BlackRock MuniHoldings California Insured Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as a non-diversified, closed-end management investment company. The Fund is organized as a Maryland corporation. The Fund’s financial statements are prepared in conformity with accounting principles generally accepted in the United States of America, which may require the use of management accruals and estimates. Actual results may differ from these estimates. The Fund determines and makes available for publication the net asset value of its Common Shares on a daily basis.
The following is a summary of significant accounting policies followed by the Fund:
In the event that application of these methods of valuation results in a price for an investment which is deemed not to be representative of the market value of such investment, the investment will be valued by a method approved by the Board as reflecting fair value (“Fair Value Assets”). When determining the price for Fair Value Assets, the investment advisor and/or sub-advisor seeks to determine the price that the Fund might reasonably expect to receive from the current sale of that asset in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the investment advisor and/or sub-advisor deems relevant. The pricing of all Fair Value Assets is subsequently reported to the Board or a committee thereof.
The cash received by the TOB from the sale of the short-term floating rate certificates, less transaction expenses, is paid to the Fund, which typically invests the cash in additional municipal securities. The Fund’s transfer of the municipal securities to a TOB is accounted for as a secured borrowing, therefore the municipal securities deposited into a TOB are presented in the Fund’s Schedule of Investments and the proceeds from the issuance of the short-term floating rate certificates are reported as a liability for trust certificates.
Interest income from the underlying securities is recorded by the Fund on an accrual basis. Interest expense incurred on the secured borrowing and other expenses related to remarketing, administration and trustee services to a TOB are reported as expenses of the Fund. The floating rate certificates have interest rates that generally reset weekly and their holders have the option to tender certificates to the TOB for redemption at par at each reset date. At December 31, 2008, the aggregate value of the underlying municipal securities transferred to TOBs was $141,420,405, the related liability for trust certificates was $83,558,317 and the range of interest rates on the trust certificates was 2.346% to 3.185%.
Financial transactions executed through TOBs generally will underperform the market for fixed rate municipal bonds when interest rates rise, but tend to outperform the market for fixed rate bonds when interest rates decline or remain relatively stable. Should short-term interest rates rise, the Fund’s investments in TOBs may adversely affect the Fund’s investment income and distributions to shareholders. Also, fluctuations in the market value of municipal securities deposited into the TOB may adversely affect the Fund’s net asset value per share.
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Notes to Financial Statements (continued) |
Zero-Coupon Bonds: The Fund may invest in zero-coupon bonds, which are normally issued at a significant discount from face value and do not provide periodic interest payments. Zero-coupon bonds may experience greater volatility in market value than similar maturity debt obligations which provide for regular interest payments.
Investment Transactions and Investment Income: Investment transactions are recorded on the dates the transactions are entered into (the trade dates). Realized gains and losses on security transactions are determined on the identified cost basis. Dividend income is recorded on the ex-dividend dates. Interest income is recognized on the accrual method. The Fund amortizes all premiums and discounts on debt securities.
Dividends and Distributions: Dividends from net investment income are declared and paid monthly. Distributions of capital gains are recorded on the ex-dividend dates. Dividends and distributions to Preferred Shareholders are accrued and determined as described in Note 5.
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.
The Fund files US federal and various state and local tax returns. No income tax returns are currently under examination.The statute of limitations on the Fund’s US federal tax returns remains open for the years ended June 30, 2005 through June 30, 2007.The statutes of limitations on the Fund’s state and local tax returns may remain open for an additional year depending upon the jurisdiction.
Recent Accounting Pronouncement: In March 2008, Statement of Financial Accounting Standards No. 161, “Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133” (“FAS 161”), was issued. FAS 161 is intended to improve financial reporting for derivative instruments by requiring enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for and how derivative instruments affect an entity’s results of operations and financial position. FAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. The impact on the Fund’s financial statement disclosures, if any, is currently being assessed.
Deferred Compensation and BlackRock Closed-End Stock Equivalent Investment Plan: Under the deferred compensation plan approved by the Fund’s Board, non-interested Directors (“Independent Directors”) defer a portion of their annual complex-wide compensation. Deferred amounts earn an approximate return as though equivalent dollar amounts have been invested in common shares of other certain BlackRock Closed-End Funds selected by the Independent Directors. This has approximately the same economic effect for the Independent Directors as if the Independent Directors had invested the deferred amounts directly in the other certain BlackRock Closed-End Funds.
