The decline of annuities has been exaggerated. For nearly two years, it seems, every time we read news about annuities that news has been negative. Or at least it’s contained a negative slant. Not this time.

According to AnnuitySpecs.com‘s Indexed Sales & Market Report, third-quarter sales for indexed annuities were $8.7 billion, up 16 percent from the same period last year. In addition, sales ticked up 5 percent from the second quarter.

“Although insurance companies are challenged to offer annuities because of the prevailing low interest rate environment, this environment has also increased the attractiveness of these products beyond anything we’ve ever seen before,” says Sheryl J. Moore, president and CEO of AnnuitySpecs.com. “With CDs averaging 0.56 percent a year and fixed annuities hovering at 3.14 percent, I think we can count on another record quarter to close out the year.”

Moore says Allianz Life maintained their position as the No. 1 carrier in the market with a 21 percent market share. According to the report, “Aviva maintained its position as the second-ranked company in the market while American Equity, Lincoln National and ING rounded-out the top five, respectively. Allianz Life’s MasterDex X is the No. 1 selling indexed annuity for the sixth consecutive quarter.” The average weighted commission paid to the indexed annuity agent reached an all-time low, 6.50 percent.

For indexed life products, third-quarter sales were $165.6 million, an increase of nearly 27 percent over the same period in 2009. Moore says new blood has entered the market.

“This quarter six new companies decided to delve into the indexed life market,” Moore says. “We still have many more companies in the research and development stage for indexed life. It will definitely be interesting to see where sales are a year from now, once all of these new players get up and running.”