I'm sorry, sounds like some of your data on your PS3 was reset.
I own all the major consoles, but I play Mass Effect 3 only on PC.
I have a vague idea on what happened, and there are some files on the PC you could try to modify/revert to restore your progress.
I do not know how to do that on the PS3.
I recommend going through Sony's Support and ask about Trophy progress resets. They are probably a bit more experienced on these issues in the general sense and may have a way to restore your progress.
It sounds like you might have to do Insanity twice.
However, there is a potential shortcut. Multiplayer is another way to unlock that Achievement and all you have to do for that is to extract on Gold from the 6 original Multiplayer maps. Multiplayer has been going on long enough that you could probably make a friend to help you carry you on through if you can't do it yourself. Then, you can tell people you beat it on insanity in Single Player, and have a Trophy to show for it, even though another PS3 player helped you get the thing to show.