The devastating impact in the Caribbean region of the hurricane season in 2017 has put the spotlight on the wide-ranging consequences of environmental vulnerability in developing countries. Rather than being an exception, these types of events are expected to become more frequent and intense due to climate change. In this context, limited capacity to mobilize domestic resources, combined with insufficient multilateral financing facilities, create conditions in which developing countries may be unable to adequately invest in climate change adaptation needs and catastrophic risk insurance. Consequently, large-scale natural disasters put the environmental, economic and social viability of environmentally vulnerable countries at risk. The international community should therefore review the tools available to address catastrophic risk, in order to support successful climate change adaptation in developing countries. This policy brief analyses the interplay of such economic dynamics in the Caribbean.