What is the term used for when there are more claims against an estate than assets to cover gifts made by a will?

The term that describes a situation where there are more claims against an estate than assets available to cover the gifts made by a will is abatement. When a decedent passes away and their debts exceed the available assets, the law requires that the gifts or bequests made in the will are reduced or eliminated to ensure that creditors are paid.

In cases of abatement, the gifts are often reduced in a specific order according to the priorities established by law. Typically, general gifts are the first to be reduced, followed by specific gifts, and finally, residuary gifts. This mechanism ensures that the estate can meet its obligations to creditors before distributing assets to the beneficiaries.

Understanding abatement is crucial for estate planning and administration since it directly affects how beneficiaries will receive their intended gifts when the estate is insufficient to cover all claims.