Was this check altered or forged, and why does it

Our customer issued a check to an insurance company. The item was altered (washed), made payable to a new payee, and deposited into that payee's account. We were outside of the 30 day return window and went bank to bank to recover the funds. We are being told that our claim is being denied due to the following: "The check contains a forged maker signature. This is not an altered item and there is no breach under UCC § 4-208. Our review of other items involving this drawer demonstrates that this check was not signed by an authorized signer of the drawer. As a result, we decline to pay the claim." How would they as the depositary bank be in any position to tell us that our customers signature is forged? It was not forged. The payee line was altered. What are our rights to refute their denial so that we can reclaim the money?