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What You Need to Know Before You Store Items into a Safe Deposit Box


Written by Sarah Li Cain

What is a safe deposit box?

A safe deposit box, also referred to as a safety deposit box, is a small secured box that sits in a vault, usually at a bank or credit union. Think of these as a smaller version of a safe, one you can rent to store valuables and important documents. The idea is that storing such items in a safe deposit box will protect them from fire, theft, tampering and other types of natural disasters. This is because a safe deposit at a financial institution is stored inside a thick vault door and reinforced with concrete and steel walls. There’s also the added protection of the bank or credit union’s security system that is monitored around the clock.

What to put in a safe deposit box

Your local bank or credit union should be able to help you figure out what items can be kept in a safe deposit box. Many of them provide a checklist of items and even guidance on creating an inventory list to help you remember what you stored inside your safe deposit box.

Items that are acceptable to put in a safe deposit box include originals of important documents, jewelry, family heirlooms or keepsakes, and even documentation for insurance purposes. Examples of that include a digital copy of photos of your home office or service records.

Here’s a more specific list of what you can store in a safe deposit box:

  • Family photos
  • Digital documents (e.g. ones in flash drives, DVDs and hard drives)
  • Rare coins
  • Death/birth certificates
  • Marriage certificates
  • Divorce decrees
  • Adoption paperwork
  • Collectibles
  • U.S. savings bonds
  • Agreements
  • Bills of sale
  • Contracts
  • Titles
  • Court Decrees
  • Historical Records
  • Income Tax Records
  • Insurance Policies
  • Lease documents
  • Mortgage documents
  • Patent Papers
  • Business receipts
  • Securities (e.g. stocks and bonds)
  • Tax records and receipts
  • Titles (e.g. car)
  • Citizenship paperwork
  • Military records or awards
  • Diplomas
  • Jewelry
  • Records of household or business inventory
  • Academic transcripts
  • Rare stamps
  • Pension certificates
  • Business-related documents (e.g. TIN, blueprints, charters, trademarks and articles of incorporation)

What not to put in a safe deposit box

Even though safe deposit boxes are used to safeguard items that are valuable, that doesn’t mean that every important document should go into one. Generally, you should only keep items that you don’t need to access often, such as collectibles and certain paperwork. That’s because you can only access the box during your bank’s regular business hours.

Cash

Cash is typically not recommended because the contents of a safe deposit box are not FDIC-insured. Just because it’s stored at the bank, doesn’t mean that it’s considered the same as a deposit account. If you want to store cash, it’s better to stick it in a bank account, one where you can access it easily. This can include savings accounts, checking accounts and even certificate of deposit accounts. In addition, banks may not even allow you to store cash, depending on what your rental agreement says.

Your will and power of attorney

For that reason, documents that you may need on an unpredictable basis, such as a will or power of attorney papers, are probably not the best things to stash in a safe box either. For these types of documents, it’s best to check with an attorney on where to best store these types of original documents based on laws in your state. An estate attorney, for example, will keep important documents on hand for you and your loved ones. You can also keep backups of your own on flash drives, portable hard drives, or cloud-based storage services like Google Docs or Dropbox.

Your passport and other IDs

Unless you’re James Bond in need of a quick disguise, most folks don’t really need to keep IDs in a safe deposit box. You may need to access these items often and storing them where you can’t get to them easily isn’t the best choice.

Safe deposit box insurance

As previously mentioned, the contents of a safe deposit box are not FDIC-insured or even NCUA-insured (if you’re storing yours at a credit union). These organizations only insure money held in regular bank accounts.

That being said, your financial institution may provide some other type of insurance for your safe deposit box. For example, there may be partial compensation if your box or the contents inside it were to be damaged or destroyed. Each bank has its own policies, so you’ll want to check the fine print in your rental agreement to see if your items are insured, if at all.

