I failed my insurance exam on the first try and I'm feeling pretty stressed about it. I'm rescheduled for a retake, but I'm wondering if recruiters actually care about a past failure. Does it make me look bad, or do they only care that I eventually pass?

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No one cares about the fails. They want to know you passed and are another to be licensed.
Which state are you doing?

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Exactly, just keep trying until you pass. I think the record for our unlicensed new hires for re takes is 8 or 9 & they went on to be a top seller.

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They only care if you give up on your self.

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I know multiple people who failed on their first attempt and went on to have completely normal careers. It's way more common than you think, people just don't talk about it. Focus on what tripped you up, study those sections harder, and pass it the second time. That's all anyone cares about. You having the license, not the path you took to get it.

Those exams can be fairly challenging. I want to say around half fail the first time taking it. Practice, understand the concepts, and do not just memorize. People typically only know you failed if you are telling them.

They only care that you pass.

For the record, I considered my sales P&C/Life and Health exams harder than my adjuster exams.

I failed my life exam 4 times (I had a lot going on at the time). Nobody has ever asked me about it and I rarely sell life products now but all anybody has ever cared about is that I have it. Your past fails don’t show up on your license, just the day it was issued.

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