via In These Times: Bigger and more expensive storms are brewing. One study found that as much as $507 billion worth of U.S. coastal property could be underwater by 2100. With $416 billion in assets at risk, the Organisation for Economic Co-operation and Development labels Miami as the city that could face the most property damage worldwide as a result of rising tides. Hurricane Katrina already claimed $48.7 billion in insured losses; Hurricane Sandy caused $18.75 billion worth.

Governments, meanwhile, are doing little to prepare. As we head into this year’s climate talks in Paris, prospects seem dim for a comprehensive plan to scale back emissions to the extent required to prevent catastrophic warming. In the United States, Department of Energy scientist Tom Wilbanks has called this country’s crumbling infrastructure, which is woefully ill-equipped to cope with even moderate climate impacts, “a national crisis.” On top of that, our federal disaster response mechanisms remain sluggish, still underfunded and encumbered by the bureaucratic mismanagement that characterized the responses to Katrina and Sandy.

But thanks to Wall Street’s ability to turn a sow’s ear into a silk purse, one disaster management tool is starting to gain traction.

The “catastrophe bond,” devised in the aftermath of 1992’s Hurricane Andrew, is a form of “reinsurance.” Reinsurance protects insurance companies in case they can’t pay out—for example, after a flurry of simultaneous claims following a catastrophic event. Stung by Katrina and Sandy, in the last decade insurance companies and eager investors have fueled an average annual growth of as much as 25 percent in what is known as the “cat bond” market, with a record $8 billion sold to investors in 2014 alone. These financial instruments are also being floated as a solution for the risk incurred by public-sector entities that range from the debt-ridden National Flood Insurance Program to impoverished countries that could face bankruptcy should a massive storm hit.

There’s just one hitch: …

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