Safe Deposit Box

Updated on July 2, 2024
Article byKosha Mehta
Edited byAaron Crowe
Reviewed byDheeraj Vaidya, CFA, FRM

What Is A Safe Deposit Box?

A safe deposit box is a protected unit that is available for rent to store valuables. These boxes are usually made of metal, and are available at traditional financial institutions or credit unions. It is useful for storing items that are too valuable to keep in a home safe.

Safe deposit box

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Safe deposit boxes are very secure as banks store such boxes in a locked vault, and to unlock it, typically, two keys are required: a client key and a key held by the bank or credit union. Bank customers can access the box by visiting the branch, producing identification, and providing the key. The account holder has complete knowledge of its contents; the bank has no access to this information.

Key Takeaways

  • Safe deposit boxes are stored in a locked vault at a bank or credit union branch.
  • Each time the holder visits the bank to open the safe box, they must present identification and the box’s key.
  • Multiple individuals are capable of opening a safe deposit box, and all individuals are regarded as co-tenants.
  • Insurance of the box’s content is advisable as no safe deposit box is completely safeguarded against loss-causing events such as theft, fire, and flooding.

Safe Deposit Box Explained

A safe deposit box for cash provides peace of mind to people concerned about their possessions being lost, stolen, or damaged. In addition, safe boxes can offer additional security beyond what one may get at home. To unlock the box, it is required to present identification and the box’s key if it is not a keyless system.

Multiple individuals are capable of opening a safe box. It is possible if other partners agree and sign to share the box. In this situation, all individuals are given keys as co-tenants.

However, this often requires the new tenant to visit the bank, provide identification, and sign documentation agreeing to be included as a co-tenant. In either situation, each co-tenant would get a safe deposit box key as permission to store items.

Co-renters share the box’s contents and any liability linked with the box equally. In cases where both partners are interested in the box’s contents, sharing it can be a practical solution. A couple may opt, for instance, to store documents of wills and personal treasures in the same location.

However, this also means that any co-tenant can remove things from the safe box without prior approval from the other co-tenants. It could be problematic as the bank does not mediate disagreements between co-tenants.

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Pros and Cons

Let us look at the merits and demerits of the deposit box to understand the concept better.

Safe deposit box - Pros & Cons

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#1 – High-quality consistency

Safe deposit boxes in banks and financial institutions are reliable as they invest in waterproof and fire-resistant boxes to withstand catastrophes that are much better than a home safe. Also, there are various safe deposit box size options per storage requirements.

#2 – Indemnification and Privacy

While box contents aren’t automatically insured, it’s generally simpler to insure the box based on its contents. For example, if a person has a precious collection or family relic, one can guarantee its safekeeping with the Safe Deposit Box Insurance Co. without revealing it. However, one must declare the home safe’s contents to the insurer to be protected by insurance.

Safe Deposit Center wouldn’t disclose contents to the authorities. Therefore, even guns can be kept in a box. This coverage and privacy are the biggest plus points of getting such a box.

#3 – Security

Commercial insurance covers damages from bank disasters and robberies. Banks and private repositories have security measures installed for free. A home safe could hold frequently-used things. These boxes are ideal for storing valuables and papers long-term.


#1 – Immediacy

The primary disadvantage of having a safe box is not getting immediate access to valuables at home. Several private safety deposit box rental services offer perks such as longer access hours to compensate.

#2 – Recurring Expense

In contrast to an in-home safe, where there is a one-time payment, these boxes typically entail monthly or annual fees. However, these fees are pretty cheap and depending on how long one wishes to keep a box; they may be less expensive than buying a safe home.

#3 – Abandonment

In addition, if the heirs are unaware of the drawer, the box is discarded upon non-payment of rent, and the state’s unclaimed-property officials take box content for sale.

Using a safe box depends on several criteria, including the objects a person wishes to store, their worth, and whether or not they are insured. Keep in mind. However, it is worth noting that boxes are not failsafe. The Federal Deposit Insurance Corporation will reimburse money up to federal restrictions if the bank fails.

Safe boxes, however, do not function in this manner. Since they are not savings accounts, The Federal Deposit Insurance Corp. does not cover them. In addition, FDIC regulations and banks are not required to provide their insurance. As a result, the FDIC advises clients that no safe deposit box is completely safeguarded against loss-causing events such as theft, fire, and flooding.

Frequently Asked Questions (FAQs)

Who can access a safe deposit box?

Two people must access the box, typically a bank staff and the client. Thus, no individual will ever be able to unlock the box and steal its contents. Signature authorization: When the safe deposit box account is opened, all authorized users sign a signature card.

How does safe deposit box work?

Banks and credit unions rent safe deposit boxes in a vault or secure location. Customers often receive a key and should check in with a bank manager, who uses an additional “security” key in conjunction with the customer’s key to unlock the safe box.

When putting money into a safe deposit box, how secure is it?

It is generally secure other than any occurrence of an unforeseen event. However, it is bank-provided storage space and not an account; thus, anything stored there is not covered by the FDIC in case of a break-in or theft. Additionally, most banks do not insure the materials of boxes.

What to keep in a safe deposit box?

Agreements and commercial papers, military discharge papers, tangible stock and bond certificates, minor antiques, and precious items are just some of the items that can be safely stored in a safe deposit box.

This is a guide to What is Safe Deposit Box. Here, we explain how it works at banks, with its pros and cons. You may learn more from the following articles –

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