The cop was right

Driving without an insurance, although a violation of criminal statute, is not a arresable offense. Besides, you cannot throw somebody into jail without a court action. That would be a violation of the Due Process Clause, from 14th Amandment. Most time the DA will make a discretion on to press charge or not and 95% of cases would not go to court.

As I said, the purpose of criminal law is to punish wrongs to public, not necessarily compensate individual victim. Your case more or less will be treated as private wrongs and Tort court is the approriate place to claim your damage. The purpose of tort law is to allocate loss economically between victim and tortfeasor.