If you’re worried about the items in your safe deposit box becoming damaged, you could purchase insurance to cover its contents. Things such as fire and theft insurance are possible and are typically part of your homeowners or renters insurance policy. This is an additional rider that specifically helps to cover your valuables, called a scheduled personal property endorsement, also known as a floater. It gives you coverage for more risk and limits that aren’t covered with standard personal property insurance, such as a loss. Items that you can insure in a floater include antiques, collectibles, jewelry, expensive equipment (like cameras) and gold coins.

While a standard homeowners and renters policy does cover your personal belongings, it can set a certain amount of money it’ll pay out for your valuables, such as collectibles. For example, you may have a $1,500 limit on what your insurance company will pay for your collectibles even if it’s worth more than that. Let’s say you have a necklace that’s worth $4,000. If you want to file a claim, your insurance company will only compensate you $1,500, meaning you’re out $2,500.

In contrast, a scheduled personal property endorsement often doesn’t have a deductible, depending on your plan. You’ll need to itemize each piece of property and detail in your inventory. To get these items approved, you’ll most likely need to get proof of the item’s value, such as a recent receipt or a professional appraisal and provide these to your insurance company.

In addition, you’ll want to document your property, such as photographing and writing down a list of items in detail that you have in your safe deposit box in a separate location. Keep copies of receipts and appraisal papers in a safe location, such as a fireproof safe in your home. Other details can include the model number of items, where you purchased it and any serial numbers. These numbers can be found on the bottom of most equipment.

Before you start documenting, check with your insurance company to see what it requires in terms of specific reimbursement requirements. That way, you can make sure to write down all necessary details and take photographs to provide ample evidence. Your insurance company may provide tools to help you. In this case, it’s generally a good idea to use their tools so that you’ll know you’ve collected all necessary data that your insurance company requires. Some of these tools don’t require that you’re a customer of the company.

Here are a few apps put out by major insurance companies:

Allstate Digital Locker©: This free app is available to everyone on Android and iOS devices. You can even use the app on your computer to create a catalog of your items. You can use it to take and store photos, include details and an estimate for each item. You can search for items quickly and export your inventory list either to PDF or onto a spreadsheet. The app claims your data is secure through their cloud-based technology.

American Family Insurance DreamVault: Similar to the Allstate app, DreamVault also catalogs items, and you can list details such as their value and even photos. You can download their app or log in via your computer, and any information included will be synced to either device. You can create reports and have them emailed to you.

Liberty Mutual Home Gallery©: You can keep an inventory of your items by scanning the item’s barcode to retrieve images and descriptions. You’re also able to back up your information by exporting your inventory and easily track items in multiple locations.

State Farm HomeIndex®: An extra perk to this inventory app is that you can email your inventory to your State Farm agent, or anyone else for that matter, as an extra precaution. If relevant, you can create labels when storing your items so you can better organize your safe deposit box. However they don’t have an app, so you can only access through your computer.

To decide which option is best for you, assess how much the items are worth in the first place. If you’re not sure, it doesn’t hurt to take them to an appraiser to find out. If the combined value of these items are worth more than the limit in your standard property protection, then you’ll want to consider the add-on. Another option is to raise the limit of their liability, which is the cheaper option. For example, instead of a limit of $1,500, you’re now insured for up to $4,000. Even with the raised limit, you will only be compensated up to a certain amount.

You’ll also want to consider in your policy whether you want to insure your possessions for replacement cost or actual cash value. Replacement cost means your insurance company would pay you to replace a lost, stolen or damaged item. Actual cash value means you’ll get cash for what the item is worth now. Meaning, you could get less money for older items, especially those that depreciate in value over time. If you do go with replacement cost, it would cost 10% more than if you choose actual cash value, but it could be worth it if you have a lot of valuables. The best way to figure out what’s best for your needs is to talk to an insurance agent about your current coverage and situation.

Insurance policies for safe deposit boxes

Another option to consider is taking out an insurance policy that is specifically for safe deposit boxes. Your bank may have partnered up with a company called Safe Deposit Box Insurance Coverage as an extra option to insure your valuables. This type of insurance will cover all contents as long as it’s legal to own up to the coverage limit you chose. This includes precious metals, jewelry, cash, bank notes, coins, collectibles and even legal documents. Unlike homeowners insurance, you’ll be covered for flood damage. Also, you’ll also be insured against natural disasters, such as landslides, earthquakes, tornadoes and hurricanes.

