The right to set off a claim is a legal concept through which reciprocal claims between a creditor and a debtor company are settled against each other reducing or extinguishing the smaller claim and leaving only a balance outstanding. A right of setoff may constitute a self-help remedy upon which a creditor can rely without the assistance of the Courts. In an insolvency situation, a right of set-off can be crucial as it may improve a creditor‘s overall financial position in relation to the debtor company.