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We do use EBS, but AWS has a flag for "delete on terminate" where the EBS is automatically purged when the instance is terminated. Not 100% sure of the conditions for this to happen, but when you have a single boolean for something like that, and the only way to configure it is through their command line tools/API, and it's poorly documented, it makes me pretty uneasy.

Edit: We also have a script that takes a daily snapshot of all our EBSes, but we haven't tried to recover them (mostly due to lack of time to experiment).

I know, it does seem the default for "delete on terminate" is wrong. Most people use EBS root volumes in an attempt to gain persistence and a level of protection against accidental termination.

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