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I know how you feel...it's a bloody nightmare. Everytime I was in an accident (not my fault) I couldn't sleep for days dealing with this type of BS. I guess that is why they have no-fault insurance in Canada now, so no matter what happens, you deal with your own company only and if you have the different options you can get a rental Navigator if you want.
It doesn't sound right to me...your situation, so I would definately check it out and luckily it wasn't serious...I am glad your wife is OK. You might want to call another insurance company or a buddy in the business for a second opinion.
Good Luck.
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Life's jounney is not to arrive at the grave safely in a well-preserved body, but rather to skid in sideways, totally worn-out shouting, "Holy sh*t! What a ride!" - unknown 
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