Beware: bank lockers may not be safest place for your jewellery

Most Indians think that a bank locker is the safest place to keep their valuables – but they may be wrong, for in case of say a robbery or a natural disaster, the bank takes no responsibility for anything stored in your locker, a Right to Information (RTI) query by a lawyer has revealed.

Bank of India, Oriental Bank of Commerce, Punjab National Bank, UCO Bank and Canara were among the 19 banks to say in a reply that "the relationship they have with customers with regard to lockers is that of lessee (landlord) and lessor (tenant)". In such a relationship, the lessor is responsible for his or her valuables kept in the locker which is owned by the bank.

Even the Reserve Bank of India (RBI) has said that ''banks have no liability for loss of valuables in lockers'', and as the locker hiring agreement absolves them of all liability.

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, lightening, 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.''

In that case, is it really worth the hassle and expense of acquiring a bank locker? Despite technological advances such as biometric access (though only in select branches) there have been reports of burglary and natural disasters and also customers losing the valuables due to sheer negligence by banks.

Moreover, getting a bank locker is not easy. Banks always seem to have run out of lockers and there's always a waiting period. Customers are charged ranging from Rs 1,000 per annum for a small locker in a non-metro city to Rs10,000 per annum (some reports even say Rs40,000 per annum) for a large-sized locker in a metro city. And most banks insist customers to open a fixed deposit with them of higher value and longer duration to rent a safe deposit locker.

This may, however, not be the whole picture. Ashish Kapur, CEO, Invest Shoppe India Ltd, told The Financial Express that when banks get their lockers leased, they undertake to ensure the security of these lockers. Hence they are liable to compensate the customers for any loss incurred by them. ''This position of responsibility of the banks for the lockers leased by them has been upheld by various courts as well as the National Consumer Redressal Commission (NCDRC) in several cases. Hence if the bank declines to compensate a customer for any loss due to theft or damage to his locker, he or she should approach NCDRC,'' suggests Kapur.

In fact, there have been a few cases in the past where customers have received compensation for loss or damage to locker contents.

Moreover, one should always make a list of the things one is putting in the locker and calculate the worth of the valuables, Atul Surana, certified financial planner, Catalyst Financial Planning, told Deccan Chronicle. This comes in handy while claiming compensation. Moreover, he suggests that one should open the locker only after the accompanying bank employee has left and ensure it is locked well before leaving.

But other experts say it may be more worthwhile to invest in a home safe than a bank locker, as most banks use the safe manufactured by the very companies which make the home safe. There are a number of options available, from single-walled to double-walled; lighter and smaller compact safes to heavy and bulky ones.

These can be easily anchored into the walls, which gives three-sided protection, or can be fitted into the flooring (it will merge with floor and burglars wouldn't even imagine it's a safe).

There are even burglary resistant safes which are designed to withstand advanced burglary attacks. For a good safe, you will have to shell out Rs 8,000-Rs 10,000 and it is a one-time investment unlike the bank charges.

And when it comes to jewellery, now there are many companies that offer insurance. Alternately, you can also look into buying a householder's policy, in which if you declare jewellery content of the house, the valuables are insured against any kind of loss or damage like theft, loss, fire, accidental damage and so on.

Indians' love for bank lockers continues as their love for gold. However, internationally, bank lockers are not in vogue. The British, for example, have almost done away with such safe deposit lockers in their banks.

With banks not willing to take the responsibility for theft of the content of your bank lockers, maybe it's time to ditch them and find a safer place - your home.