As Florida reels from the impact of Hurricane Milton, some Wall Street investors appear to be on track to profit from catastrophe bonds tied to the storm’s outcome. Cat bonds are a specialized insurance tool that can help people who've lost their homes find money to rebuild– or deliver big profits to investors who are willing to gamble on big natural disasters. As Bloomberg’s Gautam Naik has reported, last year cat bonds were the most profitable strategy for hedge funds. Naik tells Akshat Rathi about how these financial instruments differ from ordinary insurance, and why they have become an appealing proposition for climate vulnerable nations desperate for any kind of help they can get. Explore further: • Read the Big Take story on how catastrophe bonds are helping Florida but not Jamaica • Past episode about compound climate impacts with Texas Tech University professor Katharine Hayhoe • Past episode with Avinash Persaud, special adviser on climate change for the Inter-American Development Bank, about the fight brewing over what money richer nations will pay to help poorer nations face climate change Zero is a production of Bloomberg Green. Our producer is Mythili Rao. Special thanks this week to Aaron Rutkoff, Siobhan Wagner, Jim Wyss, Jessica Beck, Ethan Steinberg, and Monique Mulima. Thoughts or suggestions? Email us at [email protected]. For more coverage of climate change and solutions, visit https://www.bloomberg.com/green.

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