It is normal for you to accept a settlement of some kind. The only question being... is the settlement high enough? If it seems fair to you, then take it. If not, you might continue to threaten legal action and see if they raise the settlement.
If you haven\'t done so already, you need to hire a lawyer as soon as possible. Let the lawyer negotiate the settlement with the insurance company. They will be able to advise you what is normal acceptable compensation for a case like this. Don\'t talk to the insurance company or your friend at all until you have a retained legal counsel.