MUNIYIELD
NEW JERSEY
INSURED
FUND, INC.
FUND LOGO
Annual Report
October 31, 1995
This report, including the financial information herein, is
transmitted to the shareholders of MuniYield New Jersey 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.
<PAGE>
MuniYield
New Jersey
Insured Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
MuniYield New Jersey Insured Fund, Inc.
TO OUR SHAREHOLDERS
For the year ended October 31, 1995, the Common Stock of MuniYield
New Jersey Insured Fund, Inc. earned $0.872 per share income
dividends, which included earned and unpaid dividends of $0.075.
This represents a net annualized yield of 5.77%, based on a month-
end net asset value of $15.12 per share. Over the same period, the
total investment return on the Fund's Common Stock was +18.55%,
based on a change in per share net asset value from $13.60 to
$15.12, and assuming reinvestment of $0.872 per share income
dividends.
For the six-month period ended October 31, 1995, the total
investment return on the Fund's Common Stock was +7.61%, based on a
change in per share net asset value from $14.49 to $15.12, and
assuming reinvestment of $0.434 per share income dividends.
For the six-month period ended October 31, 1995, the Fund's Auction
Market Preferred Stock had an average yield of 3.80%.
<PAGE>
The Environment
After losing momentum through the second calendar quarter of 1995,
it now appears that the US economic expansion has resumed. Gross
domestic product growth for the three months ended September 30 was
reported to be 4.2%, higher than generally expected. September
durable goods orders increased a surprisingly strong 3%, and
existing home sales rose to a near record level. At the same time,
there is evidence that inflationary pressures remain subdued.
Reflecting the trend of renewed economic growth--and continued good
news on the inflation front--the Federal Reserve Board signaled no
near-term shift in monetary policy following its September meeting.
Thus, official interest rates may not be reduced further in the
immediate future.
Another significant development has been the strengthening of the US
dollar relative to the yen and the Deutschemark. Improving interest
rate differentials favoring the US currency, combined with
coordinated central bank intervention and more positive investor
sentiment, have helped to bolster the dollar in foreign exchange
markets. Other factors that appear to be improving the US dollar's
outlook in the near term are a pick-up in capital flows to the
United States and the prospect of increased capital outflows from
Japan. However, it remains to be seen if the US dollar's
strengthening trend can continue without significant improvements in
the US budget and trade deficits.
In the weeks ahead, investor interest will continue to focus on US
economic activity. Clear signs of a moderate, noninflationary
expansion could further benefit the US stock and bond markets. In
addition, should the current Federal budget deficit reduction
efforts now underway in Washington prove successful, the
implications would likely be positive for the US financial markets.
The Municipal Market
Tax-exempt bond yields continued to decline during the six-month
period ended October 31, 1995. As measured by the Bond Buyer Revenue
Bond Index, the yield on uninsured, long-term municipal revenue
bonds fell 30 basis points (0.30%) to end the October period at
approximately 6.00%. While tax-exempt bond yields have declined
dramatically from their highs one year ago, municipal bond yields
have exhibited considerable yield volatility on a weekly basis. In
recent months, tax-exempt bond yields have fluctuated by as much as
20 basis points on a week-to-week basis. US Treasury bond yields
have displayed similar volatility, but the extent of their decline
has been greater. By the end of October, long-term US Treasury bond
yields had declined almost 100 basis points to 6.33%. Proposed
Federal tax restructuring continued to weigh heavily on the tax-
exempt bond market. Thus far in 1995, US Treasury bond yields have
declined approximately 150 basis points. Municipal bond yields have
fallen approximately 95 basis points as the uncertainty surrounding
any changes to the existing Federal income tax structure has
prevented the municipal bond market from rallying as strongly as its
taxable counterpart.
<PAGE>
A general view of a moderately expanding domestic economy, supported
by a very favorable inflationary environment, allowed interest rates
to significantly decline from their recent highs in November 1994.
