Blaney McMurtry’s Insurance Partner, David Mackenzie, was recently featured in an article by Insurance Business Canada Magazine discussing how managed service provider (MSP) contracts, not just cyber breaches, are reshaping cyber accumulation risk for insurers.
The piece highlights a critical but often overlooked issue: while MSPs sit at the centre of large-scale cyber incidents, the real exposure for insurers is often hidden in contractual terms. David emphasizes that limitation of liability clauses, outdated service agreements and “insurance carve-outs” can significantly impact recovery. In particular, he notes that some contracts allow claimants to bypass liability caps entirely when insurance is available, effectively shifting greater exposure onto insurers.
He also underscores the practical challenges of subrogation in these scenarios. Even where liability exists, contractual caps, competing claims and limited policy limits often mean recovery is minimal, leaving insurers to absorb the loss.
Read the full article to explore how MSP contracts are quietly driving systemic cyber risk and what insurers should be watching for.