The deferred compensation plan is not funded and obligations thereunder represent general unsecured claims against the general assets of the Funds. The Fund may, however, elect to invest in Common Shares of other certain BlackRock Closed-End Funds selected by the Independent Directors in order to match its deferred compensation obligations. Investments to cover the Fund’s deferred compensation liability are included in other assets on the Statement of Assets and Liabilities. Dividends and distributions from the BlackRock Closed-End Fund investments under the plan are included in income — affiliated on the Statement of Operations.
Other: Expenses directly related to the Fund are charged to that Fund. Other operating expenses shared by several funds are pro-rated among those funds on the basis of relative net assets or other appropriate methods.
2. Investment Advisory Agreement and Other Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with BlackRock Advisors, LLC (the “Advisor”), an indirect, wholly owned subsidiary of BlackRock, Inc., to provide investment advisory and administration services. Merrill Lynch & Co., Inc. (“Merrill Lynch”) and The PNC Financial Services Group, Inc. (“PNC”) are the largest stockholders of BlackRock, Inc.As of December 31, 2008, Merrill Lynch and PNC are affiliates of BlackRock, Inc.
The Advisor 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 the Advisor a monthly fee at an annual rate of 0.55% of the Fund’s average daily net assets.Average daily net assets is the average daily value of the Fund’s total assets minus the sum of its accrued liabilities.
The Advisor has agreed to waive its advisory fee by the amount of investment advisory fees the Fund pays to the Advisor indirectly through its investment in affiliated money market funds. For the six months ended December 31, 2008, the Advisor waived $50,650, which is included in fees waived by advisor on the Statement of Operations.
The Advisor has also agreed to waive its investment advisory fee based on the proceeds of Preferred Shares and TOBs that exceeds 35% of the Fund’s total net assets. For the six months ended December 31, 2008, the Advisor waived $564,484, which is included in fees waived by advisor on the Statement of Operations.
The Advisor has entered into a separate sub-advisory agreement with BlackRock Investment Management, LLC (“BIM”), an affiliate of the Advisor, under which the Advisor pays BIM for services it provides, a monthly
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16 | BLACKROCK MUNIHOLDINGS CALIFORNIA INSURED FUND, INC. | DECEMBER 31, 2008 |
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Notes to Financial Statements (continued) |
fee that is a percentage of the investment advisory fee paid by the Fund to the Advisor.
For the six months ended December 31, 2008, the Fund reimbursed the Advisor $8,014 for certain accounting services, which is included in accounting services on the Statement of Operations.
Certain officers and/or directors of the Fund are officers and/or directors of BlackRock, Inc. or its affiliates. The Fund reimburses the Advisor for compensation paid to the Fund’s Chief Compliance Officer.
3. Investments:
Purchases and sales of investments, excluding short-term securities, for the six months ended December 31, 2008 were $45,194,842 and $144,127,265, respectively.
4. Concentration, Market and Credit Risk:
The Fund invests a substantial amount of its assets in California or a limited number states. Please see the Schedule of Investments for concentrations in specific states.
Many municipalities insure repayment of their bonds, which reduces the risk of loss due to issuer default. The market value of these bonds may fluctuate for other reasons, including market perception of the value of such insurance, and there is no guarantee that the insurer will meet its obligation.
In the normal course of business, the Fund invests in securities and enters into transactions where risks exist due to fluctuations in the market (market risk) or failure of the issuer of a security to meet all its obligations (credit risk). The value of securities held by the Fund may decline in response to certain events, including those directly involving the companies whose securities are owned by the Fund; conditions affecting the general economy; overall market changes; local, regional or global political, social or economic instability; and currency and interest rate and price fluctuations. Similar to credit risk, the Fund may be exposed to counterparty risk, or the risk that an entity with which the Fund has unsettled or open transactions may default. Financial assets, which potentially expose the Fund to credit and counterparty risks, consist principally of investments and cash due from counterparties. The extent of the Fund’s exposure to credit and coun-terparty risks with respect to these financial assets is approximated by their value recorded in the Fund’s Statement of Assets and Liabilities.
5. Capital Share Transactions:
Common Shares
The Fund is authorized to issue 200,000,000 shares, including Preferred Shares, par value $0.10 per share, all of which were initially classified as Common Shares. The Board is authorized, however, to reclassify any unissued Common Shares without approval of holders of Common Shareholders.
