That all depends on the type of mortgage you have. If you have a high-ratio mortgage, by Canadian law you are required to insure the mortgage. A high-ratio mortgage is one in which the homeowner has less than 20% down. Mortgage insurance was designed to protect lenders against potential default. There is mortgage critical injury/disability insurance. Unlike high-ratio mortgage insurance, this type of insurance is not required and is more for peace of mind.
For more questions about real estate in Canada you can find many answers at
Also see the Pros and Cons of mortgage loan insurance in Canada.