just have your insurance deal with them. Or tell the other company that you have talked with the insurance commissioner from your state and what they (the insurance company) says isn't what the insurance commissioner says. I'm betting things change in a hurry.
"I talked to a lawyer/the insurance commissioner/whomever" is an empty threat, doesn't work very often, never works on an experienced adjuster. They hear that stuff all of the time. If he wants the other person's insurance to handle it, all he has to do is what I outlined.
