InsurTech Lemonade reported a third-quarter 2025 net loss of about $37.5 million compared with a loss of $67.7 million a year ago during the same time.

Revenue and gross profit increased 42% and 113%, respectively, versus Q3 2024. However, operating expense increased $16.7 million, or 13%, to $141.2 million.

Now at nearly $1.2 billion, in force premium grew 30% in Q3.

The New York-based insurer of car, home, renters and pet insurance said the use of artificial intelligence has resulted in a “near tripling of claims handling efficiency.” The loss adjustment expense ratio—the cost of handled claims divided by gross earned premium—was reduced to 7% in Q3. The company said it expects to cut the LAE ratio in half.

“We have demonstrated our ability to transform claims handling expense, long considered a variable expense in insurance, to a near fixed expense,” Lemonade said in a letter to shareholders.

Lemonade said its car product continued to grow ahead of its schedule, with in force premium at $163 million at Q3, or about 40% growth year over year.

After nine months Lemonade has booked a net loss of $143.8 million compared with a net loss of $172.2 million in 2024.