However, this decline was not a smooth downward curve. Conflicting
economic indicators were released during recent months that have
prevented a clear consensus regarding the near-term direction of
interest rates from being reached. The resultant uncertainty has
promoted more of a saw-toothed pattern as interest rate declines
were repeatedly interrupted by indications of stronger-than-expected
economic growth. As these concerns were overcome by subsequent
weaker economic releases, interest rate declines have resumed. These
periods of volatility are likely to continue for the remainder of
1995, or until proposed Federal budget deficit reduction packages
are resolved and any resultant responses by the Federal Reserve
Board have occurred.
However, the municipal bond market's technical position remained
supportive throughout recent quarters. Approximately $82 billion in
long-term municipal securities were issued during the six months
ended October 31, 1995. While this issuance is virtually identical
to underwritings during the October 31, 1994 quarter, tax-exempt
bond issuance over the last 12 months remained approximately 25%
below comparable 1994 levels. The municipal bond market should
maintain this positive technical position well into 1996. Annual
issuance for 1995 is now projected to be approximately $140 billion,
significantly less than last year's already low level of $162
billion. Projected maturities and early redemptions for the
remainder of 1995 and throughout 1996 will lead to a continued
decline in the total outstanding municipal bond supply throughout
1996 and, perhaps, into 1998 should new bond issuance remain at
historically low levels.
Despite the municipal bond market's relative underperformance
compared to the US Treasury market thus far in 1995, the extent of
the tax-exempt bond market's rally was nonetheless quite impressive.
Municipal bond yields have fallen 135 basis points from their highs
reached in November 1994 and municipal bond prices rose accordingly.
Most tax-exempt products recouped almost all of the losses incurred
in 1994 and are well on their way to posting double-digit total
returns for all of 1995. This relative underperformance so far in
1995 provided long-term investors with the rare opportunity to
purchase tax-exempt securities at yield levels near those of taxable
securities.
<PAGE>
Additionally, many of the factors that led to the relative
underperformance of the tax-exempt bond market thus far in 1995,
namely investor concern regarding Federal budget deficit reductions
and proposed changes in the Federal income tax structure, are
nearing resolution. The Federal budget reconciliation process has
already begun, and may be essentially completed by year-end. Recent
public opinion polls suggest that the majority of American taxpayers
prefer the existing Federal income tax system compared to proposed
changes, such as the flat tax or national sales tax. In an upcoming
election year, neither party is likely to advocate a clearly
unpopular position, particularly one that can be expected to
negatively impact the Federal budget deficit reduction program
through reduced tax revenues. As these factors are resolved, we
believe that much of the resistance that the municipal bond market
met this year should dissipate. This should allow municipal bond
yields to significantly decline from current levels in order to
return to more normal historic yield relationships.
Portfolio Strategy
During the 12 months ended October 31, 1995, the municipal bond
market was extremely volatile. As measured by the Bond Buyer Revenue
Bond Index, long-term tax-exempt bond yields ranged from a high of
7.37% on November 17, 1994 to a low of 5.94% on June 8, 1995. By the
Fund's fiscal year-end at October 31, 1995, the Index was near the
low for the period, yielding 6.02%. After rising sharply for most of
1994, long-term interest rates have rallied significantly during
1995 as the US economy nearly slowed to a halt. This slowdown in
economic growth initially caused the Federal Reserve Board to stop
tightening monetary policy early in 1995. Once the magnitude of the
slowdown became apparent in July 1995, the Federal Reserve Board
actually decreased the Federal Funds rate by 0.25% to 5.75%.
We altered the Fund's portfolio strategy during the past 12 months
as investor sentiment changed. We entered the year defensively
postured and maintained that outlook through early 1995. However, as
evidence of a stagnant economy emerged early in 1995, we began to
adopt a more constructive outlook. Our strategy then centered on
reducing cash reserves as much as possible and restructuring the
Fund's holdings to extend the average portfolio maturity. This
entailed selling par bonds which have little upside potential, and
buying both discount coupon and noncallable bonds. These moves made
the Fund more responsive to changes in interest rates. As a result,
the Fund generated a positive total return and an attractive current
yield for its Common Stock shareholders.
