What is Personal Insolvency?

Personal Insolvency can refer to one of two things.

  • The term personally insolvent, is just another way of saying somebody is unable to repay their debts.


It is important to understand the distinction between these two terms. In fact somebody needs to be personally insolvent before they can enter into a Personal Insolvency Agreement.

Personal Insolvency

The term personal insolvency describes someone who has reached a point where they can no longer pay off their debts. Because insolvency is a general term that is also used in the corporate field, it can often cause confusion for individuals. If you feel you can no longer pay your bills, then you may be personally insolvent and in need of some personal debt advice. Our personal debt advisors can help you find a solution to your debt problems.

Personal Insolvency Agreement

A Personal Insolvency Agreement is a legally binding agreement that people can put in place to avoid formal bankruptcy (link to). The terms of a Personal Insolvency Agreement are less onerous than personal bankruptcy, which makes it more attractive for people who are looking for a sustainable debt solution.

The best thing to do, if you are considering a PIA, is to speak with our personal debt advisors who can advise you on the suitability of such an agreement. Our Personal Insolvency Agreements are always tailored to suit individual situations.

You can learn more about Personal Insolvency Agreements on our website, or by calling our toll free advice line – 1800 98 10 70