If you can cut your bills so you can pay them, you don't become insolvent, because you maintain a positive cash flow. In contrast, if you cannot cut your costs

If you can cut your bills so you can pay them, you don't become insolvent, because you maintain a positive cash flow. In contrast, if you cannot cut your costs anymore and your outgoings exceed your income, you will have a negative cash flow. You are still not insolvent, but you will eat into your savings and credit lines and eventually become insolvent if you cannot recover.