How does insolvency affect your credit score?

Answering a common question from those considering insolvency.

People considering insolvency options for themselves or their company often ask us - "how will this affect my credit score?". A credit score (or interchangeably referred to as a 'credit rating') is a numerical score based on your past credit experience which includes your borrowing and repayment history, your previous applications for credit, et cetera. Lenders will take your credit score into account when deciding whether to give you credit or finance. The total range of the score can depend on the particular credit reporting agency, however it is generally accepted that the higher the score, the more likely you are to be approved for credit.