| By Gautam Naik, Jim Wyss and Greg Ritchie In the hours before Hurricane Milton reached land in Florida last week, a saildrone dispatched into the maelstrom by US government researchers sent back heart-stopping data. Ocean waves driven by supercharged winds had surged to more than 28 feet tall. It was a specter that sent millions of people fleeing for safety.  A restaurant damaged by hurricanes Helene and Milton in St. Pete Beach, Florida. Photographer: Tristan Wheelock/Bloomberg Three months earlier, lightning flashed and the wind screamed at 200 miles per hour as Stephen Pituch wrestled a 75-ton propeller plane through another mammoth storm — Hurricane Beryl. Pituch is a hurricane hunter, an elite US Air Force pilot who flies into some of the most violent weather on Earth. His plane fell a stomach-churning thousand feet in the early hours of July 3 as it flew into Beryl over the Caribbean Sea. "We were getting beat up," he says. "I thought it didn't bode well for Jamaica." He was right. Though Beryl only grazed the island's southern shore, it damaged more than 13,500 homes, shredded hospital roofs and left behind $250 million in losses.  A home in Rocky Point that was lifted off its foundation by Beryl. Photographer: Bryan Anselm/Bloomberg Jamaica's government had prepared for precisely this scenario. So, too, had the insurers and local governments exposed to the recurring storms that batter Florida. Governments in both places had spent millions of dollars on securities called catastrophe bonds, which act as insurance if disaster strikes, and they were relying on those lifelines to fund recovery efforts. Floridians will get money in line with actual losses. A similar arrangement made by Jamaica didn't help at all. Its government has a catastrophe bond backed by the World Bank that could have yielded a $150 million payout, but it didn't trigger because Beryl's air pressure missed the required threshold by a hair. That sense of injustice puts into doubt a market-driven tool that's being pitched as a way to protect vulnerable populations against more extreme weather. For years, diplomats have fought bitterly at annual COP climate summits over the need for developed nations to set aside money to assist poorer countries. Now, there are discussions about using some of the limited resources gathered in a loss and damage fund to finance insurance programs that could tap capital markets for greater payouts, according to people familiar with the talks. Insurers and governments in the wealthy world tend to dislike the binary nature of parametric catastrophe bonds like the one Jamaica deployed. Yet the promise of speedy payouts has persuaded the World Bank and Western governments to push them for the developing world, even as the risk-reward curve shifts in favor of investors in London, New York and Zurich. Julett Morgan, a 50-year-old vegetable seller whose wood-and-tin shack collapsed in a hard-hit area called Rocky Point southwest of Kingston, didn't know about Jamaica's cat bond. But as she surveyed the damage around her, from ripped roofs to toppled homes, it seemed inconceivable that an insurance policy, of any variety, wouldn't pay something. "My house was flat, flat, flat," she says. "The storm took furniture, clothes, everything. I've never seen anything like it." Read the full story about how one of Wall Street's favorite climate bets works differently for rich and poor countries on Bloomberg.com. | 
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