UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-Q QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY Investment Company Act file number: 811-06590 Morgan Stanley Insured Municipal Income Trust (Exact name of registrant as specified in charter) 1221 Avenue of the Americas, New York, New York 10020 (Address of principal executive offices) (Zip code) Ronald E. Robison 1221 Avenue of the Americas, New York, New York 10020 (Name and address of agent for service) Registrant's telephone number, including area code: 212-762-4000 Date of fiscal year end: October 31, 2005 Date of reporting period: January 31, 2005 ITEM 1. SCHEDULE OF INVESTMENTS. The Trust's schedule of investments as of the close of the reporting period prepared pursuant to Rule 12-12 of Regulation S-X is as follows: MORGAN STANLEY INSURED MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS JANUARY 31, 2005 (UNAUDITED) PRINCIPAL AMOUNT IN COUPON MATURITY THOUSANDS RATE DATE VALUE --------- ---- ---- ----- TAX-EXEMPT MUNICIPAL BONDS (140.2%) General Obligation (15.3%) $3,000 Los Angeles, California, Ser 2004 A (MBIA) 5.00 % 09/01/24 $3,215,790 District of Columbia, 5,000 Refg Ser 1993 B (Ambac) 5.50 06/01/09 5,529,450 6,000 Refg Ser 1993 B (FSA) 5.50 06/01/10 6,685,440 5,000 Florida State Board of Education, Capital Outlay Refg 2002 Ser C (MBIA) 5.00 06/01/19 5,445,050 Aurora West School District 129, Illinois, 1,000 Ser 2002 A (FGIC) 5.75 02/01/20 1,142,620 2,000 Ser 2002 A (FGIC) 5.75 02/01/21 2,285,240 15,000 Chicago, Illinois, Neighborhoods Alive 21 Ser 2001 A (FGIC) 5.50 01/01/36 16,751,550 5,000 Massachusetts, Refg 2003 Ser D (Ambac) 5.50 10/01/19 5,877,650 Pennsylvania, 1,495 First Ser 2003 RITES PA - 1112 A (MBIA) 7.572+++ 01/01/18 1,754,427 2,055 First Ser 2003 RITES PA - 1112 B (MBIA) 7.572+++ 01/01/19 2,515,484 4,000 Houston, Texas, Public Impr & Refg Ser 2001 B (FSA) 5.50 +++ 03/01/17 4,467,320 ----- ---------- 49,550 55,670,021 ------ ---------- Educational Facilities Revenue (6.6%) 2,500 University of Arizona COPs 2003 Ser B (Ambac) 5.00 06/01/23 2,663,700 University of California, 2,000 Multiple Purpose Ser Q (FSA) 5.00 09/01/31 2,078,820 2,000 Ser 2003 B (Ambac) 5.00 05/15/22 2,152,080 3,000 District of Columbia, American Association for the Advancement of 5.125 01/01/27 3,157,980 Science Ser 1997 (Ambac) 4,000 Illinois Educational Facilities Authority, DePaul University 5.50 10/01/19 4,361,160 Refg Ser 1997 (Ambac) 4,000 New Hampshire Health & Education Facilities Authority, University of New Hampshire Ser 2001 (Ambac) 5.125 07/01/33 4,196,920 5,000 New Jersey Educational Facilities Authority, Higher Education Capital Impr Ser 2002 A (Ambac)++ 5.25 09/01/21 5,528,400 ----- ---------- 22,500 24,139,060 ------ ---------- Electric Revenue (19.8%) 10,000 California Department of Water Resources, Power Supply 5.375 05/01/18 11,122,600 Ser 2002 A (Ambac) 4,000 Lafayette, Louisiana, Utilities Ser 2004 (MBIA) 5.25 11/01/25 4,401,840 5,000 Nebraska Public Power District, 2003 Ser A (Ambac) 5.00 01/01/35 5,210,700 3,000 Long Island Power Authority, New York, Refg Ser 2003 C (FSA) 5.00 09/01/28 3,152,580 6,000 North Carolina Municipal Power Agency #1, Catawba Ser 2003 A (MBIA)5.25 01/01/19 6,660,840 10,000 South Carolina Public Service Authority, Ser 2003 A (Ambac) 5.00 01/01/27 10,536,500 Lower Colorado River Authority, Texas, 10,000 Refg Ser 1999 A (FSA) 5.875 05/15/16 11,273,100 5,000 Refg Ser 2001 (FSA) 5.00 05/15/26 5,200,550 8,800 Refg Ser 2002 (MBIA) 5.00 05/15/31 9,128,768 5,000 Intermountain Power Agency, Utah, 2003 Ser A (FSA) 5.00 07/01/21 5,404,250 ----- ---------- 66,800 72,091,728 ------ ---------- Hospital Revenue (7.5%) 5,000 Mesa Industrial Development Authority, Arizona, Discovery Health 5.875 01/01/16 5,645,450 Ser 1999 A (MBIA) 2,000 Illinois Finance Authority, Swedishamerican Health System Ser 2004 (Ambac) 5.00 11/15/31 2,075,120 5,500 Massachusetts Health & Educational Facilities Authority, Lahey 5.625 07/01/15 5,567,100 Clinic Medical Center Ser B (MBIA) 2,000 Missouri Health & Educational Facilities Authority, SSM Health 5.00 06/01/22 2,071,960 Care Ser 1998 A (MBIA) 1,000 University of Medicine and Dentistry, New Jersey, Ser 2004 5.00 06/15/29 1,048,370 COPs (MBIA) 1,500 Medical University South Carolina Hospital Authority, 5.25 02/15/25 1,628,865 FHA Insured Mortgage 2004 Ser A (MBIA) Amarillo Health Facilities Corporation, Texas, 3,020 Baptist St Anthony's Hospital Ser 1998 (FSA) 5.50 01/01/16 3,424,559 5,075 Baptist St Anthony's Hospital Ser 1998 (FSA) 5.50 01/01/17 5,777,888 ----- ---------- 25,095 27,239,312 ------ ----------- Industrial Development/Pollution Control Revenue (7.8%) 7,500 Adams County, Colorado, Public Service Co of Colorado 5.875 04/01/14 7,520,400 Refg 1993 Ser A (MBIA) 5,000 Hawaii Department of Budget and Finance, Hawaiian Electric Co 6.20 11/01/29 5,650,200 Ser 1999 C (AMT) (Ambac) 12,000 Indiana Development Finance Authority, PSI Energy Inc 5.75 02/15/28 12,024,000 Ser 1993 B (AMT) (MBIA) 3,000 New York State Energy Research & Development Authority, Brooklyn 9.262++ 07/08/26 3,058,920 ----- Union Gas Co 1991 Ser D (AMT) (MBIA) ---------- 27,500 28,253,520 ------ ---------- Public Facilities Revenue (9.3%) 1,000 Phoenix Industrial Development Authority, Arizona, 5.375 09/15/22 1,101,120 Capital Mall LLC Ser 2000 (Ambac) 15,000 Miami-Dade County School Board, Florida, 2003 Ser A (FGIC) 5.00 08/01/29 15,681,150 3,000 Orange County School Board, Florida, Ser 2001 A COPs (Ambac) 5.25 08/01/14 3,360,900 4,000 Kentucky State Property & Buildings Commission, Project # 79 (MBIA) 5.00 10/01/22 4,308,520 4,200 New York State Dormitory Authority, School Districts 2002 Ser E (MBIA) 5.50 10/01/17 4,757,340 4,000 Puerto Rico Public Buildings Authority, Refg Ser J (Ambac) 5.00 07/01/36 4,409,440 ----- (Mandatory Tender 07/01/12) ---------- 31,200 33,618,470 ------ ---------- Recreational Facilities Revenue (3.1%) Metropolitan Pier & Exposition Authority, Illinois, 3,000 McCormick Place Refg Ser 2002 B (MBIA) 0.00# 06/15/18 2,328,360 5,000 McCormick Place Ser 2002 A (MBIA) 5.25 06/15/42 5,332,550 2,400 Marion County Convention & Recreational Facilities Authority, Indiana, Refg Ser 2003 A (Ambac) 5.00 06/01/19 2,579,976 1,000 Casino Reinvestment Development Authority, New Jersey, Ser 2004 5.25 01/01/22 1,120,670 ----- (Ambac) ---------- 11,400 11,361,556 ------ ---------- Transportation Facilities Revenue (30.2%) 1,000 Phoenix Civic Improvement Corporation, Arizona, Sr Lien Airport 5.75 07/01/19 1,127,380 Ser 2002 B (AMT) (FGIC) California Infrastructure & Economic Development Bank, 5,000 Bay Area Toll Bridges Seismic Retrofit 1st Lien Ser 2003 A (FGIC) 5.00 07/01/29 5,235,800 10,000 Bay Area Toll Bridges Seismic Retrofit 1st Lien Ser 2003 A (Ambac) 5.00 07/01/33 10,442,900 9,000 Long Beach California, Harbor Refg Ser 1998 A (AMT) (FGIC) 6.00 05/15/18 10,641,330 5,000 Atlanta, Georgia, Airport Passenger Facilities SubLien 5.00 01/01/33 5,207,550 Ser C 2004 (FSA) 4,000 Illinois Toll Highway Authority, Priority Refg 1998 Ser A (FSA) 5.50 01/01/15 4,612,760 5,000 Minneapolis-St Paul Metropolitan Airports Commission, Minnesota, 5.25 01/01/32 5,327,600 Ser 2001 C (FGIC) 3,000 St Louis, Missouri, Lambert Int'l Airport Ser 2001 A (MBIA) 5.00 07/01/20 3,174,300 9,000 Nevada Department of Business & Industry, Las Vegas Monorail 5.375 01/01/40 9,531,450 1st Tier Ser 2000 (Ambac) 2,000 Delaware River Port Authority, Pennsylvania & New Jersey, Ser 1995 5.50 01/01/26 2,096,000 (FGIC)** Metropolitan Transportation Authority, New York, 3,000 Dedicated Tax Fund Ser 2002 A (FSA) 5.25 11/15/24 3,309,240 10,000 Transportation Refg Ser 2002 A (FGIC) 5.00 11/15/25 10,683,700 4,000 Port Authority of New York & New Jersey, Cons 135 Ser (MBIA)** 5.00 09/15/29 4,225,520 10,000 Triborough Bridge & Tunnel Authority, New York, Refg 2002 E 5.25 11/15/22 11,067,800 (MBIA) 9,000 Dallas-Fort Worth International Airport, Texas, Ser 2003 A (AMT) 5.375 11/01/22 9,748,530 (FSA) 4,000 Texas Turnpike Authority, Central Texas First Tier Ser 2002 A 5.50 08/15/39 4,421,920 (Ambac) 3,000 Richmond Metropolitan Authority, Virginia, Refg Ser 2002 (FGIC) 5.25 07/15/22 3,469,890 5,000 Port of Seattle, Washington, Ser 2001 B (AMT) (MBIA) 5.625 02/01/24 5,465,950 ----- --------- 101,000 109,789,620 ------- ----------- Water & Sewer Revenue (26.6%) 5,000 Los Angeles Department of Water & Power, California, Water 5.00 07/01/24 5,354,500 2004 Ser C (MBIA) 4,000 Oxnard Financing Authority, California, Water Ser 2004 (XLCA) 5.00 06/01/28 4,170,960 San Diego County Water Authority, California, 5,000 Ser 2002 A COPs (MBIA) 5.00 05/01/27 5,238,850 5,000 Ser 2004 A COPs (FSA) 5.00 05/01/29 5,264,050 5,000 Tampa Bay Water Authority, Florida, Ser 2001 A (FGIC) 5.00 10/01/28 5,196,300 5,000 Atlanta, Georgia, Water & Wastewater, Ser 2004 (FSA) 5.00 11/01/23 5,393,800 2,000 Augusta, Georgia, Water & Sewer Ser 2004 A (FSA) 5.25 10/01/39 2,151,000 Detroit, Michigan, 3,000 Sewage Refg Ser 2003 A (FSA) 5.00 07/01/26 3,171,840 8,000 Sewage Refg Ser 2003 A (FSA) 5.00 07/01/28 8,394,560 3,000 Sewage Disposal Ser 2001 A (FGIC) 5.125 07/01/31 3,143,730 5,080 Las Vegas Water District, Nevada, Impr & Refg Ser 2003 A (FGIC) 5.25 06/01/19 5,622,239 1,090 Cleveland, Ohio, Waterworks Impr & Refg 1998 Ser I (FSA) 5.00 01/01/23 1,156,327 5,000 Allegheny County Sanitary Authority, Pennsylvania, Sewer Ser 2000 5.50 12/01/24 5,609,650 (MBIA) 5,000 Philadelphia, Pennsylvania, Water & Wastewater Ser 1998 (Ambac) 5.25 12/15/14 5,692,200 15,000 Houston, Texas, Combined Utility Refg 2004 Ser A (FGIC) 5.25 05/15/23 16,521,450 5,000 King County, Washington, Sewer Refg 2001 (FGIC) 5.00 01/01/31 5,154,500 Seattle, Washington, 2,890 Water Refg 2003 (MBIA) 5.00 09/01/20 3,132,645 2,870 Water Refg 2003 (MBIA) 5.00 09/01/23 3,076,037 2,900 West Virginia Water Development Authority, Refg Ser B (Ambac) 5.25 11/01/23 3,204,297 ----- --------- 89,830 96,648,935 ------ ---------- Other Revenue (5.0%) 5,000 California, Economic Recovery Ser 2004 A (MBIA) 5.00 07/01/15 5,556,850 New York City Transitional Finance Authority, New York, 3,575 2004 Ser C (MBIA) 5.00 02/01/20 