Bank Safe Deposit Box Rules & Regulations
Safe deposit is often a bank's most misunderstood service area. Typically, it is located far from the main floor and tucked away inside a huge vault in some distant corner of the basement. Many bank customers take safe deposit for granted. A brief review of the main rules and regulations for safe deposit can give bank customers a new appreciation for this valuable service and its place in their lives.
A key feature of safe deposit boxes is privacy. For this reason, there are strict rules about access. If a customer wants someone else, for example a spouse or business partner, to share access to the box, then the box must be rented jointly; both parties sign the bank's documents together when they first rent the box. In an emergency, a renter cannot give someone else temporary access by simply handing over the key; the person would not be able to sign in correctly. Similarly, a power of attorney does not grant access to a safe deposit box to another person. Banks have rules that prohibit safe-deposit attendants from looking at the contents of customers' boxes while they are assisting them.
There are no federal or state laws concerning what cannot be stored in a safe deposit box. The only restrictions are those in the bank's contract that the customer signs when she rents a box. Most bank contracts prohibit anything dangerous, such as explosives. There are no rules against keeping cash in safe deposit boxes.
In order for any law enforcement agency to gain access to a safe deposit box, it must persuade the appropriate court that there is "reasonable cause" to suspect that the box renter is hiding something illegal in the box (guns, illegal drugs, or stolen property). The Internal Revenue Service can "freeze" assets, including the contents of a safe deposit box, until the tax dispute is resolved. Creditors seeking payment can do the same if they satisfy a judge that such an action is warranted.
No FDIC Insurance
The Federal Deposit Insurance Corporation insures only deposits in accounts (checking accounts, for example) at banks. Even though the word "deposit" appears in the term safe deposit box, there is no insurable deposit implied.
If the renter of a safe deposit box fails to pay his rental fee for a number of years (set by state law) and the bank is unable to notify him of the problem, the bank can declare that the box has been abandoned. Any contents will be turned over to the state, which has its own legal procedure for further handling of any abandoned property.
Renting a bank safe-deposit box can help secure important personal documents, collectibles and family heirlooms. But it's important to make wise decisions about what goes in the box and to stipulate who has access to it
What should I put in my bank safe-deposit box?
Items experts recommend storing in a safety-deposit box include birth or marriage certificates, insurance policies, property deeds, rare coins, jewelry, irreplaceable family photos, stock or bond certificates, and foreign currency.
Some people may be reluctant to put items into their boxes because of privacy concerns. But such fears are unfounded, as liability concerns keep banks from prying into safe-deposit contents.
What should I leave out of my bank safe-deposit box?
It isn't a good idea in most cases to store cash in a safe-deposit box. Cash kept in a safe-deposit box is not insured by the federal government under Federal Deposit Insurance Corp., or FDIC rules.
Who should get access to my bank safe-deposit box?
Who can access the box? It depends on the names on the signature card for the box rental at the bank
If you rent the box only in your name, you, a power-of-attorney or agent you designate are the only ones who can get into the locked boxs.
Who can access my bank safe-deposit box when I die?
Anyone who is a co-renter of the box has immediate access to it upon your death.
But what if you are the sole renter of the box? People often are confused about who can gain entry to the box. Many wrongly believe a power of attorney has access to the box after you die.
However, a power of attorney loses authority to act on your behalf upon your death, Stevenson says.
An executor or executrix that you designated to handle your estate after you die would get access to your safe-deposit box, but how quickly depends on the state you live in and the bank
It's possible to speed that process in certain states by having a "temporary executor clause" in a will, he says. In such instances, the executor can obtain a court order quickly after your death to access the box while your estate is going through probate.
If you legally appoint a trustee to oversee assets placed in trust before you die, that individual also would have access to the safe-deposit box upon your death.