Most of Mercury's employees don't know the law of tort. The employees just know that they are to fight for their insured and find anyway possible to fault the other driver. If you believe that you were in the right, sue the driver and/or owner of the car so the court could determine liability.
The only point that makes sense is to sue if you truly believe to be in the right.
However, why would an insurance company deny liablity on a claim that the insured is liable for?
1.)Insurance companies already reserve for claims (well in advance) they expect to pay. 2.) If the insured is at fault, their rates go up. 3.) If the insured gets hit with a lawsuit, it's less profitable for the insurance company since now they have to employ defense and incur the expense.
Very simple, sue if you're not happy. IF YOU'RE IN THE RIGHT, it's easy to take on insurance companies, despite what the lawyer commercials say. IF you're just a whinny bitch, then you live a miserable life anyways.