Disposable income and acquisition costs as drivers of CASCO insurance demand: an empirical analysis of the Polish market

This paper explores the determinants of demand for voluntary comprehensive car insurance (CASCO) in Poland. The study aims to identify the impact of acquisition costs and household disposable income on insurance uptake. Utilizing a multilayer perceptron neural network model, the research analyzes the relationship between motor insurance expenditures and two key variables: the disposable income of households and the acquisition costs ratio between voluntary CASCO and Mandatory Third-Party Liability insurance. The findings, validated by robust diagnostic tests, a linear ordinary least squares model as a benchmark and a leave-one-out cross-validation procedure, reveal that both factors are statistically significant predictors of demand. The results indicate that the expansion of the CASCO market in Poland is driven not only by rising consumer affluence but also by the commission ratio, which motivates intermediaries to prioritize voluntary products. This suggests a supply push mechanism where distribution costs shape market dynamics.