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InsurTech Lemonade said it booked a second-quarter net loss of $67.9 million compared with a net loss of $55.6 million during the same quarter last year, but in a letter to shareholders the company said returns will soon eclipse the costs of investments.

In keeping with comments earlier this year, the letter reiterated that Lemonade expects losses to peak in 2022 — more specifically in the next quarter — before shrinking thereafter. The AI-powered insurance company said the change from “growing losses to shrinking losses is occurring naturally. It is an outgrowth of sticking to our strategy,” which will be outlined in more detail at an Investor Day in November, the company said.

Lemonade said it made changes to its plan “with the goal of ensuring we are never forced to raise capital” without committing to never fundraising if the cost of capital becomes more favorable. As part of the new approach, it has moderated growth spend and its hiring pace.

“We’re not changing course — we’re changing pace,” the letter told shareholders. “We will continue to execute on our strategy, just at a moderated clip.”

During the third quarter Lemonade will integrate the data and tech stack, as well as about 80 percent of the staff, at pay-per-mile car insurance provider Metromile — an all-stock acquisition Lemonade closed in late July. Metromile shareholders received 7.3 million Lemonade shares valued at about $145 million, while Lemonade received a business with over $155 million in cash, over $110 million in premiums and an insurance entity licensed in 49 states that Lemonade said “changes our product mix significantly.” Renters now accounts for about a third of its book, down from about half, while auto jumped from 1 percent to 20 percent.

Lemonade said cross-selling was up in Q2. Cross- and up-sells accounted for 23 percent of sales in Q2, and Metromile gives Lemonade the opportunity to open seven more markets to bundle car and home insurance. The company also noted that “further launches are in the works.” The continued rollout of Lemonade Car, launched in Illinois in November, “promises to spike” cross-sells. In Illinois, 36 percent of Lemonade sales in Q2 were cross- or up-sells, Lemonade said.

Acknowledging the impact of inflationary pressures, Lemonade said it has mitigated the threat with about 100 rate filings over the last year and is seeing the loss ratio moderate.

“Nevertheless, inflation-induced mismatches or rate and risk are liable to recur, and we will continue to be vigilant and responsive,” Lemonade said in the letter.