insolvency

USAGE SUMMARY

"insolvency" is a correct and usable word in written English.
It typically refers to a financial situation in which an individual or business is unable to pay their debts. For example: "The company entered insolvency after months of struggling to stay afloat."

✓ Grammatically correct

News & Media

Formal & Business

Human-verified examples from authoritative sources

Exact Expressions

59 human-written examples

At present, a company can secure protection from creditors through insolvency but a sovereign state cannot.

The Guardian - Business

Fine Gael's chairman Charlie Flanagan said it was a "pretty dismal precedent" that a member of the Dail would admit to knowingly filing inaccurate returns, which Wallace in his defence insists was only done to save his company from insolvency and rescue the jobs of his workers.

The Guardian

"English judges sitting in the personal insolvency jurisdiction may have to look a little deeper into the circumstances of the debtor's move to England and claims to have severed ties with the home country," she wrote in the Law Gazette.

The Guardian

The incident has led to call for a change in the law by unions, who say workers need more protection, and the insolvency trade body R3, which says in some cases there was little or no money available to pay for the full redundancy consultation required by law.

The Guardian - Business

But shades of panic have arrived and, indelibly, have begun to reveal themselves in other ways: from the government sequestering the funds of public bodies to help pay bills; to Greek borrowing costs soaring on fears of insolvency; to savers stuffing their freezers with cash and ever more parents encouraging their children to move abroad.

The Guardian

Steve Thatcher, a Leicester-based insolvency lawyer who once had an Irish client with €150m of debt whose case was heard in just 35 seconds, says most of the figures with large debts have already been through the system and it is now younger families who are looking for his services.

The Guardian

Just before Christmas 2003, new insolvency legislation was pushed through, inspired by America's Chapter 11.

The Economist

The new bill proposes a number of Bagehot-like changes: to toughen up the definition of insolvency, such that the Fed lends only to viable firms; to offer any lending programme to many different institutions; and to ensure that when the Fed does lend, it charges punitive rates.This battle is not the only one the Fed faces.

The Economist

While the use of the initial TARP allotment has prevented any immediate collapse, it seems clear that fears of insolvency (and actual insolvency) are going to remain a problem.

The Economist

SAAB has a long history of defying the odds, as it did again in early 2010 when a last-minute deal saved the struggling Swedish company from insolvency.

The Economist

Human-verified similar examples from authoritative sources

Similar Expressions

1 human-written examples

A spokesman for Deloitte said: "We estimate the maximum possible award that could result from the Comet case to be less than half the £26m figure that has been quoted by the secretary of state, and we have provided relevant information to the Insolvency Service to assist them with paying the award.

The Guardian - Business

Expert writing Tips

Best practice

When discussing a company's financial health, use "insolvency" to specifically denote the state of being unable to pay debts as they fall due. It's a more precise term than simply saying a company is 'in trouble'.

Common error

Avoid using "insolvency" when a company is merely facing a temporary cash flow problem. "Insolvency" implies a more severe, long-term inability to meet financial obligations, whereas illiquidity might be a short-term issue.

Linguistic Context

The primary grammatical function of "insolvency" is as a noun. It typically functions as the subject or object of a sentence, referring to the state of being insolvent. Ludwig AI confirms it's a usable term.

Expression frequency: Very common

Frequent in

News & Media

46%

Formal & Business

28%

Science

26%

Less common in

Encyclopedias

0%

Wiki

0%

Reference

0%

Ludwig's WRAP-UP

In summary, "insolvency" is a grammatically correct and frequently used noun that refers to the state of being unable to pay debts. As confirmed by Ludwig AI, the term is widely used in financial and economic contexts, especially in news and business publications. When writing about financial topics, it's essential to use "insolvency" accurately, distinguishing it from related concepts like illiquidity. Remember, while "insolvency" indicates a severe financial situation, bankruptcy is the formal, legal declaration of that state.

More alternative expressions

Phrases that express similar concepts, ordered by semantic similarity:

bankruptcy

A more formal and legal term for being declared unable to pay debts.

financial failure

A general term indicating the inability to succeed financially.

financial ruin

Emphasizes the catastrophic and devastating nature of financial collapse.

economic collapse

Refers to a widespread failure of an economic system or entity.

state of indebtedness

Focuses on the condition of being heavily in debt.

financial distress

Indicates a period of difficulty in meeting financial obligations.

illiquidity

Highlights the lack of readily available assets to cover immediate debts.

business failure

Specific to the inability of a business to continue operating due to financial problems.

default

The failure to meet the legal obligations of a loan.

financial shortfall

Indicates a deficiency in funds to cover expenses or debts.

FAQs

How is "insolvency" different from bankruptcy?

"Insolvency" is a state of being unable to pay debts, while bankruptcy is a legal declaration of that state. Bankruptcy proceedings may follow "insolvency", but not all insolvent entities file for bankruptcy.

What are some signs of impending "insolvency"?

Signs include consistently late payments, difficulty securing credit, declining revenues, and increasing debt levels. Companies facing these issues may be approaching "financial distress".

What are the consequences of "insolvency" for a company?

Consequences can include liquidation of assets, closure of the business, and legal proceedings by creditors. Directors may also face personal liability in certain cases.

What can I say instead of "insolvency" to describe a company's financial difficulties?

Depending on the context, you might use terms like "financial difficulties", "financial distress", or "near bankruptcy".