Insolvency is when a company can no longer pay its debts as they fall due (cash-flow test) or its liabilities exceed its assets (balance-sheet test).
In practice
Insolvency is a legal state, not just a bad month. It is different from a temporary cash-flow gap, and it triggers specific duties for directors. If insolvency is a real risk, taking advice from a licensed insolvency practitioner early is the responsible course, and may open rescue routes.
We lend only to UK limited companies and LLPs, and the loan is to the company with no director personal guarantee. As business finance outside the consumer-credit regime, it is not covered by the Financial Ombudsman Service or FSCS.
See also: What is insolvency?, Is my company insolvent, or just short of cash?, Understanding business insolvency options.