A lot of places self insure, but some already buy insurance as you describe. Qualified immunity is a pretty high bar to get over, but some people do get settlements. I’d argue insurance should have to be bought by the officer, or their union to have any effect on their behavior.

The Aging Wheels youtube channel has a fair bit of trabant content. I’d never heard of them as a car, but its neat history.

https://m.youtube.com/watch?v=UhpIgM6TpwA