<PAGE>
In Conclusion
We appreciate your ongoing interest in MuniYield New Jersey Insured
Fund, Inc., and we look forward to assisting you with your financial
needs in the months and years ahead.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Vice President
(William M. Petty)
William M. Petty
Portfolio Manager
November 22, 1995
We are pleased to announce that William M. Petty is responsible for
the day-to-day management of MuniYield New Jersey Insured Fund, Inc.
Mr. Petty has been employed by Merrill Lynch Asset Management, L.P.
(an affiliate of the Fund's investment adviser) since 1993 as Vice
President and was Assistant Vice President from 1992 to 1993. Prior
thereto, he was employed by J. J. Kenny Municipal Bond Brokers as a
Municipal Bond Broker from 1990 to 1992.
<PAGE>
<TABLE>
PROXY RESULTS
<CAPTION>
During the six-month period ended October 31, 1995, MuniYield New
Jersey Insured Fund, Inc. Common Stock shareholders voted on the
following proposals. The proposals were approved at a special
shareholders' meeting on May 12, 1995. 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: Edward H. Meyer 7,854,679 212,884
Jack B. Sunderland 7,859,950 207,613
J. Thomas Touchton 7,863,457 204,106
Arthur Zeikel 7,863,471 204,092
<CAPTION>
Shares Shares Voted Shares Voted
Voted For Against Abstain
<S> <C> <C> <C>
2.To select Deloitte & Touche LLP as the Fund's
independent auditors. 7,826,290 75,797 165,476
During the six-month period ended October 31, 1995, MuniYield New
Jersey Insured Fund, Inc. Preferred Stock shareholders voted on the
following proposals. The proposals were approved at a special
shareholders' meeting on May 12, 1995. 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: Donald Cecil 1,349 91
M. Colyer Crum 1,349 91
Edward H. Meyer 1,349 91
Jack B. Sunderland 1,349 91
J. Thomas Touchton 1,349 91
Arthur Zeikel 1,349 91
<CAPTION>
Shares Shares Voted Shares Voted
Voted For Against Abstain
<S> <C> <C> <C>
2.To select Deloitte & Touche LLP as the Fund's
independent auditors. 1,349 90 1
</TABLE>
<PAGE>
THE BENEFITS AND RISKS OF LEVERAGING
MuniYield New Jersey 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.
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 pick-up 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.
<PAGE>
PORTFOLIO ABBREVIATIONS
To simplify the listings of MuniYield New Jersey 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 at right.
ACES SM Adjustable Convertible Extendable Securities
AMT Alternative Minimum Tax (subject to)
COP Certificates of Participation
EDA Economic Development Authority
GO General Obligation Bonds
M/F Multi-Family
PCR Pollution Control Revenue Bonds
UT Unlimited Tax
VRDN Variable Rate Demand Notes
<TABLE>
SCHEDULE OF INVESTMENTS (in Thousands)
<CAPTION>
S&P Moody's Face Value
Ratings Ratings Amount Issue (Note 1a)
New Jersey--100.3%
<S> <S> <C> <S> <C>
Atlantic City, New Jersey, Board of Education, GO, UT (d):
AAA Aaa $ 4,600 6.15% due 12/01/2013 $ 4,778
