I suppose my point is that MB is a car company and is perfectly capable of fixing its own cars. It doesn’t need to do it through an insurance company at all!
Mercedes is the conductor, not every person in the orchestra.
They design and make some but not all of the cars they sell, with the design and production of some models being outsourced to specialists.
They make very very little of the cars they sell, it’s subcontracted to specialist manufacturers, your brake pads will be made by Brembo (or similar).
They sell very few of the cars they make, they’re sold by specialist automotive retail groups, your main dealer will be Sytner, Lookers, LSH (or similar).
They repair very very very few of the faults which occur on their cars, their workshops are specialist automotive retail groups, as explained above.
They repair very very very few paintwork defects (after delivery), their main dealers will have a contract with a local bodyshop which works to MB standards.
Mercedes don’t do it all, there are lots of businesses involved in the design, manufacture, production, distribution, sales, repair, servicing etc of their cars.
If there’s a warranty repair - whether it’s a new car, approved used, or extended warranty - then the business who repairs it will want to be recompensed.
Unfortunately just as most people can’t afford total peace of mind when buying a warranty, most people couldn’t afford a Mercedes engineered to the highest standards with the highest standards of service, and which Mercedes’ deliver end-to-end.