Final answer:
The first order of preference in the distribution of an insolvent partner's assets is pro-rata between the separate creditors and partnership creditors.
Step-by-step explanation:
In the distribution of assets of an insolvent partner, the first order of preference is Pro-rata between the separate creditors and partnership creditors.
When a partner is insolvent, the assets are distributed in a certain order to satisfy the claims of different parties. The first priority is given to the separate creditors and partnership creditors. These creditors will receive their share of the assets based on their claims.
If there are any remaining assets after satisfying the claims of separate creditors and partnership creditors, then the partner's contribution to the partnership may be considered in the distribution.