AAA Aaa 2,000 6.15% due 12/01/2015 2,067
AAA Aaa 6,000 Bergen County, New Jersey, Utilities Authority, Water PCR, Series A, 6.50%
due 12/15/2012 (b) 6,493
AAA Aaa 4,875 Cape May County, New Jersey, Industrial Pollution Control Financing
Authority Revenue Bonds (Atlantic City Electric Company Project), AMT,
Series A, 7.20% due 11/01/2029 (c) 5,547
AAA Aaa 3,010 Carteret, New Jersey, Board of Education, COP, GO, 6.75% due 10/15/2019 (c) 3,342
<PAGE>
Essex County, New Jersey, Improvement Authority Revenue Bonds:
AAA Aaa 2,800 (Irvington Township School District), 6.625% due 10/01/2002 (e)(f) 3,182
AAA Aaa 2,245 (Orange Township School District), UT, Series B, 6.95% due 7/01/2014 (c) 2,524
AAA Aaa 1,120 (Parking Facility), 6.20% due 7/01/2022 (c) 1,166
Highland Park, New Jersey, School District, GO, UT (c):
AAA Aaa 1,200 6.55% due 2/15/2023 1,310
AAA Aaa 1,250 6.55% due 2/15/2024 1,364
AAA Aaa 3,630 Hoboken, Union City, Weehawken, New Jersey, Sewer Authority, Revenue
Refunding Bonds, 6.20% due 8/01/2019 (c) 3,768
A+ NR* 2,600 Hudson County, New Jersey, Improvement Authority, Essential Purpose
Revenue Bonds, 6.625% due 8/01/2025 2,769
AAA Aaa 12,600 Hudson County, New Jersey, Refunding Bonds (Correctional Facilities), COP,
6.60% due 12/01/2021 (c) 13,532
AAA Aaa 4,750 Jersey City, New Jersey, Sewer Authority Revenue Refunding Bonds, 6.25%
due 1/01/2014 (d) 5,150
NR* NR* 5,750 Middlesex County, New Jersey, Pollution Control Authority, Revenue Refunding
Bonds (Amerada Hess), 6.875% due 12/01/2022 5,943
AAA Aaa 3,750 Middlesex County, New Jersey, Utilities Authority, Sewer Revenue Refunding
Bonds, Series A, 5.375% due 9/15/2015 (b) 3,667
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued) (in Thousands)
<CAPTION>
S&P Moody's Face Value
Ratings Ratings Amount Issue (Note 1a)
New Jersey (continued)
<S> <S> <C> <S> <C>
NR* VMIG1++ $ 200 Monmouth County, New Jersey, Improvement Authority Revenue Bonds
(Pooled Government Loan Program), ACES, 3.70% due 8/01/2016 (a) $ 200
NR* VMIG1++ 200 New Jersey, EDA, Dock Facility Revenue Refunding Bonds (Bayonne International
Matex Tank Terminal Project), VRDN, Series A, 3.90% due 12/01/2027 (a) 200
New Jersey, EDA, Educational Testing Services Revenue Bonds (c):
AAA Aaa 3,745 Series A, 6% due 5/15/2025 3,836
AAA Aaa 2,305 Series B, 6.125% due 5/15/2015 2,393
<PAGE>
New Jersey, EDA, Natural Gas Facilities Revenue Bonds (d):
A1+ VMIG1++ 1,000 (New Jersey Natural Gas Company Project), VRDN, Series B, 3.55% due 8/01/2030 (a) 1,000
AAA Aaa 4,500 Refunding (Nui Corp.), Series A, 6.35% due 10/01/2022 4,776
AAA Aaa 3,250 New Jersey, EDA, Revenue Bonds (State Contract Economic Recovery), Series A,
6% due 3/15/2021 (e) 3,317
AAA Aaa 2,835 New Jersey, EDA, Revenue Refunding Bonds (RWJ Health Care Corporation), 6.50% due
7/01/2024 (e) 3,052
New Jersey Health Care Facilities Financing Authority Revenue Bonds:
AAA Aaa 1,495 (Bayshore Community Hospital), Series A, 6.50% due 7/01/2015 (c) 1,598
