Yes - you should be concerned and ask that direct question to your insurer without delay.

I assisted a colleague in exactly the same position; the terms of his contract were similar and he was liable for the costs. Luckily I advised him to return the hire car (which he did) limiting his liability.

The approved repairer provides the car at no cost to the insurance company, as part of the agreement to become “approved”. This is why some insurance policies have add on “courtesy car” cover for an additional fee to cover situations where a replacement car cannot be gotten form the repair shop.

Please let us know the outcome.