If a CDS is x%, why does this mean $(1 - x)\%$ probability of default?
Note that the 20% annual premium would imply a 20% annual default probability. Tim Bennett is then talking about the probability of default within five years.

He might have thought that
$$
1 - Prob(\text{no default for five years running}) = 1 - (1 - 0.2)^5 &gt; 0.8 
$$
but this is not true as 
$$
1 - (1 - 0.2)^5 \approx 0.67
$$