CMHC vs Sagen vs Canada Guaranty: Mortgage Default Insurance in Canada (2026)

If you're buying a home in Canada in 2026 with less than 20% down, you'll need mortgage default insurance — and you may notice three different names on the paperwork: CMHC, Sagen, or Canada Guaranty. Buyers often assume they should shop these like lenders. In reality the choice usually isn't yours, and the cost is nearly identical across all three. Here's how it actually works.

The short answer

Mortgage default insurance protects the lender (not you) if you stop paying, and it's mandatory in Canada whenever your down payment is under 20%. Three insurers provide it: CMHC, a federal Crown corporation, plus two private insurers, Sagen and Canada Guaranty. Their premium rates are essentially aligned, so you won't save money by preferring one. The lender, not the borrower, chooses which insurer to use. Estimate your premium.

What mortgage default insurance is — and when it's required

Default insurance is a one-time premium that compensates the lender if a borrower defaults and the home sale doesn't cover the loan. Because it lowers the lender's risk, it's what makes low-down-payment ownership possible at competitive rates.

• Required: any time your down payment is less than 20% of the purchase price (a "high-ratio" mortgage), on homes priced up to $1.5 million.
• Not available: on homes priced over $1.5 million, which therefore require at least 20% down.
• Optional/lender-driven: some lenders insure even 20%-down mortgages on the back end ("bulk" or "portfolio" insurance), but you won't see that premium.

Work out how much you need to put down with the down payment calculator.

The three insurers

• CMHC (Canada Mortgage and Housing Corporation): the public, federally owned insurer and the original provider. Often the most recognized name.
• Sagen: Canada's largest private mortgage insurer (formerly Genworth Canada).
• Canada Guaranty: a Canadian-owned private insurer and the third option.

All three are federally regulated and government-backed, so your mortgage is equally valid regardless of which one insures it. Premiums are essentially aligned across all three because rates are set within the same regulatory framework.

Premium rates by down payment: an illustrative table

The premium is a percentage of your mortgage amount (not the purchase price), and it rises as your down payment shrinks. The rates below are illustrative standard rates for typical owner-occupied purchases and are broadly representative across CMHC, Sagen, and Canada Guaranty — always confirm the current rate for your file.

Worked example

Suppose you buy a $500,000 home with 5% down ($25,000), giving a $475,000 mortgage at 95% LTV. Using the illustrative 4.00% rate, the premium is about $19,000. Put 10% down instead ($50,000), and on a $450,000 mortgage at the illustrative 3.10% rate the premium drops to roughly $13,950. More down payment means both a smaller loan and a lower premium rate — a double saving. Run your own figures with the CMHC insurance calculator.

Who chooses the insurer — and what actually differs

The lender chooses the insurer, based on its own relationships and how the deal fits each insurer's program rules. As a borrower you generally can't request CMHC over Sagen (or vice versa) to save money — there's nothing to save, since premiums are aligned.

What can differ are niche program rules: each insurer has slightly different policies on things like newcomers, self-employed income, certain property types, or specific portfolio products. So in some edge cases your application may fit one insurer's guidelines better than another's — which is exactly the kind of fit a broker matches behind the scenes.

PST on the premium, and how it's added to the mortgage

Two practical points buyers often miss:

• The premium itself is usually added to your mortgage and amortized with it — so you don't pay it in cash up front. That keeps your closing cash lower but means you pay interest on the premium over time.
• Provincial sales tax (PST) on the premium must be paid in cash at closing in provinces that charge it (including Ontario, Quebec, Manitoba, and Saskatchewan). PST cannot be rolled into the mortgage — it's a closing cost. On a ~$19,000 premium in Ontario (illustrative 8% PST), that's roughly $1,520 due at closing.

Frequently asked questions

Is there a real difference between CMHC, Sagen, and Canada Guaranty?

For most borrowers, no meaningful difference. All three are federally backed, and premium rates are essentially aligned. The main differences are niche program rules that affect which insurer a particular application fits best.

Can I choose my mortgage insurer?

Generally no. The lender selects the insurer based on its relationships and how your deal fits each insurer's guidelines. Since premiums are aligned, there's no cost advantage to one over another.

Do I pay the premium up front?

Usually the premium is added to your mortgage and paid off over the amortization, so it isn't due in cash at closing. However, the provincial sales tax (PST) on the premium must be paid in cash at closing where applicable.

When is mortgage default insurance required?

Whenever your down payment is less than 20% on a home priced up to $1.5 million. Homes over $1.5 million can't be insured and require at least 20% down.

Does insurance protect me as the borrower?

No. It protects the lender if you default. Its benefit to you is indirect — it's what allows you to buy with a smaller down payment at competitive rates.

Putting down less than 20%? Ask Maya to estimate your premium and PST in plain language, then talk to an advisor — we'll match your file to the right lender and insurer program and confirm the true cash you need at closing. First-time buyer? Start with our first-time home buyer mortgage guide.