What Does Superior Good Mean?
A superior good is a product that people demand more of as they their incomes grow. These are products that are generally more expensive and rarer like diamonds and classic cars. Superior goods generally convey a status symbol so they are sought after as people get richer so they can display their wealth.
From an insurance perspective, it’s important for people to buy extra coverage for superior goods because regular insurance policies often don’t provide enough coverage as they are designed for standard, normal goods. If a person has expensive property like jewelry or paintings, they should buy a separate policy rider to cover these superior goods.
Insuranceopedia Explains Superior Good
What sets superior goods apart is that they tend to be expensive and relatively rare or hard to come by. Most insurance policies set relatively low limits on the the coverage they’ll provide for jewelry and other valuables. For those who own valuables, particularly superior goods, this coverage is likely to be insufficient. In this case, additional insurance “floaters” can be purchased to provide more appropriate coverage for the value of those items.