MUNIYIELD
NEW YORK
INSURED
FUND, INC.
FUND LOGO
Annual Report
October 31, 1996
This report, including the financial information herein, is
transmitted to the shareholders of MuniYield New York Insured Fund,
Inc. for their information. It is not a prospectus, circular or
representation intended for use in the purchase of shares of the
Fund or any securities mentioned in the report. Past performance
results shown in this report should not be considered a
representation of future performance. The Fund has leveraged its
Common Stock by issuing Preferred Stock to provide the Common Stock
shareholders with a potentially higher rate of return. Leverage
creates risks for Common Stock shareholders, including the
likelihood of greater volatility of net asset value and market price
of shares of the Common Stock, and the risk that fluctuations in the
short-term dividend rates of the Preferred Stock may affect the
yield to Common Stock shareholders. Statements and other information
herein are as dated and are subject to change.
<PAGE>
MuniYield
New York
Insured Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
MuniYield New York Insured Fund, Inc.
TO OUR SHAREHOLDERS
For the year ended October 31, 1996, the Common Stock of MuniYield
New York Insured Fund, Inc. earned $0.950 per share income
dividends, which included earned and unpaid dividends of $0.078.
This represents a net annualized yield of 6.13%, based on a month-
end net asset value of $15.49 per share. Over the same period, the
total investment return on the Fund's Common Stock was +6.04%, based
on a change in per share net asset value from $15.64 to $15.49, and
assuming reinvestment of $0.950 per share income dividends and
$0.065 per share capital gains distributions.
For the six-month period ended October 31, 1996, the total
investment return on the Fund's Common Stock was +6.19%, based on a
change in per share net asset value from $15.04 to $15.49, and
assuming reinvestment of $0.451 per share income dividends.
For the six-month period ended October 31, 1996, the Fund's Auction
Market Preferred Stock had average yields of 3.60% for Series A and
3.29% for Series B.
<PAGE>
The Municipal Market Environment
Municipal bond yields generally moved lower during the six months
ended October 31, 1996. Long-term tax-exempt revenue bond yields, as
measured by the Bond Buyer Revenue Bond Index, declined approximately
35 basis points (0.35%) to close the six-month period ended October
31, 1996 at approximately 5.94%. The municipal bond market exhibited
considerable weekly yield volatility over the six months ended
October 31, 1996 with bond yields vacillating as much as 20 basis
points. This ongoing volatility was in response to fluctuating
evidence regarding the degree to which recent economic growth would
result in any significant increase in inflationary pressures. Much
of the evidence supporting stronger growth centered around the strong
employment growth seen in April and June with bond yields rising
in response. Other more recent economic indicators have suggested
that economic growth will not be excessive and inflationary pressures
will remain well-contained. This continued benign inflationary
environment has supported lower tax-exempt bond yields in recent
months. US Treasury bond yields have exhibited similar, albeit
greater, volatility during the six-month period ended October 31,
1996, falling more than 20 basis points to end the period at 6.64%.
Over the past six months, tax-exempt bond yields registered
significantly greater declines than those shown by the US Treasury
bond. This relative outperformance by the municipal bond market was
largely the result of the strong technical support the tax-exempt
market has enjoyed throughout most of 1996. Perhaps most significantly,
the pace of new bond issuance has recently slowed.
Over the last year, approximately $180 billion in long-term
municipal securities was issued, an increase of over 25% versus the
same period a year ago. Much of this increase was the result of
issuers seeking to refinance their existing higher-couponed debt as
interest rates declined in 1995 and early 1996. As interest rates
rose, these financings became increasingly economically impractical
and issuance declined. Over the last six months, approximately $90
billion in long-term tax-exempt securities was underwritten, an
increase of 5% versus the comparable period a year earlier. Only $41
billion in tax-exempt securities was issued in the last three
months, a 3% decline in issuance versus the October 31, 1995
quarter.
At the same time, investor demand remained consistently strong. With
nominal new-issue yields generally above 6%, retail investor
interest was steady. Additionally, investors received over $50
billion this June and July in assets derived from coupon income,
bond maturities, and proceeds from early redemptions. Annual new
bond issuance has declined in recent years and is expected to remain
below levels seen in the early 1990s. Consequently, as the higher-
couponed bonds issued in the early-to-mid 1980s were redeemed at
their first optional call date, the total number of outstanding tax-
exempt bonds has declined. This combination of a declining net
supply and significant amounts of assets helped maintain investor
demand in recent months.
<PAGE>
It is unlikely that the municipal bond market will continue to
significantly outperform US Treasury securities in the near future.
