in·sol·ven·cy | \ (ˌ)in-ˈsäl-vən(t)-sē , -ˈsȯl- \

Definition of insolvency 

: the fact or state of being insolvent : inability to pay debts

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Synonyms & Antonyms for insolvency


bankruptcy, failure, ruin



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Examples of insolvency in a Sentence

unless the economy improves, many resorts in the area face insolvency

Recent Examples on the Web

That may condemn crucial corporations to insolvency, and perhaps force the government to seek a rescue from the International Monetary Fund, a course that would surely entail painful spending cuts. New York Times, "Turkey’s Economy Is So Hot That It May Face a Meltdown," 10 July 2018 More than 300 such plans across the country are at risk of insolvency. Washington Post, "Thousands rally in Ohio for solution to pension crisis," 12 July 2018 Last September, the mayor threatened to file for bankruptcy as a state budget stalemate pushed Hartford to the brink of insolvency. Jenna Carlesso, Courant Community, "Oversight Board Approves Budget, End-Of-Year Subsidy For Hartford," 7 June 2018 The Commissioner’s office has also set its sights on Cambridge Analytica and its parent company, SCL Elections, which are undergoing insolvency proceedings in the UK and bankruptcy proceedings in the US. Issie Lapowsky, WIRED, "UK Regulators May Fine Facebook Over Cambridge Analytica," 10 July 2018 Then the agency would accept applications from failing pension funds, like Central States, that presented a plan to invest the loans to build wealth and avoid insolvency for 30 more years. Edward Mckinley, kansascity, "KC union retirees join rally in Ohio for pension fix — or is it a bailout?," 13 July 2018 SolarWorld's German parent company filed for insolvency last year, and SolarWorld laid off 360 Hillsboro employees, roughly half its work force. Mike Rogoway,, "SunPower's deal for SolarWorld's Hillsboro factory already facing pressure from China," 6 June 2018 Tasked with helping the U.S. territory regain access to debt markets, the board has been negotiating with Rossello for months on a fiscal blueprint for Puerto Rico’s recovery from the dual scourges of fiscal insolvency and natural disaster. Tory Newmyer, Washington Post, "The Finance 202: Fed report shows business execs worry about Trump's trade moves," 19 Apr. 2018 Each of the 5 Active Member companies participate in a $1 million traveler’s assistance program, which helps protect consumers against any losses arising from bankruptcy, insolvency or cessation of business. Jennifer Franklin, USA TODAY, "Paradise awaits in the Philippines," 2 July 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'insolvency.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of insolvency

1660, in the meaning defined above

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Statistics for insolvency

Last Updated

1 Sep 2018

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Time Traveler for insolvency

The first known use of insolvency was in 1660

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More Definitions for insolvency



Financial Definition of insolvency

What It Is

In most usages, insolvency is the inability of a company or individual to meet its financial obligations as they come due. In the legal sense of the word, an entity is considered insolvent if its total liabilities exceed its total assets.

How It Works

Entities most commonly become insolvent by taking on too much debt. For example, a company with a heavy debt load may find itself unable to cover its debt liabilities should its business slow.

In this case, the company must raise capital to pay its obligations via selling assets, borrowing, or somehow raising capital and/or reducing expenses.

If a company cannot meet its obligations, it may be forced to file for bankruptcy.

Why It Matters

Insolvency in public companies may continue to trade while restoring their financial health, but represent some of the riskiest investments on the market. Insolvency is a red flag for investors since it can lead to bankruptcy or the evation of assets in order to meet debt payments.

Source: Investing Answers


in·sol·ven·cy | \ in-ˈsäl-vən-sē \
plural insolvencies

Legal Definition of insolvency 

1 : the fact or state of being insolvent — compare bankruptcy

2 : insufficiency (as of an estate) to discharge all enforceable debts

Note: Insolvency matters are covered under the Bankruptcy Code.

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Comments on insolvency

What made you want to look up insolvency? Please tell us where you read or heard it (including the quote, if possible).


to deposit or conceal in a hiding place

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