All of us would be smart to take a cue from movie stars and athletes. We all have items in our lives worth protecting: valuable jewelry and heirlooms, collectible coins or baseball cards, deeds, titles, wills, digital backups and even precious photos.
Federal, state and local law enforcement, FEMA, The American Red Cross, AARP and many professional advisors recommend a safe deposit box as the smartest, safest storage solution. With annual rental costs generally starting at $30 to $45 a year, they are one of the best values offered by financial institutions today — and also one of the most underutilized.
Three tips for protecting your valuables
1. Your bank is safer than your home.
Your home is far more likely to be broken into than a bank. In 2013 the FBI reported that a home burglary occurred approximately every 16 seconds.
And using a safe at home does not change that equation. “In fact, it makes you more vulnerable,” says Dave McGuinn, president of Safe Deposit Box Specialist. “People underestimate the number of service repairmen and overall traffic in and out of a home. Logically once the presence of a safe becomes known, the house becomes a more attractive target.”
Natural disasters also pose a greater risk than ever before. Homes are more vulnerable and lack the structural integrity and security offered by a bank. It’s one of the biggest reasons people use safe deposit boxes according to the Independent Community Bankers of America (ICBA).
2. Take advantage of low cost insurance.
“It is important to understand that boxes are loss-resistant, not loss-proof,” says Gerald Pluard, president of Safe Deposit Box Insurance Coverage, LLC.
In the past three years, more than 50,000 boxes have been impacted by flooding, fires and other natural disasters, affecting more than $1 billion in property. Surprisingly, a recent national survey conducted by SurveyUSA revealed that half of the 25 million people renting safe deposit boxes today incorrectly assume the contents stored inside their box are insured by the bank or a federal agency.
They are not.
But that is changing. SDBIC recently introduced a simple, affordable insurance coverage specifically designed to protect the contents of a safe deposit box — and at a fraction of the cost of traditional insurance.
“Despite common misperceptions, items kept in safe deposit boxes are not insured by the bank or FDIC,” said Deanne Marino, executive director of American Banking Insurance Association. “We are encouraged that many banks across the country have begun offering this kind of insurance as an enhancement to their current safe deposit box services.”
What is so unique about this insurance, which is underwritten by AXA ART, is that you do not need to identify what is stored inside the box to obtain coverage. “No disclosures, appraisals or deductibles; if it’s legal and fits in the box, we will insure it,” noted Pluard.
Even important papers such as wills, titles, deeds, photos and digital backups are covered — an industry first.
For those who already insure items at home but do not use them regularly, placing them in a box and insuring them with SDBIC could save 50 percent or more in annual costs compared to homeowner’s rates, added Pluard.
3. Use that smart phone.
Consumers should frequently take an inventory of their valuables and important documents. Whether financial or emotional, if it’s hard to replicate or replace, it should go in a box and be insured.
Even with these precautions, there are certain items that no amount of money can replace. Take photos when you place them in the box. If ever stolen or lost your photos can help law enforcement recover those items — including distributing the images across national database to pawnshops and other places where the items could be offloaded.
We all can’t be a famous athlete or actor, but we can certainly store our valuables like one. Millions of people trust safe deposit boxes. Millions more should; they work, are inexpensive, and now, even insurable.
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