CMHC Insurance Calculator
If your down payment is under 20%, Canadian law requires mortgage default insurance. It protects the lender, not you — and you pay for it. This works out the premium, the minimum down payment at your price, and what the premium actually costs once it's rolled into the mortgage.
How the premium is calculated
The premium is a percentage of your mortgage amount, and the percentage depends on your loan-to-value ratio — how much you're borrowing relative to the purchase price. Rates as of August 2026:
| Down payment | Loan-to-value | Premium rate |
|---|---|---|
| 5% – 9.99% | 90.01% – 95% | 4.00% |
| 10% – 14.99% | 85.01% – 90% | 3.10% |
| 15% – 19.99% | 80.01% – 85% | 2.80% |
| 20% or more | 80% or less | No insurance required |
A 30-year amortization on an insured mortgage adds a 0.20% surcharge. Note the cliff edges: moving from 9.99% down to exactly 10% drops the rate from 4.00% to 3.10%. On a $650,000 home that single extra dollar of down payment is worth thousands. The ladder above the fold shows where your nearest threshold sits.
The minimum down payment is a sliding scale
Canada doesn't use a flat 5%. The requirement steps up with price:
- 5% on the first $500,000
- 10% on the portion between $500,000 and $1,500,000
- 20% on any home over $1,500,000 — and homes above that cap cannot be insured at all
So a $700,000 home needs $25,000 (5% of the first $500k) plus $20,000 (10% of the next $200k) — $45,000, which is 6.43% rather than 5%. The insurable cap rose from $1M to $1.5M in December 2024.
The part most buyers miss
The premium is almost always added to your mortgage rather than paid up front. That's convenient, but it means you pay interest on the insurance premium for the entire life of the loan. A $24,000 premium at 4.79% over 25 years costs considerably more than $24,000 by the time it's repaid — the calculator's "true cost" figure shows the real number for your situation.
One exception: in Ontario, Quebec, Manitoba and Saskatchewan the provincial sales tax on the premium cannot be financed. It's due in cash at closing, and it surprises people who budgeted to the dollar.
It insures the lender, not you
This is the most widely misunderstood part of the Canadian mortgage system. Default insurance pays the lender if you fail to pay. It gives you no protection whatsoever. If your home is repossessed and sold for less than the balance, the insurer can still pursue you for the shortfall in most provinces.
What it does buy you is access: without it, a lender cannot legally issue a mortgage above 80% loan-to-value. Insured mortgages also often carry slightly lower interest rates, because the lender's risk is covered — occasionally enough to offset a meaningful part of the premium.
CMHC isn't the only insurer
Three providers operate in Canada: CMHC (a federal Crown corporation), Sagen, and Canada Guaranty. Premium rates are effectively identical across all three, and your lender chooses — you generally don't. "CMHC insurance" is simply the term everyone uses.