>> Bank Locker Policy Insurance

Bank Locker Policy Insurance


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    Bank Locker Policy Insurance

    Bank Locker Policy Insurance Bank lockers are traditionally considered a safe place for one's valuables, gold and jewelry as people believed there could be no other location to keep their valuables, gold and jewelry safe other than the bank lockers. People believed the bank lockers would help safeguard their valuables and jewelry against burglary or theft as they would be kept in the bank's safe custody. However, the perception changed when banks announced they were not responsible for the contents in the bank lockers. Banks argued that they wouldn't know the contents in the bank lockers and hence would be unable to take the liability. So, banks are providing their customers with a safe facility to store their valuables without taking any liability. Banks acted as "landlords," whereas the depositors were the "tenants," and the entire responsibility of the valuables rested with the tenants.
    This generated a need for insurance covering the valuables, gold and jewelry of people locked up in bank lockers. A Bank locker protector insurance policy is designed to provide insurance coverage for the valuables, gold and jewelry stored in a bank locker by the policyholder. This policy offers protection from burglary, accidents, and any possible acts of terror by bank employees and terrorist acts. We will discuss further details.

    Coverage

    Loss of Jewelry and Valuables

    The bank locker protector insurance policy would compensate the insured customer in case of loss or damage to the jewelry and valuables of the insured or their family members when in the custody of the bank due to, Any accident that occurs during the policy period, Burglary or hold-up of the insured or the bank staff leading to the theft of the valuables and jewelry Infidelity of bank staff resulting in the loss or damage of valuables or jewelry Any act of terrorism as notified by the Government of India resulting in the loss or damage to the jewelry and valuables stored in the safe deposit boxes in the bank.

    Sum Insured Limits

    The minimum sum insured under the Bank locker protector policy is Rs. 3 Lakhs, whereas the maximum sum insured under the policy is Rs. 40 Lakhs. Sum insured options above Rs.40 Lakhs are also available with the insurance companies, and the policies will be underwritten based on the risk profile of the customers. In case of any accident, the maximum sum insured that would be payable by the insurance company is the sum insured mentioned in the policy document.

    Limit of Liability

    Under this section, the maximum liability limit represents the insured amount listed within an applicable policy. A higher sum insured means a higher limit of liability for the insurance company. The maximum limit of liability cannot exceed the sum insured mentioned in the policy document, and the policy is offered as an indemnity policy in which the claim amount depends on the loss incurred by the policyholder.

    Policy Term

    The policy term would be for 12 calendar months, after which the policy can be renewed on payment of the required premium. The insurer might permit no mid-term addition or deletion of the sum insured under the Bank locker protection policy.


    Exclusions



    • The policy should also outline any violations.
    • Losses due to failing to account for valuables and jewelry as per policy conditions are also significant.
    • Loss of essential documents such as title deeds documents, plans, investment and insurance policies, and property documents like passports or financial transaction cards could result in their being uncovered if an additional plan does not cover them.
    • The policy does not cover unexplained loss or mysterious disappearance from the locker.
    • Any items that are not stored in the secure bank locker
    • Any loss arising out of accounting errors or omission
    • Damage caused by electrical or mechanical breakdowns such as failure, breakdown, or malfunction, including excessive winding of clocks or watches
    • Data loss or corruption on computers, hardware, or software could result in severe economic damages and should never be underestimated.
    • Damage to jewelry may result from natural wear-and-tear, inbuilt vices, rust corrosion, latent defects, shrinkage warping bugs, or corrosion.
    • Damage caused by heat or light exposure, except in instances such as storm-induced forest fires or other unexpected catastrophes, is commonly the result of drought-induced climate conditions and humidity levels or from their combination.
    • Damages caused due to improper maintenance.
    • Damage or loss to the jewelry, valuables and other documents due to war, nuclear, rebelling, etc.
    • Jewelry or other worthless objects confiscated under official orders issued by government bodies or legally recognized authorities are subject to confiscation.
    • Wilful act or negligence
    • Losses arising from wear and tear, consequential loss, and any existing damage at the time of taking the policy.

