Techniques for policy-based failure handling of data that is received for processing by failed edge services are described herein. The techniques may include receiving, at an edge node of a network, a data handling policy for a service hosted on the edge node. The service may be configured to process traffic on behalf of an application hosted by a cloud-based platform. In some examples, the data handling policy may be stored in a memory that is accessible to the edge node. The techniques may also include receiving traffic at the edge node that is to be processed at least partially by the service. At least partially responsive to detecting an error associated with the service, the edge node may cause the traffic to be handled according to the data handling policy while the service is experiencing the error.