Another advantage to taking out a policy with Safe Deposit Box Insurance Coverage is that your documents are insured in case of damage or theft. Homeowners and renters insurance does not have such coverage. The policy covers up to $3,000 for documents such as deeds, wills and titles. The money is intended to go toward getting replacements for them. Since the policy covers what’s physically in the box, you don’t need to provide a list of contents or get items appraised. In other words, you can add in extra items and those will be covered by your policy in case of loss, theft or damage. Depending on your situation and how much your items are worth, it may be cheaper to take out safe deposit box insurance instead of adding on a separate policy through your homeowners or renters insurance.

To obtain a safe deposit box insurance policy, you can fill out an online application and get one in as little as five minutes. Alternatively, you can fax or mail in an application. All you need to do is provide your contact information, name and location of the financial institution where you keep your safe deposit box and the last two digits of the box.

Private bank vault companies are an alternative to banks. Many of these companies claim to have state-of-the-art security, such as steel-reinforced walls and motion sensors. These companies also provide insurance for their safety deposit box customers. Most will insure up to $5,000 worth of contents, and for a small fee, you can increase the coverage. When renting a box, you can choose how much coverage you want and the company will issue a policy in your name.

How to get a safety deposit box

You can get one at your local bank or credit union. When visiting a branch, the bank manager or a teller would be able to let you know about the sizes available and pricing, including any discounts you qualify for. It might be a good idea to either bring the items you intend on storing or gather the items in your home to estimate the size you’ll need.

Once you determine what you want and there is availability, you’ll be asked to sign a lease agreement and identify who has access to the box. You’ll then be given one or two keys, and the bank keeps one on the premises.

The process for private safety deposit box companies are similar, except that you may be able to reserve a box online then complete the rental process in person.

Are there different safe deposit box sizes?

There are different sized boxes, with options depending on your bank of choice. Typically, the smallest box is around 3" x 5" x 24” (imagine a larger version of a mailbox) and the largest size is around 10” x 10” x 24” (like a small school locker). Not every branch will offer all sizes nor will they be available. It’s always a good idea to call around and check to see what’s available in your local area.

How much does a safe deposit box cost?

Average safe deposit boxes can range from $20 per year all the way to $200, depending on the size. Some banks offer a discount for those who make auto payments or have a premium checking account. Some major banks even provide a free small safe deposit box with their premier accounts.

Private safe deposit box vault companies tend to be more expensive than banks. Prices usually start at a few hundred dollars a year for a small box.

Designating access to others in case of emergency

In case you can’t physically get to your safe deposit box, it might be a good idea to designate access to someone else in case of an emergency. If you’re the only owner, it may be difficult for heirs or other family members to get access to your possessions. This is especially true if you didn’t tell anyone about the box or keep records of its whereabouts or contents.

If you pass away and a family member wants to get access, the bank will need that person to provide documentation like a death certificate or court appointment as executor. This could take some time and may be a hassle for those involved, especially if you’ve had the box for some time. It could be that the bank you rented the safe deposit box from classified the account as closed. If that’s the case, the property would have been transferred to the unclaimed property in your last state of residence.

There’s also the possibility that the bank has no record of the account anymore. Family members can still find your property by doing a free search, but again, that can be a hassle for them. If there are items you want to make sure someone can get to, it’s better to be safe than sorry to grant someone permission to access your safe deposit box.

However, you can’t just give privileges to someone and be the sole owner of the box.

Banks and credit unions often don’t allow you to assign limited privileges of access to your safe deposit box. The only alternative is specifying another authorized person, where the person would have full access.

If this is the case, then it’s a good idea to ensure that whoever has access to the box is someone you trust. You don’t want to find out the person you gave access to went in without your knowledge. Banks can’t deny access to an authorized person to a safe deposit box. While they may keep records of who accessed the box, they don’t know who is the actual owner of the contents inside.

