Tonik Insurance Sneaks 20% Premium Increase On Customer After Approval

Tonik is the rad, x-treme! lifestyle health insurance for young people who can’t afford regular insurance—sort of the Poochie of health insurance, except it’s not going to go away. Aasma wrote to us to let us know that when she signed up for it over the weekend, she got a nasty surprise after she submitted her credit card information.

Today, I tried to sign up for the Tonik insurance plan through Blue Cross in California. I answered all their questions and based on my answers was quoted a certain price for health insurance. I then gave them my CC information. Upon completion of this transaction I received the following email:

  Congratulations! Your application has been approved for DN15 with a 20% increase in premium.

This decision was based on the information you submitted.

I could send you the full text of the email, but you get my issue. Nowhere did I have the ability to deny this coverage. I then had to argue with them for an hour to get them to cancel. I had to send a screenshot of the total page which did not say anywhere that they could just randomly raise the price. After an hour of throwing a hissy fit and getting them to let me email the cancellation instead of faxing it they finally sent me a cancellation email. I still don’t feel safe though.

I think people should know about this. It can’t be legal. I’m also sending you the screenshot I took of the total page. I should have known better than to sign up for insurance called the “thrill seeker” but I was desperate and they tried to take advantage of me.

Is there any place to report these deceptive and evil insurance selling practices? You can’t just quote someone a price, take their money and then raise the price, can you? I would also like to add that I am an attorney and I did read the fine print.

Aasma, you may want to try contacting the California Department of Insurance to ask them where to complain about what happened. You should also check out the Health Insurers page on the California Attorney General’s website for more information.


Edit Your Comment

  1. gatewaytoheaven says:

    Epic fail.

    There needs to be better oversight when it comes to situations such as these. This is very similar to the bait-and-switch story posted earlier.

    • SGriswold says:


      Nothing to do with “bait and switch.” Every insurance company from life to health to auto, reserves the rate to charge you a higher premium if you are a higher risk.

      The problem here is lack of sufficient disclosure. It’s buried in the documentation somewhere but should be prominently displayed on the quote. I warn my clients that if they have existing health issues that they can get rated or declined.

    • thinkliberty says:


      Better oversight is not a solution. Over site just adds cost to an already overpriced service.

      There needs to be another option when it comes to health care. I will take any of the following 2.

      1. Nationalized healthcare. One where insurance companies do not make money on healthcare. Insurance companies do nothing to treat any illness or condition. They don’t deserve any money.

      2. A free market healthcare system. One were the AMA and FDA are no longer monopolies. Where people have access to ANY medication with out a doctors prescription.

      What we currently have is a fascist health care system. Where people must pay a doctor before getting medication. Will people abuse medication under a free market healthcare system? Probably, but it’s not a valid accuse to deny people that really need the medication from getting it. Requiring someone to pay 80 dollars to a doctor to get a prescription for a 4 dollar bottle of antibiotics is theft.

      If you don’t like drug legalization see option one.

  2. SGriswold says:

    This is standard practice for insurance companies.
    When you are quoted, you are quoted at the Tier 1 rate. However, the company has additional tiers which can add 20-50% of premiums based on any existing health conditions as an alternative to flat-out declining you.

    Often things like minor chronic illnesses can contribute to this. It’s shitty, but I am guessing they disclose this SOMEWHERE in the application process.

    This is also why you should go through an independent agent rather than directly through the company — a good agent would either negotiate for a rate appeal or yell at Blue Cross on the phone on your behalf so you don’t waste your time.

    • iMike says:

      @SGriswold: Correct. The same is true (for different reasons) when applying for auto or homeowners insurance.

    • katylostherart says:

      @SGriswold: how is that legal? while i don’t doubt that it IS legal, i’m just wondering how? if i get quoted for car insurance i pay what they quote. i mean that’s the point of a quote isn’t it? if the information doesn’t change between getting the quote and being charged for the first month’s premium, how is it legal to up that?

