I can only hope lawyers for the town have looked in to it.
Insurance isn't meant to prevent anything. It's there to help things get back to normal when bad things happen. What prevents your house from being flooded is not buying a house in a flood zone or right next to a major waterway.
As for suing the corps I'll defer to just about everyone. I don't know a thing about them. What would you sue them for? What have they negligently done? If they set the flood plane (one hundred years) and it flooded it seems to me they were spot on.
Those people chose to live in a flood plane, like me. They shouldn't be angry at anyone other than themselves. If there is something I don't know regarding that particular flood plane or neighborhood, I apologize up front. I'm just adding my two cents in general.