June 29, 2022 – Lemonade Biometric Data Privacy Settlement Site Is Live
The official website for the Lemonade settlement detailed on this page is now live and can be found at LemonadeBIPASettlement.com.
The deadline to submit a claim is August 22, 2022. Claims can be submitted online by clicking here, or by mail. You’ll need to provide the unique ID you should have received in a notice from the settlement administrator. Notices were mailed out on June 22, 2022.
If you don’t have a unique ID, you can still submit a claim via mail by following the instructions under the “File by Mail” section on this page.
Payments will be sent out only after the settlement receives final approval and any appeals are resolved. A final approval hearing has been scheduled for August 25, 2022.
June 2, 2022 – Lemonade Agrees to $4M Settlement
Lemonade has agreed to a $4 million deal that aims to settle a handful of consolidated cases, including the one detailed on this page.
The proposed settlement aims to cover Lemonade policyholders in the U.S. who, between June 25, 2019 and May 27, 2021, provided first notice of loss through a video claim submission from which the defendants could have obtained the individuals’ biometric information or identifiers.
According to a May 17 memo, the plaintiff’s counsel estimates that more than 110,000 people are included in the class.
The deal also proposes a subclass of Illinois residents who fit the aforementioned criteria. The estimated 5,000 or so members of the proposed subclass will split $3 million of the $4 million settlement fund, after certain fees and expenses are deducted, while the remaining $1 million will be shared among the rest of the class.
The plaintiffs’ counsel pointed out that BIPA-related claims, which only apply to Illinois residents, typically result in higher per-person recoveries than non-BIPA privacy-based claims.
“Indeed, it is not uncommon for there to be no monetary relief whatsoever for consumer class action settlements based on such claims,” the May 17 memo argues in support of the deal.
Lemonade has also agreed as part of the settlement to delete all biometric data previously collected from class members. According to the memo, the insurer stopped collecting such information as of May 27, 2021 and has promised under the settlement to comply with the BIPA and “all other applicable laws” if it ever decides to begin collecting biometric information again.
If the proposed settlement receives the judge’s stamp of preliminary approval, those covered should keep an eye out for a notice via email or regular mail providing more details about the deal and instructions on what to do next. There will also be a website set up where class members will be able to file claims.
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A proposed class action claims Lemonade Inc. has unlawfully collected Illinois residents’ facial geometries through videos uploaded as part of the claims process on the insurance company’s website.
The 22-page lawsuit out of Cook County Circuit Court alleges Lemonade, an “artificial intelligence-driven” insurer, has violated the Illinois Biometric Information Privacy Act (BIPA) by collecting scans of residents’ facial geometries as part of its claims process without first providing required disclosures and obtaining their express consent to do so. Per the suit, Lemonade has failed to notify Illinois customers in writing of its intention to collect their biometric data, secure a written release to do so, and publish a publicly available retention schedule outlining how and when the data would be destroyed.
Although Lemonade represents that it provides an “instant, seamless, and delightful” insurance experience that allows insureds to upload videos explaining their claims in their own words, the company, the case alleges, has failed to disclose that its business model is built on collecting vast amounts of consumer data without their knowledge or consent.
“Or, put another way, Lemonade is an insurance company that claims it is replacing human brokers and actuaries with bots and AI in order to streamline the insurance claim process,” the complaint states. “In the process, however, Lemonade collects tremendous amounts of data, including biometric information, about its customers without telling them in direct violation of BIPA.”
Lemonade purportedly touts its ability to “extract thousands of bits of data” from the videos it requires customers to upload to its app as part of the insurance claims process. According to the case, customers are required to record videos of themselves answering a series of questions posed by Lemonade’s automated chatbot and, in the process, the insurer’s technology collects as many as 1,600 data points. Lemonade, which offers homeowners, renters, pet and life insurance policies, has boasted that its “vast troves of customer information” allow it to decide whether to pay out certain claims, detect fraud and price its products, the complaint says.
The lawsuit centers on a Twitter thread posted by Lemonade in which the insurer stated its artificial intelligence could analyze customers’ videos for signs of fraud by picking up “non-verbal cues” that traditional insurers would be unable to detect. Per the suit, the company faced immediate backlash over the controversial posts describing its AI technology, and later clarified that “[t]he term, non-verbal cues was a bad choice of words to describe the facial recognition technology we’re using to flag claims submitted by the same person under different identities. These flagged claims then get reviewed by our human investigators.”
The complaint alleges the company’s admission to its use of facial recognition technology makes clear that Lemonade has collected “reams of data, including biometric data like face geometry” from Illinois residents without adhering to the BIPA’s requirements.
“In short, Lemonade did not disclose to its customers the extent to which it was collecting and using their sensitive biometric (and other information),” the lawsuit says. “Indeed, the ‘instant, seamless, and delightful’ insurance experience that Lemonade aggressively markets was built by the collection of its customers’ own data, including their biometric information, which those customers never realized they were providing.”
The lawsuit looks to represent anyone whose biometric identifiers or biometric information was collected, captured, stored, used, transmitted, received or otherwise obtained or disseminated by Lemonade in Illinois within the applicable statute of limitations.
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