The tax-exempt bond market's recent performance has led to the yield
ratio between long-term taxable and tax-exempt securities falling
from in excess of 90% to approximately 85%. While still historically
very attractive, some institutional investors, particularly short-
term traders, began to view the tax-exempt bond market's recent
outperformance as an opportunity to sell a relatively expensive
asset. However, to the long-term investor, such a sale would
represent the loss of an attractively priced asset which may not be
easily replaced given the relative scarcity of municipal bonds under
present supply conditions.
Looking ahead, no clear consensus for the direction of interest
rates currently exists. Perhaps, the primary focus going forward
will be the extent to which the increase in interest rates seen thus
far in 1996 will negatively impact future economic growth. Should
growth slow in the interest rate-sensitive sectors of the economy,
like housing, auto, and consumer spending, as many economists assert
is likely, then bond yields are likely to decline. Under such a
scenario, the municipal bond market's performance is likely to
closely mirror that of the US Treasury bond market.
Portfolio Strategy
During the 12-month period ended October 31, 1996, our portfolio
strategy focused on seeking to provide current return while being
mindful of capital appreciation. In an effort to enhance the
additional benefit of increased yield to Common Stock shareholders,
we kept the Fund's Preferred Stock in the shortest possible maturity
range. (See "The Benefits and Risks of Leveraging" on page 4 of this
report to shareholders.) The Fund's performance was enhanced this
year by early recognition that interest rates in the beginning of
1996 were likely to head higher. We maintained an above-average
coupon structure, tempering the negative reaction of net asset value
to the ensuing interest rate increases.
As the year progressed, we identified a fairly well-defined trading
range in the municipal market. We effectively managed the purchases
and sales of long-term revenue bonds in the Fund's holdings by
exploiting the upper and lower boundaries of this trading range. We
then concentrated larger percentages of the Fund's assets in
securities rated at least AAA by one or more of the major rating
agencies, in response to the lack of yield differentials between
credit quality classes. We anticipate continuing this approach until
the point where deteriorating economic releases lead to a change in
an interest rate forecast that allows a more constructive trend for
bond prices.
In Conclusion
We appreciate your ongoing interest in MuniYield New York Insured
Fund, Inc., and we look forward to assisting you with your financial
needs in the months and years to come.
<PAGE>
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Senior Vice President
(Walter C. O'Connor)
Walter C. O'Connor
Vice President and Portfolio Manager
November 27, 1996
PROXY RESULTS
<TABLE>
During the six-month period ended October 31, 1996, MuniYield New
York Insured Fund, Inc. Common Stock shareholders voted on the
following proposals. The proposals were approved at a special
shareholders' meeting on September 19, 1996. The description of each
proposal and number of shares voted are as follows:
<CAPTION>
Shares Shares Voted
Voted For Without Authority
<S> <S> <C> <C>
1.To elect the Fund's Board of Directors: James H. Bodurtha 11,540,964 264,297
Herbert I. London 11,529,473 275,788
Robert R. Martin 11,533,389 271,872
Arthur Zeikel 11,545,104 260,157
<PAGE>
<CAPTION>
Shares Shares Voted Shares Voted
Voted For Against Abstain
2.To ratify the selection of Deloitte & Touche LLP as the
Fund's independent auditors for the current fiscal year. 11,446,001 79,803 279,457
<CAPTION>
During the six-month period ended October 31, 1996, MuniYield New
York Insured Fund, Inc. Preferred Stock shareholders (Series A and
B) voted on the following proposals. The proposals were approved at
the annual shareholders' meeting on September 19, 1996. The
description of each proposal and number of shares voted are as
follows:
Shares Shares Voted
Voted For Without Authority
<S> <S> <C> <C>
1.To elect the Fund's Board of Directors:
James H. Bodurtha, Herbert I. London,
Robert R. Martin, Joseph L. May, Andre F. Perold
and Arthur Zeikel as follows: Series A 1,550 8
Series B 1,621 24
Shares Shares Voted Shares Voted
Voted For Against Abstain
2.To ratify the selection of Deloitte & Touche LLP
as the Fund's independent auditors for the
current fiscal year as follows: Series A 1,511 47 0
Series B 1,645 0 0
</TABLE>
THE BENEFITS AND RISKS OF LEVERAGING
MuniYield New York Insured Fund, Inc. utilizes leveraging to seek to
enhance the yield and net asset value of its Common Stock. However,
these objectives cannot be achieved in all interest rate
environments. To leverage, the Fund issues Preferred Stock, which
pays dividends at prevailing short-term interest rates and invests
the proceeds in long-term municipal bonds. The interest earned on
these investments is paid to Common Stock shareholders in the form
of dividends, and the value of these portfolio holdings is reflected
in the per share net asset value of the Fund's Common Stock.
However, in order to benefit Common Stock shareholders, the yield
curve must be positively sloped; that is, short-term interest rates
must be lower than long-term interest rates. At the same time, a
period of generally declining interest rates will benefit Common
Stock shareholders. If either of these conditions change, then the
risks of leveraging will begin to outweigh the benefits.
