Indexed annuity sales rose to $8.7 billion in the third quarter, up 16% from the total recorded in the third quarter of 2009.

LIMRA, Windsor, Conn., and AnnuitySpecs.com, Pleasant Hill, Iowa, are reporting identical third-quarter sales totals and percentage increase figures.

Joseph Montminy, an assistant vice president at LIMRA, is calling the Up arrowcurrent market for indexed annuities “ideal,” with “lots of volatility in the equities markets coupled with low credited rates and declining interest rate spreads on traditional fixed-rate annuities.”

Indexed annuities now have 41% of the fixed annuity market, LIMRA found.

Sales of variable annuities rose 9%, to $35 billion, and sales of fixed annuities fell 10%, to $21 billion.

Total individual annuity sales rose just 1% in the third quarter, to $56 billion.

The results for the latest quarter look better than the year-to-date results: Individual annuity sales totaled $164.5 billion for the first 3 quarters of the year, down 11% from

the total for the comparable period in 2009. Variable annuity sales have been up 8% year-to-date, but fixed annuity sales dropped 31%.

Sheryl Moore, president of AnnuitySpecs.com, says low interest rates have increased the attractiveness of fixed annuities in general. She noted that rates on certificates of deposit have been averaging about 0.6% a year while fixed annuity rates have been averaging about 3.1%

AnnuitySpecs says Allianz Life Insurance Company of North America ranked first in the indexed annuity market, with a 21% market share, followed, in order, by Aviva Life and Annuity Company, American Equity Investment Life Insurance Company, Lincoln National Corp. and ING Insurance U.S.

AnnuitySpecs also released data on indexed universal life insurance (IUL) sales. IUL sales totaled about $166 million in the third quarter, up about 27% from the total for the third quarter of 2009.