At some point during your company's financial crisis, someone will tell you that you need an insolvency practitioner. An IP. The person who'll guide your company through whatever comes next — administration, liquidation, CVA, or some other formal process.
Choosing the right IP matters more than you might think. A good one will protect your interests, explain your options clearly, manage the process efficiently, and treat you like a human being rather than a case file. A bad one will rack up fees, communicate poorly, and make an already terrible experience significantly worse.
Here's how to find a good one and avoid the bad ones.
What an insolvency practitioner actually does
An IP is a licensed professional authorised to act in relation to insolvent companies and individuals. They're regulated by one of several recognised professional bodies — the Insolvency Practitioners Association (IPA), the Institute of Chartered Accountants in England and Wales (ICAEW), and others — and they have legal obligations to act ethically and in creditors' interests.
Depending on the process, an IP might act as: an administrator (taking control of the company in administration), a liquidator (winding up the company in a CVL or compulsory liquidation), a supervisor (overseeing a CVA), or an adviser (helping you understand your options before any formal process begins).
In the advisory role — which is usually where the relationship starts — the IP assesses your company's situation, explains the available options, recommends the most appropriate course of action, and helps you implement whatever is decided.
Most IPs offer a free initial consultation. This is standard practice, not a favour. Use it.
How to find candidates
Ask your accountant. Your accountant probably knows several IPs and can recommend ones they've worked with successfully. This is often the best starting point because your accountant understands your business and can match you with an IP whose experience is relevant.
Ask your solicitor. Similarly, if you have a business solicitor, they'll have professional relationships with IPs and can make informed recommendations.
The Insolvency Service website. The government maintains a register of licensed insolvency practitioners at gov.uk. You can search by location and see which regulatory body each IP is licensed by.
R3 (the Association of Business Recovery Professionals). R3's website has a "find an IP" tool that lets you search by location and specialism. R3 members tend to be established practitioners, though membership isn't a guarantee of quality.
Other founders. If you know someone who's been through insolvency, ask who they used and whether they'd recommend them. First-hand experience is invaluable — the person can tell you not just about the IP's competence, but about how it actually felt to work with them during a crisis.
Avoid cold approaches. If an IP contacts you unsolicited — perhaps because they've seen a winding-up petition advertised against your company — be cautious. Some IPs actively chase distressed companies. That doesn't make them bad, but it means they found you rather than you finding them, which shifts the dynamic.
Talk to at least three
This is the most important advice in this guide: do not engage the first IP you speak to. Talk to at least three. The conversations are free, they'll each take about an hour, and the differences between practitioners will become apparent quickly.
Why three? Because insolvency practitioners, like all professionals, vary enormously in: their experience with companies like yours, their communication style, their approach to fees, their willingness to explain things in plain English, their empathy and understanding of what you're going through, and their actual recommendation for what should happen.
You might be surprised to find that three IPs give you three different recommendations. One might suggest administration. Another might suggest a CVL. A third might suggest a CVA. This isn't because insolvency is arbitrary — it's because reasonable professionals can disagree about the best course of action, and their recommendations may be influenced by their own expertise, their fee structures, and their assessment of the situation.
Hearing multiple perspectives helps you make an informed decision rather than accepting the first recommendation you receive.
What to ask in the initial meeting
Go into each meeting with a clear set of questions. Here are the ones that matter:
About their experience
"Have you handled companies similar to mine?" Size, sector, and complexity matter. An IP who specialises in large corporate restructurings may not be the right fit for a 15-person startup. Conversely, an IP who usually handles straightforward small company liquidations may lack the experience for a complex situation.
"How many cases are you personally handling right now?" An IP with too many cases will delegate your matter to junior staff. That might be fine for a simple CVL, but if your situation is complex, you want the principal's attention.
"Who will actually be managing my case day-to-day?" Meet the person who'll be doing the work, not just the partner who pitches for new business. The day-to-day manager is the person you'll interact with most, and their competence and communication style matter enormously.
About the process
"What do you recommend, and why?" Listen carefully to the reasoning. A good IP will explain the pros and cons of each option and why they're recommending a particular route. Be wary of an IP who recommends a specific process without thoroughly exploring alternatives.
"What's the likely timeline?" Different processes take different amounts of time. Get a realistic estimate — not a best case.
"What will you need from me?" Understanding your obligations and the time commitment involved helps you plan.
About fees
"How do you charge?" IPs typically charge by time — hourly rates for themselves and their staff. Ask for the rates of everyone who'll work on your case, from the principal down to the administrative staff.
"Can you give me an estimate of total costs?" Good IPs will provide a fee estimate. It won't be exact, but it should give you a range. Be very wary of IPs who are evasive about fees.
"How are your fees paid?" In an insolvency, the IP's fees are paid from the company's assets and take priority over most creditors. This means the more the IP charges, the less is available for creditors. There's an inherent conflict of interest here — which is why creditors have the right to approve or challenge the IP's fees.
