I see that Bristol West Holdings (BRW), a nonstandard auto insurer with operations in FL and Ca went public today. It was up over 14% on opening day and is trading at a PE of 30. At current prices, TCHC trades at a PE of roughly 8, one quarter of BRW's. The moral of this (true)story: The market is waking up to the valuations of insurers including ones whom specialize in nonstandard insurance. TCHC is currently valued at a small fraction of the valuations of others in the industry. That will change and TCHC should be an easy double or better this year.
I guess a better way to put it would be to say that while insider does have legit concerns it seems that these concerns are not weighing the market down too heavily. It's much like the concern that I have over CSCO massaging their numbers so that they look better than they are; or when JPM starts to take on a lot of risk that they have no way to compensate for. You are correct to point out the long term unsustainable or dangerous nature, but risk is being loved in this market (rightly or wrongly) if it's risk they want, I'll buy into it too. Hopefully I'll be able to jump out before everyone else does (haha, this is not likely to happen).
brw coming public is an interesting development. As you stated, it trades for a P-E of 30. That looks pretty fair considering its growth rate and prospects. I have long felt that tchc has been trading at a discount to its intrinsic value. When one considers the expanded product line, and potential new markets, it is not hard to see that tchc has the ability to greatly enhance shareholder value. Management is savvy and is determined to grow the business. Never forget that insider ownership is above 30%. The Chairman of the Board owns roughly a million shares. He has built this business on low-cost, quality service auto insurance and has taken it to a new level of a diversified insurance holding company. Institutions are increasing their ownership, and I would expect them to continue to do so. It has been a wild ride so far as a shareholder, but all in all, almost every shareholder is way ahead. IMO, it's best to buy this stock and just forget about it. Hold for the long-term and collect the dividends that have been increasing dramatically. Good luck.
Bristol West was already part of a public company - it is owned by KKR (a public investment company). KKR owns a number of companies and Bristol West produces 600-900 million in production, so it is not comparable to TCHC.
Bristol West is owned by a substantial company with many millions in holdings, not like a small holding company with an insurance subsidiary.
TCHC is over-valued at the present and the main insiders are getting ready to dump even more of their shares of stock. I would not count on the fact that he owns 1 million shares at present. Planned sales are coming.