In fact, he is not suing your insurance company - he is suing you and alleging your negligence is the cause of his injuries. You insurance company will handle this because they have the duty to defend you, as their policyholder, and to pay any judgement that might result.
In order for him to collect any money from you / your insurance, he will need to prove that he was injured and that you were responsible. It appears he will have little trouble proving you caused the accident. However, he may have a difficult time proving he has any real injuries. If he did not seek or receive any immediate medical attention that does not help his case. He would have to provide evidence of medical treatment due to injuries caused by the accident. He could receive reimbursement for medical care, but would have to prove the care was needed due to the accident. If he is, currently, perfectly fine health-wise, it would be difficult for him to make a case for any disability or pain & suffering. He would have to prove an injury exists and your insurance company will make him do that before they offer a dime.
You need to get in contact with your insurance company adjuster who is handling this claim. Give them your statement and any information you have about your "buddy's" injuries, demands, etc. Cooperate fully with your adjuster and let them handle this.