Convergence quiz - How well do you speak the language of convergence?

(From Reinsurance)

During the past few years, a favourite talking point in the reinsurance community has been the convergence of the investment banking and reinsurance sectors. The evidence is plentiful: an insurer has issued a catastrophe bond; a reinsurer has formed a sidecar; and so on.

On the surface, investment bankers and reinsurers make a good match. Both are in the business of taking risks. Both operate in a world without barriers, getting business from all parts of the globe. Both are good with numbers, combining intuition with complex financial modelling. So what divides them?

A number of possible answers may come to mind. There are of course cultural differences in the way reinsurance and investment-banking sectors operate. Another difference lies in the way they communicate with one another.

Over the years, investment bankers and reinsurers have developed extensive jargons of their own, a range of code words that set insiders apart from the crowd. Most professions have done that, so why shouldn't they? But for the convergence process to be successful, investment bankers and reinsurers need to understand each other's code words.

So how big is the language barrier that still divides them? To answer this, we have developed a simple test that helps assess an individual's 'conversion readiness'. The test combines investment banking and reinsurance terminology. To complete it, select the answer that you believe to be most appropriate for a given question. The scoring guide is provided below.

QUIZ