UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-06434

Morgan Stanley Insured Municipal 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: April 30, 2005

Item 1 - Report to Shareholders

Welcome, Shareholder:

In this report, you'll learn about how your investment in Morgan Stanley Insured
Municipal Trust performed during the semiannual period. We will provide an
overview of the market conditions, and discuss some of the factors that affected
performance during the reporting period. In addition, this report includes the
Trust's financial statements and a list of Trust investments.

MARKET FORECASTS PROVIDED IN THIS REPORT MAY NOT NECESSARILY COME TO PASS. THERE
IS NO ASSURANCE THAT THE TRUST WILL ACHIEVE ITS INVESTMENT OBJECTIVE. THE TRUST
IS SUBJECT TO MARKET RISK, WHICH IS THE POSSIBILITY THAT MARKET VALUES OF
SECURITIES OWNED BY THE TRUST WILL DECLINE AND, THEREFORE, THE VALUE OF THE
TRUST'S SHARES MAY BE LESS THAN WHAT YOU PAID FOR THEM. ACCORDINGLY, YOU CAN
LOSE MONEY INVESTING IN THIS TRUST.

FUND REPORT

For the six-month period ended April 30, 2005

MARKET CONDITIONS

Consumer spending and business investment helped the U.S. economy expand at a
solid pace. This, in turn, translated into generally higher interest rates
during the six-month fiscal period ended April 30, 2005. The markets also
continued to focus on global commodity supply pressures, specifically the rapid
climb in oil prices and the large federal budget and trade deficits. However,
employment growth remained uneven and bonds often rallied on weaker than
anticipated monthly reports.

The Federal Open Market Committee (the "Fed") reaffirmed its pledge to raise the
federal funds target rate at a "measured" pace and did so in its meetings
throughout the period. The Fed's policy shift began in June 2004 with the first
of seven consecutive 25-basis point rate hikes which took the federal funds
target rate to 2.75 percent by the end of April 2005. These increases
represented a reversal of the Fed's rate reductions between January 2001 and
June 2003. At the end of the period, the forward yield curve reflected a
widespread view that the Fed would continue its current pace of rate increases.

Against this setting, long-term municipal bond yields remained in a trading
range which moved rates higher at the beginning of the period, lower through the
winter and higher at the end of the first quarter. By the end of April, yields
declined again and ended the fiscal period at or near their lows. In contrast,
yields on shorter maturity bonds which were more directly impacted by the Fed's
actions rose. As a result, the municipal yield curve continued to flatten and
the yield spread (or differential between one-year rates and 30-year rates)
narrowed.

In the first four months of 2005, total municipal underwriting volume increased
by nine percent over the same period in 2004. Refunding issues accounted for the
incremental growth. Bonds backed by insurance increased their market penetration
from 50 to 60 percent over the same period. Issuers in California, Texas, New
York, Florida and New Jersey accounted for 32 percent of the total municipal
underwriting volume.

On the demand side, the municipal-to-Treasury yield ratio, which gauges relative
performance between the two markets, remained attractive for tax-exempts. As a
result, fixed income investors that normally focus on taxable sectors (such as
insurance companies and hedge funds) supported municipals by "crossing over" to
purchase bonds. However, retail investors continued to experience rate shock
from the absolute level of rates and largely remained on the sidelines.

PERFORMANCE ANALYSIS

For the six-month period ended April 30, 2005, the net asset value (NAV) of the
Morgan Stanley Insured Municipal Trust (IMT) increased from $15.49 to $15.51 per
share. Based on this increase plus reinvestment of tax-free dividends totaling
$0.405 per share the Trust's total NAV return was 3.11 percent. IMT's value on
the New York Stock Exchange (NYSE) moved from $13.88 to $13.80 per share during
the same period. Based on this change plus reinvestment of tax-free dividends,
IMT's total market return was 2.39 percent. On April 30, 2005, IMT's NYSE market
price was at an 11.03 percent discount to its NAV. Past performance is no
guarantee of future results.

Monthly dividends for the second quarter of 2005, declared in March, were
unchanged at $0.0675 per share. The dividend reflects the current level of the
Trust's net investment income. IMT's level of undistributed net investment
income was $0.11 per

share on April 30, 2005, versus $0.076 per share six months earlier.(1)

During the period, IMT maintained a conservative strategy in anticipation of
continued Fed tightening and higher interest rates. Adjusted for leverage, the
Trust's duration* (a measure of interest rates sensitivity) was 9.7 years. This
positioning helped performance early in the period when rates rose, but had the
net effect of hampering total returns when rates declined later in the period.
The Trust's net assets, including preferred shares, of $423 million were
diversified across 76 credits in 13 long-term sectors.

As discussed in previous reports, the total income available for distribution to
holders of common shares includes incremental income provided by the Trust's
outstanding Auction Rate Preferred Shares (ARPS). ARPS dividends reflect
prevailing short-term interest rates on maturities ranging from one week to two
years. Incremental income to holders of common shares depends on two factors:
the amount of ARPS outstanding and the spread between the portfolio's cost yield
and its ARPS auction rate and expenses. The greater the spread and the higher
the amount of ARPS outstanding, the greater the amount of incremental income
available for distribution to holders of common shares. The level of net
investment income available for distribution to holders of common shares varies
with the level of short-term interest rates. ARPS leverage also increases the
price volatility of common shares and has the effect of extending portfolio
duration.

During this six-month period, ARPS leverage contributed approximately $0.09 per
share to common-share earnings. The Trust has two ARPS series totaling $130
million, representing 31 percent of net assets, including preferred shares. The
yield on the series in two-year auction mode was 1.54 percent weekly yields
ranging from 1.649 to 2.80 percent.

The Trust's procedure for reinvesting all dividends and distributions in common
shares is through purchases in the open market. This method helps support the
market value of the Trust's shares. In addition, we would like to remind you
that the Trustees have approved a procedure whereby the Trust may, when
appropriate, purchase shares in the open market or in privately negotiated
transactions at a price not above market value or net asset value, whichever is
lower at the time of purchase. The Trust may also utilize procedures to reduce
or eliminate the amount of ARPS outstanding, including their purchase in the
open market or in privately negotiated transactions. During the six-month period
ended April 30, 2005, the Trust purchased and retired 483,059 shares of common
shares at a weighted average market discount of 11.37 percent.
- --------------------------------------------------------------------------------
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. INVESTMENT RETURN, NET ASSET VALUE AND COMMON SHARE MARKET PRICE WILL
FLUCTUATE AND TRUST SHARES, WHEN SOLD, MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST.

* A measure of the sensitivity of a bond's price to changes in interest rates,
expressed in years. Each year of duration represents an expected 1 percent
change in the price of a bond for every 1 percent change in interest rates. The
longer a bond's duration, the greater the effect of interest-rate movements on
its price. Typically, trusts with shorter durations perform better in
rising-interest-rate environments, while trusts with longer durations perform
better when rates decline.

There is no guarantee that any sectors mentioned will continue to perform well
or be held by the Trust in the future.

(1) Income earned by certain securities in the portfolio may be subject to the
federal alternative tax (AMT).