AAA Aaa 6,355 (Holy Name Hospital), Series B, 6.75% due 7/01/2020 (d) 6,804
AAA Aaa 5,445 (Mercer Medical Center), 6.50% due 7/01/2021 (c) 5,822
AAA Aaa 1,185 Refunding (Hackensack Medical Center), 6.625% due 7/01/2017 (b) 1,280
AAA Aaa 4,000 Refunding (JFK Health Systems), 6.70% due 7/01/2021 (b) 4,316
AAA Aaa 2,000 Refunding (Jersey Shore Medical Center), 5.875% due 7/01/2024 (d) 2,005
AAA Aaa 2,000 (Somerset Medical Center), Series A, 5.20% due 7/01/2024 (b) 1,851
New Jersey Sports and Exposition Authority, Luxury Tax Revenue Refunding Bonds
(Convention Center), Series A (c):
AAA Aaa 2,000 6.60% due 7/01/2015 2,174
AAA Aaa 7,380 6.25% due 7/01/2020 7,715
AAA Aaa 2,000 New Jersey State Educational Facilities Authority Revenue Bonds (Montclair State
University), Series E, 6.50% due 7/01/2021 (d) 2,129
AAA Aaa 4,000 New Jersey State Housing and Mortgage Finance Agency, Home Buyer Revenue Bonds,
AMT, Series M, 7% due 10/01/2026 (c) 4,235
New Jersey State Housing and Mortgage Finance Agency, Housing Revenue
Refunding Bonds:
AAA NR* 4,000 M/F (Presidential Plaza), 7% due 5/01/2030 (g) 4,202
AAA Aaa 5,000 M/F, Series A, 6.05% due 11/01/2020 (d) 5,029
A+ NR* 2,500 Series A, 6.95% due 11/01/2013 2,643
AAA Aaa 5,350 New Jersey State Transportation Corporation, COP (Raymond Plaza East,
Incorporated), 6.50% due 10/01/2016 (e) 5,818
New Jersey State Transportation Trust Fund Authority Refunding Bonds,
Series A (c):
AAA Aaa 5,000 5.50% due 6/15/2013 4,944
AAA Aaa 3,000 5% due 6/15/2015 2,821
</TABLE>
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (concluded) (in Thousands)
<CAPTION>
S&P Moody's Face Value
Ratings Ratings Amount Issue (Note 1a)
New Jersey (concluded)
<S> <S> <C> <S> <C>
New Jersey State Turnpike Authority, Revenue Refunding Bonds:
AAA Aaa $1,500 Series C, 6.50% due 1/01/2016 (c) $ 1,689
AAA VMIG1++ 7,000 VRDN, Series D, 3.60% due 1/01/2018 (a)(b) 7,000
AAA Aaa 5,000 New Jersey Wastewater Treatment Trust Loan, Insured Revenue Bonds, Series B,
6.25% due 5/01/2012 (c) 5,287
AAA Aaa 3,490 Passaic Valley, New Jersey, Water Commission, Water Supply Revenue Bonds,
Series A, 6.40% due 12/15/2002 (b)(f) 3,929
Port Authority of New York and New Jersey, Consolidated Revenue Bonds:
AAA Aaa 3,500 96th Series, AMT, 6.60% due 10/01/2023 (b) 3,716
AA- A1 3,000 100th Series, 5.75% due 6/15/2030 2,942
AAA Aaa 4,000 Refunding, 97th Series, AMT, UT, 6.65% due 1/15/2023 (b) 4,266
AAA Aaa 1,180 South Brunswick Township, New Jersey, Board of Education, GO, UT, 6.40% due
8/01/2021 (b) 1,265
A1+ P1 300 Union County, New Jersey, Industrial Pollution Control Financing Authority, PCR,
Refunding (Exxon Project), VRDN, 3.50% due 10/01/2024 (a) 300
Total Investments (Cost--$171,399)--100.3% 181,156
Liabilities in Excess of Other Assets--(0.3%) (517)
--------
Net Assets--100.0% $180,639
========
<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, 1995.
(b)FGIC Insured.
(c)MBIA Insured.
(d)AMBAC Insured.
(e)FSA Insured.
(f)Prerefunded.
(g)FHA Insured.
