Insurance has nothing to do with people drowning or ending up homeless. It pays to rebuild a home in a flood zone. Perfectly fine. There’s a risk to living in a flood zone and insurance is a perfectly valid way to spread the risk. Just like any other home owner insurance.
But if you subsidize the insurance, then you inadvertently encourage people to build, and rebuild, where the risk is higher than the insurance cost would indicate. You want to live in a flood zone? No problem. But the risk you choose, and the cost associated, should be your responsibility.
