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Canada needs to be better prepared to weather a housing crash that would leave taxpayers and mortgage insurers on the hook, according to a report.

The country should build a fund to cover taxpayer losses of as much as $9 billion, which the government could tap in case of mass defaults, according to a report from the C.D. Howe Institute scheduled for release Wednesday. The fund would build up reserves over 50 years through an additional charge on mortgage-insurance products, be overseen by the government and have a quasi-regulatory role.

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The sole purpose of the agency would be to staunch the effects of a U.S.-style housing collapse. The fund could issue bonds secured by future fee premiums in case a crash occurs before sufficient reserves have been built up.

“These big events happen, they don’t happen very often, but they’re costly when they do,” James MacGee, one of the report authors and associate professor of economics at Western University, said by phone. “What we want to do is redesign the Canadian mortgage-insurance infrastructure.”