“In more severe situations, a mortgage originator may become unwilling or unable to repurchases loans that are in violation of securitization representations and warranties, leaving problem loans to the securitization collateral pools,” the report said.

The Fitch report noted that the financial guarantors have insured a net par exposure of $24 billion to securitization by “less stable” originators and services of mortgage-backed securities.

But analyst George Masek wrote that most of the exposure of the financial guarantors is in the highly rated class of RMBS securities. “The relative seniority of the industry's exposure within the securitization structure is a key factor in evaluating the extent of the industry's actual risk,” he wrote.

Nonetheless, the report did not rule out individual instances of problems involving one or more securitizations from certain financially stressed companies such as New Century Financial Corp. and Fremont General Corp.

“However, these problems are likely to be isolated and small in relation to each financial guarantor's capital base,” Mr. Masek said.

In a related note, Morgan Stanley property-casualty analyst William Wilt said that property-casualty insurers have little to fear from the investment side from the deterioration of the subprime market.

Mortgage-backed securities represent less than 20 percent of invested assets. “More importantly, the tranches owned tend to be of very high credit quality,” he wrote.