How does the AI handle debt?

[The Errant]

So far I've only seen a single faction destroyed out of rebelling troops. The Ptolemies. That's after the Seleucids have taken over all their other provinces with the exception of Cyprus. I have no idea what sort of mismanagement the Ptolies perform on that island, but for some reason it's prone to rebel if it's the last settlement they have left.

I've never seen the KH rebel, even when they have been reduced to a single province like Rhodes. Sooner or later they will either invade or gain another settlement due to rebellion against another faction. The most common of these being Halikarnassos, Sinope, Syracusae and Cyrene.