Country bumpkin, dont have much to offer in regards to treatments, but didn't want to just read and run! I suffer from insomnia too, its either I can't get to sleep until about 4 in the morning, or the reverse, I fall asleep ok but am awake from about 4. Once it gets a hold I seem to enter a loop where it just goes on for weeks on end. I try and cope by telling myself Ive no pressure to perform as such the next day and can go back to bed if needed, though I never do. I definitely have no bother sleeping if Ive had a busy day, like when I am up from six to care for my grandchildren, but its the in-between days that I find problematic.
You are bound to feel a bit low of mood since the death of your friend, and the insomnia could be a natural part of the grief process. I hope the Diazepam and sleeping tablets help you get back to a normal pattern again. I cant see any harm in getting on the waiting list for the Psych referral, and by the time it comes round you can either go or cancel depending on how you are feeling then.