    • Mary Marsala with Fries says:

      @SGriswold: …and this is why private health insurance companies are a fscking sham and will always be a fscking sham. If it’s a “product” that’s safe enough and simple enough to force the public to buy it directly, then LAWYERS SHOULDN’T NEED TO HIRE HELP in order to complete the transaction without getting screwed!!

  3. Roclawzi says:

    If you’re an attorney who can throw a hissy fit for an hour, you can defend me anytime.

    But it would have to be worded into the contract that they could raise the price, otherwise they would need your consent, so no, it’s not legal. Unless it was so deftly hidden that no one can find it.

  4. youbastid says:

    Screw Tonik (and Blue Cross in general, of course). I had Tonik a few years back, then got insurance through work. After I left that job and needed Tonik again, they flat out rejected me, because while under their plan, I went to the doctor complaining of chest pains (heart burn) and another time received a prescription for Lunesta, which wasn’t even covered. Because of these two things, I was considered “too risky” and didn’t qualify.

    • juri squared says:

      @youbastid: Jesus, if they reject you for that, I’m utterly screwed if I ever need unsubsidized insurance.

      • SybilDisobedience says:

        @jurijuri: Tell me about it. I’ve had multiple surgeries for ovarian tumors, and I get wicked migraines about 4 times a month. I can’t catch a break most anywhere, and this company would laugh me right out of their (virtual) office.

  5. odinzero17 says:

    I was a Tonik member for a little over a year and a half. From when I first became a member they raised my premium from about $80 for their best coverage (it might of even been called eXtreme coverage) to $140 when I discontinued my policy. They never told you when or why they were raising your premium. They also automatically set you up for direct withdraws from your bank account so you would only know about it when they took it out of your account. Customer service was hard to get a hold of (I never could on their normal lines, I looked on the internet for other phone numbers). You don’t even get a statement or anything in the mail every month or ever. In short I don’t recommend this policy to anyone unless you’re that desperate for catastrophic coverage (which I was).

  6. BeeBoo says:

    You can’t expect to get decent non-subsidized health insurance for under $200 a month no matter how stylish and flash-reliant the website.

    • mythago says:

      @BeeBoo: You SHOULD expect the insurance company to be upfront with exactly how much they are going to charge you and for what coverage.

      • BeeBoo says:

        @mythago: Anyone who is going to charge your charge card or do direct withdrawals from your bank account should be absolutely upfront and clear about what will be charged.

    • SGriswold says:


      Actually there are plans from a few companies that cost <$150 if you’re healthy and under 30.

      You start REALLY getting screwed once you get into your 50’s, when the cost of insurance skyrockets and you get into the age where things start going wrong with your body, often making you ineligible for insurance in the first place.

    • TheLadyK says:

      @BeeBoo: This is why I am so screwed if I ever become unemployed.

      I have chronic depression and anxiety, have for years, that is well controlled with daily medication. Its close to deadly without it. Currently, I pay between $2-5 a month, depending on insurance plan to support my drug habit of thinking logically.

      If I didn’t get insurance through work, I’d be uninsurable, I’m sure. (No insurance = no drugs, no drugs = depression, depression = health issues including death, health issues, ironically = no insurance!) Retail? About $400/month… without income coming in.

      So screwed. I’d be a bag lady living under a bridge mumbling myself to sleep with a bottle of cheap vodka in no time.

  7. backbroken says:

    Old and busted: Health Insurance
    New Hotness: Bankruptcy

    Bankruptcy…the #1 choice for eliminating your medical bills since 2007.

  8. MoreFunThanToast says:

    I used to buy Tonik because it was affordable, around $60/month. Over the course of a year, they raised the premium for the same plan to over $100, with less coverage for certain services.


  9. PandoraWindies says:

    I had a similar problem with BC-BS.

    I filled-out the required info for coverage online and was quoted a monthly rate. I received an e-mail stating the rate quoted was subject to change based on the information I gave, I would receive an information package in the mail with the actual monthly rate.

    After about a week I received the package and the rate was much higher (three times) than the original quote. I never filled-out the forms and returned them, I just trashed the whole package and never looked back.