    Add-ons

    Loss of Documents:

    The bank locker protector insurance policy would compensate the insured customer for the reasonable cost of replacement of the documents that are lost or damaged when the documents are kept in the bank locker in the event of,

    • Any accident that occurs during the policy period,
    • Burglary or hold-up of the insured or the bank staff leading to the theft of the valuables and jewelry
    • Infidelity of bank staff resulting in the loss or damage of valuables or jewelry
    • Any act of terrorism as notified by the Government of India resulting in the loss or damage to the jewelry and valuables stored in the safe deposit boxes in the bank.

    Documents include stocks or share certificates, deposit receipts, insurance policies, titles, deeds, plans, and manuscripts - even passports serve as additional documentation and certificates.


    Sum Insured Limits: Maximum coverage through this add-on insurance option is Rs 25,000 or any higher sum that has been agreed upon between the customer who is being insured and the underwriters of an insurance firm.

    Limit of Liability: Under any given situation, an insurer's maximum financial responsibility in any incident shall not exceed Rs.25,000 unless otherwise stipulated in policy documents with the approval of Corporate or regional underwriters.

    Policy Term: The policy term for this add-on is 12 calendar months, similar to that of the basic policy period.


    Terms to Remember:


    • Accident is any unintended, unexpected, and fortuitous incident caused by external and visible irresistible forces.
    • Banks are companies operating a banking system according to Section 5 of the Banking Regulations Act of 1949. An entity must operate as a bank and abide by all RBI guidelines about bank creation and operation - not including non-bank financial companies (NBFCs).
    • Burglary refers to any property theft requiring violent means, such as entering or exiting insured premises, including dacoity and robbery.
    • Family means any individual living alongside an insured at their residence who is also interested in its insurance-insured value.
    • Hold-up means forcible theft, including actual or threatened violence against the staff, customers, or other visitors in the bank by a person holding a weapon or claiming to have a weapon. This doesn't necessarily mean that the person holding up people displays some weapon, as the policy allows the person to claim to carry a weapon to settle the claim.
    • Jewelry means costume jewelry, items of silver, gold, diamonds, platinum, or any other precious stone or metals.
    • Valuables mean photographic, video, audio, computer and other electronic and electrical equipment, telecommunication equipment, binoculars, telescopes, watches, antiques and furs.

    Benefits of Bank Locker Policy:

    • Secure infrastructure + Insurance

      The first and foremost thing is to keep the valuables and jewelry safe; one would choose a bank locker over a home locker. A Bank locker insurance policy complements the existing infrastructure provided by the bank, such as CCTV cameras, strong room, etc. A bank locker insurance policy protects valuable jewelry and documents stored in bank lockers. For this, one should declare the contents of the bank locker and may even submit the appraisal report stating the quality of gold as well as the number of items in the bank locker. The other advantage of this policy is that it doesn't cover mysterious disappearances of jewelry or other valuables. So, the jewelry and other valuables would be covered only if an event resulted from an insured peril.

    • Covers infidelity:

      The other major benefit of a bank locker insurance policy is that it covers the infidelity of the bank employees. For instance, let us assume that the bank employee has stolen your jewelry and you learned about it later. You would now have two options: either to register the police complaint and hope that the employee would be arrested and subsequent recovery would be done, or sue the bank for the damages caused to you. These events are time-consuming and require many resources to start with and continue the legal course. What if you have an insurance policy that would compensate you for the infidelity of the bank employees leading to your loss? A bank locker insurance policy would compensate the policyholder for the loss or damage to their jewelry due to the infidelity acts committed by the bank employees. This policy would compensate up to the sum insured mentioned under the policy in case of any infidelity from the employee's side.

    • Hassle-free claim settlement process:

      The main benefit of an insurance policy for bank lockers is the hassle-free claims settlement procedure. Almost all the claims made under the bank locker insurance policy require an FIR from the Police describing the events leading to the loss. FIR would be required in case of burglary, natural event, employee infidelity, etc, and the claim would be settled based on the loss suffered by the policyholder. Once the cause of the loss or damage is ascertained and verified by the insurance company, the claim settlement will be done immediately. Claim settlement can be done on a total loss as well as a partial loss basis.

