Mortgage Default Insurance (CMHC) Explained
Default insurance is required when your down payment is under 20%. It protects the lender, but you pay the premium.
Calculator
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Insurance premium
$16,740
3.10% of the $540,000 loan (loan-to-value 90.0%)
Total mortgage with premium added
$556,740
Plus $1,339 provincial sales tax, paid in cash at closing
Uses CMHC's published homeowner premium rates. Other insurers set their own premiums.
How the premium works
The premium is a percentage of the loan, and the percentage rises with your loan-to-value ratio. It's usually added to the mortgage. In Ontario, Quebec and Saskatchewan, provincial sales tax on the premium is due in cash at closing and can't be added to the loan.
Eligibility limits
- Price below $1,500,000
- Down payment at or above the federal minimum
- Amortization up to 25 years, or 30 for first-time buyers and new builds
- Pass the stress test and GDS/TDS limits (39% / 44%)
Who provides it
CMHC is the federal Crown corporation that insures mortgages. Private insurers also offer default insurance, backed by a federal guarantee. Your lender chooses the insurer; you pay the premium.
Estimate your premium
Calculator
Results update as you type · Nothing you enter leaves your browser
Insurance premium
$16,740
3.10% of the $540,000 loan (loan-to-value 90.0%)
Total mortgage with premium added
$556,740
Plus $1,339 provincial sales tax, paid in cash at closing
Uses CMHC's published homeowner premium rates. Other insurers set their own premiums.
Frequently asked questions
Can I cancel mortgage default insurance?
No. The premium is a one-time charge for the life of the mortgage, usually added to the loan. It isn't refunded if you later build more equity.
Is it the same as mortgage life insurance?
No. Default insurance protects the lender if you stop paying. Mortgage life or disability insurance is optional coverage that protects you and your family.
Sources
Rules are summarized in our own words from official publications. Check the source and talk to your lender or a licensed professional before making a decision.
Informational only, not financial advice. Data as of the release snapshot generated 2026-11-12.