    About a month later I received a “late notice” with the (past due) adjusted rate plus late charges. I called to find out why I was being charged for an account I never signed-up for and was told that by filling-out the online form I had signed-up. I pointed out that there was no way they could expect anyone to sign-up without knowing what the actual costs would be. The CSR wasn’t happy about it and argued a bit but I stood my ground (Why would I sign-up for anything without knowing the price?) and she finally said that although it was not standard procedure she would cancel the account.

    I still don’t get it.

  10. ironchef says:

    blue cross rejected my health care application 62 days after I applied. Under the current law, I have 60 days to prove continuous coverage.

    Thank you blue cross. Thanks for nothing.

  11. Etoiles says:

    If this were any other product ordered online — ANY other product — then every commenter to this site would be up in arms about being charged 20% extra after looking at the invoice (product, shipping, taxes) and getting the notice that your order was complete. So how is it acceptable for insurance companies to do this?

  12. simplekismet says:

    I recently applied to Blue Cross for short term coverage as I am between school and a job. On my application submitted page, it says this:

    “Please note any premium rates may be subject to change based on responses to application questions, age of applicant(s) and/or scheduled rate adjustments.”

    I double checked; it doesn’t say it on my “application received” notice, but it is very plain on my “application submitted” page.

    Not sure if Tonik is the same, but they are run by the same company.

    • stinerman says:


      So in English:

      We don’t know what we’re going to charge you, but whatever it is you’ve already agreed to pay us that amount.

      Yeah, that’s legal.


    I had Tonik, and they did the same thing for me. I signed up for crappy $60/mo. coverage, but since I have a “pre-existing condition,” they set my premium at $98/mo. (Sidenote: the condition was a congenital heart problem that was cured w/ medicine when I was 3.)

    THEN after I was on the plan for a few months, they upped it AGAIN to $138/mo. But that time, with even less explanation.

    Their customer service has usually been pretty nice to me, but they definitely are in it to screw you being an insurance provider and whatnot.

  14. drftjgoj says:

    Hmm. A few years ago I had Tonik and didn’t have any problems with them. I think they upped my premium once over the course of 2 years. I have since moved on to my company’s insurance plan, but I remember liking Tonik’s coverage for me. I was in a very nasty snowboarding accident (fractured femur) and they covered everything without a single denial of benefits. They even covered a few months of physical therapy, which I remember my therapist saying a lot of plans won’t do.

    That’s just my experience with them, FWIW.

  15. Geekybiker says:

    Meh. No insurance in final until it gets to the underwriters. Its considered an estimate until that point. Happens all the time on auto insurance.

    • razremytuxbuddy says:

      @Geekybiker: That doesn’t make it right to suck in a potential subscriber with a low ball estimate, take a down payment, take forever for the underwriters to firm up the quote, and then tell the person who has been waiting and relying on the quote and payment, rather than shopping around, that it’s his tough luck the premium will be a lot more. I’ve been through this same scenario, and I consider it a pure scam.

      • Geekybiker says:

        @razremytuxbuddy: Just saying that an online system *can’t* deliver a firm quote. Maybe they don’t have an extensive enough questionnaire though?

        • Carencey says:

          @Geekybiker: If the online system can’t deliver a firm quote, then it shouldn’t be able to take a payment until the firm quote is delivered. If I am reading the OP correctly, the only piece of new information given between the first quote and the increase in premium was her credit card #.

  16. TorrentFreak says:

    Does anyone have any insurance they would recommend? I’m between school and work and I need health insurance but I refuse to pay $350/month for it. I am starting to think screw it, if I get sick I will go to the hospital with no insurance and then not pay them. It is ridiculous that health insurance has to be more then my car payment and electricity combined.

    Richest country in the world and I can’t even get antibiotics if I get ill.


    • resonanteye says:


      This is how I get medical help. I just can’t afford insurance.

      It’s hard though when you need any kind of non-emergancy care- or the dentist- but it’s better than nothing.