<Table>
<Caption>
LARGEST SECTORS

Water and Sewer 32.7%
Transportation 26.5%
General Obligation 23.6%
Electric 14.1%
Refunded 12.3%
</Table>

<Table>
<Caption>
LONG-TERM CREDIT ENHANCEMENTS

Ambac 30.0%
MBIA 26.7%
FSA 22.7%
FGIC 20.6%
</Table>

Data as of April 30, 2005. Subject to change daily. All percentages for largest
sectors are as a percentage of net assets applicable to common shareholders. All
percentages for long-term credit enhancements are as a percentage of total
long-term investments. These data are provided for informational purposes only
and should not be deemed a recommendation to buy or sell the securities
mentioned. Morgan Stanley is a full-service securities firm engaged in
securities trading and brokerage activities, investment banking, research and
analysis, financing and financial advisory services.

FOR MORE INFORMATION
ABOUT PORTFOLIO HOLDINGS

EACH MORGAN STANLEY TRUST PROVIDES A COMPLETE SCHEDULE OF PORTFOLIO HOLDINGS IN
ITS SEMIANNUAL AND ANNUAL REPORTS WITHIN 60 DAYS OF THE END OF THE TRUST'S
SECOND AND FOURTH FISCAL QUARTERS BY FILING THE SCHEDULE ELECTRONICALLY WITH THE
SECURITIES AND EXCHANGE COMMISSION (SEC). THE SEMIANNUAL REPORTS ARE FILED ON
FORM N-CSRS AND THE ANNUAL REPORTS ARE FILED ON FORM N-CSR. MORGAN STANLEY ALSO
DELIVERS THE SEMIANNUAL AND ANNUAL REPORTS TO TRUST SHAREHOLDERS AND MAKES THESE
REPORTS AVAILABLE ON ITS PUBLIC WEB SITE, WWW.MORGANSTANLEY.COM. EACH MORGAN
STANLEY TRUST ALSO FILES A COMPLETE SCHEDULE OF PORTFOLIO HOLDINGS WITH THE SEC
FOR THE TRUST'S FIRST AND THIRD FISCAL QUARTERS ON FORM N-Q. MORGAN STANLEY DOES
NOT DELIVER THE REPORTS FOR THE FIRST AND THIRD FISCAL QUARTERS TO SHAREHOLDERS,
NOR ARE THE REPORTS POSTED TO THE MORGAN STANLEY PUBLIC WEB SITE. YOU MAY,
HOWEVER, OBTAIN THE FORM N-Q FILINGS (AS WELL AS THE FORM N-CSR AND N-CSRS
FILINGS) BY ACCESSING THE SEC'S WEB SITE, HTTP://WWW.SEC.GOV. YOU MAY ALSO
REVIEW AND COPY THEM AT THE SEC'S PUBLIC REFERENCE ROOM IN WASHINGTON, DC.
INFORMATION ON THE OPERATION OF THE SEC'S PUBLIC REFERENCE ROOM MAY BE OBTAINED
BY CALLING THE SEC AT (800) SEC-0330. YOU CAN ALSO REQUEST COPIES OF THESE
MATERIALS, UPON PAYMENT OF A DUPLICATING FEE, BY ELECTRONIC REQUEST AT THE SEC'S
E-MAIL ADDRESS (PUBLICINFO@SEC.GOV) OR BY WRITING THE PUBLIC REFERENCE SECTION
OF THE SEC, WASHINGTON, DC 20549-0102.

DISTRIBUTION BY MATURITY
(% of Long-Term Portfolio) As of April 30, 2005

WEIGHTED AVERAGE MATURITY: 17 YEARS(A)

<Table>

1-5 11
5-10 9
10-15 25
15-20 17
20-25 15
25-30 22
30+ 1
</Table>

(a) Where applicable maturities reflect mandatory tenders, puts and call dates.
Portfolio structure is subject to change.

Geographic Summary of Investments
Based on Market Value as a Percent of Total Investments

April 30, 2005 (unaudited)

<Table>

Alaska.................... 2.1%
Arizona................... 0.7
California................ 6.3
Colorado.................. 4.6
Delaware.................. 3.6
Florida................... 4.2
Georgia................... 3.0
Hawaii.................... 5.0
Idaho..................... 2.8
Illinois.................. 9.7
Indiana................... 1.2
Iowa...................... 1.6%
Kentucky.................. 3.5
Louisiana................. 0.5
Maryland.................. 0.6
Massachusetts............. 1.3
Michigan.................. 2.5
Minnesota................. 3.0
Missouri.................. 1.3
Montana................... 0.6
Nevada.................... 2.9
New Jersey................ 4.7
New Mexico................ 0.4%
New York.................. 6.7
North Carolina............ 1.1
Ohio...................... 2.5
Pennsylvania.............. 2.7
South Carolina............ 4.3
Texas..................... 9.6
Utah...................... 0.8
Virginia.................. 1.5
Washington................ 4.7
Joint exemption*.......... 0.0
-----
Total+.................... 100.0%
=====
</Table>

- ------------------

* Joint exemptions have been included in each geographic location.

+ Does not include open short futures contracts with an underlying face amount
of $54,523,440 with unrealized depreciation of $209,191.

CALL AND COST (BOOK) YIELD STRUCTURE
(Based on Long-Term Portfolio) As of April 30, 2005

YEARS OF BONDS CALLABLE -- WEIGHTED AVERAGE CALL PROTECTION: 7 YEARS

<Table>

2005(a) 1
2006 6
2007 2
2008 0
2009 7
2010 15
2011 19
2012 15
2013 6
2014 11
2015+ 16
</Table>

COST (BOOK) YIELD(B) -- WEIGHTED AVERAGE BOOK YIELD: 5.3%

<Table>

2005(a) 6.5
2006 6.6
2007 5.3
2008 0.0
2009 5.8
2010 5.7
2011 5.4
2012 4.8
2013 4.9
2014 4.9
2015+ 5.0
</Table>

(a) May include issues initially callable in previous years.

(b) Cost or "book" yield is the annual income earned on a portfolio investment
based on its original purchase price before the Trust's operating expenses.
For example, the Trust is earning a book yield of 6.5% on 1% of the
long-term portfolio that is callable in 2005.

Portfolio structure is subject to change.

INVESTMENT ADVISORY AGREEMENT APPROVAL

NATURE, EXTENT AND QUALITY OF SERVICES

The Board reviewed and considered the nature and extent of the investment
advisory services provided by the Investment Adviser under the Advisory
Agreement, including portfolio management, investment research and fixed income
securities trading. The Board also reviewed and considered the nature and extent
of the non-advisory, administrative services provided by the Trust's
Administrator under the Administration Agreement, including accounting,
clerical, bookkeeping, compliance, business management and planning, and the
provision of supplies, office space and utilities at the Adviser's expense. (The
Investment Adviser and the Administrator together are referred to as the
"Adviser" and the Advisory and Administration Agreements together are referred
to as the "Management Agreement.") The Board also compared the nature of the
services provided by the Adviser with similar services provided by
non-affiliated advisers as reported to the Board by Lipper Inc. ("Lipper").

The Board reviewed and considered the qualifications of the portfolio managers,
the senior administrative managers and other key personnel of the Adviser who
provide the administrative and investment advisory services to the Trust. The
Board determined that the Adviser's portfolio managers and key personnel are
well qualified by education and/or training and experience to perform the
services in an efficient and professional manner. The Board concluded that the
nature and extent of the advisory and administrative services provided were
necessary and appropriate for the conduct of the business and investment
activities of the Trust. The Board also concluded that the overall quality of
the advisory and administrative services was satisfactory.

