Should you opt for bank locker insurance by IFFCO Tokio GIC?

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We fear that our jewellery and valuables may not be safe at home and so we put them in our bank lockers. But what are the chances of your bank locker being broken into? Barely negligible, but it did happen a little over a year ago.  And where there is risk- even a minute one- trust an insurance company to be present with a solution. IFFCO Tokio General Insurance Company has launched a product called IFFCO Tokio Bank Locker Protector Policy.

This policy aims to offer cover the loss caused to your valuables in the bank locker, such as jewellery and other such valuables. Is it really worth it?

What works?

It’s not just theft that the policy aims to cover your losses from. It offers to cover loss arising out of fire, earthquake, burglary, hold-up, fraud committed by a bank staff or any act of terrorism. It offers seven cover options to choose from. For instance, a policy with a sum assured of Rs 5 lakh comes at a premium of Rs 500 plus GST. A policy with a sum assured of Rs 30 lakh comes at a premium of Rs 2,000 plus GST.

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To buy this product, the consumer is expected to fill the form and submit a self-declaration of contents. The insurer insists on the valuation report by the government approved valuer only if value of an individual item is more than Rs 10 lakh and in cases where the total sum of all the valuable you wish to get covered for, exceeds Rs 40 lakh for an individual.

“The insurance buyer can go to any government approved valuer and obtain a valuation certificate for articles to be insured. Valuation certificate is waived for an individual item less than Rs 10 lakh and the total sum assured below Rs 40 lakh to make buying process simple for insurance buyers as we rely on self-declaration by insurance buyer,” said Subrata Mondal, EVP-Underwriting, IFFCO Tokio General Insurance Company.

In case of loss of your jewellery or other valuables, the insurer promises to make good your losses in case such loss is caused by one of the covered conditions.

You also have the option of covering documents kept in the locker as an add-on rider. The sum insured for this kept at a maximum of Rs 25,000. In case of loss of documents, the insurer will pay for replacing the lost or damaged documents on actual basis (in simple words, the cost you incur to get a duplicate set of documents) subject to the sum assured.

What does not work?

The cover is applicable only for jewellery and other valuables kept in the bank locker. So gold kept at home is not covered. Standalone home insurance plans cover your jewellery that you store at home (you need to mention the jewellery in detail while buying the policy); some policies also cover the jewellery that you keep in your bank locker. The premium quoted by IFFCO Tokio is low, though, as it covers jewellery kept in bank locker only.

While settling the claim the insurer will rely on the first information report filed by the bank and not you since the bank locker is owned by bank. The claim will be admissible if the bank lodges an FIR with the police. This makes the recovery process lengthier than usual.

The policy is not available online. You have to approach the insurer and fill up the form and submit the declaration or the valuation certificate as applicable. The policy will be issued on case to case basis.

Verdict:

Insurance for content in locker under home insurance is not high on the shopping list of the insurance buyers as bank lockers are perceived as safe storage options by most individuals. “Home insurance should be a higher priority for a customer, when compared to a bank locker protection plan. Also, if you are keen to insure your jewellery, it is better to go for all-risk jewellery cover,” said Abhishek Bondia, co-founder and principal officer of SecureNow.  To be sure, the all-risk jewellery cover is a standalone policy that aims to cover all your jewellery; at home, in use and in your locker.

If you are unduly worried about safety of their belonging in bank lockers, only then opt for this cover. However, it does not cover the valuables when they are in use or kept outside the bank locker – even at your own home in an electronic safe. Lack of ease of purchase will also act against the product as most insurance buyers would like to purchase it online. The low probability of your bank locker going bust weighed against the hassle of buying such a product means that it may not be worth your time.