  17. JiminyChristmas says:

    In case anyone is confused by what John McCain’s healthcare policies are about, this is a perfect illustration.

    His plan is to treat employer health benefits as taxable income, and make up the difference by giving everyone a tax credit so they can go forth in the marketplace and buy individual policies.

    Well, this is what you can look forward to. Best of luck finding health insurance worth having with McCain’s $2,000 tax credit + ??? from your employer.

    • Quill2006 says:

      @JiminyChristmas: Exactly, and his tax credit would help me SOOO much, as I already pay almost nothing in taxes. I’m not proud of that, but I’m currently in a very low income bracket and am in school, which gets me most of my money back. I already can’t afford health insurance and am not covered through my employer. How is a $2000 credit going to help me when I would get maybe $500 more back from the government?

      Also, when I recently applied for Blue Cross Blue Shield health coverage, they doubled my quoted rate. DOUBLED it. 20% would have been great in comparison. Because I had supposedly dropped from the preferred rate I’d been at a year before when I dropped my coverage with them to the regular rate. They didn’t give me any reason why I had changed ratings, even though my health is the same. They also claimed on some of the paperwork that the premium was for two months, not one, when it was actually just for one month, which made me think I was getting the original rate. I tried to get them to clear it all up and they delayed so long I had to cancel it. What a bunch of BS.

    • Powerlurker says:


      If I’ve interpreted the plan correctly, if you have employee health benefits, it should be a wash. You get the same coverage as before from your employer, only now it’s taxable income, but should be offset by the new credit. If you’re self-employed, this should be better than the status quo as you now have tax benefits for buying your own coverage, which you did before only without any of the tax benefits that recipients of employee benefits did. Now, of course one could make the argument that universal healthcare is a better solution or that Obama’s plan is better, but it seems like McCain’s plan is better than the current mediocre setup.

      • grumpygirl says:

        Um, not exactly. McCain’s plan is to take the tax benefit away from employers who provide employee health insurance. The vast majority of employers don’t provide insurance out of the goodness of their hearts, and they will stop offering coverage because there is no tangible benefit in doing so.

        McCain’s idea is that the “free market” will drive down the cost of health plans. Um, yeah – that’s worked so well for everything else… It also doesn’t address the issue of people with preexisting health conditions being essentially uninsurable. Getting thyroid cancer at 18 (who knows how) pretty much eliminated any possibilities I had of being anything other than a wage slave.

        So I will hold my nose and vote for Obama, as it is simply a matter of basic survival for me.

  18. LucilleBateia says:

    I have Tonik, I suffer from Lupus. They have been nothing but AMAZING to me. All my medications add up to about 6k a month. Mostly it’s one med that would cost 5k without insurance. I pay $10 for it.

    They pay for my Physical Therapy, specialists, everything. I signed up for their best plan. At the time it was about $120 a month and now costs $138. Not a big deal for what I get.

    I think they are great and easy to get a hold of. They do medication overrides (like when you need to fill up an prescription earlier than when they say you should have run out) you simply call and say you need an override for whatever reason and they do it right away. They also let you fill up prescriptions 10 days early.

    I am not some secret employee of Tonik. I just am a very very satisfied customer.

  19. SunnyLea says:

    I think that whole “Congratulations! We are charging you more money!” thing would be hilarious if it weren’t so horrible.

    Sadly, it probably is legal. I’m pretty sure insurance companies are allowed to jerk you around in whatever way they feel like… mine certainly does.

  20. SagunaDascylus says:

    I definitely recommend contacting the Insurance Commissioner’s office in California and discussing this case.

    Write down all details as accurately as possible, and provide those details and all correspondence you have had with the company.

    Since I don’t know California’s laws on the matter and am not health insurance licensed in California, I won’t go into a diatribe on the principles of Offer and Acceptance. But I am curious if their rate raise after you submitted your application and payment constitutes a counter-offer and if you have a right under California law to decline that counter-offer.

    If you do approach the California Insurance Department, please let us know the outcome.