Life Insurance With Mortgage Canada — Lender vs Personal Policy (2026)
When you have a mortgage, you have two main ways to protect it with life insurance: lender (bank) mortgage insurance or a personal term life policy. This guide compares both across Canada and explains why personal life insurance with a mortgage often gives better value and control. For Ontario-specific detail see do you need life insurance if you have a mortgage in Ontario.
Updated March 16, 2026
Lender mortgage insurance vs personal life insurance
Lender insurance is offered by the bank when you get a mortgage. The coverage is often tied to the loan balance and the bank is the beneficiary; premiums can be higher than a comparable term life policy and the product is usually less flexible. Personal term life is a policy you own: you choose the coverage amount and beneficiary. The death benefit can pay off the mortgage, replace income, or both. You can shop across 50+ insurers — see compare quotes. The FCAC recommends understanding the difference before deciding.
How much life insurance with a mortgage?
A simple rule is to cover at least the outstanding mortgage balance so the benefit can pay off the loan. Many families also add coverage for income replacement and other debts. Use our coverage calculator or how much life insurance coverage to size the amount; then get life insurance quotes for that amount.
Term length
Match the term to your mortgage — e.g. 20- or 30-year term for a long amortization. 30 year term life insurance locks in the rate for the longest period; 30 year term Canada has more on who it suits.
FAQ
Should I get life insurance through my bank for my mortgage?
Often no. Personal term life usually costs less and gives you ownership and choice of beneficiary. Compare both.
How much do I need for my mortgage?
At least the mortgage balance; many add income replacement. Use a coverage calculator and compare term quotes.
What term length?
Match your mortgage — e.g. 20 or 30 years. Term life is flexible and convertible.
Compare life insurance for your mortgage
Compare life insurance quotes and see how personal term compares to lender insurance. Also see life insurance and mortgage Ontario and term life insurance Canada.