There are multiple safety issues with water heaters which can be readily assessed. In addition, new standards have recently been implemented which will make your next water heater safer.
Water Temperature. Infants, toddlers and seniors can be scalded by excessive water temperature. Reduce your water temperature to no higher than 120 degrees Fahrenheit by turning the dial on the face of the water heater counter clockwise. Unfortunately, most water heaters do not have accurately calibrated dials, so it is best to experiment with lowering the temperature to the minimum setting that still provides a hot shower.
Earthquake Bracing. Since we live in earthquake country, it is very important that our water heaters are securely braced. An improperly braced water heater may topple in an earthquake perhaps igniting a fire or explosion and at least knocking out the water supply. Bracing should tightly encircle the water heater at two points (high and low) and be bolted to the house framing.
Carbon Monoxide. Most water heaters in our area burn natural gas. A product of the combustion process is Carbon Monoxide (CO). CO can be recirculated into the living space if the burner or exhaust flue is cracked. Water heaters can be assessed for these conditions while installing a Carbon Monoxide monitor will give you confidence that a dangerous concentration of CO is not building inside your home.
Fire. Roughly 800 fires each year occur as the result of flammable vapors (e.g. gas and paint thinner) becoming ignited by a water heater. Elevating the water heater reduces the likelihood of flammable vapor fires as will the new standards described below. Combustibles, such as paper and plastic items, stored too close to a water heater can also result in a fire. An effective preventive measure is to create a combustible free perimeter around your water heater.
New Standards. Water heaters manufactured after July 1, 2003 must be equipped with new safety technology to help prevent fires. The new water heaters will incorporate a flame arrestor which will prevent flashback fires involving flammable vapors. Whether you have one of these new water heaters or not, it is important to store flammable liquids in tightly closed and properly labeled (non-glass) safety containers away from ignition sources and inaccessible to children.