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Climate disasters demand an integration of multilateral negotiations on climate change, disaster risk reduction, sustainable development, human rights and human security. Via detailed examination of recent law and policy initiatives from around the world, and making use of a capability approach, Rosemary Lyster develops a unique approach to human and non-human climate justice and its application to all stages of a disaster: prevention; response, recovery and rebuilding; and compensation and risk transfer. She comprehensively analyses the complexities of climate science and their interfaces with the law- and policy-making processes, and also provides an in-depth analysis of multilateral climate change negotiations dating from the establishment of the 1992 United Nations Framework Convention on Climate Change (UNFCCC) to the Twentieth Conference of the Parties in Lima (COP 20) in December 2014.

This article describes the challenges that victims, insurers and governments face in dealing with insurance for low-probability high-consequence events in both developed and developing economies. In developed economies, given their limited experience with catastrophes, there is a tendency for all three parties to engage in short-term intuitive thinking rather than long-term deliberative thinking when making insurance-related decisions. Here, public-private partnerships can encourage investment in protective measures prior to a disaster, deal with affordability problems and provide coverage for catastrophic risks. Insurance premiums based on risk provide signals to residents and business as to the hazards they face and enable insurers to lower premiums for properties where steps have been taken to reduce their risk. To address issues of equity and fairness, homeowners who cannot afford insurance could be given vouchers tied to loans for investing in loss reduction measures. The National Flood Insurance Program provides an opportunity to implement a public-private partnership that could eventually be extended to other extreme events, while the United Kingdom's Flood Re provides a good case study. In developing economies, insurance penetration is historically very low. This requires innovative solutions to catastrophic risk insurance such as risk pooling, parametric insurance and micro insurance. Nevertheless, the uninsured and uncompensated losses of disasters remain extensive, implying the need for public-private partnerships.

Three sets of social institutions deal with catastrophic risk: government regulation through rule making, the market, and civil liability. Climate disasters expose the limitations of all of these social institutions and often result in extensive uncompensated losses, particularly in developing countries. The author proposes the establishment of a fossil fuel-funded Climate Disaster Response Fund to compensate victims for the ‘residual’ risk of climate disasters in developing countries that are particularly vulnerable to the impacts of climate change. This Fund, established under the UNFCCC’s Warsaw International Mechanism for Loss and Damage Associated with Climate Change Impacts, would comprise levies placed on the world’s top 200 fossil fuel companies. This proposal is modelled on various domestic and international funds which have been established to overcome the difficulties posed by tort law and which require companies to pay for the hazardous consequences of their activities and products. Precedents include funds to compensate for the damage caused by toxic chemicals, oil pollution spills, asbestos and nuclear accidents.