Obviously, you should NOT file a fraudulant insurance claim to help them pocket the money.
Under the terms of your lease and/or the laws of your state do you have an obligation to repair the damage or otherwise make them whole for the damage to their property from the storm? If so, the fact that you have been lax about enforcing your rights (timely payment of rent, payment of deposists etc.) that may not relieve you of your obligations.
If you do have such an obligation, then I would not see a (moral) problem with giving them the money that the repairs would cost. They can decide whether to use the money for the repairs or other more pressing needs. You have indicated that the damages are small enough that you would not file an insurance claim (maybe smaller than your deductible?)
It sounds like you have been generous and compassionate in your dealings with these tenants, but it also sounds like you are getting uncomfortable with the arrangement. Perhaps the incident with the storm has made more clear to you the risks and liabilities you are assuming by letting them live there for below-market rent while not enforcing the terms of your lease.
If you don’t feel comfortable continuing this arrangement, I don’t think you have any obligation to do so (other than what your lease may have created). Simply tell them that you have decided to do something else with the house when their lease expires. It would be compassionate to give them 2 or 3 months notice so they have ample time to make other arrangements.
You might also be able to help them with referrals to various social service agencies that could help them with rental assistance and other services during this difficult time. These government and private programs are there to help people in situations like this.
It is probably better to let the social workers do social work, rather than trying to do it yourself while also being their landlord.