PERFORMANCE RELATIVE TO COMPARABLE FUNDS MANAGED BY OTHER ADVISERS

The Board reviewed the Trust's performance for one, three and five year periods
ended November 30, 2004, as shown in reports provided by Lipper (the "Lipper
Reports"), compared to the performance of comparable funds selected by Lipper
(the "performance peer group"), and noted that the Trust's performance was lower
than its performance peer group average for the one and five year periods, but
better for the three year period. The Board noted that performance was only
slightly lower than the peer group average for the one year period and concluded
that the Trust's overall performance was satisfactory.

FEES RELATIVE TO OTHER FUNDS MANAGED BY THE ADVISER WITH COMPARABLE INVESTMENT
STRATEGIES

The Board reviewed the advisory and administrative fees (together, the
"management fee") paid by the Trust under the Management Agreement. The Board
noted that the rate was comparable to the management fee rates charged by the
Adviser to any other funds it manages with investment strategies comparable to
those of the Trust.

FEES AND EXPENSES RELATIVE TO COMPARABLE FUNDS MANAGED BY OTHER ADVISERS

The Board reviewed the management fee rate and total expense ratio of the Trust.
The Board noted that: (i) the Trust's management fee rate was lower than the
average management fee rate for funds, selected by Lipper (the "expense peer
group"), managed by other advisers, with investment strategies comparable to
those of the Trust, as shown in the Lipper Report for the Trust; and (ii) the
Trust's total expense ratio was also lower than the average total expense ratio
of the trusts included in the Trust's expense peer group. The Board concluded
that the Trust's management fee and total expenses were competitive with those
of the Trust's expense peer group.

BREAKPOINTS AND ECONOMIES OF SCALE

The Board reviewed the structure of the Trust's management fee schedule under
the Management Agreement and noted that it does not include any breakpoints. The
Board considered that the Trust is closed-end and is not a growth trust and,
therefore, that the Trust's assets are not likely to grow with new sales or grow
significantly as a result of capital appreciation. The Board concluded that
economies of scale for this Trust were not a factor that needed to be
considered.

PROFITABILITY OF ADVISER AND AFFILIATES

The Board considered and reviewed information concerning the costs incurred and
profits realized by the Adviser and its affiliates during the last two years
from their relationship with the Trust and the Morgan Stanley Fund Complex and
reviewed with the Controller of the Adviser the cost allocation methodology used
to determine the Adviser's profitability. Based on their review of the
information they received, the Board concluded that the profits earned by the
Adviser and its affiliates were not excessive in light of the advisory,
administrative and other services provided to the Trust.

FALL-OUT BENEFITS

The Board considered so-called "fall-out benefits" derived by the Adviser and
its affiliates from their relationship with the Trust and the Fund Complex, such
as "float" benefits derived from handling of checks for purchases and sales of
Trust shares through a broker-dealer affiliate of the Adviser. The Board
considered the float benefits and concluded that they were relatively small.

SOFT DOLLAR BENEFITS

The Board considered whether the Adviser realizes any benefits from commissions
paid to brokers who execute securities transactions for the Fund ("soft
dollars"). The Board noted that the Trust invests only in fixed income
securities, which do not generate soft dollars.

ADVISER FINANCIALLY SOUND AND FINANCIALLY CAPABLE OF MEETING THE TRUST'S NEEDS

The Board considered whether the Adviser is financially sound and has the
resources necessary to perform its obligations under the Management Agreement.
The Board noted that the Adviser's operations remain profitable, although
increased expenses in recent years have reduced the Adviser's profitability. The
Board concluded that the Adviser has the financial resources necessary to
fulfill its obligations under the Management Agreement.

HISTORICAL RELATIONSHIP BETWEEN THE TRUST AND THE ADVISER

The Board also reviewed and considered the historical relationship between the
Trust and the Adviser, including the organizational structure of the Adviser,
the policies and procedures formulated and adopted by the Adviser for managing
the Trust's operations and the Board's confidence in the competence and
integrity of the senior managers and key personnel of the Adviser. The Board
concluded that it is beneficial for the Trust to continue its relationship with
the Adviser.

OTHER FACTORS AND CURRENT TRENDS

The Board considered the controls and procedures adopted and implemented by the
Adviser and monitored by the Trust's Chief Compliance Officer and concluded that
the conduct of business by the Adviser indicates a good faith effort on its part
to adhere to high ethical standards in the conduct of the Trust's business.

GENERAL CONCLUSION

After considering and weighing all of the above factors, the Board concluded it
would be in the best interest of the Trust and its shareholders to approve
renewal of the Management Agreement for another year.

Morgan Stanley Insured Municipal Trust
PORTFOLIO OF INVESTMENTS - APRIL 30, 2005 (UNAUDITED)

<Table>
<Caption>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- -------------------------------------------------------------------------------------------------------------

Tax-Exempt Municipal Bonds (139.7%)
General Obligation (23.6%)
$ 10,000 North Slope Borough, Alaska, Ser 2000 B (MBIA)........... 0.00 % 06/30/10 $ 8,328,300
3,000 Los Angeles, California, Ser 2004 A (MBIA)............... 5.00 09/01/24 3,201,570
3,000 San Diego Unified School District, California, Ser 2003 E
(FSA).................................................. 5.25 07/01/23 3,368,880
3,000 Florida Board of Education, Capital Outlay Refg 2002 Ser
C (MBIA)............................................... 5.00 06/01/20 3,233,100
Honolulu City & County, Hawaii,
2,500 ROLS RR II R 237-2 (MBIA).............................. 7.386+++ 03/01/25 2,974,775
2,500 ROLS RR II R 237-3 (MBIA).............................. 7.386+++ 03/01/26 2,842,125
Chicago, Illinois,
8,000 Refg Ser 1992 (Ambac).................................. 6.25 01/01/11 9,050,880
2,000 Refg 2001 A (MBIA)..................................... 0.00++ 01/01/21 1,657,260
2,000 Refg 2001 A (MBIA)..................................... 0.00++ 01/01/22 1,650,440
Illinois,
10,000 Ser 2001 (MBIA)........................................ 5.375 04/01/15 11,322,500
10,000 Ser 2001 (MBIA)........................................ 5.375 04/01/16 11,306,100
3,000 Brainerd Independent School District 181, Minnesota, Ser
2002 A (FGIC).......................................... 5.375% 02/01/18 3,312,000
4,000 Clark County, Nevada, Transportation Impr Ltd Tax Ser
06/01/92 B (Ambac)..................................... 6.50 06/01/17 4,957,480
1,880 King County, Washington, Refg 1998 Ser B (MBIA).......... 5.25 01/01/34 1,976,331
-------------
- --------
69,181,741
64,880
-------------
- --------
Educational Facilities Revenue (5.2%)
2,000 Arizona Board of Regents, Arizona State University Ser
2004 COPs (Ambac)...................................... 5.00 09/01/30 2,103,180
2,000 University of California, Multiple Purpose Ser Q (FSA)... 5.00 09/01/31 2,092,680
Fulton County Development Authority, Georgia,
900 Morehouse College Ser 2000 (Ambac)..................... 6.25 12/01/21 1,036,485
1,700 Morehouse College Ser 2000 (Ambac)..................... 5.875 12/01/30 1,906,244
2,500 University of North Carolina, Ser 2000 (Ambac)........... 5.25 10/01/20 2,710,375
2,000 University of North Carolina at Wilmington, Student
Housing Ser 2005 COPs (FGIC)........................... 5.00 06/01/36 2,091,360
3,000 Utah Board of Regents, University of Utah - Huntsman
Cancer Institute Refg Ser 2000 A (MBIA)................ 5.50 04/01/18 3,305,070
-------------
- --------
15,245,394
14,100
-------------
- --------
Electric Revenue (14.1%)
5,000 California Department of Water Resources, Power Supply
Ser 2002 A (Ambac)..................................... 5.375 05/01/18 5,556,250
2,000 Indiana Municipal Power Agency, Power Supply 2004 Ser A
(FGIC)................................................. 5.00 01/01/32 2,094,380
</Table>