Shares issued and outstanding during the six months ended December 31, 2008 and during the year ended June 30, 2008 remained constant.
Preferred Shares
The Preferred Shares are redeemable at the option of the Fund, in whole or in part, on any dividend payment date at $25,000 per share plus any accumulated or unpaid dividends whether or not declared. The Preferred Shares are also subject to mandatory redemption at their liquidation preference plus any accumulated or unpaid dividends, whether or not declared, if certain requirements relating to the composition of the assets and liabilities of a Fund, as set forth in the Fund’s Articles Supplementary, are not satisfied.
The holders of Preferred Shares have voting rights equal to the holders of Common Shares (one vote per share) and will vote together with holders of Common Shares (one vote per share) as a single class. However, the holders of Preferred Shares, voting as a separate class, are also entitled to elect two Directors for the Fund. In addition, the 1940 Act requires that along with approval by shareholders that might otherwise be required, the approval of the holders of a majority of any outstanding Preferred Shares, voting separately as a class would be required to (a) adopt any plan of reorganization that would adversely affect the Preferred Shares, (b) change the Fund’s subclassification as a closed-end investment company or change its fundamental investment restrictions or (c) change its business so as to cease to be an investment company.
The Fund had the following series of Preferred Shares outstanding and effective yields at December 31, 2008:
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Series | | Shares | | Yield | |
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A | | | 1,415 | | | 1.721 | % |
B | | | 2,859 | | | 1.721 | % |
C | | | 2,358 | | | 1.752 | % |
D | | | 2,181 | | | 1.752 | % |
E | | | 2,682 | | | 1.432 | % |
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Dividends on seven-day Preferred Shares are cumulative at a rate, which is reset every seven days based on the results of an auction. Dividends on 28 day Preferred Shares are cumulative at a rate which is reset every 28 days based on the results of an auction. If the Preferred Shares fail to clear the auction on an auction date, the Fund is required to pay the maximum applicable rate on the Preferred Shares to holders of such shares for each successive dividend period until such time as the shares are successfully auctioned. The maximum applicable rate on the Preferred Shares is the higher of 110% of the AA commercial paper rate or 110% of 90% of the Kenny S&P 30-day High Grade Index rate divided by 1.00 minus the
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BLACKROCK MUNIHOLDINGS CALIFORNIA INSURED FUND, INC. | DECEMBER 31, 2008 | 17 |
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Notes to Financial Statements (concluded) |
marginal tax rate. The low, high and average dividend rates on the Preferred Shares of the Fund for the six months ended December 31, 2008 were as follows:
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Series | | Low | | High | | Average | |
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A | | | 1.097 | % | | 10.205 | % | | 3.413 | % |
B | | | 1.142 | % | | 11.728 | % | | 3.408 | % |
C | | | 1.142 | % | | 12.261 | % | | 3.434 | % |
D | | | 1.173 | % | | 12.565 | % | | 3.445 | % |
E | | | 1.142 | % | | 11.347 | % | | 3.409 | % |
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Since February 13, 2008, the Preferred Shares of the Fund failed to clear any auctions.As a result, the Preferred Shares dividend rates were reset to the maximum applicable rate, which ranged from 1.097% to 12.565%. A failed auction is not an event of default for the Fund but it has a negative impact on the liquidity of Preferred Shares.A failed auction occurs when there are more sellers of a fund’s auction rate preferred shares than buyers. It is impossible to predict how long this imbalance will last.A successful auction for the Fund’s Preferred Shares may not occur for some time, if ever, and even if liquidity does resume, holders of Preferred Shares may not have the ability to sell the Preferred Shares at its liquidation preference.
The Fund may not declare dividends or make other distributions on Common Shares or purchase any such shares if, at the time of the declaration, distribution or purchase, asset coverage with respect to the outstanding Preferred Shares is less than 200%.
The Fund pays commissions to certain broker-dealers at the end of each auction at an annual rate of 0.25%, calculated on the aggregated principal amount. In December 2008, commissions paid to broker-dealers on preferred shares that experience a failed auction were reduced to 0.15% on the aggregate principal amount. The Fund will continue to pay commissions of 0.25% on the aggregate principal amount of all shares that successfully clear their auctions. For the six months ended December 31, 2008, Merrill Lynch, Pierce, Fenner & Smith Incorporated, a wholly owned subsidiary of Merrill Lynch, earned commissions of $108,782.
