By Keith Martin, Executive Director, Canadian Association of Financial Institutions in Insurance (CAFII)
For millions of Canadian homeowners, 2025 and 2026 represent one of the most significant financial moments in recent memory. About 60 per cent of all outstanding mortgages in Canada are expected to renew during this period, many of them originally locked in when interest rates were near historic lows. For borrowers who secured a five-year fixed-rate mortgage during the pandemic, monthly payments could climb by 15 to 20 per cent at renewal. Bank of CanadaCMP
That’s a meaningful shift in household budgets. And it’s prompting many Canadians to take a closer look at their finances — sometimes for the first time in years.
But while most of the conversation around renewal focuses on rates and terms, there’s an important topic that is often not considered: In the event of an injury or illness or if you pass away, do you have adequate protections preventing you from working or could your family maintain the mortgage payments should you pass away? While not pleasant issues to consider, being prepared for these what if situations is critical to being prepared and making sure your family is protected
Renewal is a financial checkpoint, not just a rate negotiation
When a mortgage comes up for renewal, it’s tempting to focus narrowly on locking in the best rate. That’s understandable. For many households, the payment difference matters.
What’s easy to overlook is that renewal is also one of the few moments when Canadians sit down with their financial institution and review their full mortgage picture. It’s a natural opening to ask whether the protection behind that mortgage still reflects life as it stands today.
Families change. Incomes change. Health circumstances change. A coverage decision made five years ago may not be the right fit today.
Four types of mortgage protection worth understanding
There are four main forms of mortgage protection insurance available to Canadian homeowners, each designed to address a different kind of financial disruption:
Mortgage life insurance helps pays out the outstanding balance of your mortgage in the event of your death, helping ensure your family can remain in their home without carrying that financial burden.
Mortgage disability insurance helps cover your mortgage payments if you become disabled and are unable to work — providing stability during a period when income can drop significantly and unexpectedly.
Mortgage critical illness insurance provides a benefit if you are diagnosed with a covered serious illness such as cancer, heart attack, or stroke, giving you the financial flexibility to focus on recovery rather than payments.
Mortgage job loss insurance makes your mortgage payments on your behalf for a limited period if you involuntarily lose your employment – a bridge that keeps your home protected while you get back on your feet.
Together, these products are designed to cover the kinds of life events that can make it difficult to keep up with a mortgage: Passing away, becoming disabled, a serious illness or losing a job. Not every household needs every type of coverage. But understanding what each one does is the starting point for making an informed decision.
The risk Canadians are most worried about and least covered for
Of the four types of protection, job loss coverage deserves particular attention right now.
More than half of Canadian mortgage holders have expressed concern about job loss in the coming year, a reflection of broader economic uncertainty that many households are navigating alongside their renewal. And yet job loss is one of the least represented risks in existing mortgage protection policies. According to a 2025 Pollara Strategic Insights study commissioned by CAFII, only 66 per cent of mortgage-related Credit Protection Insurance policies include job loss coverage, compared to 94 per cent for life coverage.
That gap matters. If a household’s primary earner loses their job, the mortgage doesn’t pause. Payments continue to come due, even as income disappears. Job loss insurance exists precisely to bridge that window, making payments while a homeowner finds their footing again.
For anyone renewing a mortgage in the current environment, it’s worth asking directly: does my coverage include job loss protection?
Confidence isn’t the same as coverage
One pattern that shows up consistently in research on Canadian homeowners is a gap between how protected people feel and what their coverage actually provides. Many Canadians carry insurance they don’t fully understand, not because they’re careless, but because these products are rarely top of mind until they’re needed.
That tends to change at renewal. When Canadians are already reviewing their mortgage, they’re more likely to look at the full picture, including the protections attached to it.
CAFII research has found that nearly four in ten mortgage holders aren’t confident they could cover their mortgage payments if the household’s primary income disappeared. That’s a meaningful number of families carrying more financial exposure than they may realize.
Renewal is the moment to close that gap, to look at what you have, understand what it actually covers, and make sure it reflects the life you’re living now, not the one you had five years ago.
A few questions worth raising at renewal
You don’t need to overhaul your finances to make this renewal more productive. A few straightforward questions can make a significant difference:
- Does my current coverage include protection for job loss, disability, or critical illness — not just life coverage?
- If my income changed suddenly, how long would my existing protection support my mortgage payments?
- Has anything changed in my household over the last five years that should change how I think about coverage?
These aren’t complicated conversations. But they’re ones that many Canadians haven’t had reason to have, until now.
The bottom line
Mortgage renewal season draws attention to rates, terms, and lender options. All of that matters. But it’s also an opportunity to look beyond the payment and ask a more fundamental question: if something unexpected happened, is your home protected?
For the millions of Canadians renewing in 2026, this is the moment to find out.
CAFII is the Canadian Association of Financial Institutions in Insurance. We work to support an open, competitive marketplace that gives consumers expanded choice and access to insurance products and services. Learn more about mortgage protection options at cafii.com.
