New Zealand Law
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There is a real risk all the claims will be refused because of the changing stories. Even though you have been straight with the insurance company, the changing stories are likely to make them decline the claims and cancel the insurance. Your son should tell the truth, but I am not sure that this will end well for anyone.
You can complain to the Insurance Ombudsman if you think you are being treated unfairly. This is a free service and they will look at this. You must first complain to the Insurance Company, although you may have done that already. The basis for the complaint is that other people have lied, but you have been quite honest and truthful
Insurance companies operate on a principle of utmost good faith, implied in all insurance contracts, which sets a very standard of honesty and integrity. This means that when a claim is tainted by lies, as has happened, they get generally suspicious, and are entitled under insurance law to reject claims or at least examine them very closely. Where you are the innocent party this can be a difficult process and be upsetting as this was not your doing. The option to the Ombudsman would be to sue, either in the Disputes Tribunal or the District Court, stating the rejection of the claim was not correct as a matter of interpretation of the contract and the acts. But that would be an expensive option