Client
One of the largest global providers of insurance, annuities, and employee benefits programs, with more than 90 million customers in more than 60 countries
Problem
The client engaged Modern Hire while looking for a way to predict candidate success on licensing exams.
Investment professionals must pass qualification examinations to demonstrate they are prepared to fully function in the role. The study and acquisition of industry-specific knowledge requires a significant investment of time and resources. Individuals who pass the exams on the first attempt are able to provide appropriate services and build a robust portfolio sooner.
While the Financial Industry Regulatory Association (FINRA) does not publicly release information on fail rates, first-time pass rates for these exams are reported to range from 50-65%.
Solution
Modern Hire partnered with the client to create a custom Virtual Job Tryout that tested candidates on problem-solving, leadership characteristics, and logical reasoning.
Results
Candidates who scored in the top 70% on the Virtual Job Tryout grew their client portfolio and revenue every quarter, eight quarters in a row. Candidates who scored in the bottom 30 sold fewer products, acquired fewer clients, and achieved lower overall sales results.
Scores on the Virtual Job Tryout’s problem-solving competency had the strongest relationship to first-time license exam pass rates. Candidates who scored in the top 50% on the problem-solving competency were 31% more likely to pass the General Securities Representative Exam and 16% more likely to pass the Uniform Combined State Law Examination exam the first time.
A 2014 Wall Street Journal study concluded that the more times a stockbroker had to retake a qualifying exam, the higher the average number of complaints on that broker’s record. The study examined retake rates for the Series 63 exam, a state-set exam that is a subset of the Series 66 exam, and found that brokers who failed the exam at least three times were about two-thirds more likely to have three or more complaints on their record than brokers who passed the exam the first time.