Can the Govt introduce an automated insurance policy for bank lockers? Nirmala Sitharaman answers

Finance Minister Nirmala Sitharaman on Monday, March 30, 2026, in reply to the demand for a comprehensive and automated differential insurance cover for all bank locker contents in Lok Sabha, said that the compensation extended to the locker holders is fixed at 100 times the annual locker rent in the event of any loss.

“This limit exists because banks do not know or assess the contents of lockers and asking customers to disclose valuables would violate banking confidentiality norms,” said a post by Nirmala Sitharaman’s Office on X.

The finance minister emphasised that banks cannot see and record what valuables are placed by customers in lockers, as it would result in a breach of banking regulations. So, item-wise valuation or insurance isn’t feasible, and hence a standardised compensation framework is applied.

Demanding differential coverage would require disclosure of locker contents, something banking rules don't permit, Sitharaman said.

The demand for a comprehensive and an automated insurance coverage based on locker contents was raised by Congress leader and MP from Gadchiroli-Chimur constituency, Namdeo Dasaram Kirsan, during the Question Hour in the Lok Sabha.

Ruling out such differential insurance cover based on locker content, the finance minister reiterated that 100 times the annual locker rent is what is paid to the locker customers in case of any loss.

RBI bank locker rules

According to RBI guidelines, in case the bank locker holder suffers loss due to the proven negligence of the bank, i.e., due to fire, theft, robbery etc., the bank is liable to pay up to 100 times the annual locker rent as compensation.

However, if the loss is due to any natural disaster such as flood, earthquake, thunderstorm etc., the bank is not liable for any damage and or loss of the locker content. Similarly, it is not responsible for any act that is attributable to the sole negligence or fault of the customer.

Nonetheless, banks should ensure that a proper system is in place for protecting locker systems as well as premises.