Are bank lockers the safest place for your valuables?

If you thought that bank lockers are the safest place for your valuables, then think again. For, even the Reserve Bank of India (RBI) has now said that “banks have no liability for loss of valuables in lockers.” This means that you should not expect any compensation for theft or burglary of valuables in safe deposit boxes of banks as the locker hiring agreement absolves them of all liability. This bitter truth was disclosed in an RTI response by the RBI and 19 PSU banks.

Worse, even the private sector banks are not better in this case as even their locker hiring agreements are almost similar in nature. For instance, the locker hiring agreement of a leading private sector bank says, “The Bank shall not be responsible or liable for any loss or deterioration of or damage to the contents of the Locker whether caused by rain, fire, flood, earthquake, lightning, civil commotion, war, riot or any other cause/s not in the control of the Bank and shall also not be liable or responsible for any loss, sustained by the Hirer/s by leaving any articles outside the Locker.”

It further says, “While the Bank will exercise all such normal precautions as it may in its absolute discretion deem fit does not accept liability or responsibility of any loss or damage whatever sustained to items deposited in the Locker. Accordingly, the Hirer/s are advised in their own interest to insure any items of value deposited in the Locker with the Bank.”

How to safeguard against such unforeseen incidents?  

Wherever locker hiring agreement does not have any compensation clause for any untoward incidents, Bank locker protector policy or Jewellery insurance cover bridges the gap and protects valuables stored in a bank locker.

In this article, we will confine ourselves with the newly introduced Bank locker protector policy in view of cheap premium and holistic in nature.  

The Cover: Bank locker protector policy will provide cover against various risks such as fire, burglary, earthquake, infidelity by bank staff, hold up, or any act of terrorism.

Apart from insuring jewelry and valuables, you can insure important documents by taking an add-on cover.

Valuation: To buy this product, the consumer is expected to fill the form and submit a self-declaration of contents. Normally the insurer insists on the valuation report by the government-approved valuer only if the value of an individual item is more than Rs 10 lakh and in cases where the total sum of all the valuable you wish to get covered for exceeds Rs 40 lakh for an individual.

The cost: You need to pay a premium of

Rs. 300 + GST   for a cover of Rs. 3 lakh

Rs. 500 + GST   for a cover of Rs. 5 lakh

Rs.1000 + GST  for a cover of Rs.10 lakh

Rs.1500 + GST  for a cover of Rs.20 lakh

Rs.2000 + GST  for a cover of Rs.30 lakh

Rs.2500 + GST  for a cover of Rs.40 lakh

Above Rs. 40 lakh, Rs. 0.6 will be added to the premium if you enhance the cover by Rs. 1,000. This comes to Rs. 600 for a cover of Rs. 10 lakh.

Above premium table - IFFCO Tokio general insurance

Making a Claim: While settling the claim the insurer will rely on the first information report filed by the bank and not you since the bank locker is owned by bank. The claim will be admissible if the bank lodges an FIR with the police.