10
See Notes to Financial Statements

Morgan Stanley Insured Municipal Trust
PORTFOLIO OF INVESTMENTS - APRIL 30, 2005 (UNAUDITED) continued

<Table>
<Caption>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- -------------------------------------------------------------------------------------------------------------

South Carolina Public Service Authority,
$ 9,325 Ser 2002 B (FSA)....................................... 5.375% 01/01/17 $ 10,237,638
2,000 2003 Ser A (Ambac)..................................... 5.00 01/01/27 2,097,600
10,000 Lower Colorado River Authority, Texas, Refg Ser 1999 A
(FSA).................................................. 5.875 05/15/16 11,074,900
10,000 Seattle, Washington, Light & Power Refg Rev 2001 (FSA)... 5.125 03/01/26 10,388,500
-------------
- --------
41,449,268
38,325
-------------
- --------
Hospital Revenue (7.0%)
3,000 Indiana Health Facilities Financing Authority, Community
Health Ser 2005 A (Ambac) (WI)......................... 5.00 05/01/35 3,109,980
2,000 Louisiana Public Facilities Authority, Baton Rouge
General Medical Center FHA Insured Mtge Ser 2004
(MBIA)................................................. 5.25 07/01/33 2,128,600
4,000 Minneapolis Health Care System, Minnesota, Fairview
Health
2005 Ser D (Ambac) (WI)................................ 5.00 11/15/34 4,197,200
5,000 Missouri Health & Education Authority, SSM Healthcare Ser
2001 A (Ambac)......................................... 5.25 06/01/28 5,283,350
2,650 Montana Health Facilities Authority, Deaconess Billings
Clinic Ser 1994 (Ambac)................................ 7.409+++ 02/25/25 2,710,261
2,000 New York State Dormitory Authority, Montefiore
Hospital - FHA Insured Mtge Refg Ser 2004 A (FGIC)..... 5.00 08/01/29 2,106,380
1,000 Medical University South Carolina Hospital Authority, FHA
Insured Mtge Refg Ser 2004 A (MBIA).................... 5.25 02/15/25 1,078,450
-------------
- --------
20,614,221
19,650
-------------
- --------
Industrial Development/Pollution Control Revenue (3.6%)
5,000 Humboldt County, Nevada, Sierra Pacific Power Co Refg Ser
1987 (Ambac)........................................... 6.55 10/01/13 5,250,500
5,000 New York State Energy Research & Development Authority,
Brooklyn Union Gas Co 1996 Ser (MBIA).................. 5.50 01/01/21 5,176,600
-------------
- --------
10,427,100
10,000
-------------
- --------
Mortgage Revenue - Single Family (2.3%)
1,000 Alaska Housing Finance Corporation, Governmental 1995 Ser
A (MBIA)............................................... 5.875 12/01/24 1,034,570
4,440 New Jersey Housing Mortgage Finance Authority, Home Buyer
Ser 2000 CC (AMT) (MBIA)............................... 5.875 10/01/31 4,490,217
1,105 Virginia Housing Development Authority, 2001 Ser J
(MBIA)................................................. 5.20 07/01/19 1,118,116
-------------
- --------
6,642,903
6,545
-------------
- --------
</Table>

11
See Notes to Financial Statements

Morgan Stanley Insured Municipal Trust
PORTFOLIO OF INVESTMENTS - APRIL 30, 2005 (UNAUDITED) continued

<Table>
<Caption>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- ---------------------------------------------------------------------------------------------------------

Public Facilities Revenue (2.5%)
$ 2,500 College Park Business & Industrial Development Authority,
Georgia, Civic Center Ser 2000 (Ambac)................. 5.75 % 09/01/26 $ 2,800,150
1,500 Albuquerque, New Mexico, Gross Receipts Lodgers' Tax Refg
Ser 2004 A (FSA)....................................... 5.00 07/01/37 1,566,075
3,000 Pennsylvania Public School Building Authority,
Philadelphia School District Ser 2003 (FSA)............ 5.00 06/01/33 3,121,080
-------------
- --------
7,487,305
7,000
-------------
- --------
Recreational Facilities Revenue (6.1%)
Iowa,
3,600 Vision Iowa Ser 2001 (MBIA)............................ 5.50 02/15/19 4,186,764
2,500 Vision Iowa Ser 2001 (MBIA)............................ 5.50 02/15/20 2,917,075
10,000 Hamilton County, Ohio, Sales Tax Ser 2000 (Ambac)........ 5.25 12/01/32 10,723,600
-------------
- --------
17,827,439
16,100
-------------
- --------
Tax Allocation Revenue (0.8%)
2,390 San Jose Redevelopment Agency, California, Merged Area
- -------- Ser 2002 (MBIA)........................................ 5.00 08/01/32 2,470,017
-------------
Transportation Facilities Revenue (26.5%)
5,000 Denver City & County, Colorado, Airport Refg Ser 2000 A
(AMT) (Ambac).......................................... 6.00 11/15/18 5,541,200
Miami Dade County, Florida,
2,155 Miami Int'l Airport Refg Ser 2003 B (AMT) (MBIA)....... 5.25 10/01/18 2,311,669
2,270 Miami Int'l Airport Refg Ser 2003 B (AMT) (MBIA)....... 5.25 10/01/19 2,430,058
5,000 Atlanta, Georgia, Airport Ser 2004 C (FSA)............... 5.00 01/01/33 5,206,850
5,000 Hawaii, Airports Refg Ser 2001 (AMT) (FGIC).............. 5.25 07/01/21 5,251,750
2,000 Chicago, Illinois, O'Hare Int'l Airport Third Lien Ser
2003 (AMT) (FSA)....................................... 5.75 01/01/23 2,220,940
4,000 Regional Transportation Authority, Illinois, Refg Ser
1999 (FSA)............................................. 5.75 06/01/21 4,784,840
2,500 Maryland Economic Development Corporation, Maryland
Aviation Administration Ser 2003 (AMT) (FSA)........... 5.375 06/01/22 2,694,800
5,000 Minneapolis - St Paul Metropolitan Airports Commission,
Minnesota, Ser 2001 C (FGIC)........................... 5.25 01/01/32 5,310,200
5,000 Nevada Department of Business & Industry, Las Vegas
Monorail 1st Tier Ser 2000 (Ambac)..................... 0.00 01/01/21 2,381,900
2,000 New Jersey Transportation Trust Fund Authority, 2005 Ser
C (FGIC)............................................... 5.25 06/15/20 2,205,540
5,000 New Jersey Turnpike Authority, Ser 2003 A (Ambac)........ 5.00 01/01/30 5,237,000
Metropolitan Transportation Authority, New York,
6,805 State Service Contract Refg Ser 2002 B (MBIA).......... 5.50 07/01/20 7,524,901
10,000 Transportation Refg Ser 2002 A (Ambac)................. 5.50 11/15/17 11,241,799
2,000 Transportation Refg Ser 2002 A (FGIC).................. 5.00 11/15/25 2,110,980
</Table>

