Life insurance sales increase by 10% from a year earlier, according to LIMRA.

The Windsor, Conn., based life insurance trade group only provides dollar amounts for annual sales, so there’s no direct comparison available for quarter-to-quarter performance. However, Karen Terry, manager for product research at LIMRA said “2009 was a terrible year, the worst in decades,” for life insurance sales.

“While the first quarter is encouraging, we’re not yet at the level we were in 2008,” she said. “It will take several years to recover to that point.” LIMRA’s official forecast is that the industry won’t return to 2008’s sales figures until 2013.

Universal life insurance enjoyed the largest growth spurt of 17% in the first quarter. Almost 65% of the 72 insurance companies polled that sell universal life contributed to that growth.

“Universal life was one of the most challenged products in 2009,” Terry said.

Universal life policies without guaranteed death benefits grew by 30%, while those with guaranteed death benefits, which cost more, rose by 10%. Guarantees prevent policyholders from accidentally underfunding their death benefits in these flexible premium products.

Whole life insurance, the only life insurance product to grow last year, experienced a 15% jump in the first quarter over a year earlier. Variable universal life was also up, posting a 10% hike over the first quarter 2009’s sales figures.

Term life was the only product for which sales fell compared to the same period last year, down 4%, partly because it garnered unnatural attention last year. Now, insurance buyers are heading back to traditional products in the permanent marketplace, Terry said.