What is mortgage loan insurance?

Mortgage loan insurance is provided by Canada Mortgage and Housing Corporation (CMHC), a crown corporation, and GE Capital Mortgage Insurance Company, an approved private corporation. This insurance is required by law to ensure lenders against defaults on mortgages with a loan to value ration of more than 80%. The insurance premiums, ranging from .50% to 3.75% are paid by the borrower and can be added directly into the mortgage amount. This is not the same as mortgage life insurance.