"What's the fixed cost of the initial process?" Some IPs offer fixed fees for certain aspects of the work (e.g., the initial filing). This can provide cost certainty for at least part of the process.
About communication
"How will you keep me informed?" Regular updates — even if there's nothing to report — are essential. Ask how frequently you'll hear from them and in what format (email, phone, meetings).
"Can I call you with questions?" Some IPs are accessible and responsive. Others treat director queries as an inconvenience that generates chargeable time. You want the former.
Red flags to watch for
Through my experience and conversations with other founders who've been through insolvency, certain warning signs consistently emerge:
Pressure to decide immediately. A legitimate IP will give you time to consider your options and talk to other practitioners. Anyone who pressures you to sign an engagement letter on the spot is prioritising their interests, not yours.
Recommending the most expensive option without clear justification. Administration generates higher fees than a CVL. If an IP recommends administration, make sure there's a genuine reason — not just a fee incentive. Ask: "Would a CVL achieve a similar outcome at lower cost?"
Vagueness about fees. If an IP can't or won't give you a fee estimate, that's a red flag. Insolvency work is experienced and predictable enough that a competent practitioner can estimate costs.
Poor communication during the initial process. If the IP is slow to respond, difficult to reach, or unclear in their communication during the pitch phase — when they're trying to win your business — imagine how they'll be once they have it.
Badmouthing other IPs. Professionals don't need to trash the competition. If an IP spends time criticising others rather than explaining their own approach, question their confidence.
No interest in your emotional wellbeing. This might seem like a soft factor, but it matters. You're going through one of the hardest experiences of your professional life. An IP who treats you purely as a case file, with no acknowledgement of the human dimension, will make the process harder than it needs to be. The best IPs understand that effective professional service includes basic human decency.
Fees: the uncomfortable truth
IP fees are a source of genuine frustration for directors and creditors alike. The fees come out of the company's assets — money that would otherwise go to creditors — and they can be substantial.
Some context: insolvency work requires specialist qualifications, regulatory compliance, and professional insurance. The work carries personal liability for the IP. It's not unreasonable for it to be expensive. But "not unreasonable" and "value for money" are different things, and some IPs charge significantly more than others for equivalent work.
Protect yourself by: getting fee estimates from multiple IPs before choosing, asking for fees to be broken down by task (not just a total), understanding what triggers additional fees (court applications, complications, extended timelines), and knowing that creditors can challenge fees they consider excessive.
The IP's fees are ultimately approved by creditors (or the court). If you feel the fees are disproportionate, this is a check in the system — but in practice, creditors rarely challenge fees because the effort of doing so exceeds the likely saving. Choosing wisely upfront is more effective than challenging fees after the fact.
The relationship dynamic
The relationship between a director and an insolvency practitioner is unusual and often uncomfortable. The IP has a duty to creditors, not to you. They'll investigate your conduct. They'll make decisions you disagree with. They'll sometimes tell you things you don't want to hear.
At the same time, they need your cooperation. You know the business better than anyone. Your information, contacts, and institutional knowledge are valuable to the process. A good working relationship benefits everyone — the IP, the creditors, and you.
Approach it professionally. Cooperate fully and promptly. Provide information honestly. Ask questions when you don't understand something. Push back respectfully when you disagree. And remember that the IP's duty to creditors doesn't make them your enemy — it makes them an independent professional doing a difficult job, just as you're a founder navigating a difficult situation.
After you've chosen
Once you've selected an IP, a few practical points:
Get the engagement terms in writing. Understand exactly what you're agreeing to, including fee arrangements and your obligations.
Provide everything they ask for, quickly. Delays in providing information slow the process, increase costs, and frustrate everyone. If the IP asks for accounts, contracts, or employee records, prioritise getting them what they need.
Keep your own records. Document your interactions with the IP. Note what advice you were given and when. If your conduct as a director is later questioned, a record of having sought and followed professional advice is your strongest defence.
Stay engaged but accept your role. Once a formal process begins, the IP is in charge. You can ask questions and provide input, but the decisions are theirs. Accepting this — genuinely, not just superficially — reduces friction and stress for everyone.
For more on what to expect during the insolvency process itself, read: What actually happens when a company goes into administration and Administration vs liquidation vs CVA: which one is right?.
One final thing
Choosing an insolvency practitioner feels like the final admission that your business has failed. The act of searching for one, meeting them, discussing your company's insolvency — it makes the situation real in a way that internal worry doesn't.
Many founders delay this step for weeks or months, hoping the situation will improve. It almost never does. And the delay typically makes things worse — more debt accumulates, more options close, and the eventual insolvency is more damaging to creditors and more stressful for you.
The best time to talk to an IP is before you absolutely have to. When you're worried but not yet desperate. When there are still options on the table. When the conversation is exploratory rather than urgent.
If you're reading this article, you probably already know it's time to make the call. So make it. The initial conversation is free, confidential, and non-committal. And the relief of having a professional assess your situation — of converting vague dread into specific facts — is almost always worth the discomfort of making the appointment.