|Main reason for entering a non-business related personal insolvency||Number of insolvent debtors in 2012-13||Number of insolvent debtors in 2013-14|
|Unemployment or loss of income||8333||8418|
|Excessive use of credit||7649||6999|
|Domestic discord or relationship breakdown||3063||3056|
|Adverse legal action||659||682|
|Gambling or speculation||541||544|
|Liabilities due to guarantees||359||446|
|Other non-business reason||1851||1627|
Most personal insolvencies are not business related
In 2013–14, 81% of debtors entered a personal insolvency because of non-business related reasons or the reason was unknown.
Since 2007–08, the proportion of debtors entering a personal insolvency because of non-business related reasons reached a:
- peak in 2008–09 (88% of debtors)
- low in 2012–13 (79% of debtors).
Unemployment or loss of income is the most common cause of non-business related personal insolvencies
In 2013–14, the most common causes of debtors entering non-business related personal insolvencies were:
- unemployment or loss of income (8418 debtors)
- excessive use of credit (6999 debtors)
- domestic discord or relationship breakdowns (3056 debtors).
Causes of debtors entering non-business related personal insolvencies in 2013-14
Compared to other types of personal insolvency, debt agreement debtors were more likely to enter a personal insolvency due to excessive use of credit. In 2013–14, 44% of debtors who entered a non-business related debt agreement did so because of excessive use of credit.
The common non-business related causes are relatively stable over time
The reasons that debtors enter business related personal insolvencies have been stable since 2007–08. Each year:
- unemployment or loss of income is the most common cause
- liabilities on guarantees or not stated are the least common causes.
The biggest changes in the proportion of debtors who entered a business related personal insolvency from 2007–08 to 2013–14 were:
- other non-business related reason increased from 3% to 7%
- ill health fell from 11% to 9%.
For the full non-business related personal insolvency causes report see: