Say somebody crashed into your car and bent your bumper... their insurance company paid you $3k to get it fixed. You don't have to get it fixed.

The insurance company says your repair will cost $X.. how you spend it is up to you.

Having said that... You probably won't be able to match the wood floor. Flooring changes over time (thickness, colors, plank dimensions... etc). We just renovated our kitchen and moved things around. My wife wanted to keep our old floor so we had to 'patch' the floor in areas (under our old island, and in new sections of the kitchen). It cost us more than just replacing the entire floor.