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Are you suggesting the family should simply accept "Ooops, sorry"?
So your response would be to sue the department for money that the people pay for? Insurance or not the money still isn't being payed by those that would have raided the wrong house.
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If the democratic system is working properly, when the taxpayers get tired of paying for police who raid the wrong house, they will vote the elected officials who continue to let the police do so out of office.