If its under the street, then its their job to fix it
Many sewer utilities are responsible only for the main sewer and the person whose lateral is involved is responsible for everything else including the tap.
I would ask the plumber if its possible to sip a large pex plastic pipe into the current pipe to prevent any future issues. I have an illegal water pipe. The builder put 1-1/4 inch well pipe(inspectors name was payola) instead of copper. Was talking to the town water guys, who were all too familiar with the issue and the said one of their “friends” had a rig to pull a correct copper pipe to the city connection. I was restoring a 1870’s house with a bad gas pipe. The plumber used the old pipe as a conduit to push a new pipe. In your case all you need is a barrier, so even if the connection isn’t perfect, all you want is to prevent the terracotta from being a problem down the road. Since the likelyhood is the pipe is straight you might even be able to dig up a 6-10 foot section on your property and shove some pvc through your current pipe.
just my 2 cents