That might be true in some cases but I'm sure there is more to things than that. A good insurance company will want repairs that reflect their standards, not a shoddy job that the customer is going to complain about. When I've had repairs done the garages used were widely regarded as being the best in the area.
My current insurer’s (Aviva) nearest approved repairer to where I live is also approved by Audi, VW, Seat and Skoda.
My brother - also insured with Aviva - claimed for body repairs to his car under his policy a couple of years ago (Mutjack deer jumped out of a hedgerow into the side of his car). He used the above approved repairer and the repairs were excellent. Because of my car OCD, I’m usually quite good at spotting repairs; differences in paintwork finish and colour, irregularities in panel gaps / shut lines, paint overspray etc. I could see absolutely no evidence of repairs to his car, and because I’d seen it in its pre-repaired, damaged state, I knew where to look.
I’d have no hesitation in using my insurer’s approved repairer - certainly not the one who repaired my brother’s car, and that would be the one my insurer would direct me to as it’s closest to me.