*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>
<PAGE>
FINANCIAL INFORMATION
<TABLE>
Statement of Assets, Liabilities and Capital as of October 31, 1995
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$171,398,935) (Note 1a) $181,155,736
Cash 69,762
Interest receivable 3,423,979
Deferred organization expenses (Note 1e) 5,743
Prepaid expenses and other assets 6,261
------------
Total assets 184,661,481
------------
Liabilities: Payables:
Securities purchased $ 3,669,127
Dividends to shareholders (Note 1f) 216,206
Investment adviser (Note 2) 78,936 3,964,269
------------
Accrued expenses and other liabilities 57,902
------------
Total liabilities 4,022,171
------------
Net Assets: Net assets $180,639,310
============
Capital: Capital Stock (200,000,000 shares authorized) (Note 4):
Preferred Stock, par value $.10 per share (2,240
shares of AMPS* issued and outstanding at $25,000
per share liquidation preference) $ 56,000,000
Common Stock, par value $.10 per share (8,241,167 shares
issued and outstanding) $ 824,117
Paid-in capital in excess of par 114,958,321
Undistributed investment income--net 768,424
Accumulated realized capital losses on investments--net
(Note 5) (1,668,353)
Unrealized appreciation on investments--net 9,756,801
------------
Total--Equivalent to $15.12 net asset value per share of
Common Stock (market price--$14.125) 124,639,310
------------
Total capital $180,639,310
============
<FN>
*Auction Market Preferred Stock.
See Notes to Financial Statements.
</TABLE>
<PAGE>
FINANCIAL INFORMATION (continued)
<TABLE>
Statement of Operations
<CAPTION>
For the Year Ended
October 31, 1995
<S> <S> <C> <C>
Investment Income Interest and amortization of premium and discount earned $ 10,637,190
(Note 1d):
Expenses: Investment advisory fees (Note 2) $ 874,621
Commission fees (Note 4) 140,709
Professional fees 69,994
Accounting services (Note 2) 39,170
Transfer agent fees 38,750
Printing and shareholder reports 28,977
Directors' fees and expenses 22,639
Listing fees 17,483
Custodian fees 11,249
Pricing fees 6,308
Amortization of organization expenses (Note 1e) 2,864
Other 12,236
------------
Total expenses 1,265,000
------------
Investment income--net 9,372,190
------------
Realized & Unreal- Realized loss on investments--net (1,151,903)
lized Gain (Loss) Change in unrealized appreciation/depreciation on investments--net 13,636,732
on Investments--Net ------------
(Notes 1b, 1d & 3): Net Increase in Net Assets Resulting from Operations $ 21,857,019
============
</TABLE>
<TABLE>
Statements of Changes in Net Assets
<CAPTION>
For the Year Ended October 31,
Increase (Decrease) in Net Assets: 1995 1994
<S> <S> <C> <C>
Operations: Investment income--net $ 9,372,190 $ 9,304,187
Realized loss on investments--net (1,151,903) (516,282)
Change in unrealized appreciation/depreciation on investments--net 13,636,732 (21,388,370)
------------ ------------
Net increase (decrease) in net assets resulting from operations 21,857,019 (12,600,465)
------------ ------------
<PAGE>
Dividends & Investment income--net:
Distributions to Common Stock (7,185,309) (7,644,949)
Shareholders Preferred Stock (2,142,347) (1,584,553)
(Note 1f): Realized gain on investments--net:
Common Stock -- (278,573)
Preferred Stock -- (48,967)
------------ ------------
Net decrease in net assets resulting from dividends and
distributions to shareholders (9,327,656) (9,557,042)
------------ ------------
Capital Stock Value of shares issued to Common Stock shareholders in
Transactions reinvestment of dividends and distributions -- 712,910
(Note 4): ------------ ------------
Net increase in net assets derived from capital stock
transactions -- 712,910
------------ ------------
Net Assets: Total increase (decrease) in net assets 12,529,363 (21,444,597)
Beginning of year 168,109,947 189,554,544
------------ ------------
End of year* $180,639,310 $168,109,947
============ ============
<FN>
*Undistributed investment income--net $ 768,424 $ 723,890
============ ============
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (concluded)
<PAGE>
<TABLE>
Financial Highlights
<CAPTION>
For the
Period
The following per share data and ratios have been derived Oct. 30,
from information provided in the financial statements For the Year Ended 1992++ to
October 31, Oct. 31,
Increase (Decrease) in Net Asset Value: 1995 1994 1993 1992
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 13.60 $ 16.30 $ 14.14 $ 14.18
