The case describes how Lemonade, a notable insurance technology (insurtech) startup, created and developed a novel business model with social impact. The case also explains how entrepreneurs leverage their experience, creativity, and more importantly, knowledge from behavioral science to tackle challenges in a century-old industry. For undergraduate or master’s students, the instructor can stimulate discussion on how to develop creative business ideas and how to improve the robustness of a novel business with scientific knowledge, especially social sciences such as social psychology. Another fascinating aspect of this case is that Lemonade organically integrates social impact into its core business model without engaging in public relations–like campaigns. For a deeper discussion, the instructor can introduce a few fundamentally debated topics in business schools. For example, can a business be scientifically guided? Simply put: is running a business art or science?
To provide students with a fundamental view of the insurance industry and how business opportunities arise from the century-old industry.
To provide students with a real case of how to create new ventures with novel business models by embracing design thinking and scientific knowledge.
To inspire creative thinking on how firms can deliver social goods by organically incorporating behavioral science into its core business operation.
To enable students to critically examine the dynamics of running an insurtech startup.