Arsjola DODOVECI & Elena BARDHAJ

Abstract In random process, the outcome of a given experiment can affect the outcome of the next experiment. This kind of process is called Markovian Chain. There are several ways to study models with many periods dependent on how time is measured. In general terms, financial models can be divided into two families, discrete time model and continuous time model. In discrete time models markets are open to date (period ) of finite or countable preceded by 0,1,…… , T. At the time of the continuing patterns are always open markets and establishing dates are on interval [ 0 , T ]. We want to present these mathematical models based on stochastic processes that allows us to make predictions with low % error for the future. To develop market of insurance in Albania is important to forecast the future of our insurances based in concrete data using stochastic processes.
Key words insurance, stochastic processes, Markovian chain, spreadsheet.
JEL classification G11, G22, J65