Which insurance policy begins with a very low premium, eventually raising it after 3-5 years to a constant rate for life?

The modified whole life insurance policy is designed to start with a low premium for the initial years, typically ranging from 3 to 5 years. This initial period allows policyholders to ease into premium payments while still obtaining a whole life insurance product that provides lifetime coverage. After the introductory phase, the premium increases to a constant amount that the policyholder will pay for the remainder of the policy's life.

This structure is particularly appealing because it allows younger individuals or those with tighter budgets to secure life insurance without the immediate financial burden of higher premiums. As the policyholder's financial situation improves over time, they transition to a stable, predictable premium cost that lasts for the life of the policy.

Other options do not share this same premium structure. For instance, universal life insurance often offers flexible premiums that can vary over time, while variable life insurance entails investment components and fluctuating premiums based on underlying assets. Graded premium whole life insurance, while similar in concept, usually has a different approach to premium increases over time. Therefore, modified whole life is the product that specifically exemplifies the gradual increase from a low initial premium to a consistent rate thereafter.