Cant comment on the keys, but the insurance....
If they refuse to cover you for the keys ask which clause in the policy excludes them, once they've given you the clause ask if thats their full and considered determination - get them to say yes!
Have a read of the clause - if it's absolutely clear that it excludes car keys then not much you can do unfortunately. If however its in the least bit unclear start making a fuss about it; basically it should be very clear - if not then it's not a fair clause. If you want post a copy of the clause up or dm it to me, happy to have a read and let you know what i think.