You turn it over to your auto insurer and they will defend you and cover losses up to your policy limits. If you did not have auto insurance, you will need an experienced attorney who will protect your interests. I have done these in the past where no insurance was involved and bankruptcy was not an option for the client.
He can try to settle the claim directly with the adjuster for the insurer of the store. That doesn't usually work and he will have to find a personal injury lawyer. A suit would be more than likely to get proper compensation.
Yes, because the insurer denied the claim, so no one was getting anything. The lawyer, through their efforts, got these benefits coming and are entitled to 1/3 under the fee agreement. But for their involvement, your caregiver would have zero.
Insurers are inherently unfair and will never deal fairly with unrepresented people. If they offered policy limits (assuming one trusts them to disclose policy limits) that would be different. The insurers job is to pay out as little as possible.
Litigation with an experienced attorney is the only way to even the playing field. If your friends family has been offered $100k, then a hired attorney could adjust his or her fee based on the money already offered without counsel and the attorney...
It wholly depends on your status as an insured driver or not in Michigan. Please have your father check immediately to find out the status of the insurance. Also, how do you know the other driver was drunk if they drove off? Was this info from the police after they caught her? You should certainly obtain counsel right away and complete these investigation items. Sorry for your losses here.