Business Notes INSURANCE

In the quick-buck '80s, even staid mutual life insurance companies were lured by high-yield, high-risk investments. Now many are looking for sources of cash to buy their way out of trouble.

Last week, in a bid to raise capital, Equitable Life Assurance Society, the third largest U.S. insurer, announced it will convert to a stock-owned company. The $500 million in additional capital that chairman Richard Jenrette expects to raise through the stock sale will help offset large losses from risky ventures: junk bonds, real estate and high-interest guaranteed- investment contracts. It will also make it easier for the company to diversify.

Analysts are cautiously optimistic about the proposal. Says Larry Brossman, vice president of Duff & Phelps, a credit-rating company: "It may lead the way for others not in as much trouble as Equitable." The unknown element: the nearly 3 million policyholders whom Equitable hopes to convert to shareholders by getting them to vote yes for the plan.