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322 L.Schäfer et al. works by pooling losses, transferring risk of fortuitous losses and indemnification (Rejda andMcNamara 2017). By spreading risks among people and over space and time, insurance-related tools allow to collectively manage losses that would overwhelm individualmembers of a group, limiting the need formembers to take costly individual action. In this arrangement, the premium replaces the “uncertain prospect of losseswith the certainty ofmaking small, regular premiumpayments” (Churchill 2006). In case of a loss which is covered by the insurance policy, the insuredholds the right toclaimcompensation. Basedontheseprinciples,disasterriskinsuranceisafacilitativemechanismwhich provides post-disaster financial support against the loss of assets, livelihoods, and lives at an individual, community, national, and regional level. “Climate risk insur- ance” refers to a special type of disaster insurance, covering losses and damages causedbyextremeweatherevents,whichare intensifiedand increased in frequency byclimatechange.Climate risk insuranceschemesmaybebothdirect and indirect. Direct insurance approaches are those inwhich the insured benefits directly from transferringrisktoarisktakingentity(suchasaninsurer). Intheevent theinsurance agreement is triggered, the insurance payout is directly transferred to the insured. Indirectinsuranceapproachesarethosewherethefinalintendedtargetgroupbenefits indirectly frompayments intermediatedby an insuredgovernment or frombeing a memberofan institution thathas insurance (Schäferet al. 2016; seealsochapterby Linnerooth-Bayeret al. 2018 in thisbook). This chapter argues that insurance can support people and communities on the frontierof adaptation in severalways,helping themin • exploring adaptation frontiers by contributing to a framework for signalling the magnitude, location, and exposure to climate-related risks andproviding signals whenadaptation limits areapproached; • movingawayfromadaptationlimitsbyimprovingex-antedecisionmaking,incen- tivisingriskreductionandcreatingaspaceofcertaintyforclimateresilientdevel- opment; • remaining in the tolerable risk spaceby facilitatingfinancial buffering as part of contingencyapproacheswhenclimate-related risksexceedcurrent capabilities to manage. Inthefollowing,thedifferentrolesofinsuranceinexploringandmanagingadapta- tionfrontiersaredescribedindetail.Ithastobenoted,however,thattransferringrisks inacost-efficientwaythroughinsuranceisonlyonestepinasystematicprocess.The effectivemanagement of adaptation frontiers, aimed at enabling climate-resilience development,requiresacomprehensiveapproachtoriskmanagement.Thisapproach should involve a portfolio of actions aimed at improving the understanding of dis- aster risks, reducing and transferring risk aswell as responding to and recovering fromeventsanddisasters—asopposed toasingular focusonanyoneactionor type ofaction (seeFig.13.2).