my LLCs box truck got rear-ended by an at-fault driver but his Progressive commercial policy is now denying because the named insured wasnt driving - do i go through my own collision and let them subrogate?

small business owner here trying to figure out the cleanest path forward. would appreciate input from anyone who has dealt with commercial auto subrogation on the carrier side or had something similar happen.

the situation: my LLC owns a 2021 Isuzu NPR box truck used for HVAC service work. on april 14 my technician was stopped at a light when a Ford E450 delivery van rear-ended us at maybe 25 mph. clearly the other drivers fault, police report assigns full liability to him, citation issued, no question on facts. damage to my truck is $18,400, plus we lost 9 days of revenue while it was at the shop ($7,200 in invoiced jobs we had to push or subcontract out at a loss).

opened the claim with the other drivers carrier (Progressive Commercial). they confirmed coverage, took the report, said they would handle it. fast forward 6 weeks of slow walking, they come back saying the driver who hit us was not the named insured on the policy. the policy is held by a small courier company. driver was apparently a 1099 contractor not listed as an additional insured or driver. Progressive is denying citing the "driver exclusion" / non-permissive use language and pointing me back at the actual driver, who is judgment proof, broke, and basically uncontactable now.

options i can see:

(1) sue the courier company under negligent entrustment / respondeat superior theories. courier company has minimal assets per a quick public records check. probably uncollectible even with a judgment.

(2) sue Progressive directly arguing the driver was a "permissive user" of the vehicle since the courier company was using him to make their deliveries. their internal classification of him as 1099 vs employee should not change the policys obligation under most permissive use case law i have seen. this is the route i think actually has legs but it means hiring an attorney for what is functionally a $25k-ish dispute.

(3) submit a claim under my own commercial auto policy (Travelers, i have collision with $1,000 deductible and rental reimbursement that ran out around day 4). let Travelers subrogate against Progressive. i eat the deductible and the business interruption loss but i get my truck back fast and clean.

(4) make UM/UIM claim against my own Travelers policy. driver is essentially uninsured if Progressive successfully denies. but my UM/UIM is at minimums because i thought commercial auto liability was the bigger risk - i am underinsured for this.

im leaning toward option 3 - take the cleanest path, eat the $1k deductible plus the business interruption hit, and let Travelers fight Progressive on subrogation. but i am worried about (a) what this does to my commercial auto renewal next year, and (b) whether Travelers will even pursue subrogation hard enough to matter, or just chalk it up and raise my rates anyway. anyone been on either side of this? does Travelers actually go after carriers like Progressive on the driver exclusion issue or do they just close the file?