M-447 Voluntary Insurance

That the Standing Committee on Finance be instructed to study and make recommendations regarding a voluntary insurance hedging mechanism to protect Canadians from a rapid escalation of mortgage interest rates and provide a temporary financial cushion, and to consider, among other things, (i) current levels of mortgage debt in Canada, (ii) the potential effect of a rapid escalation of mortgage rates on the Canadian economy taking into account current national mortgage debt levels, (iii) historical information and evidence from previous worldwide and Canadian recessions regarding rapid rate escalation, (iv) the option for institutions currently offering mortgage services, to also offer optional mortgage rate insurance to new and existing mortgage-holders which would insure against dramatically increased mortgage payments resulting from significantly escalating mortgage rates, and would be applied to the difference between the actual mortgage rate and the insured rate and for a specific number of months, (v) a suite of insurance products which would allow consumers to choose between various levels of risk and various term-lengths, (vi) options for commercial mortgage rate insurance products to offset potential losses by corporations as a result of significantly escalating mortgage rates, (vii) consequential positive and/or negative benefits to mortgage-holders, (viii) consequential positive and/or negative benefits to the Canadian economy, (ix) how such a mechanism could be applied to all mortgage types, (x) how to best move forward in implementing such a mechanism or mechanisms; and that the Committee report its findings and recommendations to this House within one year of the adoption of this Order.