<PAGE>
To illustrate these concepts, assume a fund's Common Stock
capitalization of $100 million and the issuance of Preferred Stock
for an additional $50 million, creating a total value of $150
million available for investment in long-term municipal bonds. If
prevailing short-term interest rates are approximately 3% and long-
term interest rates are approximately 6%, the yield curve has a
strongly positive slope. The fund pays dividends on the $50 million
of Preferred Stock based on the lower short-term interest rates. At
the same time, the fund's total portfolio of $150 million earns the
income based on long-term interest rates. Of course, increases in
short-term interest rates would reduce (and even eliminate) the
dividends on the Common Stock.
In this case, the dividends paid to Preferred Stock shareholders are
significantly lower than the income earned on the fund's long-term
investments, and therefore the Common Stock shareholders are the
beneficiaries of the incremental yield. However, if short-term
interest rates rise, narrowing the differential between short-term
and long-term interest rates, the incremental yield pickup on the
Common Stock will be reduced or eliminated completely. At the same
time, the market value of the fund's Common Stock (that is, its
price as listed on the New York Stock Exchange) may, as a result,
decline. Furthermore, if long-term interest rates rise, the Common
Stock's net asset value will reflect the full decline in the price
of the portfolio's investments, since the value of the fund's
Preferred Stock does not fluctuate. In addition to the decline in
net asset value, the market value of the fund's Common Stock may
also decline.
PORTFOLIO ABBREVIATIONS
To simplify the listings of MuniYield New York Insured Fund, Inc.'s
portfolio holdings in the Schedule of Investments, we have
abbreviated the names of many of the securities according to the
list below and at right.
AMT Alternative Minimum Tax (subject to)
COP Certificates of Participation
GO General Obligation Bonds
HFA Housing Finance Agency
IDA Industrial Development Authority
PCR Pollution Control Revenue Bonds
RIB Residual Interest Bonds
UT Unlimited Tax
VRDN Variable Rate Demand Notes
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (in Thousands)
<CAPTION>
S&P Moody's Face Value
Ratings Ratings Amount Issue (Note 1a)
New York--98.5%
<S> <C> <S> <C>
AAA Aaa $ 4,000 Buffalo and Fort Erie, New York, Public Bridge Authority, Toll Bridge System
Revenue Bonds, 5.75% due 1/01/2025 (d) $ 3,989
AAA Aaa 1,000 Metropolitan Transportation Authority, New York, Commuter Facilities Revenue
Refunding Bonds, Series B, 6.25% due 7/01/2017 (d) 1,050
Metropolitan Transportation Authority, New York, Transportation Facilities
Revenue Bonds:
AAA Aaa 3,500 Refunding, Series K, 6.20% due 7/01/2004 (d) 3,797
AAA Aaa 4,000 Series J, 6.375% due 7/01/2010 (c) 4,294
AAA Aaa 20,620 Series J, 6.50% due 7/01/2018 (c) 22,376
Monroe County, New York, Public Improvement, GO (d):
AAA Aaa 2,825 6.10% due 3/01/2010 2,958
AAA Aaa 2,175 6.10% due 3/01/2011 2,273
AAA Aaa 1,040 6.10% due 3/01/2012 1,085
A1+ NR* 2,300 Nassau County, New York, IDA, Civic Facilities Revenue Bonds (Cold Spring
Harbor Laboratory Project), VRDN, 3.50% due 7/01/2019 (a) 2,300
A1+ VMIG1++ 297 New York City, New York, Cultural Resource Trust Revenue Bonds (Soloman R.
