Based on the facts as you have given them: You didn't own car, but you authorized someone else to drive a friend's car. Generally, the insurer would have the ability to pursue the owner and/or the driver. In this case the argument is that you were acting in the place of the owner or against the wishes of the owner in entrusting a third party to drive. The issue would be whether you entrusted the vehicle to a someone you either knew or should have known was incompetent to drive. You should report this to your insurance carrier. And you should talk to a lawyer.
As you were not driving and didn't own the vehicle you shouldn't be involved at all. You should immediately consult a local attorney regarding this matter.
You shouldn't talk to an insurance company without consulting an attorney. You will also need the attorney to investigate various facts of the case to see if these particular facts give rise to negligent entrustment.
Hire an attorney. Depending on the circmustances, you may have a legitimate defense against the neglligent entrustment charge, but you may be better off trying to settle the case as cheaply as possible. Either way you need a lawyer.
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