Car insurance is dropping us

This is really just a rant but if anyone has any advice on how we should handle this, that'd be nice.

So a couple weeks ago my husband and this other person were both backing up (or something to that effect, my husband says he's not sure what the other person was doing, he didn't see them at all) and they bumped rear bumpers. My husband says there was no damage to either vehicle and there's nothing on my car I know, but the other person insisted that he give them our insurance info (which I understand but still, if there's no damage then idk what the deal was). Now, we get a letter saying our insurance is going to drop us once our term runs out in March because the other person claimed personal injury and damage to their vehicle.

According to the agent we spoke to when we finally were able to get a hold of her, the other party hadn't even contacted them back since the accident so nobody from our insurance has been out to inspect either vehicle, ours or theirs. I call ******** on the other people claiming personal injury at the very least. We have liability so our insurance is supposed to pay for up to $25,000 in damages (which is the state minimum) and there's no damn way a little bump like what my husband described would cause over $25,000 in damages.

We've had a ton of problems with this insurance company so we were meaning to switch to something else but now with this stupid "accident" claim we are getting dropped and any other insurance is going to raise our premiums. This is total bull crap. My husband doesn't even know where that other car came from, and where he was it's really hard to see anything. It's a really small parking lot right on the corner of a busy intersection and it's hard to back out of those parking spaces. I myself have trouble backing out of there, and more than likely my husband had parked on the side where the parking lot narrows into a triangle, it would have been easy for either my husband or the other person to not see each other if they were turning right and going by that side of the parking lot.

I wasn't there so I don't know what the heck happened but it's just so stupid, my husband says there was no damage, no scratches or anything, and they couldn't possibly have been going fast enough to cause bodily injury, so I don't understand why someone's got to be an *** about it.