"The children have a jacket."
Translation:לילדים יש ז'קט.
As you say, it's not widely used in everyday Hebrew, and what's more, when it is used, it refers to a suit jacket, not a coat. It's very rare for children in Israel to have a suit.
Note: every online dictionary that I've checked claims that מקטרן is a direct translation of "jacket", which would imply that it does refer to a coat. But I've only heard it used to refer to suit jackets, never to what protects you from the cold.