See Notes to Financial Statements
12

Morgan Stanley Insured Municipal Trust
PORTFOLIO OF INVESTMENTS - APRIL 30, 2005 (UNAUDITED) continued

<Table>
<Caption>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- ---------------------------------------------------------------------------------------------------------

Pennsylvania Turnpike Commission,
$ 4,000 Ser R 2001 (Ambac)..................................... 5.00 % 12/01/26 $ 4,205,720
4,000 Ser A 2004 (Ambac)..................................... 5.00 12/01/34 4,213,160
2,500 Port of Seattle, Washington, Ser 2001 B (AMT) (MBIA)..... 5.625 02/01/24 2,693,750
-------------
- --------
77,567,057
74,230
-------------
- --------
Water & Sewer Revenue (32.7%)
1,000 Phoenix Civic Improvement Corporation, Arizona, Water
(MBIA)................................................. 5.00 07/01/27 1,055,640
5,000 San Diego County Water Authority, California, Ser 2004 A
COPs (FSA)............................................. 5.00 05/01/29 5,280,100
10,000 Tampa Bay Water, Florida, Ser 2001 B (FGIC).............. 5.00 10/01/31 10,357,600
2,000 Atlanta, Georgia, Water & Wastewater Ser 1999 A (FGIC)... 5.00 11/01/29 2,068,620
5,000 Honolulu City & County, Hawaii, Wastewater Ser 2001
(Ambac)................................................ 5.125 07/01/31 5,212,450
10,000 Louisville & Jefferson County Metropolitan Sewer
District, Kentucky, Ser 1999 A (FGIC).................. 5.75 05/15/33 11,045,200
3,800 Louisville Board of Water Works, Kentucky, Water Ser 2000
(FSA).................................................. 5.50 11/15/25 4,139,948
5,000 Detroit, Michigan, Sewage Disposal Ser 2001 A (FGIC)..... 5.125 07/01/31 5,230,600
5,000 Grand Strand Water & Sewer Authority, South Carolina,
Refg Ser 2001 (FSA).................................... 5.00 06/01/31 5,191,000
Austin, Texas,
10,000 Water & Wastewater Refg Ser 2001 A (FSA)............... 5.125 05/15/27 10,407,800
2,000 Water & Wastewater Ser 2004 A (Ambac).................. 5.00 11/15/27 2,107,180
15,000 Houston, Texas, Combined Utility First Lien Refg 2004 Ser
A (FGIC)............................................... 5.25 05/15/23 16,198,200
San Antonio, Texas,
2,000 Water & Refg Ser 2002 (FSA)............................ 5.50 05/15/18 2,219,460
2,500 Water & Refg Ser 2002 (FSA)............................ 5.50 05/15/20 2,745,875
Wichita Falls, Texas,
2,000 Water & Sewer Ser 2001 (Ambac)......................... 5.375 08/01/20 2,170,320
3,000 Water & Sewer Ser 2001 (Ambac)......................... 5.375 08/01/24 3,255,480
5,000 King County, Washington, Sewer Refg 2001 (FGIC).......... 5.00 01/01/31 5,161,300
2,000 West Virginia Water Development Authority, Loan Program
IV 2005 Ser A (FSA) (WI)............................... 5.00 11/01/44 2,072,460
-------------
- --------
95,919,233
90,300
-------------
- --------
Other Revenue (3.0%)
4,000 California, Economic Recovery Ser 2004 A (MBIA).......... 5.00 07/01/15 4,406,040
1,000 Sales Tax Asset Receivable Corporation, New York, 2005
Ser A (Ambac).......................................... 5.00 10/15/29 1,061,510
3,000 Alexandria Industrial Development Authority, Virginia,
Institute for Defense Analysis Ser 2000 A (Ambac)...... 5.90 10/01/30 3,359,880
-------------
- --------
8,827,430
8,000
-------------
- --------
</Table>

See Notes to Financial Statements
13

Morgan Stanley Insured Municipal Trust
PORTFOLIO OF INVESTMENTS - APRIL 30, 2005 (UNAUDITED) continued

<Table>
<Caption>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- ---------------------------------------------------------------------------------------------------------

Refunded (12.3%)
$ 15,000 Delaware Health Facilities Authority, Medical Center of
Delaware Ser 1992 (MBIA) (ETM)......................... 6.25 % 10/01/06 $ 15,725,850
3,000 Denver, Colorado, Civic Center Office Building Ser 2000 B
COPs (Ambac)........................................... 5.50 12/01/10+ 3,378,060
5,000 Detroit, Michigan, Water Supply Ser 1999 A (FGIC)........ 5.75 07/01/10+ 5,616,450
5,000 Hawaii, 1999 Ser CT (FSA)................................ 5.875 09/01/09+ 5,616,850
5,000 Massachusetts, Special Obligation 2002 Ser A (FGIC)...... 5.375 06/01/12+ 5,588,900
-------------
- --------
35,926,110
33,000
-------------
- --------
384,520 Total Tax-Exempt Municipal Bonds (Cost $379,816,473)........................ 409,585,218
-------------
- --------
Short-Term Tax-Exempt Municipal Obligations (8.4%)
1,000 Newport Beach, California, Hoag Memorial Presbyterian
Hospital 1992 Ser (Demand 05/02/05).................... 2.95* 10/01/22 1,000,000
12,270 Idaho Health Facilities Authority, St Luke's Regional
Medical Center Ser 2000 (FSA) (Demand 11/01/04)........ 2.95* 07/01/30 12,270,000
600 Missouri Health & Educational Facilities Authority, Cox
Health Ser 1997 (MBIA) (Demand 05/02/05)............... 3.03* 06/01/15 600,000
8,195 New Jersey Housing Mortgage Finance Agency, 1995 Ser A
(Ambac) (called for redemption 05/01/05)............... 6.05** 11/01/20 8,360,457
2,400 North Central Texas Health Facilities Development
Corporation, Presbyterian Medical Center Ser 1985 D
(MBIA) (Demand 05/02/05)............................... 2.95* 12/01/15 2,400,000
-------------
- --------
24,465 Total Short-Term Tax-Exempt Municipal Obligations (Cost $24,629,098)........ 24,630,457
-------------
- --------
</Table>

<Table>

$408,985 Total Investments (Cost $404,445,571) (a) (b)...................... 148.1% 434,215,675
========
Liabilities in Excess of Other Assets.............................. (3.7) (10,910,117)

Preferred Shares of Beneficial Interest............................ (44.4) (130,051,336)
----- -------------
Net Assets......................................................... 100.0% $ 293,254,222
===== =============
</Table>

See Notes to Financial Statements
14

Morgan Stanley Insured Municipal Trust
PORTFOLIO OF INVESTMENTS - APRIL 30, 2005 (UNAUDITED) continued

- ---------------------

<Table>

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.
ROLS Reset Option Longs. (Illiquid securities).
WI Security purchased on a when-issued basis.
+ Prerefunded to call date shown.
++ Currently a zero coupon security; will convert to 5.56% and
5.58%, respectively on January 1, 2011.
+++ Current coupon rate for residual interest bond. This rate
resets periodically as the auction rate on the related
security changes. Positions in inverse floating rate
municipal obligation have a value of $8,527,161, which
represents 2.9% of net assets applicable to common
shareholders.
* Current coupon of variable rate demand obligation.
** A portion of this security has been physically segregated in
connection with open futures contracts in the amount of
$295,000.
(a) Securities have been designated as collateral in an amount
equal to $63,279,174 in connection with open futures
contracts and security purchased on a when-issued basis.
(b) The aggregate cost for federal income tax purposes
approximates the aggregate cost for book purposes. The
aggregate gross and net unrealized appreciation is
$29,776,178.