Guggenheim), VRDN, Series B, 3.40% due 12/01/2015 (a) 297
New York City, New York, GO, UT:
BBB+ Baa1 5,000 Refunding, Series B, 6.375% due 8/15/2012 5,091
AAA Aaa 1,665 Series I, 7.25% due 8/15/2015 (b) 1,808
A1+ NR* 1,200 New York City, New York, IDA, Civic Facilities Revenue Bonds (National
Audobon Society), VRDN, 3.40% due 12/01/2014 (a) 1,200
New York City, New York, Municipal Water Finance Authority, Water and
Sewer System Revenue Bonds:
A- A 4,000 RIB, 7.564% due 6/15/2025 (h) 4,076
AAA Aaa 3,325 Refunding, Series A, 5.375% due 6/15/2026 (g) 3,185
AAA Aaa 3,700 Series A, 7% due 6/15/2001 (c)(e) 4,120
AAA Aaa 700 Series A, 7% due 6/15/2015 (c) 775
AAA Aaa 2,000 Series A, 6.75% due 6/15/2016 (c) 2,184
AAA Aaa 1,590 Series A-1994, 7% due 6/15/2001 (c)(e) 1,771
AAA Aaa 2,480 Series A-1994, 7% due 6/15/2015 (b) 2,746
</TABLE>
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued) (in Thousands)
<CAPTION>
S&P Moody's Face Value
Ratings Ratings Amount Issue (Note 1a)
New York (continued)
<S> <C> <S> <C>
New York State Dormitory Authority Revenue Bonds:
AAA Aaa $ 4,400 (City University System), Series C, 7.50% due 7/01/2010 (c) $ 5,335
AAA Aaa 7,070 (City University System), Series C, 7% due 7/01/2014 (c) 7,758
AAA Aaa 2,365 (City University System), Third Resolution-One, 6.25% due 7/01/2016 (b) 2,506
AAA Aaa 4,000 (City University System), Third Resolution-One, 6.25% due 7/01/2020 (b) 4,207
A1+ VMIG1++ 300 (Cornell University), VRDN, Series B, 3.40% due 7/01/2025 (a) 300
AAA Aaa 8,000 (Mental Health Services Facilities Improvement), Series B, 5.125%
due 8/15/2021 (d) 7,473
AAA Aaa 12,975 (Mount Sinai School of Medicine), Series A, 5.15% due 7/01/2024 (d) 12,262
AAA Aaa 3,000 (University of Rochester), 6.50% due 7/01/2009 (d) 3,101
AAA Aaa 10,500 New York State Energy Research and Development Authority, Electric Facilities
Revenue Bonds (Consolidated Edison Company, Inc.), AMT, Series A, 6.75% due
1/15/2027 (d) 11,220
AAA Aaa 10,250 New York State Energy Research and Development Authority, Gas Facilities Revenue
Bonds (Brooklyn Union Gas Company), AMT, Series B, 6.75% due 2/01/2024 (d) 11,108
New York State Energy Research and Development Authority, PCR, AMT (d):
NR* Aaa 4,135 (New York State Electric and Gas Corporation Project), Series A, 6.15%
due 7/01/2026 4,219
AAA Aaa 3,600 Refunding (Rochester Gas and Electric Project), Series B, 6.50% due 5/15/2032 3,822
A1+ NR* 2,300 New York State Environmental Facilities Corporation, Resource Recovery Revenue
Bonds (OFS Equity Huntington Project), VRDN, AMT, 3.55% due 11/01/2014 (a) 2,300
New York State, HFA, Housing Mortgage Project Revenue Refunding Bonds,
Series A (g):
AAA Aaa 2,750 6.10% due 11/01/2015 2,812
AAA Aaa 1,250 6.125% due 11/01/2020 1,276
New York State Local Government Assistance Corporation, VRDN (a):
A1+ VMIG1++ 2,200 Series F, 3.40% due 4/01/2025 2,200
A1+ VMIG1++ 1,500 Series G, 3.40% due 4/01/2025 1,500
New York State Medical Care Facilities Finance Agency Revenue Bonds:
AAA Aaa 2,790 (Health Center Project-Second Mortgage), Series A, 6.375% due 11/15/2019 (b) 2,954
AAA Aaa 1,865 (Long-Term Health Care), Series B, 6.45% due 11/01/2014 (g) 1,977
AAA Aaa 1,000 (Long-Term Health Care), Series D, 6.50% due 11/01/2015 (g) 1,080
AAA Aaa 8,335 (Mental Health Services Facilities), Series A, 6.375% due 8/15/2017 (c) 8,808
AAA Aaa 7,250 (New York Hospital Mortgage), Series A, 6.80% due 8/15/2024 (b)(f) 8,003
AAA Aaa 10,000 Refunding (Hospital and Nursing Home), Series C, 6.375% due 8/15/2029 (d) 10,599
BBB Baa 5,000 (Security Hospital), Series A, 7.40% due 8/15/2021 5,384
<PAGE>
AAA Aaa 5,000 New York State Power Authority, General Purpose and Revenue Refunding Bonds,
Series Z, 6.50% due 1/01/2019 (b) 5,401
