Automated Fault and Recovery System

A mechanism is provided for handling incidents occurring in a managed environment. An incident is detected in a resource in the managed environment. A set of incident handling actions are identified based on incident handling rules for an incident type of the incident. From the set of incident handling actions, one incident handling action is identified to be executed based on a set of impact indicators associated with the set of incident handling rules. The identified incident handling action is then executed to address the failure of the resource.