Shares issued and outstanding during the six months ended December 31, 2008 remained constant.
During the year ended June 30, 2008, the Fund announced the following redemptions of Preferred Shares at a price of $25,000 per share plus any accrued and unpaid dividends through the redemption date:
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Series | | Redemption
Date | | Shares
Redeemed | | Aggregate
Principal | |
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A | | | 6/24/2008 | | 505 | | | $ | 12,625,000 | |
B | | | 6/23/2008 | | 1,021 | | | $ | 25,525,000 | |
C | | | 6/27/2008 | | 842 | | | $ | 21,050,000 | |
D | | | 6/26/2008 | | 779 | | | $ | 19,475,000 | |
E | | | 6/25/2008 | | 958 | | | $ | 23,950,000 | |
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The Fund financed the Preferred Share redemptions with cash received from TOB transactions.
6. Capital Loss Carryforward:
As of June 30, 2008, the Fund had a capital loss carryforward available to offset future realized capital gains through the indicated year of expiration:
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Expires June 30, | | | |
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2009 | | $ | 21,432,179 | |
2012 | | | 3,107,367 | |
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Total | | $ | 24,539,546 | |
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7. Subsequent Events:
The Fund paid a net investment income dividend to holders of Common Shares in the amount of $0.053 per share on February 2, 2009 to shareholders of record on January 15, 2009.
The dividends declared on Preferred Shares for the period January 1, 2009 to January 31, 2009 were as follows:
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Series | | Dividends
Declared | |
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A | | $ | 3,809 | |
B | | $ | 8,978 | |
C | | $ | 10,874 | |
D | | $ | 4,458 | |
E | | $ | 6,714 | |
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On January 1, 2009, Bank of America Corporation announced that it had completed its acquisition of Merrill Lynch, one of the largest stockholders of BlackRock, Inc.
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18 | BLACKROCK MUNIHOLDINGS CALIFORNIA INSURED FUND, INC. | DECEMBER 31, 2008 |
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Officers and Directors |
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Richard E. Cavanagh, Chairman of the Board and Director |
Karen P. Robards, Vice Chair of the Board, Chair of the Audit Committee and Director |
G. Nicholas Beckwith, III, Director |
Richard S. Davis, Director |
Kent Dixon, Director |
Frank J. Fabozzi, Director |
Kathleen F. Feldstein, Director |
James T. Flynn, Director |
Henry Gabbay, Director |
Jerrold B. Harris, Director |
R. Glenn Hubbard, Director |
W. Carl Kester, Director |
Robert S. Salomon, Jr., Director |
Donald C. Burke, Company President and Chief Executive Officer |
Anne F. Ackerley, Vice President |
Neal J. Andrews, Chief Financial Officer |
Jay M. Fife, Treasurer |
Brian P. Kindelan, Chief Compliance Officer of the Fund |
Howard B. Surloff, Secretary |
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Custodian |
The Bank of New York Mellon |
New York, NY 10286 |
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Transfer Agent |
Common and Auction Market Preferred Shares: |
BNY Mellon Shareowner Services |
Jersey City, NJ 07310 |
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Accounting Agent |
State Street Bank and Trust Company |
Princeton, NJ 08540 |
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Independent Registered Public Accounting Firm |
Deloitte & Touche LLP |
Princeton, NJ 08540 |
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Legal Counsel |
Skadden, Arps, Slate, Meagher & Flom LLP |
New York, NY 10036 |
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| Effective January 1, 2009, Robert S. Salomon, Jr. retired as Director of the Fund.