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (concluded) (in Thousands)
<CAPTION>
S&P Moody's Face Value
Ratings Ratings Amount Issue (Note 1a)
New York (concluded)
<S> <C> <S> <C>
New York State Thruway Authority, Highway and Bridge Trust Fund:
AAA Aaa $ 2,000 Series A, 6.25% due 4/01/2004 (d) $ 2,187
AAA Aaa 8,000 UT, Series B, 6.25% due 4/01/2012 (c) 8,521
AAA Aaa 3,000 UT, Series B, 6% due 4/01/2014 (c) 3,087
New York State Urban Development Corporation Revenue Bonds:
AAA Aaa 10,000 (Correctional Capital Facilities), Series 5, 5.50% due 1/01/2025 (d) 9,720
AAA Aaa 7,500 Refunding (Correctional Capital Facilities), Series A, 5% due 1/01/2017 (b) 6,934
AAA Aaa 2,000 (Sports Facilities Assistance Program), 6.25% due 4/01/2006 (d) 2,184
Port Authority of New York and New Jersey, Consolidated Revenue Bonds:
AA- A1 5,000 69th Series, 7.125% due 6/01/2025 5,429
AA- A1 5,000 72nd Series, 7.35% due 10/01/2002 (e) 5,743
AAA Aaa 2,180 Refunding, AMT, UT, 97th Series, 6.50% due 7/15/2019 (c) 2,344
AAA Aaa 3,155 Suffolk County, New York, IDA, Revenue Refunding Bonds (Southwest Sewer System),
6% due 2/01/2007 (c) 3,419
AAA Aaa 5,700 Syracuse, New York, COP (Syracuse Hancock International Airport), AMT, 6.50% due
1/01/2017 (c) 6,040
Triborough Bridge and Tunnel Authority, New York, Special Obligation Refunding
Bonds:
AAA Aaa 4,500 Series A, 6.625% due 1/01/2017 (d) 4,859
AAA Aaa 1,000 Series B, 6.875% due 1/01/2015 (b) 1,097
AAA Aaa 6,440 Series B, 6.875% due 1/01/2015 (c) 7,067
Total Investments (Cost--$250,505)--98.5% 267,611
Other Assets Less Liabilities--1.5% 4,000
--------
Net Assets--100.0% $271,611
========
<PAGE>
<FN>
(a)The interest rate is subject to change periodically based upon
prevailing market rates. The interest rate shown is the rate in
effect at October 31, 1996.
(b)AMBAC Insured.
(c)FGIC Insured.
(d)MBIA Insured.
(e)Prerefunded.
(f)FHA Insured.
(g)FSA Insured.
(h)The interest rate is subject to change periodically and
inversely based upon prevailing market rates. The interest
rate shown is the rate in effect at October 31, 1996.
*Not Rated.
++Highest short-term rating by Moody's Investors Service, Inc.
Ratings of issues shown have not been audited by Deloitte & Touche LLP.
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION
<TABLE>
Statement of Assets, Liabilities and Capital as of October 31, 1996
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$250,504,589) (Note 1a) $267,610,763
Cash 17,323
Receivables:
Interest $ 4,508,645
Securities sold 3,000 4,511,645
------------
Deferred organization expenses (Note 1e) 2,109
Prepaid expenses and other assets 13,443
------------
Total assets 272,155,283
------------
Liabilities: Payables:
Dividends to shareholders (Note 1f) 333,239
Investment adviser (Note 2) 114,633 447,872
------------
Accrued expenses and other liabilities 96,369
------------
Total liabilities 544,241
------------
Net Assets: Net assets $271,611,042
============
<PAGE>
Capital: Capital Stock (200,000,000 shares authorized) (Note 4):
Preferred Stock, par value $.05 per share (3,400 shares of AMPS*
issued and outstanding at $25,000 per share liquidation preference) $ 85,000,000
Common Stock, par value $.10 per share (12,046,743 shares issued
and outstanding) $ 1,204,674
Paid-in capital in excess of par 168,007,202
Undistributed investment income--net 2,459,338
Accumulated realized capital losses on investments--net (587,973)
Accumulated distributions in excess of realized capital
gains--net (Note 1f) (1,578,373)
Unrealized appreciation on investments--net 17,106,174
------------
Total--Equivalent to $15.49 net asset value per share of Common
Stock (market price--$14.875) 186,611,042
------------
Total capital $271,611,042
============
<FN>
*Auction Market Preferred Stock.
