its not possible that the timing belt fell of due to ECU vent pipe underneath the coolant fan in this car, since this is a m/y 2001. The vent pipe was changed around new year 1999, which means after half m/y 2000 production. This car is built after that break and have a shorter vent pipe which should be OK.

If the pipe was of old type (longer) the driver usually hit the vent pipe when parking too cloose to pavement. When pipe has been hit, it become loose and will interfer into the aux belt (and timing belt) with engine failures as result.

Normal engine failures should in many cases be covered by insurance company, when there is no technical reasons which can be covered by warranty or customer.

Repairing the engine is much cheaper (maybe 3-4000) and if dealer replace whe whole engine, it will cost more, maybe 5-7000. I think 12000 is too much.
Dealers always want to replace parts rather than repairing, since they get more profit the more expensive the parts sales are. (40% of the net parts price is dealer profit, and of course an engine cost a lot more than a cylinder head)