Ace the Funeral Arts National Board Exam 2025 – Elevate Your Career with Confidence!

The term that accurately describes an estate unable to meet its financial obligations is "insolvent estate." An insolvent estate arises when the liabilities of the deceased person exceed the value of their assets, leaving insufficient funds to cover debts and obligations. This situation necessitates a specific legal process to determine how the remaining assets can be fairly distributed among creditors and, if possible, beneficiaries.

In legal contexts, distinguishing an insolvent estate is vital as it influences the probate process and the handling of debts. Creditors have certain rights in these situations, and there are established procedures for settling the claims against the estate.

Active estates, on the other hand, refer to estates that are undergoing active probate proceedings while funded and capable of meeting obligations. Probated estates are those estates that have gone through probate court for administration after a person's death, which doesn't directly relate to insolvency. A revoked estate typically refers to a situation where a previous estate plan or will has been invalidated and is not a recognized legal status of an estate's financial health.