A study carried out for Vivus Finance, an online lending platform, also found that almost a fifth of people with a loan are afraid of being unable to work due to cancer and 16% due to injury. Another 15% of respondents say death is their biggest fear. However, COVID-19 is becoming less scary for the population, with only 3% of respondents admitting to fearing it.
Psychologist-psychotherapist Lina Bagdonavičienė explains that people are most afraid of what they cannot control.
„Serious illnesses and their course, death, crisis, war and other cause uncertainty and have an impact on a person's functioning. According to Maslow's hierarchy of needs, the primary human needs are physiological – air, water, food, sleep, cold, and heat. We pay for heating, buy food, and take out bank loans. In order to meet these needs, it is important to have financial stability. When we lose it – through job loss, illness or other unforeseen events – we are thrown into uncertainty, and it becomes much harder to meet our needs. That is why they are the most worrying,“ says L. Bagdonavičienė.
There are several ways to help reduce feelings of fear, she says. One of them is to develop psychological resilience: „Emotional stability allows you to cope with unexpected situations and to keep going. Although it is not easy to develop resilience, we can develop these skills through psychological practices. By seeking help from mental health professionals, we learn to take preventive care of our emotional health.“
However, L. Bagdonavičienė points out that concrete preventive actions are just as important as psychological resilience. A financially fit person is better able to cope with changing conditions.
„Health insurance gives us peace of mind because if we are ill or injured, we will have the opportunity to recover without additional stress or to buy a better splint that will help us recover faster. Saving money also gives you more peace of mind, especially when you‘re struggling financially. So the earlier we take preventive measures, the better we will be able to cope with the challenges we face,“ says the psychologist.
One in two Lithuanians is unprepared
A representative survey of the population shows that almost half of people with financial obligations are not aware of the possibility of insuring their loan repayments. This is more often the case among those with lower incomes.
„The survey found that as many as 48% of Lithuanians have never heard of loan premium insurance. We also see that this service is still surrounded by myths that there are no benefits to be gained from insurance. However, we have already seen cases where, after the unexpected death of a mother, the insurance company covers the debts of her young children, thus easing the burden on the family in a difficult time,“ says Giedrė Štuopė, CEO of Vivus Finance.
Štuopė also points out that there is a collective fear in the society about upcoming hard times. She says that insurance can help you prepare a financial cushion and stay calm.
„We estimate that the average cost of mortgage premium insurance for residents is up to EUR 8 per month, depending on the size of the liability. It's a relatively small investment that can provide a lifeline and help maintain financial stability in the event of an unexpected situation. By taking care of prevention and reducing potential risks, people feel calmer, are not scared of the looming crisis, and remain more productive at work,“ shares Štuopė.
A representative survey of the population's opinion on fears about loans was conducted by Spinter Research in November 2022, interviewing 1013 Lithuanians aged between 18 and 75 years.