Insolvency of the deceased's estate represents a special type of insolvency proceedings, which may be instituted over an estate of a deceased natural person. In the main focus of this paper are the ways in which the insolvency of estate differs from the insolvency proceedings in general. The differences between the two types of insolvency relate to: the reasons for initiating the insolvency proceedings, persons entitled to initiate the proceedings, legal personhood and attributes of the insolvent debtor, bankruptcy estate, payment priorities, as well as the separatio bonorum as a distinctive consequence of the opening of insolvency proceedings over the deceased's estate. The author calls attention to the need of introducing the insolvency proceedings over the estate of a natural person into Serbian law. This would ensure equal and fair treatment of the deceased's creditors, ascertain adequate payment priorities, but also protect the heirs who have inherited insolvent estates.