For many people, a safe deposit box at the bank is the place to put all of your most important papers, cash, and other things you simply can not afford to lose. However, have you ever really contemplated the safety aspect of the safe deposit box? It may not be that safe at all.

Think back to the wave of natural disasters that have struck the nation in the last few years. Tragic events, such as Hurricane Katrina, destroyed entire towns, including the buildings housing banks. Any customer that did not have coverage on the safe deposit box through their homeowners insurance did not have protection. Adding to that, anyone storing cash in their safe deposit box do not even have the option to insure, as homeowners’ insurance policies will not cover cash. The contracts that accompany safe deposit boxes also exclude any cash from being in the box.

As the economic crisis affects more and more people, many have started storing cash in the deposit boxes. This is a risking proposition as that money is not protected, despite it’s residence in an FDIC-insured bank, which only insures deposits made into the bank and not the bank’s deposit boxes. In the event a bank literally closes their door, customers will likely have options to recover their belongings in a timely manner. Either the bank will notify your prior to the closing or there will be a posting on the building with a contact person and phone number to gain access to the contents of your deposit box.

Beyond the aspect of a bank’s closing, there are also other safety concerns surrounding the use of a safety deposit box, including:

  • In the event of a death, some state laws are stringent about the process of accessing the deceased person’s box contents. It is recommended you have a second name on the account in order to avoid the hassles for survivors to claim your belongings.
  • Should you be involved in a discrepancy with the Internal Revenue Service, your box contents can be frozen and you will not be able to access the contents until the dispute has been settled.
  • If the bank suspects your box is involved with any suspicious activity, a court order can be issued and the Department of Homeland Security can be given access to your safe deposit box.

To keep yourself as safe as possible while using a bank’s safe deposit box, you should:

  • Check your homeowner’s insurance for safe deposit box coverage. You may need to pay an additional premium for this coverage.
  • Keep photographs of the contents of your deposit box.
  • Keep the receipts of any items in the box that have been appraised.
  • Leave information about the location of your safe deposit box with your other important papers concerning your will, in the event of your death. If you do not have additional lessees on the box, make sure to appoint a power of attorney so someone can access the box.
  • Remember that bank vaults are fireproof but not necessarily protected from water damage. Use sealable plastic bags to store all your valuables in the event of a fire or a flood.
  • Never store those documents you use on a regular basis, such as passports or any legal papers that may be needed in the event of your illness or death.


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