Sadly, it may have everything to do with it If car keys are stolen by means of force - either in person from their owner or by forcing access to a place of keeping - then that's one thing, but if the keys were willingly left with uninsured persons who were thereafter liable for damage to the car, then the insurance company could claim that the keys were not given due care. There's usually a (small print) clause about such things in the insurance policy.
I'm not saying it's right, but as an insurance company they'll use any legitimate means to avoid paying out thousands of pounds
As Playsatan2 says, shouldn't stop you doing everything you can to extract a settlement from them.
If ultimately the insurance route fails - and I guess this depends on how you see your future with this mate of yours - you might consider speaking to a lawyer about the possibilities of taking him to court and claiming damages directly from him (assuming he can't/won't pay you back voluntarily). Citizens' Advice may be able to help with this if you want to get a rough idea of where you stand without handing over any cash.
Good luck, mate.