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (continued)
<TABLE>
Statement of Operations
<CAPTION>
For the Year Ended
October 31, 1996
<S> <S> <C> <C>
Investment Income Interest and amortization of premium and discount earned $ 15,782,047
(Note 1d):
Expenses: Investment advisory fees (Note 2) $ 1,355,294
Commission fees (Note 4) 215,297
Professional fees 79,206
Transfer agent fees 61,562
Accounting services (Note 2) 60,378
Listing fees 24,635
Printing and shareholder reports 23,844
Directors' fees and expenses 22,997
Custodian fees 21,856
Pricing fees 8,218
Amortization of organization expenses (Note 1e) 6,328
Other 17,902
------------
Total expenses 1,897,517
------------
Investment income--net 13,884,530
------------
<PAGE>
Realized & Realized loss on investments--net (565,697)
Unrealized Change in unrealized appreciation on investments--net 272,623
Gain (Loss) on ------------
Investments--Net Net Increase in Net Assets Resulting from Operations $ 13,591,456
(Notes 1b, 1d & 3): ============
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (continued)
<TABLE>
Statements of Changes in Net Assets
<CAPTION>
For the Year Ended
October 31,
Increase (Decrease) in Net Assets: 1996 1995
<S> <S> <C> <C>
Operations: Investment income--net $ 13,884,530 $ 14,267,774
Realized loss on investments--net (565,697) (18,035)
Change in unrealized appreciation on investments--net 272,623 19,066,265
------------ ------------
Net increase in net assets resulting from operations 13,591,456 33,316,004
------------ ------------
Dividends and Investment income--net:
Distributions to Common Stock (10,991,979) (11,029,938)
Shareholders Preferred Stock (2,764,285) (3,125,544)
(Note 1f): Realized gain on investments--net:
Common Stock -- (1,257,764)
Preferred Stock -- (218,850)
In excess of realized gains on investments--net:
Common Stock (1,232,695) --
Preferred Stock (345,678) --
------------ ------------
Net decrease in net assets resulting from dividends and
distributions to shareholders (15,334,637) (15,632,096)
------------ ------------
Net Assets: Total increase (decrease) in net assets (1,743,181) 17,683,908
Beginning of year 273,354,223 255,670,315
------------ ------------
End of year* $271,611,042 $273,354,223
============ ============
<FN>
*Undistributed investment income--net $ 2,459,338 $ 2,331,072
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
FINANCIAL INFORMATION (concluded)
<TABLE>
Financial Highlights
<CAPTION>
For the Period
The following per share data and ratios have been derived Feb. 28,
from information provided in the financial statements. For the Year Ended 1992++ to
October 31, Oct. 31,
Increase (Decrease) in Net Asset Value: 1996 1995 1994 1993 1992
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 15.64 $ 14.17 $ 16.85 $ 14.45 $ 14.18
Operating -------- -------- -------- -------- --------
Performance: Investment income--net 1.15 1.19 1.20 1.23 .75
Realized and unrealized gain (loss) on
investments--net (.03) 1.58 (2.67) 2.34 .36
-------- -------- -------- -------- --------
Total from investment operations 1.12 2.77 (1.47) 3.57 1.11
-------- -------- -------- -------- --------
Less dividends and distributions to Common
Stock shareholders:
Investment income--net (.91) (.92) (.97) (.99) (.55)
Realized gain on investments--net -- (.10) (.05) -- --
In excess of realized gain on
investments--net (.10) -- -- -- --
-------- -------- -------- -------- --------
Total dividends and distributions to Common
Stock shareholders (1.01) (1.02) (1.02) (.99) (.55)
-------- -------- -------- -------- --------
Capital charge resulting from issuance of
Common Stock -- -- -- -- (.02)
-------- -------- -------- -------- --------
Effect of Preferred Stock activity:++++
Dividends and distributions to Preferred
Stock shareholders:
Investment income--net (.23) (.26) (.18) (.18) (.12)
Realized gain on investments--net -- (.02) (.01) -- --
In excess of realized gain on
investments--net (.03) -- -- -- --
Capital charge resulting from issuance of
Preferred Stock -- -- -- -- (.15)
-------- -------- -------- -------- --------
Total effect of Preferred Stock activity (.26) (.28) (.19) (.18) (.27)
-------- -------- -------- -------- --------
Net asset value, end of period $ 15.49 $ 15.64 $ 14.17 $ 16.85 $ 14.45
======== ======== ======== ======== ========
Market price per share, end of period $ 14.875 $ 14.375 $ 12.25 $ 16.50 $ 14.75
======== ======== ======== ======== ========
Total Investment Based on market price per share 10.79% 26.40% (20.49%) 19.04% 2.05%+++
Return:** ======== ======== ======== ======== ========
Based on net asset value per share 6.04% 18.89% (9.94%) 24.09% 5.76%+++
======== ======== ======== ======== ========
<PAGE>
Ratios to Average Expenses, net of reimbursement .70% .71% .70% .69% .54%*
Net Assets:*** ======== ======== ======== ======== ========
Expenses .70% .71% .70% .69% .71%*
======== ======== ======== ======== ========
Investment income--net 5.11% 5.42% 5.28% 5.36% 5.56%*
======== ======== ======== ======== ========
Supplemental Net assets, net of Preferred Stock,
Data: end of period (in thousands) $186,611 $188,354 $170,670 $202,998 $171,587
======== ======== ======== ======== ========
Preferred Stock outstanding, end of
period (in thousands) $ 85,000 $ 85,000 $ 85,000 $ 85,000 $ 85,000
======== ======== ======== ======== ========
Portfolio turnover 80.59% 88.17% 41.26% 1.63% 18.10%
======== ======== ======== ======== ========
Leverage: Asset coverage per $1,000 $ 3,195 $ 3,216 $ 3,008 $ 3,388 $ 3,019
======== ======== ======== ======== ========
Dividends Per Series A--Investment income--net $ 819 $ 935 $ 673 $ 638 $ 442
Share On ======== ======== ======== ======== ========
Preferred Stock Series B--Investment income--net $ 807 $ 904 $ 593 $ 651 $ 426
Outstanding:++++++ ======== ======== ======== ======== ========
<FN>
*Annualized.
