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0 pointsh4nkoslo9y ago0 comments

I'd be really surprised if their entire risk was reinsured; that tends to lead to severe incentive misalignment since they would have every incentive to sell to the riskiest customers they could find.

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2 comments · 2 top-level

nerdponx9y ago

Good point. Although again, adverse incentives on Lemonade's side are supposedly handled by the fact that they're a nonprofit.

SmellTheGlove9y ago

I'd be really surprised if they could get reasonable terms to reinsure their book, good decision or not.

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