Bond Insurance:
- ---------------
Ambac Ambac Assurance Corporation.
FGIC Financial Guaranty Insurance Company.
FSA Financial Security Assurance Inc.
MBIA Municipal Bond Investors Assurance Corporation.
</Table>

Futures Contracts Open at April 30, 2005:

<Table>
<Caption>
NUMBER OF DESCRIPTION, DELIVERY UNDERLYING FACE UNREALIZED
CONTRACTS LONG/SHORT MONTH AND YEAR AMOUNT AT VALUE DEPRECIATION
- --------- ---------- ----------------------------- --------------- ------------

U.S. Treasury Notes 5 year,
400 Short June 2005 $(43,381,252) $(104,228)
U.S. Treasury Notes 10 year,
100 Short June 2005 (11,142,188) (104,963)
---------
Total unrealized depreciation.............................. $(209,191)
=========
</Table>

15
See Notes to Financial Statements

Morgan Stanley Insured Municipal Trust
FINANCIAL STATEMENTS

Statement of Assets and Liabilities
April 30, 2005 (unaudited)

<Table>

Assets:
Investments in securities, at value
(cost $404,713,075)............... $434,215,675
Cash................................ 25,289
Receivable for:
Interest........................ 6,361,341
Variation margin................ 125,000
Prepaid expenses and other assets... 168,504
------------
Total Assets.................... 440,895,809
------------
Liabilities:
Payable for:
Investments purchased........... 17,259,197
Investment advisory fee......... 115,368
Common shares of beneficial
interest repurchased.......... 79,068
Administration fee.............. 34,183
Accrued expenses and other
payables.......................... 102,435
------------
Total Liabilities............... 17,590,251
------------
Preferred shares of beneficial
interest (at liquidating value)
(1,000,000 shares
authorized of non-participating
$.01 par value, 2,600 shares
outstanding)...................... 130,051,336
------------
Net Assets Applicable to Common
Shareholders.................. $293,254,222
============
Composition of Net Assets Applicable
to Common Shareholders:
Common shares of beneficial interest
(unlimited shares authorized of
$.01
par value, 18,903,921 shares
outstanding)...................... $262,623,501
Net unrealized appreciation......... 29,560,913
Accumulated undistributed net
investment income................. 2,088,593
Accumulated net realized loss....... (1,018,785)
------------
Net Assets Applicable to Common
Shareholders.................. $293,254,222
============
Net Asset Value Per Common Share
($293,254,222 divided by 18,903,921
common shares outstanding).......... $15.51
============
</Table>

Statement of Operations
For the six months ended April 30, 2005 (unaudited)

<Table>

Net Investment Income:

Interest Income...................... $10,355,092
-----------

Expenses
Investment advisory fee.............. 570,942
Auction commission fees.............. 251,899
Administration fee................... 169,168
Transfer agent fees and expenses..... 48,391
Professional fees.................... 35,211
Shareholder reports and notices...... 27,063
Custodian fees....................... 10,905
Auction agent fees................... 7,995
Registration fees.................... 6,794
Trustees' fees and expenses.......... 6,292
Other................................ 24,910
-----------

Total Expenses................... 1,159,570
-----------

Net Investment Income............ 9,195,522
-----------

Net Realized and Unrealized Gain
(Loss):
Net realized gain (loss) on:
Investments.......................... 1,374,158
Futures contracts.................... (84,809)
-----------

Net Realized Gain................ 1,289,349
-----------
Net Change in Unrealized
Appreciation/ Depreciation on:
Investments.......................... (2,921,344)
Futures contracts.................... 823,915
-----------

Net Depreciation................. (2,097,429)
-----------

Net Loss......................... (808,080)
-----------

Dividends to preferred shareholders
from net investment income......... (1,101,474)
-----------

Net Increase......................... $ 7,285,968
===========
</Table>

See Notes to Financial Statements
16

Morgan Stanley Insured Municipal Trust
FINANCIAL STATEMENTS continued

Statement of Changes in Net Assets

<Table>
<Caption>
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
APRIL 30, 2005 OCTOBER 31, 2004
-------------- ----------------
(unaudited)

Increase (Decrease) in Net Assets:
Operations:
Net investment income....................................... $ 9,195,522 $ 19,360,032
Net realized gain (loss).................................... 1,289,349 (3,322,884)
Net change in unrealized appreciation/depreciation.......... (2,097,429) 5,962,786
Dividends to preferred shareholders from net investment
income.................................................... (1,101,474) (2,089,610)
------------ ------------
Net Increase............................................ 7,285,968 19,910,324
------------ ------------
Dividends and Distributions to Common Shareholders from:
Net investment income....................................... (7,757,560) (17,193,068)
Net realized gain........................................... -- (1,587,770)
------------ ------------
Total Dividends and Distributions....................... (7,757,560) (18,780,838)
------------ ------------

Decrease from transactions in common shares of beneficial
interest.................................................. (6,603,056) (10,096,973)
------------ ------------
Net Decrease............................................ (7,074,648) (8,967,487)
Net Assets Applicable to Common Shareholders:
Beginning of period......................................... 300,328,870 309,296,357
------------ ------------
End of Period
(Including accumulated undistributed net investment income
of $2,088,593 and $1,752,105, respectively)................. $293,254,222 $300,328,870
============ ============
</Table>

See Notes to Financial Statements
17

Morgan Stanley Insured Municipal Trust
NOTES TO FINANCIAL STATEMENTS - APRIL 30, 2005 (UNAUDITED)

1. Organization and Accounting Policies

Morgan Stanley Insured Municipal Trust (the "Trust") is registered under the
Investment Company Act of 1940, as amended, as a diversified, closed-end
management investment company. The Trust's investment objective is to provide
current income which is exempt from federal income tax. The Trust was organized
as a Massachusetts business trust on October 3, 1991 and commenced operations on
February 28, 1992.

