Maturity comes with responsibility. It is good that she offered to pay. State laws differ however if your sister vandalized a vehicle by kicking it repeatedly and causing a dent then she can usually be held personally responsible. Given the conduct of your sister it may be that the other party did not feel comfortable trying to get the money for the damages from her directly and thus chose to use their own physical damage coverage and paid their deductible to do so. Making a claim may also affect their future insurance rates.

Since they went through their own insurance company it is likely that insurance provider will now subrogate with your sister. This means they will contact her and request that she pays them for damages she caused to the vehicle which they paid out the claim on. The insurance company may request the whole $750, meaning the $250 deductible and the remaining $500 they paid out, or just the $500 they paid out. If they request the $750 then they should return to their policyholders their $250 deductible.

Common sense says that your sister is responsible for the full $750 if she caused $750 in damage, regardless of any other payment. Whether it be from grandparents or an insurance company.

If the insurance company does not subrogate for the victim's deductible then that person could request the $250 deductible be paid to them and in most states this means they could take your sister to court to seek a judgment for this amount that they are out due to her actions. The other party could not normally now request the whole $750 amount from your sister since they were not out that full amount.

If your sister pays the other party any amount she may want to get a signed document stating the amount given, etc so that if the insurance company does come after her for monies she can prove what she has already paid back to the other party.