If you do decide to have a co-authorized person for your box, it’s a good idea to find trusted family members first. Someone like your spouse or a child would be best because you have a closer relationship to those people. With anyone you designate, keep the lines of communication open, such as someone you see on a regular basis so you can make sure they understand your wishes or you can contact them at a moment’s notice if you need access to your contents. In any case, keep detailed records of its contents, the bank’s contact information and the box number you rented.

Alternatives to safe deposit boxes

If you’re not sure whether to keep important items or valuables in a safe deposit box, there are alternatives. Of course, with each option, there are pros and cons.

Home safes

This option can range from tens of dollars to hundreds, depending on the size and strength. You can choose from different features, from having one installed and affixed to a wall, to electronic entry, via a key or a mechanical entry lock. Some even go so far as to have biometric access where to open your safe you must simply scan your fingerprint.

The advantage to a home safe is that you can access its contents 24/7, so you can even store items that you may need to get to often, such as your passport or IDs. These safes can be customized to any size you want, unlike ones at banks. This is good for those who want to store large items or have many valuables they want to keep safe. Most home safes are also fireproof, waterproof and in some cases smokeproof, helping to protect your valuables. Because they can be large or affixed to a wall, they could be safer because it’ll be difficult for burglars to remove and break into them later.

However, because they are hard to remove, it may not be as convenient as other options mentioned below. If there is a fire or other type of situation where you need to evacuate, you may not be able to remove its contents in time. You’re also responsible for making sure you or a trusted person can access your safe. For instance, if you misplaced the keys, it could be difficult getting access. If you have a biometric safe and that’s the option to open it, it may be problematic in the event of your death.

Fireproof/waterproof safe deposit boxes

This option is similar to a safe but are smaller in size. These boxes also tend to be lighter, meaning they may not be made of thicker or sturdier materials compared with home safes. You can access it contents using biometrics, a key or electronically much like home safes. The advantage to these types of boxes is that they’re portable, meaning you can place them anywhere for safekeeping or remove it from your home at a moment’s notice. They come in various sizes and you can use them to store smaller valuables. However, like home safes, they’re not guaranteed to be fireproof or waterproof. Because of its portability, thieves can remove them and break into the boxes at another location.

Diversion boxes

Also referred to as a diversion safe, these boxes are meant to be disguised as an everyday object in the house. The idea behind them is that thieves won’t know that there are valuables stored inside a “book” or a “clock” and move on. These boxes are meant to store smaller items or a stash of cash in case of emergencies. They’re much more inexpensive compared with safes and safe deposit boxes if cost is a concern for you.

Since they’re not as big as safes or even safe deposit boxes, they’re not going to help you with storing multiple items or even important documents. Furthermore, these items aren’t as sturdy as the above mentioned options since they’re most likely constructed from wood, thin metal and even cardboard. It also means that these items most likely will be destroyed or severely damaged in the event of a fire or flood.

Whether it’s a safe deposit box at a bank, a private vault or one of the above mentioned at-home options, make sure you fully understand all the pros and cons. Make sure to read and understand the rental agreement and your insurance policy so you’re aware of your responsibilities and rights in case something does happen. It’s also a good idea to check your safe deposit box often so you know about the status of your valuables.

Comments
Kicko
Kicko   |     |   Comment #1
First, if you need all those insurance riders, policies and extra payments just to recover a partial part of the original value, why bother.
Second, if a bank can not guarantee the content of your box, why pay them for the box and an extra insurance.
Third, when a rogue employee finds out that you carry extra insurance on a certain bank box, you divert immediate attention to that box and the box number can be attacked from inside job(s).
Fourth, there are fire safes you can by for a $100 for your documents an store it at home. Also, there are almost full proof safes for your valuables that can be encased in concrete slab with no chance to be opened without a digital password or USB key (there are no hinges or combination locks exposed for tempering), they are even bomb proof.
Ann
Ann   |     |   Comment #2
The safes that get "encased in concrete slab" are presumably floor safes (designed to be embedded in a concrete floor), which are at risk of water intrusion.

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