Legal Question in Insurance Law in California

The short answer is, "because it's not YOUR insurance."

The long answer involves a somewhat obscure area of the law called "subrogation." In laymen's terms, to be subrogated means to step into the shoes of a claimant by satisfying a claim that you are not liable for, but are obligated to pay for some other reason. In your case, the landlord's insurance company was not directly liable for the damage, but they were contractually obligated under the insurance policy to pay for it. By doing so, they became subrogated to the landlord's claim against you for the additional damage. If you carried renters insurance, you should tender the claim to them, because they are the ones with a contract with you to insure against your negligent conduct (though there may be an exclusion for damage to the rental property). It's worth a try in any case. If you did not have renters insurance then you have a problem.

Because you separately settled with your landlord, however, you may have another obscure legal principal in your favor, called "accord and satisfaction." By accepting your agreement to pay for some of the damage, the landlord's settlement with you may be asserted against the insurance company. Because the insurance company stands in the shoes of the landlord, the landlord's settlement with you affects them. It's a rather complex area of the law, and without a full review of all the facts, circumstances and any related documents including any applicable insurance policies, I can't even begin to say if that argument would stand up, but it's certainly one to consider in your situation.