    Things to consider before taking Bank locker insurance policy

    Documents required for Bank Locker Policy Insurance Claim
    • Proposal Form: The first and foremost thing to consider before taking a bank locker insurance policy is to fill out the proposal form carefully. The proposal forms the basis for insurance being granted to the applicants. The underwriter would review the request according to the data provided on the proposal form. The details provided in the proposal form would be used to analyze the risk and the occurrence of future losses. For instance, the sum insured section in the proposal form is very important, and it should be equal to the value of jewelry and other valuables kept in the bank's safe locker. For example, if you have appraised your jewelry and found the value to be Rs.15 Lakhs, the sum insured should also be taken for the same amount in the policy. Failing to take the same sum insured as the jewelry value would lead to under-insurance. Under-insurance happens when the value insured by the policy is lower than the amount of the insured property. In such cases, the final claim settlement amount would also be less than the actual loss incurred by the policyholder.
    • Sum Insured: The sum insured under the policy is an important thing that has to be considered by the applicant. Once taken under the policy, the sum insured cannot be changed, as the insurance company may not permit mid-term additions or deletions. Hence, deciding the sum insured carefully before taking the bank locker insurance policy is important. Getting the jewelry appraised by a recognised appraiser and then deciding the sum insured accordingly is advisable. The appraisal certificate may also be submitted to the insurance company to justify the sum insured under the policy. If the invoices are present, then the same could be used to decide the sum insured under the bank locker insurance policy. If the sum insured is higher (more than Rs.40 Lakhs), the proposal will be underwritten by an insurance company's underwriter on the risk profile of the person applying.
    • Mid-term additions: There could be instances where you might have purchased the jewelry during the policy period and may want to include it in the policy. Insurance companies might permit or reject the mid-term addition to the policy. If the insurer does not permit midterm addition, it would be better to take a higher sum insured policy anticipating future additions. Mid-term additions, if permitted, would require the policyholder to make the necessary premium payments to cover the risk posed by the newly added jewelry. For further information about adding a mid-term term to bank locker insurance, contact our insurance experts via Ethika insurance broking.


    Bank Locker Policy Insurance Claim Settlement Process


    Bank Locker Policy Insurance Claim Settlement Process Step 1: First first step in the claim settlement process in bank locker insurance policy is to inform the insurance company about the loss suffered due to an insured peril. The losses could be related to theft, hold-ups, accidents, the infidelity of bank employees, or other acts of terror. You could call the customer care number provided by the insurance company and register the claim. It is necessary to provide details of the loss, such as the nature of loss, reasons for the loss, cause of occurrence of the event, date and time of loss, circumstances of loss, items affected by the loss, FIR details, etc briefly so that the insurance company could prepare the initial claim report. In addition, a duly filled out claim form with the above-mentioned details should be submitted to the insurance company.
    Step 2: After the claim has been reported to the insurer, an insurance company claim reference number will be created that could later be utilized for subsequent communications. Once the notice of loss is given to the insurance company, they appoint a surveyor to check the nature and quantum of loss and other factors leading to the claim settlement. A surveyor would usually be deputed within 24 hours after the intimation of the loss. The surveyor would then submit the final claim report to the insurance company stating the amount of loss.
    Step 3: The insurance company would then share the surveyor report mentioning the extent of loss that could be settled under the policy. Once the insured agrees to the claim settlement, the claim amount will be transferred to the insured customer. To ensure that the claim is resolved, the insured client must present the following documents to the insurer.

    Documents Required for Claim Settlement

      Documents required for Bank Locker Policy Insurance Claim
    • Fill and sign the Settlement Form as instructed.
    • Report from your local police station regarding an Initial Intelligence report.
    • Cost of repair (if applicable).
    • Bank locker insurance policy details.
    • Canceled cheque leaf for claim amount to be transferred to your account
    • A detail of the items affected by the loss is to be submitted in the format provided by the insurer.

    FAQ's


    The insurance for lockers in banks is available both in a retail insurance policy and an insurance policy that is a group purchase for banks. If you have an account with any bank, you could take the bank locker insurance policy. In some cases, it could be possible that the bank is offering the bank locker policy on a group basis to all its customers.