Will my insurance stick me a big bill?

Three years ago I got into wn accident that was my fault. Around october a lady from my insurance called to tell me I am being sued and i need to give them a statement. It was a while ago and i have bad memory but i did the statement, now my insurance sent me mail saying my story contradicts the claim against me so they are denying me coverage and have the right to get back any money spent for defending me. Does this mean they will stick me with a huge bill and leave me dealing with a lawsuit on my own? Can i sue my insurance for practicing in bad faith? Please help me.