The Board of Directors wishes Mr. Salomon well in his retirement. | |
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BLACKROCK MUNIHOLDINGS CALIFORNIA INSURED FUND, INC. | DECEMBER 31, 2008 | 19 |
The Annual Meeting of Shareholders was held on September 12, 2008 for shareholders of record on July 14, 2008, to elect director nominees of the Fund:
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| | | Votes For | | Votes Withheld | |
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Approved the Directors as follows: | G. Nicholas Beckwith, III | | 36,265,360 | | 1,250,785 | |
| Kent Dixon | | 36,245,364 | | 1,270,781 | |
| R. Glenn Hubbard | | 36,256,956 | | 1,259,189 | |
| W. Carl Kester | | 5,032 | 1 | 2,293 | 1 |
| Robert S. Salomon, Jr. | | 36,263,064 | | 1,253,081 | |
| Richard S. Davis | | 36,249,052 | | 1,267,093 | |
| Frank J. Fabozzi | | 5,032 | 1 | 2,293 | 1 |
| James T. Flynn | | 36,260,339 | | 1,255,806 | |
| Karen P. Robards | | 36,267,003 | | 1,249,142 | |
| Richard E. Cavanagh | | 36,265,360 | | 1,250,785 | |
| Kathleen F. Feldstein | | 36,267,003 | | 1,249,142 | |
| Henry Gabbay | | 36,245,860 | | 1,270,285 | |
| Jerrold B. Harris | | 36,265,360 | | 1,250,785 | |
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1 Voted on by holders of Preferred Shares only. | | | | |
The Fund’s dividend policy is to distribute all or a portion of its net investment income to its shareholders on a monthly basis. In order to provide shareholders with a more stable level of dividend distributions, the Fund may at times pay out less than the entire amount of net investment income earned in any particular month and may at times in any particular month pay out such accumulated but undistributed income in addition to net investment income earned in that month. As a result, the dividends paid by the Fund for any particular month may be more or less than the amount of net investment income earned by the Fund during such month. The Fund’s current accumulated but undistributed net investment income, if any, is disclosed in the Statement of Assets and Liabilities, which comprises part of the financial information included in this report.
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Availability of Quarterly Schedule of Investments |
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The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the SEC’s website at http://www.sec.gov and may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. The Fund’s Forms N-Q may also be obtained upon request and without charge by calling (800) 441-7762.
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20 | BLACKROCK MUNIHOLDINGS CALIFORNIA INSURED FUND, INC. | DECEMBER 31, 2008 |
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Additional Information (continued) |
The Fund will mail only one copy of shareholder documents, including annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called “householding” and it is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact the Fund at (800) 441-7762.
Quarterly performance, semi-annual and annual reports and other information regarding the Fund may be found on BlackRock’s website, which can be accessed at http://www.blackrock.com. This reference to BlackRock’s website is intended to allow investors public access to information regarding the Fund and does not, and is not intended to, incorporate BlackRock’s website into this report.
Electronic copies of most financial reports are available on the Fund’s website or shareholders can sign up for e-mail notifications of quarterly statements, annual and semi-annual reports by enrolling in the Fund’s electronic delivery program.
Shareholders Who Hold Accounts with Investment Advisors, Banks or Brokerages:
Please contact your financial advisor to enroll. Please note that not all investment advisors, banks or brokerages may offer this service.
Effective September 13, 2008, following approval by the Fund’s Board and the applicable rating agencies, the Board amended the terms of the Fund’s Preferred Shares in order to allow the Fund to enter into TOB transactions, the proceeds of which were used to redeem a portion of the Fund’s Preferred Shares. Accordingly, the definition of Inverse Floaters was amended to incorporate the Fund’s permissable ratio of floating rate instruments into inverse floating rate instruments. Additionally, conforming changes and certain formula modifications concerning inverse floaters were made to the definitions of Moody’s Discount Factor and S&P Discount Factor, as applicable, to integrate the Fund’s investments in TOBs into applicable calculations.
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BLACKROCK MUNIHOLDINGS CALIFORNIA INSURED FUND, INC. | DECEMBER 31, 2008 | 21 |
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Additional Information (concluded) |
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BlackRock Privacy Principles |
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BlackRock is committed to maintaining the privacy of its current and former fund investors and individual clients (collectively, “Clients”) and to safeguarding their non-public personal information. The following information is provided to help you understand what personal information BlackRock collects, how we protect that information and why in certain cases we share such information with select parties.
If you are located in a jurisdiction where specific laws, rules or regulations require BlackRock to provide you with additional or different privacy-related rights beyond what is set forth below, then BlackRock will comply with those specific laws, rules or regulations.
BlackRock obtains or verifies personal non-public information from and about you from different sources, including the following: (i) information we receive from you or, if applicable, your financial intermediary, on applications, forms or other documents; (ii) information about your transactions with us, our affiliates, or others; (iii) information we receive from a consumer reporting agency; and (iv) from visits to our websites.
