Carriers don't price you at your age. They price you at your insurance age, and for most carriers that's the birthday you're nearest to. Six months before you turn 40, you're already 40 to the underwriter. That flips the rate per thousand to the 40-year-old's rate for the life of the contract, on a whole life base premium that never changes and on the cost-of-insurance schedule inside an IUL that runs off your age every year.
Backdating is the fix the industry built for it. The carrier sets the policy date up to six months earlier than the issue date, which most states allow. So the policy is dated before your half birthday and issued at the younger age. The catch is that you pay premium from the policy date, which means the months between the backdated date and the day the policy is issued get billed at the start. Backdate five months and the first payment is five months of premium plus the current month, all at once.
Whether that's a good trade depends on what the policy is for. On a design built for cash value, the back premium isn't gone. It goes into the contract like any other premium and buys cash value, and the policy anniversary lands earlier, so year two, the PUA rider window, and the seven-pay clock all arrive months sooner than they would have. What you gave up is the premium for months of coverage that had already passed, and the use of that money for a few months. What you got is a lower base rate for every year the policy exists, and on a level premium that adds up across decades.
On a policy built mainly for death benefit with the smallest premium possible, the math is tighter. If the rate difference between the two ages is 3% and you paid five months of premium to get it, the break-even on premium alone runs well past a decade. Ask the agent for both illustrations, the backdated one and the current-age one, and compare the premium and the tenth-year cash value on each. The answer is on the page.
Backdating doesn't backdate the coverage. The insured wasn't covered during those months, which only matters for the record. It's a request the agent has to make at application, and once the policy is issued at the older age the window is closed. And it's only useful past the half birthday. Before it, you're already the younger age and there's nothing to save.
If you're applying and you're past your half birthday, ask two questions before you sign: what's my insurance age on this application, and what does the backdated version cost up front. Then run the two illustrations side by side and let the tenth-year column decide.