The deposition of electrically insulating coatings is a challenging topic. This is especially true for applications where it is crucial that growth defects do not interfere with the function of the coating. Current deposition methods often have major disadvantages, including high deposition temperatures and low deposition rates, and cannot be easily integrated into existing industrial processes. This study investigated the potential for the deposition of low-defect coatings using bipolar pulsed magnetron sputtering with the aim of overcoming some of these limitations. Generally, sputtering low or non-conductive materials is demanding due to process instabilities or poor film quality. The latter can be primarily attributed to growth defects that inherently form during sputtering processes. Consequently, the film functionality can be improved by preventing the formation of growth defects. The present study pursued the approach of minimizing defect growth by interrupting layer growth. Initial concepts included non-reactive deposition of AlN to avoid problems due to target poisoning, the periodic application of a bias voltage during short deposition interruptions, plasma modulation, and the deposition of multilayer coatings by combining metallic seed layers with a sequence of different oxides to the desired insulating material. Progress was subsequently achieved by combining AlN and Al2O3 in a multilayer structure, as both materials appear to preferentially form different growth defects. The coating was deposited with a single metallic Al target and varying the reactive gas from nitrogen to oxygen. Another strategy applied was to ground the substrate holder during deposition, which resulted in more homogeneous coatings and proved to be crucial for the process. This approach has enabled reproducible deposition at rates of up to 500 nm/h at a substrate temperature of 400 °C. Further investigations revealed a resistivity of up to 7E11 Ω·cm and columnar growth of AlN as well as mixed crystalline and amorphous growth of Al2O3 with sharp layer interfaces.