Risks do not take turns

IN risk management, we are trained to examine hazards one at a time: the typhoon, the earthquake, the outbreak, the market shock. Nature and history have never been so polite. As we enter the last quarter of 2026, the risks on our horizon are not waiting in line. They are arriving together.

Let me begin with a discipline every underwriter learns early: Verify before you price. A risk you have not checked is not yet a risk you can manage.

The most certain threat is already in the Pacific. The National Oceanic and Atmospheric Administration now puts the odds of a strong to very strong El Niño lasting into early 2027 at better than 83 percent. Science and Technology Secretary Renato Solidum has warned that every province may be in drought by the end of March. The habagat masked the early effects. The dry months will not. Expect thinner reservoirs, strained irrigation and hydropower, heavier power demand and food prices that climb faster than incomes.

But El Niño is no holiday from typhoons. The Philippine Atmospheric, Geophysical and Astronomical Services Administration (Pagasa) expects fewer cyclones, not gentler ones. A super typhoon striking communities already weakened by drought is precisely the compound loss our disaster financing is least equipped to absorb.

Beyond our shores, the Bundibugyo strain of Ebola has caused more than 8,600 confirmed cases and over 4,100 deaths in the Democratic Republic of the Congo, the largest Ebola outbreak that country has recorded. On Oct. 6, Kenya confirmed an imported case: a traveler who went by road through Uganda and flew to Nairobi while ill and heavily medicated. That single journey is the lesson. With millions of Filipinos working abroad, our borders are only as strong as our screening, isolation capacity and contact tracing.

Then there is rumor outrunning fact. Early this month, social media declared a plague outbreak in Siberia after a worker died at a research institute. Russia has since told the World Health Organization (WHO) that no plague case was registered, and nearly 5,000 tests found no dangerous pathogen. That calls for vigilance on laboratory biosafety, not panic.

Geopolitics demands the same discipline. In July, a Russian cruise missile fell in eastern Poland, well inside NATO territory. Wars spill across borders by accident as often as by design. Closer to home, every water cannon incident in the West Philippine Sea carries the same risk of miscalculation, with our fisherfolk, sea lanes and offshore energy ambitions in harm’s way.

The least visible threat may be the most pervasive. The International Monetary Fund has warned that artificial intelligence is making cyberattacks faster, cheaper and easier to scale, and that emerging markets are the most exposed. A deep-faked executive approving a fund transfer, or a fake evacuation order in the middle of a storm, is no longer fiction.

What, then, should we do? Risk managers do not predict. We prepare. Allow me four points.

First, plan for the compound scenario, not the single hazard. Drought, a strong typhoon, power interruptions and price spikes in the same quarter should be the base case in every contingency plan, public and private.

Second, close the protection gap before the losses arrive, not after. Roughly 98 percent of our catastrophe losses remain uninsured, so the bill falls by default on the national budget and on household savings. Parametric cover for farmers, fisherfolk and local governments, the Agricultural Co-Insurance Pool and wider participation in the Philippine Catastrophe Insurance Facility can put cash in hands within days, not months. The industry is ready to do its part. The window to place cover before El Niño peaks is closing.

Third, treat cybersecurity as a stability issue, not an IT budget line. Boards of banks, insurers, utilities and hospitals should test whether they can keep operating through an outage and confirm every urgent payment instruction through a second channel.

Fourth, invest in verification. Government needs fast, credible channels to confirm or debunk alarming reports, because in a crisis misinformation often travels faster than the event.

And to every reader: Conserve water now, review your insurance cover, keep a go-bag ready and trust Pagasa, the Philippine Institute of Volcanology and Seismology, the Department of Health and the WHO over whatever is trending.

Resilience is always cheaper than recovery. The bill for unpreparedness always arrives. The only question is who pays it, and whether we chose, while there was still time, to share it.

Source: www.manilatimes.net