I don't think insulated pipes would help as the time period between the use of the hot water would let the water in the pipe cool.
Five minutes of running water does seem like a long time. I think my time is about a minute if my recirculating pump is off. Maybe the system is not operating correctly and takes to long to heat the water. Maybe some others who have the tankless system will give us some times.
I think you have to install a conventual hot water tank and a recirculating pump.
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