3,889,493 2,000 2000 Ser C (Ambac) 5.25 08/01/21 2,213,140 2,500 2000 Ser C (Ambac) 5.25 08/01/22 2,764,175 3,000 Alexandria Industrial Development Authority, Virginia, Institute 5.90 10/01/30 3,416,220 ----- for Defense Analysis Ser 2000 A (Ambac) --------- 16,075 17,839,878 ------ ---------- Refunded (9.0%) 3,275 Massachusetts Municipal Wholesale Electric Company, 1993 Ser A 5.00 07/01/10 3,539,063 (Ambac) (ETM) 8,000 Washoe County, Nevada, Reno - Sparks Convention Ltd Tax 5.75 07/01/22 8,110,160 Ser 1993 A (FGIC) (ETM) 5,000 Allegheny County Hospital Development Authority, Pennsylvania, 5.625 08/15/18 5,302,050 Pittsburgh Mercy Health Ser 1996 (Ambac) (ETM) 10,000 Rhode Island Depositors Economic Protection Corporation, 6.00 08/01/17 10,164,200 Refg 1992 Ser B (MBIA) (ETM) 5,000 South Carolina Transportation Infrastructure Bank, Ser 1999 A 5.50 10/01/09+ 5,622,250 ----- (Ambac) --------- 31,275 32,737,723 ------ ---------- 472,225 TOTAL TAX-EXEMPT MUNICIPAL BONDS (Cost $476,431,671) 509,389,823 ------- ----------- SHORT-TERM TAX-EXEMPT MUNICIPAL OBLIGATIONS (0.8%) 1,600 Redding, California, Electric Ser 1993 A COPs (FGIC) 9.461++ 06/01/05+ 1,633,392 600 Port Authority of New York & New Jersey, Versatile Structure Ser 2 1.90* 05/01/19 600,000 (Demand 02/01/05) 800 Harris County Health Facilities Development Corporation, Texas, 1.90* 12/01/32 800,000 --- Methodist Hospital Ser 2002 (Demand 02/01/05) ------- 3,000 TOTAL SHORT-TERM TAX-EXEMPT MUNICIPAL OBLIGATIONS (Cost $3,000,000) 3,033,392 ----- --------- $475,225 TOTAL INVESTMENTS (Cost $479,431,671) (a)(b) 141.0% 512,423,215 ======== OTHER ASSETS IN EXCESS OF LIABILITIES 1.7 6,109,541 PREFERRED SHARES OF BENEFICIAL INTEREST (42.7) (155,198,442) ------ ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS 100.0% $363,334,314 ===== ============ -------------- Note: The categories of investments are shown as a percentage of net assets applicable to common shareholders. AMT Alternative Minimum Tax. COPs Certificates of Participation. ETM Escrowed to maturity RITES Residual Interest Tax - Exempt Securities (Illiquid securities). + Prerefunded to call date shown. ++ A portion of this security has been physically segregated in connection with open futures contracts in the amount of $910,000. +++ Current coupon rate for inverse floating rate municipal obligation. This rate resets periodically as the auction rate on the related security changes. Positions in inverse floating rate municipal obligations have a total value of $8,962,223 which represents 2.5% of net assets applicable to common shareholders. # Currently a zero coupon security; will convert to 5.30% on June 15, 2012. * Current coupon of variable rate demand obligation. ** Joint exemption in locations shown. (a) Securities have been designated as collateral in an amount equal to $141,709,146 in connection with open futures contracts. (b) The aggregate cost for federal income tax purposes approximates the aggregate cost for book purposes. The aggregate gross unrealized appreciation is $33,004,955 and the aggregate gross unrealized depreciation is $13,411, resulting in net unrealized appreciation $32,991,544. Bond Insurance: --------------- Ambac Ambac Assurance Corporation. FGIC Financial Guaranty Insurance Company. FSA Financial Security Assurance Inc. MBIA Municipal Bond Investors Assurance Corporation. XLCA XL Capital