Just a few short years ago, I purchased a new car from a dealer about an hour away from my house. I wanted to take home the car that day, but my insurance company (one of the large national insurers) wouldn't issue my policy unless I physically brought a check to one of their local office–another hour away. Needless to say, I didn't get my car that day and I was furious. I switched over to one of the large direct insurers as soon as I got home and transferred both my auto and homeowner's policies. A digital self-service capability was important to me: #frustrated!

My new insurer sells primarily auto insurance and partners with another large agency insurer for homeowners' insurance. While I now have a great online and mobile service experience with my auto policy, all servicing of my homeowners' policy took place through a call center until just a couple of months ago. But because there are two insurance companies here, it's two completely different online experiences, one fairly mature and the other nascent.

For some time now, consumer expectations have been reshaping interactions in almost every industry. The shift from face-to-face to digital for basic transactions, in many ways driven by the influence of the technology giants Apple, Google and Amazon, has been exponential. The quality and speed of the digital services and products provided by those companies have heightened consumer expectations: We expect all of our digital interactions and transactions to be as seamless.

Direct insurance writers have a distinct advantage in the space, many having grown up with an Internet backbone. In fact, premium growth rates for direct insurers are exceeding agency providers for commodity insurance products. The message is clear: Consumers want no-hassle, self-service capabilities, but also a call center representative standing by when needed. Insurers' approach to digital must evolve as well. It's no longer enough to merely provide information; digital capabilities must include the ability to initiate and complete transactions easily. It's also not just about the operational back-end of the site; front-end user experience is also critical.

One of my favorite examples is the redesign of the Healthcare.gov website. After the rocky launch of the site in 2013, the administration brought in a team of developers and designers from the technology industry as part of a "tech surge" to fix the site. While streamlining the back end of the site was important to stability and scalability, massive improvements were needed in the user interface. Starting with a goal of "bringing humanity" to the site, the user experience designers modernized the interface, used responsive design so the site functioned well on mobile and tablet, and created plain English instructions. They reduced the number of screens needed to apply for insurance from 76 to 16. The results were powerful: 10% more people are completing registrations in one sitting, and mobile account registrations are up 30%.

Another compelling example is Progressive Insurance's online rate-quote-issue process, which is only five screens from start to finish. As I start the quote application, I am immediately cross-sold: The site asks me if I want to bundle different insurance products in my quote. Then I'm asked to provide my name, address and birthdate. In real-time, the system reaches out to a number of industry databases and pre-loads my motor vehicle data. My current coverage limits from my existing insurance provider are also pre-loaded, and Progressive presents me with a scenario builder as part of its "name your price" option. Let's say my budget is $150 per month; I can set it to that option and see what coverage is available for that price. At any time during this process, I can click-to-chat or click-to-call if I need help, and my in-process quote is saved. You can do all of this from your mobile device as well.

Both of these examples show us the importance of good digital services for insurance–processes that make it easy to do business and provide great customer experience are no longer luxuries. Perhaps surprisingly, governments are leading the pack in digitizing services. The U.K.'s "digital by default" initiative has a mandate to provide digital government services that are "so straightforward and convenient that all those who can use them will choose to do so, while those who can't aren't excluded."

As part of the criteria for selecting which existing processes should go digital first, the government first researches real user needs based on data. Where there's good alignment between user needs and the service, a team is assembled to scope out and prototype the digital service using user-centered design techniques. Once the prototype is released, the team gathers user feedback and makes adjustments before fully launching the capability. The post-implementation target is an increased digital use rate of 80%, with an expected overall annual cost savings of $2 billion.

Insurers can take a page from the gov.uk playbook: By digitizing transactional capabilities, they have an opportunity to both enrich the customer and agent experience and maximize long-term, profitable relationships. Technology can be used to not only better serve customer needs, but also significantly reduce long-term policy servicing costs. Yet for many insurers, digitizing with current operating models remains a challenge. The pervasiveness of legacy infrastructure impedes an ability to quickly react; channel conflicts create inertia (although agencies are struggling with the same digital relevancy issues); and changing internal cultures based on decades of experience is difficult.

However, if governments can change and adapt in a digital world, so can the insurance industry. If you're just starting your digital journey, find out who your customers are and what's important to them. Create experiments and prototypes that allow you to test and validate design approaches. Get continuous customer feedback, measure successes and scale out.

Rachel Alt-Simmons is a Principal Management Consultant for Best Practices at SAS, based in Cary, NC. Simmons drove business intelligence initiatives at Travelers and Hartford Life, and was Research Director for Life and Annuity at research firm TowerGroup.

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The digital insurer: The time is now

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