There is no "towel" to throw, after the event has happened. Either the affected people have partial/full flood coverage in their home insurance, or they don't.  If they don't, there is no way taxpayers should cover them, ever...  It does not matter why they do not have coverage - they chose not to buy it, or could not get it, period, because the risk was too high.  But when everybody knows that a dumb government will bail you out, you build in the flood zone anyway.  You can always pin a thank-you card to taxpayers up at the Legislature!