Assurance Inc. Futures Contracts Open at January 31, 2005: DESCRIPTION, NUMBER OF DELIVERY MONTH UNDERLYING FACE UNREALIZED CONTRACTS LONG/SHORT AND YEAR AMOUNT AT VALUE DEPRECIATION ---------------- --------------- -------------------------------------- ---------------------- ---------------------- 650 Short U.S. Treasury Note 5 Yr March/2005 $(71,012,500) $(336,941) 650 Short U.S. Treasury Note 10 Yr March/2005 (72,972,600) (1,032,648) ---------------------- Total unrealized depreciation......................... $(1,369,589) ====================== GEOGRAPHIC SUMMARY OF INVESTMENTS BASED ON MARKET VALUE AS A PRESENT OF TOTAL INVESTMENTS Arizona 2.1% California 14.1 Colorado 1.5 District of Columbia 3.0 Florida 5.8 Georgia 2.5 Hawaii 1.1 Illinois 7.6 Indiana 2.8 Kentucky 0.8 Louisiana 0.9 Massachusetts 2.9 Michigan 2.9 Minnesota 1.0 Missouri 1.0 Nebraska 1.0 Nevada 4.5 New Hampshire 0.8 New Jersey 2.7 New York 9.7 North Carolina 1.3 Ohio 0.2 Pennsylvania 4.5 Puerto Rico 0.9 Rhode Island 2.0 South Carolina 3.5 Texas 13.8 Utah 1.1 Virginia 1.3 Washington 3.3 West Virginia 0.6 Joint exemptions* (1.2) ------ Total+ 100.0% ====== --------------- * Joint exemptions have been included in each geographic location. + Does not include open short futures contracts with an underlying face amount of $143,985,100 with unrealized depreciation of $1,369,589. ITEM 2. CONTROLS AND PROCEDURES. (a) The Trust's principal executive officer and principal financial officer have concluded that the Trust's disclosure controls and procedures are sufficient to ensure that information required to be disclosed by the Trust in this Form N-Q was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, based upon such officers' evaluation of these controls and procedures as of a date within 90 days of the filing date of the report. (b) There were no changes in the Trust's internal control over financial reporting that occurred during the registrant's fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Trust's internal control over financial reporting. ITEM 3. EXHIBITS. (a) A separate certification for each principal executive officer and principal financial officer of the registrant are attached hereto. 2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Morgan Stanley Insured Municipal Income Trust /s/ Ronald E. Robison Ronald E. Robison Principal Executive Officer March 22, 2005 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated. /s/ Ronald E. Robison Ronald E. Robison Principal Executive Officer March 22, 2005 /s/ Francis Smith Francis Smith Principal Financial Officer March 22, 2005 3 EXHIBIT 3 A1 CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER I, Ronald E. Robison, certify that: 1. I have reviewed this report on Form N-Q of Morgan Stanley Insured Municipal Income Trust; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Omitted; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: March 22, 2005 /s/ Ronald E. Robison Ronald E. Robison Principal Executive Officer 4 EXHIBIT 3 A2 CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER I, Francis Smith, certify that: 1. I have reviewed this report on Form N-Q of Morgan Stanley Insured Municipal Income Trust; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Omitted; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: March 22, 2005 /s/ Francis Smith Francis Smith Principal Financial Officer 5