By the end of 2026, the managed service provider (MSP) market will look fundamentally different to that of today. The shift will not be driven by technology alone, but by regulation, insurance, board-level scrutiny and supply-chain pressure too. Critically, MSPs will sit at the centre of the UK’s cyber resilience ecosystem and will be expected to prove it every day. But which changes will affect MSPs the most?
Introduction of the UK’s Cyber Security and Resilience Bill
The most visible catalyst is regulation. In November 2025, the UK’s Cyber Security and Resilience Bill was introduced to the House of Commons. The Bill represents one of the most significant government-led cybersecurity reforms in recent years. Once enacted, the Bill will broaden both the definition and the responsibilities of ‘Relevant Managed Service Providers,’ bringing an estimated 1,000 MSPs directly into scope, particularly those supporting critical national infrastructure (CNI) or public sector-linked organisations. Adoption of the Cyber Assessment Framework across critical sectors will introduce clearer expectations around baseline security controls, incident reporting and formal assurance. For many MSPs, this marks a transition from being indirectly affected by regulation through clients, to being regulated entities in their own right, under the banner of the new Information Commission (IC).
This change matters because it resets the relationship between MSPs, customers and regulators. Transparency and discipline will no longer be optional differentiators, rather they will be critical stakes. Recent research suggests that the market is already moving in this direction, with 77% of MSPs reporting the increased scrutiny of their security capabilities by prospects and customers over the past year. By 2026, that scrutiny will be systematic, continuous and often externally enforced.
Real Time Operational Risk Becomes Key Insurance Indicator
Insurance will play a parallel role in accelerating this shift. The cyber insurance market is moving away from static, point-in-time questionnaires that fail to reflect real operational risk. Instead, insurers are increasingly requesting continuous security telemetry, particularly for small and medium-sized businesses (SMBs). This reflects a growing consensus that cyber risk can only be understood through real-time visibility. For MSPs, this creates both pressure and opportunity. Those able to deliver continuous monitoring and evidence-based assurance will become essential partners in helping customers secure cover at viable premiums. Those that cannot will find themselves excluded from deals before conversations even begin.
Board Expectations Will Rise Sharply
At the same time, board-level expectations are rising sharply, with cybersecurity fast becoming an essential board discussion. Directors are no longer satisfied with policies, frameworks or certifications that look impressive but cannot be demonstrated in practice. This shift coincides with the increasing media attention given to high-profile hacks, especially those that have led to significant financial and reputational losses. No doubt board members have stood up to the potential risk and devastation of a cyber incident. Now, boards need verifiable proof of operational cyber hygiene, including controls that are implemented, monitored and effective on a day-to-day basis. This is driving rapid adoption of automated evidence collection and continuous control monitoring, replacing annual compliance exercises with living assurance models. By 2026, MSPs will increasingly be judged not on what they say they do, but on what their data shows they are doing right now.
Increased Supply-Chain Scrutiny
Supply-chain security will complete the picture. High-profile interventions such as the FTSE 350 cyber letter and updated defence requirements under CSM v4 have pushed cyber resilience firmly into mainstream procurement. Cyber resilience is now a normal, expected and enforceable part of how organisations select and retain suppliers, not a specialist conversation reserved for security teams or high-risk contracts. Large organisations now expect their suppliers, including SMEs supported by MSPs, to demonstrate consistent, certifiable cyber controls. This pressure flows downstream, making MSPs key enablers of supply-chain compliance. In practice, this means MSPs must standardise security baselines across their customer base, ensuring resilience is not bespoke or ad hoc, but repeatable and provable.
Key Takeaways: The MSP in 2026
Between increased regulation and increased scrutiny and dependence, MSPs will evolve from trusted IT partners into regulated cyber operators. Success will depend on their ability to provide continuous assurance, real-time visibility and demonstrable resilience, not just for clients but for themselves. Whilst there’s no enforcement date yet, those who adapt early will find regulation, insurance and supply-chain demands reinforcing their value. Those who delay will discover that the market no longer rewards intent, only evidence.
