I’m not generally a critic of pooling resources to buy nice things like parks, infrastructure, space stations, security, etc. Insurance, whether private or public, may be one of those nice things. Yes, there is some injustice to resource pooling. Some people never go to parks, but must pay for them anyway. There are some roads in your city where you will never drive. But overall, the method gets things done when the private market cannot.
Should houses be built in low lying areas where there is a risk of flooding? It’s kind of like asking should anything be built near fault lines, or in coastal areas that experience hurricanes, or in Oklahoma where they have tornados, or in deserts where the heat can exceed human endurance.
So who is to blame for repetitive flooding / assistance needs? Ask who lobbied the politicians who directed the permitting people to allow building in flooodplains.