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What kind of insurance does she have on the car? It may be better in the end that he was listed on the policy, IF you have a comprehensive type policy, and not just liability insurance on it. I would imagine that if the car is not paid for then the noteholder would require some sort of comprehensive policy to protect their investment.
So, if the jerk was listed as a driver, and you have more than standard liability, your insurance company should be paying. You might also want to hit them up for loss of value as well if you've got the comprehensive policy.
Don't let the insurance company tell you they aren't paying and leave it at that either. If need be, spend a hundred bucks and get an hour long consultation with a lawyer who works on such matters. You may be glad you did.
In either case, look forward to paying way jacked up rates after the insurance company pays out, if they don't outright cancel you...
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