Lemonade Is Working With Avalanche, Chainlink on Weather Insurance for Farmers

A newly formed DAO backed by the Lemonade Foundation will roll out permissionless weather insurance to African farmers later this year.

AccessTimeIconMar 22, 2022 at 6:26 p.m. UTC
Updated Mar 22, 2022 at 7:11 p.m. UTC

Tracy Wang is a senior reporter at CoinDesk. She owns BTC, ETH, MINA, ENS, various stablecoins, and some NFTs.

The charitable arm of a publicly traded insurance company is tapping Avalanche and Chainlink to build a decentralized twist on weather insurance.

Lemonade (LMND), a $1.7 billion market cap company listed on the New York Stock Exchange, is rolling out a newly created decentralized autonomous organization (DAO) called the Lemonade Crypto Climate Coalition.

Administered by the Lemonade Foundation, the project includes representatives from the Avalanche blockchain; Chainlink, which provide real-world data to blockchains; DAOstack, a creator of DAO software stacks; Etherisc, a builder of decentralized insurance apps; Hannover Re, a German reinsurance company; Pula, an agricultural insurance startup; and Tomorrow.io, a provider of real-time weather information.

The new project, which will be formally introduced on Wednesday at the Avalanche Summit in Barcelona, Spain, marks Lemonade’s entry into blockchain-based insurance with a prosocial focus on farmers in emerging markets.

“By using a DAO instead of a traditional insurance company, smart contracts instead of insurance policies and oracles instead of claims professionals, we expect to harness the communal and decentralized aspects of Web 3 and real-time weather data to deliver affordable and instantaneous climate insurance to the people who need it most,” Lemonade Foundation director Daniel Schreiber said in a statement.

A spokesperson for Lemonade confirmed this is the firm’s first Web 3 experiment.

The insurance program will be accepting stablecoin or local currency payments from farmers through a decentralized application on the Avalanche blockchain. An initial rollout in Africa is expected within the year, with flood insurance in Nigeria expected to be an initial offering, according to a person involved in the project.

“It’s fully permissionless,” Chainlink Labs Managing Director William Herkelrath told CoinDesk. “Each insurance contract has a specific condition and is monitored separately by node operators for the occurrence of conditions.”

So far, insurance protocols represent a relatively niche application of blockchain technology, but many proponents of insurance protocols say it can revolutionize a trillion-dollar industry that is often plagued by slow payouts and disputes between counterparties.

“Anytime you need fast results and transparency, where information and value are flowing simultaneously, Avalanche is the best solution,” John Wu, president of Ava Labs, told CoinDesk on the sidelines of the Avalanche conference in Barcelona.

When asked about the decision to work with African farmers, Wu said, “It’s just the beginning, everyone starts somewhere.”


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Tracy Wang is a senior reporter at CoinDesk. She owns BTC, ETH, MINA, ENS, various stablecoins, and some NFTs.

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Tracy Wang is a senior reporter at CoinDesk. She owns BTC, ETH, MINA, ENS, various stablecoins, and some NFTs.


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