BlackRock does not sell or disclose to non-affiliated third parties any non-public personal information about its Clients, except as permitted by law or as is necessary to respond to regulatory requests or to service Client accounts. These non-affiliated third parties are required to protect the confidentiality and security of this information and to use it only for its intended purpose.
We may share information with our affiliates to service your account or to provide you with information about other BlackRock products or services that may be of interest to you. In addition, BlackRock restricts access to non-public personal information about its Clients to those BlackRock employees with a legitimate business need for the information. BlackRock maintains physical, electronic and procedural safeguards that are designed to protect the non-public personal information of its Clients, including procedures relating to the proper storage and disposal of such information.
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22 | BLACKROCK MUNIHOLDINGS CALIFORNIA INSURED FUND, INC. | DECEMBER 31, 2008 |
This report is transmitted to shareholders only. It is not a prospectus. Past performance results shown in this report should not be considered a representation of future performance. The Fund has leveraged its Common Shares, which creates risks for Common Shareholders, including the likelihood of greater volatility of net asset value and market price of shares of the Common Shares and the risk that fluctuations in the short-term dividend rates of the Preferred Shares, currently set at the maximum reset rate as a result of failed auctions, may affect the yield to Common Shareholders. Statements and other information herein are as dated and are subject to change.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available (1) without charge, upon request, by calling toll-free (800) 441-7762; (2) at www.blackrock.com; and (3) on the Securities and Exchange Commission’s website at http://www.sec.gov. Information about how the Fund voted proxies relating to securities held in the Fund’s portfolio during the most recent 12-month period ended June 30 is available upon request and without charge (1) at www.blackrock.com or by calling (800) 441-7762 and (2) on the Securities and Exchange Commission’s website at http://www.sec.gov.
BlackRock MuniHoldings California Insured Fund, Inc.
100 Bellevue Parkway
Wilmington, DE 19809
# HOLDCA-12/08
| Item 2 – | Code of Ethics – Not Applicable to this semi-annual report |
Item 3 – | Audit Committee Financial Expert – Not Applicable to this semi-annual report |
| Item 4 – | Principal Accountant Fees and Services – Not Applicable to this semi-annual report |
Item 5 – | Audit Committee of Listed Registrants – Not Applicable to this semi-annual report |
| Item 6 – | Investments
(a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this form.
(b) Not Applicable due to no such divestments during the semi-annual period covered since the previous Form N-CSR filing. |
| Item 7 – | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – Not Applicable to this semi-annual report |
| Item 8 – | Portfolio Managers of Closed-End Management Investment Companies – Not Applicable to this semi-annual report |
| Item 9 – | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable |
| Item 10 – | Submission of Matters to a Vote of Security Holders – The registrant’s Nominating and Governance Committee will consider nominees to the board of directors recommended by shareholders when a vacancy becomes available. Shareholders who wish to recommend a nominee should send nominations that include biographical information and set forth the qualifications of the proposed nominee to the registrant’s Secretary. There have been no material changes to these procedures. |
| Item 11 – | Controls and Procedures |
| 11(a) – | The registrant’s principal executive and principal financial officers or persons performing similar functions have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13(a)-15(b) under the Securities Exchange Act of 1934, as amended. |
| 11(b) – | There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
| Item 12 – | Exhibits attached hereto |
| 12(a)(1) – | Code of Ethics – Not Applicable to this semi-annual report |
| 12(a)(2) – | Certifications – Attached hereto |
| 12(a)(3) – | Not Applicable |
12(b) – | Certifications – Attached hereto |
| | 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. |
| | BlackRock MuniHoldings California Insured Fund, Inc. |
| | By: | /s/ Donald C. Burke | |
| | | Donald C. Burke |
| | | Chief Executive Officer of |
| | | BlackRock MuniHoldings California Insured Fund, Inc. |
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| | Date: February 23, 2009 |
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| | Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. |
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| | By: | /s/ Donald C. Burke | |
| | | Donald C. Burke |
| | | Chief Executive Officer (principal executive officer) of |
| | | BlackRock MuniHoldings California Insured Fund, Inc. |
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| | Date: February 23, 2009 |
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| | By: | /s/ Neal J. Andrews | |
| | | Neal J. Andrews |
| | | Chief Financial Officer (principal financial officer) of |
| | | BlackRock MuniHoldings California Insured Fund, Inc. |
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| | Date: February 23, 2009 |
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