The following is a summary of significant accounting policies:

A. Valuation of Investments -- (1) portfolio securities are valued by an outside
independent pricing service approved by the Trustees. The pricing service uses
both a computerized grid matrix of tax-exempt securities and evaluations by its
staff, in each case based on information concerning market transactions and
quotations from dealers which reflect the mean between the last reported bid and
asked price. The portfolio securities are thus valued by reference to a
combination of transactions and quotations for the same or other securities
believed to be comparable in quality, coupon, maturity, type of issue, call
provisions, trading characteristics and other features deemed to be relevant.
The Trustees believe that timely and reliable market quotations are generally
not readily available for purposes of valuing tax-exempt securities and that the
valuations supplied by the pricing service are more likely to approximate the
fair value of such securities; (2) futures are valued at the latest sale price
on the commodities exchange on which they trade unless it is determined that
such price does not reflect their market value, in which case they will be
valued at their fair value as determined in good faith under procedures
established by and under the supervision of the Trustees; and (3) short-term
debt securities having a maturity date of more than sixty days at time of
purchase are valued on a mark-to-market basis until sixty days prior to maturity
and thereafter at amortized cost based on their value on the 61st day.
Short-term debt securities having a maturity date of sixty days or less at the
time of purchase are valued at amortized cost.

B. Accounting for Investments -- Security transactions are accounted for on the
trade date (date the order to buy or sell is executed). Realized gains and
losses on security transactions are determined by the identified cost method.
Discounts are accreted and premiums are amortized over the life of the
respective securities. Interest income is accrued daily.

C. Futures Contracts -- A futures contract is an agreement between two parties
to buy and sell financial instruments or contracts based on financial indices at
a set price on a future date. Upon entering into such a contract, the Trust is
required to pledge to the broker cash, U.S. Government securities or other
liquid portfolio securities equal to the minimum initial margin requirements of
the applicable futures exchange. Pursuant to the contract, the Trust agrees to
receive from or pay to the

Morgan Stanley Insured Municipal Trust
NOTES TO FINANCIAL STATEMENTS - APRIL 30, 2005 (UNAUDITED) continued

broker an amount of cash equal to the daily fluctuation in the value of the
contract. Such receipts or payments known as variation margin are recorded by
the Trust as unrealized gains and losses. Upon closing of the contract, the
Trust realizes a 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.

D. Federal Income Tax Policy -- It is the Trust'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 and nontaxable
income to its shareholders. Accordingly, no federal income tax provision is
required.

E. Dividends and Distributions to Shareholders -- Dividends and distributions to
shareholders are recorded on the ex-dividend date.

F. Use of Estimates -- The preparation of financial statements in accordance
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts and disclosures.
Actual results could differ from those estimates.

2. Investment Advisory/Administration Agreements

Pursuant to an Investment Advisory Agreement with Morgan Stanley Investment
Advisors Inc. (the "Investment Adviser"), the Trust pays an advisory fee,
calculated weekly and payable monthly, by applying the annual rate of 0.27% to
the Trust's weekly total net assets including preferred shares.

Pursuant to an Administration Agreement with Morgan Stanley Services Company
Inc. (the "Administrator"), an affiliate of the Investment Adviser, the Trust
pays an administration fee, calculated weekly and payable monthly, by applying
the annual rate of 0.08% to the Trust's weekly total net assets including
preferred shares.

3. Security Transactions and Transactions With Affiliates

The cost of purchases and proceeds from sales of portfolio securities, excluding
short-term investments, for the six months ended April 30, 2005 aggregated
$28,073,790 and $29,615,615, respectively.

Morgan Stanley Trust, an affiliate of the Investment Adviser and Administrator,
is the Trust's transfer agent. At April 30, 2005, the Trust had transfer agent
fees and expenses payable of approximately $9,000.

The Trust has an unfunded noncontributory defined benefit pension plan covering
certain independent Trustees of the Trust who will have served as independent
Trustees for at least five years at the time of retirement. Benefits under this
plan are based on factors which include years of service and

Morgan Stanley Insured Municipal Trust
NOTES TO FINANCIAL STATEMENTS - APRIL 30, 2005 (UNAUDITED) continued

compensation. Aggregate pension costs for the six months ended April 30, 2005
included in Trustees' fees and expenses in the Statement of Operations amounted
to $3,310. At April 30, 2005, the Trust had an accrued pension liability of
$55,635 which is included in accrued expenses in the Statement of Assets and
Liabilities. On December 2, 2003, the Trustees voted to close the plan to new
participants and eliminate the future benefits growth due to increases to
compensation after July 31, 2003.

The Trust has an unfunded Deferred Compensation Plan (the "Compensation Plan")
which allows each independent Trustee to defer payment of all, or a portion, of
the fees he receives for serving on the Board of Trustees. Each eligible Trustee
generally may elect to have the deferred amounts credited with a return equal to
the total return on one or more of the Morgan Stanley funds that are offered as
investment options under the Compensation Plan. Appreciation/depreciation and
distributions received from these investments are recorded with an offsetting
increase/decrease in the deferred compensation obligation and do not affect the
net asset value of the Trust.

4. Preferred Shares of Beneficial Interest

The Trust is authorized to issue up to 1,000,000 non-participating preferred
shares of beneficial interest having a par value of $.01 per share, in one or
more series, with rights as determined by the Trustees, without approval of the
common shareholders. The Trust has issued Series TU and TH Auction Rate
Preferred Shares ("Preferred Shares") which have a liquidation value of $50,000
per share plus the redemption premium, if any, plus accumulated but unpaid
dividends, whether or not declared, thereon to the date of distribution. The
Trust may redeem such shares, in whole or in part, at the original purchase
price of $50,000 per share plus accumulated but unpaid dividends, whether or not
declared, thereon to the date of redemption.

Dividends, which are cumulative, are reset through auction procedures.

<Table>
<Caption>
AMOUNT RESET DIVIDEND
SERIES SHARES* IN THOUSANDS* RATE* DATE RATES
- ------ ------- ------------- ----- -------- ------------

TU 800 $40,000 1.54% 01/04/06 1.54%
TH 1,800 90,000 2.80 05/06/05 1.649 - 2.80
</Table>

- ---------------------
* As of April 30, 2005.

Subsequent to April 30, 2005 and up through June 3, 2005 the Trust paid
dividends to Series TU and TH at rates ranging from 1.54% to 2.80% in the
aggregate amount of $341,730.

Morgan Stanley Insured Municipal Trust
NOTES TO FINANCIAL STATEMENTS - APRIL 30, 2005 (UNAUDITED) continued

The Trust is subject to certain restrictions relating to the preferred shares.
Failure to comply with these restrictions could preclude the Trust from
declaring any distributions to common shareholders or purchasing common shares
and/or could trigger the mandatory redemption of preferred shares at liquidation
value.

The preferred shares, which are entitled to one vote per share, generally vote
with the common shares but vote separately as a class to elect two Trustees and
on any matters affecting the rights of the preferred shares.

5. Common Shares of Beneficial Interest

Transactions in common shares of beneficial interest were as follows:

<Table>
<Caption>
CAPITAL
PAID IN
EXCESS OF
SHARES PAR VALUE PAR VALUE
---------- --------- ------------

Balance, October 31, 2003................................... 20,110,680 $201,107 $279,122,423
Treasury shares purchased and retired (weighted average
discount 8.70%)*.......................................... (723,700) (7,237) (10,089,736)
---------- -------- ------------
Balance, October 31, 2004................................... 19,386,980 193,870 269,032,687
Treasury shares purchased and retired (weighted average
discount 11.37%)*......................................... (483,059) (4,831) (6,598,225)
---------- -------- ------------
Balance, April 30, 2005..................................... 18,903,921 $189,039 $262,434,462
========== ======== ============
</Table>

- ---------------------
* The Trustees have voted to retire the shares purchased.

