(a) Every municipality shall have plenary power and authority to contract and expend public funds for the purchase of one or more policies of public liability insurance, with or without a sharing in the cost thereof by the officers, agents and employees of such municipality, providing the municipality and its officers, agents and employees insurance coverage for legal liability of said municipality and its officers, agents and employees for bodily injury, personal injury or damage (including, but not limited to, false arrest and false imprisonment) and property damage, and affording said municipality and its officers, agents and employees insurance coverage against any and all legal liability arising from, growing out of, by reason of or in any way connected with, any acts or omissions of said municipality, or its officers, agents or employees in the performance of their official duties. So long as the coverage aforesaid is obtained and remains in full force and effect as to the police officers of a municipality, the bond specified in section five, article seven, chapter sixty-one of this code shall not be required as to such police officers.

(b) Every municipality shall also have plenary power and authority to provide for the indemnification of its officers, agents and employees against any and all liability, losses, damages, expenses and costs, including court costs and reasonable and necessary attorney fees, arising from, growing out of, by reason of or in any way connected with any acts or omissions of said officers, agents or employees in the performance of their official duties. Such indemnification may be provided by a self-funding program, by expenditures from the General Fund, or by the purchase of insurance as provided in subsection (a) of this section, with or without financial contribution or participation by such officers, agents and employees. Prior to the expenditure of any public funds pursuant to the power and authority conferred by the provisions of this subsection (b), the governing body shall determine by ordinance applicable to an entire class or classes of officers, agents or employees the manner in which such power and authority shall be exercised.