Globalization is the process of interaction and integration among people, companies and governments of different nations, driven by pulls and pressures from developed economies and aided by the pace of information technology. Insurance being an integral part of financial services could not claim immunity to the impact of the globalization process and thus followed suit and opened up to private and global players, world over including India, thanks to the persistent efforts of Multinational Companies (MNCs) and the wider world economic order.

Herman E Daly, an Analyst of Global Policy Forum, characterizes globalization as, "Global integration of many former national economies into global economy, mainly by free trade and free mobility, but also by easy or uncontrolled economic purposes." He further clarifies that globalization is not internationalization - globalization brings about a single, integrated, global economy, while internationalization is a federation of nations cooperating as sovereign units to advance the national interests of all members. According to Anthony Giddens, globalization is, "The intensification of worldwide social, political and economic relations which link distant localities in such a way that local happenings are shaped by events occurring many miles away and vice versa." If one considers the whole world as one single "global village" and the socioeconomic relations or interactions among its people as a process, it is, in essence, globalization, in simple language. Diverse societies, cultures and people's practices have developed close interface under the dynamic process of globalization.

The world-class MNCs constantly pursued their strategy of gaining access to every promising market, world over, which has sound growth potentialities, in order to expand their network and control over the respective local economies. The consequence was that some of the markets, particularly in developing countries like China and India, adopted some sort of self-protectionist mechanisms by imposing certain deliberate politico-legal restrictions in order to restrict the entry of capital and goods of MNCs into their markets. However, with the change of socio-political situations and economic conditions in such countries and due to indirect pressure from international bodies like the World Bank, International Monetary Fund, etc. for integration of their economies with the market-oriented world economy, the cross-border restrictions got slowly diluted or withdrawn, thereby paving the way for globalization of capital, goods and services world over.

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