6. Dividends to Common Shareholders

On March 29, 2005, the Trust declared the following dividends from net
investment income:

<Table>
<Caption>
AMOUNT RECORD PAYABLE
PER SHARE DATE DATE
- --------- ------------- -------------

$0.0675 May 6, 2005 May 20, 2005
$0.0675 June 3, 2005 June 17, 2005
</Table>

7. Expense Offset

The expense offset represents a reduction of the custodian fees for earnings on
cash balances maintained by the Trust.

Morgan Stanley Insured Municipal Trust
NOTES TO FINANCIAL STATEMENTS - APRIL 30, 2005 (UNAUDITED) continued

8. Risks Relating to Certain Financial Instruments

The Trust may invest a portion of its assets in residual interest bonds, which
are inverse floating rate municipal obligations. The prices of these securities
are subject to greater market fluctuations during periods of changing prevailing
interest rates than are comparable fixed rate obligations.

To hedge against adverse interest rate changes, the Trust may invest in
financial futures contracts or municipal bond index futures contracts ("futures
contracts").

These futures contracts involve elements of market risk in excess of the amount
reflected in the Statement of Assets and Liabilities. The Trust bears the risk
of an unfavorable change in the value of the underlying securities. Risks may
also arise upon entering into these contracts from the potential inability of
the counterparties to meet the terms of their contracts.

9. Federal Income Tax Status

The amount of dividends and distributions from net investment income and net
realized capital gains are determined in accordance with federal income tax
regulations which may differ from generally accepted accounting principles.
These "book/tax" differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such amounts
are reclassified within the capital accounts based on their federal tax-basis
treatment; temporary differences do not require reclassification. Dividends and
distributions which exceed net investment income and net realized capital gains
for tax purposes are reported as distributions of paid-in-capital.

As of October 31, 2004, the Trust had a net capital loss carryforward of
$3,341,240 which will expire on October 31, 2012 to offset future capital gains
to the extent provided by regulations.

As of October 31, 2004, the Trust had temporary book/tax differences primarily
attributable to book amortization of discounts on debt securities,
mark-to-market of open futures contracts and dividend payable.

Morgan Stanley Insured Municipal Trust
FINANCIAL HIGHLIGHTS

Selected ratios and per share data for a common share of beneficial interest
outstanding throughout each period:

<Table>
<Caption>
FOR THE SIX FOR THE YEAR ENDED OCTOBER 31,
MONTHS ENDED ---------------------------------------------------------------------
APRIL 30, 2005 2004 2003 2002 2001 2000
-------------- --------- --------- --------- --------- ---------
(unaudited)

Selected Per Share Data:
Net asset value, beginning of
period............................ $15.49 $15.38 $15.50 $15.74 $15.09 $ 14.91
------ ------ ------ ------ ------ -------
Income (loss) from investment
operations:
Net investment income*......... 0.49 0.96 0.97 1.05 1.14 1.15
Net realized and unrealized
gain (loss).................... (0.04) 0.16 0.14 0.15 0.79 0.14
Common share equivalent of
dividends paid to preferred
shareholders*.................. (0.06) (0.11) (0.13) (0.18) (0.22) (0.24)
------ ------ ------ ------ ------ -------
Total income from investment
operations........................ 0.39 1.01 0.98 1.02 1.71 1.05
------ ------ ------ ------ ------ -------
Less dividends and distributions
from:
Net investment income.......... (0.41) (0.87) (0.90) (0.85) (0.93) (0.93)
Net realized gain.............. -- (0.08) (0.23) (0.43) (0.13) --
------ ------ ------ ------ ------ -------
Total dividends and
distributions..................... (0.41) (0.95) (1.13) (1.28) (1.06) (0.93)
------ ------ ------ ------ ------ -------
Anti-dilutive effect of acquiring
treasury shares*.................. 0.04 0.05 0.03 0.02 0.00 0.06
------ ------ ------ ------ ------ -------
Net asset value, end of period..... $15.51 $15.49 $15.38 $15.50 $15.74 $ 15.09
====== ====== ====== ====== ====== =======
Market value, end of period........ $13.80 $13.88 $14.38 $14.15 $15.29 $14.188
====== ====== ====== ====== ====== =======
Total Return+...................... 2.39%(1) 3.21% 9.78% 1.14% 15.48% 10.87%
Ratios to Average Net Assets of Common Shareholders:
Total expenses (before expense
offset)........................... 0.79%(2)(3) 0.82%(3) 0.80%(3) 0.76%(3) 0.71%(3) 0.71%(3)
Net investment income before
preferred stock dividends......... 6.26%(2) 6.34% 6.26% 6.92% 7.42% 7.74%
Preferred stock dividends.......... 0.75%(2) 0.69% 0.87% 1.15% 1.43% 1.63%
Net investment income available to
common shareholders............... 5.51%(2) 5.65% 5.39% 5.77% 5.99% 6.11%
Supplemental Data:
Net assets applicable to common
shareholders,
end of period, in thousands....... $293,254 $300,329 $309,296 $320,331 $331,834 $319,076
Asset coverage on preferred shares
at end of period.................. 325% 331% 338% 346% 354% 345%
Portfolio turnover rate............ 7%(1) 14% 11% 17% 29% 26%
</Table>

- ---------------------

<Table>

* The per share amounts were computed using an average number
of common shares outstanding during the period.
+ Total return is based upon the current market value on the
last day of each period reported. Dividends and
distributions are assumed to be reinvested at the prices
obtained under the Trust's dividend reinvestment plan. Total
return does not reflect brokerage commissions.
(1) Not annualized.
(2) Annualized.
(3) Does not reflect the effect of expense offset of 0.01%.
</Table>

23
See Notes to Financial Statements

TRUSTEES

Michael Bozic
Charles A. Fiumefreddo
Edwin J. Garn
Wayne E. Hedien
James F. Higgins
Dr. Manuel H. Johnson
Joseph J. Kearns
Michael E. Nugent
Fergus Reid

OFFICERS

Charles A. Fiumefreddo
Chairman of the Board

Mitchell M. Merin
President

Ronald E. Robison
Executive Vice President and Principal Executive Officer

Joseph J. McAlinden
Vice President

Barry Fink
Vice President

Amy R. Doberman
Vice President

Carsten Otto
Chief Compliance Officer

Stefanie V. Chang
Vice President

Francis J. Smith
Treasurer and Chief Financial Officer

Thomas F. Caloia
Vice President

Mary E. Mullin
Secretary

TRANSFER AGENT

Morgan Stanley Trust
Harborside Financial Center, Plaza Two
Jersey City, New Jersey 07311

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Deloitte & Touche LLP
Two World Financial Center
New York, New York 10281

INVESTMENT ADVISER

Morgan Stanley Investment Advisors Inc.
1221 Avenue of the Americas
New York, New York 10020

The financial statements included herein have been taken from the records of the
Trust without examination by the independent auditors and accordingly they do
not express an opinion thereon.

Investments and services offered through Morgan Stanley DW Inc., member SIPC.

[MORGAN STANLEY LOGO]

MORGAN STANLEY FUNDS

Morgan Stanley
Insured Municipal Trust
Semiannual Report
April 30, 2005

[MORGAN STANLEY LOGO]

37974RPT-RA05-00474P-Y04/05

Item 2. Code of Ethics.