed on February 25, 2026, and in our other subsequent filings with the SEC, could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s beliefs as of the date of this press release. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change.

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Press contact:

Paul Staats

Press@lemonade.com