Class Action Lawsuit Claims Lemonade Illegally Excludes Older, Female Facebook Users from Receiving Insurance Ads

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Lemonade Insurance Co. faces a proposed class action lawsuit that claims its online advertising practices discriminate against female and older Facebook users, preventing them from accessing valuable information about insurance opportunities.

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According to the 21-page Lemonade lawsuit, the insurance company has used Meta’s audience selection tools to ensure that its Facebook ads are shown only to younger people or men. The filing notes that Facebook’s default audience selection settings offer to send ads to users of all genders and within the age range of “18-65+”—meaning that Lemonade has consciously chosen to exclude women and older people from its campaigns, the case alleges.

“By denying them this information through its discriminatory advertising, Lemonade is able to accomplish what it is otherwise prohibited by law from doing: selecting its target demographic—younger men—and thereby denying older people and women the opportunity to learn about and obtain important insurance products and services,” the complaint contends.

California’s Unruh Act requires all business establishments operating within the state to provide “full and equal” services to customers without discriminating based on sex, age, race or other protected traits, the filing relays. The lawsuit asserts that Lemonade’s advertisements for insurance products—including renters, homeowners, car, pet and life insurance—are services that must be equally accessible to all customers.

“For decades, bars, restaurants, and other establishments in California have been prohibited from using race, gender, or age to offer better services or lower prices to certain customers, to segregate customers, or to exclude particular groups from receiving products or services,” the suit says. “The same rules apply to companies like Lemonade[.]”

In fact, the case shares, the California Court of Appeal has ruled that it is illegal under the Unruh Act for an advertiser to intentionally target ads based on users’ ages and gender.

The complaint calls Lemonade’s advertising practices “digital redlining,” claiming that the company’s alleged discrimination compounds a historical barrier women and older people face in obtaining insurance on equal terms as younger people and men. Per the case, the defendant’s conduct is based on “unlawful gender and age-based stereotypes” and has placed tens of millions of women and older Americans at an economic disadvantage.

The lawsuit looks to represent all California residents who, within the past three years, were Facebook users, located in California, at least 40 years old or women of any age, and were excluded or will be excluded due to their age and/or gender from the audience selection of at least one Lemonade advertisement related to insurance opportunities.

Learn all about the legal process: What is a class action lawsuit?