Largely for the hassle of dealing with the situation of needing to replace the vehicle with something else for what they will give you.
How would you like to have an older vehicle you maintained religiously, wanted to keep a few more years to be totaled by someone rear ending it?
Now you gotta find something to replace it with the money they gave you. The problem is that you most likely wont find something as good as what you had and the accident ends up costing YOU money, since your now making a vehicle payment or paying more for a later model car.
Auto accidents and suing isn't some new trend that is going to escalate the cost of insurance. That has already happened decades ago.