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Law Aspire (Legal)     07 February 2017

Difficult terms in law

What is the difference between Insolvency and Bankruptcy?

Please explain 



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 1 Replies

Martin Lois   23 February 2017

Insolvency- If you can pay your bills as and when they become due and payable, you are 'solvent'. If you cannot, you are insolvent whereas bankruptcy is a legal status of a person or other entity that cannot repay the debts it owes to creditors. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the debtor.


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