How does an idea emerge and gain traction in the international arena when its underpinning principles are contested by powerful players? The adoption in 2013 of the Warsaw International Mechanism on Loss and Damage as part of the United Nations Framework Convention on Climate Change (UNFCCC) puzzled observers, because key state parties, such as the United States, had historically opposed the policy. This article examines the roles of frame contestation and ambiguity in accounting for the evolution and institutionalization of the “loss and damage” norm within the UNFCCC. The article applies frame analysis to the data from coverage of the negotiations and elite interviews. It reveals that two competing framings, one focused on liability and compensation and the other on risk and insurance, evolved into a single, overarching master frame. This more ambiguous framing allowed parties to attach different meanings to the policy that led to the resolution of differences among the parties and the embedding of the idea of loss and damage in international climate policy.