Israeli digital insurance company Lemonade (NYSE: LMND) will offer farmers in emerging markets climate insurance at cost price through The Lemonade Foundation, a nonprofit founded by Lemonade to effect exponential social and environmental impact through technology.
The Lemonade Foundation also announced today the formation of the Lemonade Crypto Climate Coalition. The coalition is being constituted as a Decentralized Autonomous Organization (DAO), dedicated to building and distributing at-cost, instantaneous, parametric weather insurance to subsistence farmers and livestock keepers in emerging markets. Alongside the Lemonade Foundation, founding coalition members include Avalanche, Chainlink, DAOstack, Etherisc, Hannover Re, Pula, and Tomorrow.io.
Lemonade said that the climate insurance will be architected as a stablecoin-denominated, decentralized application (dApp) on Avalanche, an eco-friendly proof-of-stake blockchain. Farmers will be able to make and receive payments with ease from their phone using global stablecoins or local currencies, much as they do for banking and payments today. An initial rollout in Africa is expected within the year.
The Lemonade Foundation will provide the initial capital to fund the DAO’s smart contracts, and in time all crypto investors will be able to fund the DAO’s liquidity pool. The DAO will also issue a governance token to reward participation by the broader community.
"Africa has an estimated 300 million smallholder farmers. The majority face real climate risks to their livelihoods, as traditional, indemnity-based insurance is often unaffordable or unavailable to them," said Rose Goslinga, co-founder of Pula, a Kenya-based insurtech that specializes in digital and agricultural insurance to de-risk millions of smallholder farmers across Africa. "This is where the power of the Lemonade Crypto Climate Coalition comes in: An on-chain solution that can be immediately impactful at scale will allow farmers to finally get financially protected against the increasingly frequent risks such as drought."
Lemonade was founded in 2015 by co-CEOs Shai Wininger and Daniel Schreiber. The company operates in the US offering home insurance, pet insurance and life insurance. Lemonade recently entered the car insurance market and acquired digital car insurance company Metromile in a share deal for $500 million.
The company held its IPO on the NYSE in June 2020 at $29 per share, and is currently trading at $26.85, giving a market cap of $1.65 billion.
Published by Globes, Israel business news - en.globes.co.il - on March 22, 2022.
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