Your buddy is not being straight with you. Red flags all over his reaction/responses to you. That doesn't mean the insurance company is right in this instance. I have no idea if they are, or are not, but I can tell from what you've posted thus far that your buddy has a hand in this issue.
I've always been told it is risky to cash the check because it can imply you accept the insurance company's settlement amount and limits your options for pursuing further insurance money
That's not correct. There is no such thing as an implied settlement.
