People often use safe lockers in banks to store valuables such as jewellery and property papers. But do you know what happens if your belongings in a bank locker are lost? Earlier, banks were not responsible for the loss of items in your locker. You could not claim financial damages from them. There are instances of thefts at banks where lockers were broken into. However, the locker owners were not compensated for those losses.
To remedy this, the Reserve Bank of India had recently announced a new rule that allows locker holders to claim compensation up to 100 times the annual locker rent if the holdings are lost due to theft, fire, bank fraud etc.
Let’s look at a few must-know things you need to know about the safety of lockers.
Keep Records Of Your Locker Items
Make an itemised list of your valuables in the safe. When you add or subtract items from the locker, diligently update your list. You may not access the locker for long intervals and may therefore forget what you have saved there. Hence having this list will help you track your valuables. If in some situation, an item goes missing from your locker, the list will help you identify it.
Access Locker At Least Once A Year
Locker holders must operate their lockers at least once a year, else banks are permitted to break them open using the protocols laid in your locker agreement. Before banks take any such action, they are required to send locker holders sufficient notice when their locker accounts become inactive. Locker holders need to provide a valid reason for their non-use of the account. Banks can rule if the reason is valid or not. To avoid such troubles, one may simply operate the account at regular intervals.
Get Agreement Copy From Bank
The new locker rules won’t apply immediately to the existing locker holders. Banks must renew agreements with the current customers from January 1, 2023. The new rules will be applicable from January 1, 2022 for customers signing up for new lockers. The RBI has notified that banks shall ensure fair terms and conditions. But you must read your locker agreement carefully and always keep a copy of it with you.
Pay Locker Charges On Time
Under the new rules, the RBI has permitted banks to get a term deposit from new customers while allotting lockers so that such deposits can be used to recover locker rent for up to three years along with the charges towards breaking the open locker under contingency. However, if the customer has a satisfactory bank balance, the bank may not additionally require the term deposit. In case you fail to pay the rent for three years, the bank can at its discretion break open the locker. It would be prudent to pay your locker rent on time to avoid such troubles.
Divide Valuable Items Between Home & Locker
People assume bank lockers are 100 percent safe. But we know this isn’t true and there are always risks, and losses also may not be adequately compensated for. Therefore, you may consider splitting your valuables between home and bank locker and avoiding holding all valuables in either one of those options. Ideally, the valuables in your locker should not be worth more than 100 times your annual locker rent. The rest can be in a safe location in your home, in a high-quality home locker that you can purchase from any reputed manufacturer.
What Else Can You Do?
Apart from the above, you may also take an insurance policy against your valuables. Insurance is one of the best ways to protect against loss of value due to theft, fire, burglary etc. The insurance company will inspect and ascertain the valuation of your contents. Insurance can be bought for items kept both in your bank locker and your home locker. However, chances of claim settlement are higher if the contents are kept at home.
(The writer is CEO, BankBazaar.com)