**Total investment returns based on market value, which
can be significantly greater or lesser than the net asset
value, may result in substantially different returns. Total
investment returns exclude the effects of sales loads.
***Do not reflect the effect of dividens to Preferred
Shareholders.
++Commencement of Operations.
++++The Fund's Preferred Stock were issued on
September 16, 1992.
++++++Dividends per share have been adjusted to reflect a two-
for-one stock split that occured on December 1, 1994.
+++Aggregrate total investment return.
See Notes to Financial Information.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
MuniYield New York Insured Fund, Inc. (the "Fund") is registered
under the Investment Company Act of 1940 as a non-diversified,
closed-end management investment company. The Fund determines and
makes available for publication the net asset value of its Common
Stock on a weekly basis. The Fund's Common Stock is listed on the
New York Stock Exchange under the symbol MYN. The following is a
summary of significant accounting policies followed by the Fund.
<PAGE>
(a) Valuation of investments--Municipal bonds are traded primarily
in the over-the-counter markets and are valued at the most recent
bid price or yield equivalent as obtained by the Fund's pricing
service from dealers that make markets in such securities. Financial
futures contracts and options thereon, which are traded on
exchanges, are valued at their closing prices as of the close of
such exchanges. Options, which are traded on exchanges, are valued
at their last sale price as of the close of such exchanges or,
lacking any sales, at the last available bid price. Securities with
remaining maturities of sixty days or less are valued at amortized
cost, which approximates market value. Securities for which market
quotations are not readily available are valued at their fair value
as determined in good faith by or under the direction of the Board
of Directors of the Fund, including valuations furnished by a
pricing service retained by the Fund, which may utilize a matrix
system for valuations. The procedures of the pricing service and its
valuations are reviewed by the officers of the Fund under the
general supervision of the Board of Directors.
(b) Derivative financial instruments--The Fund may engage in various
portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the debt markets. Losses may
arise due to changes in the value of the contract or if the
counterparty does not perform under the contract.
* Financial futures contracts--The Fund may purchase or sell
interest rate futures contracts and options on such futures
contracts for the purpose of hedging the market risk on existing
securities or the intended purchase of securities. Futures contracts
are contracts for delayed delivery of securities at a specific
future date and at a specific price or yield. Upon entering into a
contract, the Fund deposits and maintains as collateral such initial
margin as required by the exchange on which the transaction is
effected. Pursuant to the contract, the Fund agrees to receive from
or pay to the broker an amount of cash equal to the daily
fluctuation in value of the contract. Such receipts or payments are
known as variation margin and are recorded by the Fund as unrealized
gains or losses. When the contract is closed, the Fund records a
realized gain or loss equal to the difference between the value of
the contract at the time it was opened and the value at the time it
was closed.
* Options--The Fund is authorized to write covered call options and
purchase put options. When the Fund writes an option, an amount
equal to the premium received by the Fund is reflected as an asset
and an equivalent liability. The amount of the liability is
subsequently marked to market to reflect the current market value of
the option written.
When a security is purchased or sold through an exercise of an
option, the related premium paid (or received) is added to (or
deducted from) the basis of the security acquired or deducted from
(or added to) the proceeds of the security sold. When an option
expires (or the Fund enters into a closing transaction), the Fund
realizes a gain or loss on the option to the extent of the premiums
received or paid (or gain or loss to the extent the cost of the
closing transaction exceeds the premium paid or received).
<PAGE>
Written and purchased options are non-income producing investments.
(c) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(d) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income is recognized on the accrual
basis. Discounts and market premiums are amortized into interest
income. Realized gains and losses on security transactions are
determined on the identified cost basis.
(e) Deferred organization expenses--Deferred organization expenses
are amortized on a straight-line basis over a five-year period.
(f) Dividends and distributions--Dividends from net investment
income are declared and paid monthly. Distributions of capital gains
are recorded on the ex-dividend dates. Distributions in excess of
realized capital gains are due primarily to differing tax treatments
for futures transactions.
2. Investment Advisory Agreement and
Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund
Asset Management, L.P. ("FAM"). The general partner of FAM is
Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee at an annual rate of 0.50% of
the Fund's average weekly net assets.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or directors of the Fund are officers and/or
directors of FAM, PSI, Merrill Lynch, Pierce, Fenner & Smith Inc.
("MLPF&S"), and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the year ended October 31, 1996 were $213,970,428 and
$224,731,654, respectively.