Operating -------- -------- -------- --------
Performance: Investment income--net 1.13 1.13 1.11 --
Realized and unrealized gain (loss) on
investments--net 1.52 (2.67) 2.21 --
-------- -------- -------- --------
Total from investment operations 2.65 (1.54) 3.32 --
-------- -------- -------- --------
Less dividends and distributions to Common Stock
shareholders:
Investment income--net (.87) (.93) (.86) --
Realized gain on investments--net -- (.03) -- --
-------- -------- -------- --------
Total dividends and distributions to Common Stock
shareholders (.87) (.96) (.86) --
-------- -------- -------- --------
Capital charge resulting from issuance of Common Stock -- -- -- (.04)
-------- -------- -------- --------
Effect of Preferred Stock activity:++++
Dividends and distributions to Preferred Stock
shareholders:
Investment income--net (.26) (.19) (.17) --
Realized gain on investments--net -- (.01) -- --
Capital charge resulting from issuance of
Preferred Stock -- -- (.13) --
-------- -------- -------- --------
Total effect of Preferred Stock activity (.26) (.20) (.30) --
-------- -------- -------- --------
Net asset value, end of period $ 15.12 $ 13.60 $ 16.30 $ 14.14
======== ======== ======== ========
Market price per share, end of period $ 14.125 $ 11.25 $ 16.50 $ 15.00
======== ======== ======== ========
Total Investment Based on market price per share 33.88% (27.05%) 16.25% .00%+++
Return:* ======== ======== ======== ========
Based on net asset value per share 18.55% (10.73%) 21.83% (.28%)+++
======== ======== ======== ========
Ratios to Average Expenses, net of reimbursement .72% .75% .57% --
Net Assets:** ======== ======== ======== ========
Expenses .72% .75% .72% --
======== ======== ======== ========
Investment income--net 5.36% 5.14% 5.19% --
======== ======== ======== ========
<PAGE>
Supplemental Net assets, net of Preferred Stock, end of period
Data: (in thousands) $124,639 $112,110 $133,555 $112,666
======== ======== ======== ========
Preferred Stock outstanding, end of period
(in thousands) $ 56,000 $ 56,000 $ 56,000 $ --
======== ======== ======== ========
Portfolio turnover 39.36% 21.47% 9.10% --
======== ======== ======== ========
Dividends Per Investment income--net $ 956 $ 708 $ 599 $ --
Share on ======== ======== ======== ========
Preferred Stock
Outstanding:++++++
<FN>
*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 dividends to Preferred Stock
shareholders.
++Commencement of Operations.
++++The Fund's Preferred Stock was issued on November 30, 1992.
++++++Dividends per share have been adjusted to reflect a two-for-
one stock split.
+++Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
MuniYield New Jersey 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 MJI. 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 and assets for
which market quotations are not readily available are valued at 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.
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, 1995 were $65,391,666 and
$65,807,368, respectively.
<PAGE>
Net realized and unrealized gains (losses) as of October 31, 1995
were as follows:
Realized
Gains Unrealized
(Losses) Gains
Long-term investments $ 164,925 $ 9,756,801
Financial futures contracts (1,316,828) --
----------- -----------
Total $(1,151,903) $ 9,756,801
=========== ===========
As of October 31, 1995, net unrealized appreciation for Federal
income tax purposes aggregated $9,756,801, all of which related to
appreciatedsecurities. The aggregate cost of investments at October
31, 1995 for Federal income tax purposes was $171,398,935.
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 holders of Common Stock.
Common Stock
For the year ended October 31, 1995, shares issued and outstanding
remained constant at 8,241,167. At October 31, 1995, total paid-in
capital amounted to $115,782,438.
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 yield in effect at October 31, 1995 was 3.80%.
A two-for-one stock split occurred on December 1, 1994. As a result,
as of October 31, 1995, there were 2,240 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, 1995, MLPF&S, an affiliate of FAM, earned $127,617 as
commissions.
<PAGE>
5. Capital Loss Carryforward:
At October 31, 1995, the Fund had a capital loss carryforward of
approximately $284,000, all of which expires in 2002. This amount
will be available to offset like amounts of any future taxable
gains.
