Insurance Company Wants Money Back

[frustrated and innocent]

My question involves insurance law for the state of: California

My sister's car was hit and totaled while parked on the street in front of her apartment. The police report says the driver was at fault, obviously because my sister was not in her vechicle. After months without a car, the insurance company paid her out and took her old car away. Now a year later, she receives a letter in the mail from the insurance company saying the claim was reevaluated and it was discovered to be her fault. They are telling her she must pay the money given to her back to the insurance company. Can the insurance company do this? Also how was she at fault if she was not in the car?

[Mr. Knowitall]

What does the letter say about why they have changed their mind? If it doesn't explain, what was she told when she called her adjuster and asked?