Net realized and unrealized gains (losses) as of October 31, 1996
were as follows:
<PAGE>
Realized Unrealized
Gains (Losses) Gains
Long-term investments $ 706,202 $17,106,174
Short-term investments (805) --
Financial futures contracts (1,271,094) --
----------- -----------
Total $ (565,697) $17,106,174
=========== ===========
As of October 31, 1996, net unrealized appreciation for Federal
income tax purposes aggregated $17,106,174, of which $17,130,897
related to appreciated securities and $24,723 related to depreciated
securities. The aggregate cost of investments at October 31, 1996
for Federal income tax purposes was $250,504,589.
4. Capital Stock Transactions:
The Fund is authorized to issue 200,000,000 shares of capital stock,
including Preferred Stock, par value $.10 per share, all of which
were initially classified as Common Stock. The Board of Directors is
authorized, however, to reclassify any unissued shares of capital
stock without approval of the holders of Common Stock.
Common Stock
For the year ended October 31, 1996, shares issued and outstanding
remained constant at 12,046,743. At October 31, 1996, total paid-in
capital amounted to $169,211,876.
Preferred Stock
Auction Market Preferred Stock ("AMPS") are shares of Preferred
Stock of the Fund that entitle their holders to receive cash
dividends at an annual rate that may vary for the successive
dividend periods. The yields in effect at October 31, 1996 were:
Series A, 3.40% and Series B, 3.17%.
As of October 31, 1996, there were 3,400 AMPS shares authorized,
issued and outstanding with a liquidation preference of $25,000 per
share.
The Fund pays commissions to certain broker-dealers at the end of
each auction at an annual rate ranging from 0.25% to 0.375%,
calculated on the proceeds of each auction. For the year ended
October 31, 1996, MLPF&S, an affiliate of FAM, earned $128,690 as
commissions.
5. Subsequent Event:
On November 8, 1996, the Fund's Board of Directors declared an
ordinary income dividend to Common Stock shareholders in the amount
of $.077587 per share, payable on November 27, 1996 to shareholders
of record as of November 18, 1996.
<PAGE>
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders of
MuniYield New York Insured Fund, Inc.:
We have audited the accompanying statement of assets, liabilities
and capital, including the schedule of investments, of MuniYield New
York Insured Fund, Inc. as of October 31, 1996, the related
statements of operations for the year then ended and changes in net
assets for each of the years in the two-year period then ended, and
the financial highlights for each of the years in the four-year
period then ended and the period February 28, 1992 (commencement of
operations) to October 31, 1992. These financial statements and the
financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these
financial statements and the financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements and the financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.
Our procedures included confirmation of securities owned at October
31, 1996 by correspondence with the custodian. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights
present fairly, in all material respects, the financial position of
MuniYield New York Insured Fund, Inc. as of October 31, 1996, the
results of its operations, the changes in its net assets, and the
financial highlights for the respective stated periods in conformity
with generally accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
December 3, 1996
</AUDIT-REPORT>
<PAGE>
IMPORTANT TAX INFORMATION (unaudited)
<TABLE>
All of the net investment income distributions paid by MuniYield New
York Insured Fund, Inc. during its taxable year ended October 31,
1996 qualify as tax-exempt interest dividends for Federal income tax
purposes. Additionally, the following table summarizes the per share
capital gains distributions paid by the Fund during the year:
<CAPTION>
Payable Short-Term Long-Term
Date Capital Gains Capital Gains
<S> <S> <S> <C> <C>
Common Stock Shareholders 12/28/95 $ 0.037659 $ 0.064667
Preferred Stock Shareholders: Series A 11/28/95 $44.50 $76.41
Series B 11/28/95 $12.24 $21.02
12/05/95 $11.75 $20.15
12/12/95 $11.73 $20.17
12/19/95 $ 1.07 $ 1.84
Please retain this information for your records.
</TABLE>
OFFICERS AND DIRECTORS
Arthur Zeikel, President and Director
James H. Bodurtha, Director
Herbert I. London, Director
Robert R. Martin, Director
Joseph L. May, Director
Andre F. Perold, Director
Terry K. Glenn, Executive Vice President
Vincent R. Giordano, Senior Vice President
Donald C. Burke, Vice President
Kenneth A. Jacob, Vice President
Walter C. O'Connor, Vice President
Gerald M. Richard, Treasurer
Mark B. Goldfus, Secretary
Custodian
The Bank of New York
90 Washington Street
New York, New York 10286
Transfer Agents
Common Stock:
The Bank of New York
101 Barclay Street
New York, New York 10286
<PAGE>
Preferred Stock:
IBJ Schroder Bank & Trust Company
One State Street
New York, New York 10004
NYSE Symbol
MYN
