There's always the danger that the encryption keys will be lost or that the only person who knows the keys will be hit by a bus. But the nuisance level can be minimized, and anyone who stores sensitive information off-site with a commercial firm and does not use encryption is, excuse me for being blunt, an idiot. It's like walking down the street in a bad neighborhood with twenty-dollar bills sticking out of your pockets, essentially asking to be robbed.