graph of early IVA terminations showing lower rate for TIP panel members

The TIP panel – and early IVA failure rates

IVA failure rates for arrangements set up and run by TIP IPs are far lower than for the whole sector. An IVA provided by TIP’s insolvency practitioner panel might be better for people in debt. And for the companies they owe.

A TIP IVA is less likely to fail

TIP IVAs are a lot less likely to fail in the first two years than Individual Voluntary Arrangements provided by the sector as a whole. The TIP panel’s early termination rates are 52% better than the sector as a whole in the first year and 42% better over the first two years of an IVA.

We use data like this to help our IP panel members improve what they do. This is good for everybody involved. One of the reasons for setting up TIP was to bring transparency to the IVA sector. It’s part of our plan to restore trust.

Insolvency Practitioners (IPs) on our panel give us daily updates on their cases. This ensures full transparency on things like IVA completions, arrears and terminations (failures).

This is good for debt advisors (who can also access to specific case information, with their clients’ consent). It clearly shows that their clients are coping (or not) and being appropriately supported.

TIP IVAs are less likely to fail in the first two years as Individual Voluntary Arrangements provided by the sector as a whole.

And, creditors can more easily forecast the returns they’ll get from their book of TIP IVAs. They can compare our IVAs with the market as a whole.

How we found out about IVA failure

As part of our due diligence process, TIP asked about IVA failure rates. The data we got showed that the successful candidates for our panel had low and similar failure rates.

At about the time we were doing this the government’s Insolvency Service published a set of data about IVA failure rates in their first two years of what is, usually, a five-year life.

The Insolvency. Service data related to IVAs started in 2015 and 2016. They gave termination rates for the first 12 and 24 months of the life of these IVAs. We asked our panel for their data over the same period.

Our panel’s data
TIP’s data is based on the IVA failure rate of 909 cases passed by the firms in our panel in 2015 and 1,378 passed in 2016. Terminations of these cases were reported up to December ’17. Our sample has a termination rate across the panel of 3.7% in the first 12 months (All IVAs – 7.7% – ie the Insolvency Service figures) and a 7.3% rate over the first 24 months (12.7% for all IVAs). 








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PennySmart*, the Chester-based money, debt and benefits advice organisation, is partnering with TIP (The Insolvency