6. Subsequent Event:
On November 13, 1995, the Fund's Board of Directors declared an
ordinary income dividend to Common Stock shareholders in the amount
of $.074745 per share, payable on November 29, 1995 to shareholders
of record as of November 24, 1995.
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders of MuniYield New Jersey
Insured Fund, Inc.:
We have audited the accompanying statement of assets, liabilities
and capital, including the schedule of investments, of MuniYield New
Jersey Insured Fund, Inc. as of October 31, 1995, 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 three-year
period then ended and the period October 30, 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, 1995 by correspondence with the custodian and broker. 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.
<PAGE>
In our opinion, such financial statements and financial highlights
present fairly, in all material respects, the financial position of
MuniYield New Jersey Insured Fund, Inc. as of October 31, 1995, 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 1, 1995
</AUDIT-REPORT>
IMPORTANT TAX INFORMATION (UNAUDITED)
All of the net investment income distributions paid monthly by
MuniYield New Jersey Insured Fund, Inc. during its taxable year
ended October 31, 1995 qualify as tax-exempt interest dividends for
Federal income tax purposes. Additionally, there were no capital
gains distributed by the Fund during the year.
Please retain this information for your records.
<PAGE>
PER SHARE INFORMATION (UNAUDITED)
<TABLE>
Per Share Selected Quarterly Financial Data*
<CAPTION>
Net Realized Unrealized Dividends/Distributions
Investment Gains Gains Net Investment Income Capital Gains
For the Quarter Income (Losses) (Losses) Common Preferred Common Preferred
<S> <C> <C> <C> <C> <C> <C> <C>
November 1, 1993 to January 31, 1994 $.29 -- $ .17 $.24 $.04 $.03 $.01
February 1, 1994 to April 30, 1994 .28 $(.02) (1.93) .23 .05 -- --
May 1, 1994 to July 31, 1994 .28 .03 2.28 .23 .05 -- --
August 1, 1994 to October 31, 1994 .28 (.08) (3.12) .23 .05 -- --
November 1, 1994 to January 31, 1995 .29 (.19) .77 .22 .07 -- --
February 1, 1995 to April 30, 1995 .27 (.05) .37 .22 .06 -- --
May 1, 1995 to July 31, 1995 .29 .03 .23 .21 .07 -- --
August 1, 1995 to October 31, 1995 .28 .07 .29 .22 .06 -- --
<CAPTION>
Net Asset Value Market Price**
For the Quarter High Low High Low Volume***
<S> <C> <C> <C> <C> <C>
November 1, 1993 to January 31, 1994 $16.44 $15.77 $16.75 $15.375 685
February 1, 1994 to April 30, 1994 16.39 14.21 16.875 13.75 745
May 1, 1994 to July 31, 1994 15.02 14.15 14.75 13.375 539
August 1, 1994 to October 31, 1994 14.70 13.60 14.125 11.375 909
November 1, 1994 to January 31, 1995 14.18 12.56 13.50 10.625 1,435
February 1, 1995 to April 30, 1995 14.82 14.20 14.00 12.875 628
May 1, 1995 to July 31, 1995 15.34 14.49 14.50 13.25 590
August 1, 1995 to October 31, 1995 15.50 14.54 14.375 13.50 532
<FN>
*Calculations are based upon shares of Common Stock outstanding at
the end of each quarter.
**As reported in the consolidated transaction reporting system.
***In thousands.
</TABLE>
<PAGE>
OFFICERS AND DIRECTORS
Arthur Zeikel, President and Director
Donald Cecil, Director
M. Colyer Crum, Director
Edward H. Meyer, Director
Jack B. Sunderland, Director
J. Thomas Touchton, Director
Terry K. Glenn, Executive Vice President
Donald C. Burke, Vice President
Vincent R. Giordano, Vice President
Kenneth A. Jacob, 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
Preferred Stock:
IBJ Schroder Bank & Trust Company
One State Street
New York, New York 10004
NYSE Symbol
MJI
