Annuity sales for the second quarter of 2012 were up 9.9 percent to $54.5 billion, from $49.6 billion in the first quarter, the Insured Retirement Institute announced Tuesday.

However, the sales were down 1.4 percent from the $55.3 billion that were sold in the second quarter last year.

The numbers were compiled from data from Morningstar Inc. and Beacon Research.

Fixed annuity sales totaled $17.14 billion, an increase of 14.6 percent from just under $15 billion in the first quarter and up 0.2 percent from $17.10 billion in the second quarter of 2012. This is the highest quarterly sales since the fourth quarter of 2011.

Variable annuity total sales rose to $37.3 billion in the second quarter, a 7.8 percent increase from $34.6 billion in the first quarter, but a 2.2 percent drop from the $38.2 billion in the second quarter of 2012.

Sales of market-value-adjusted annuities rose 34.9 percent, indexed annuity sales were up 17.1 percent, and income annuity sales were up 16.9 percent quarter over quarter. For the fixed annuity market, there were $9.4 billion in qualified sales and $7.7 billion in non-qualified sales during the second quarter.

Variable annuity total net assets increased by a fraction of a percent from the previous quarter, IRI says. The upward movement was the seventh consecutive quarterly increase in variable annuity total net assets to more than $1.7 trillion. That was a 10.1 percent increase from $1.6 trillion in the second quarter of last year. Within the variable annuity market, there were $23.8 billion in qualified sales and $13.5 billion in non-qualified sales for the quarter.

“In previous quarters, demand for lifetime income was balancing headwinds from low interest rates,” says Cathy Weatherford, IRI president and CEO. “Now with rates rising, we are seeing sales swing upwards with fixed sales reaching their highest mark in six quarters and variable annuity sales at their highest level in a year. With VA total net assets reaching a new record high and VA net sales showing marked improvement, overall it was a solid quarter for the industry.”