diff --git a/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/ExecuteStepsUpdateTask.java b/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/ExecuteStepsUpdateTask.java
index d32da3e3ec9..c50dbd6f17c 100644
--- a/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/ExecuteStepsUpdateTask.java
+++ b/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/ExecuteStepsUpdateTask.java
@@ -6,6 +6,7 @@
 package org.elasticsearch.xpack.indexlifecycle;
 
 import org.apache.logging.log4j.Logger;
+import org.elasticsearch.ElasticsearchException;
 import org.elasticsearch.cluster.ClusterState;
 import org.elasticsearch.cluster.ClusterStateUpdateTask;
 import org.elasticsearch.common.logging.ESLoggerFactory;
@@ -98,6 +99,7 @@ public class ExecuteStepsUpdateTask extends ClusterStateUpdateTask {
 
     @Override
     public void onFailure(String source, Exception e) {
-        throw new RuntimeException(e); // NORELEASE implement error handling
+        throw new ElasticsearchException(
+                "policy [" + policy + "] for index [" + index.getName() + "] failed on step [" + startStep.getKey() + "].", e);
     }
 }
diff --git a/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/MoveToErrorStepUpdateTask.java b/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/MoveToErrorStepUpdateTask.java
index f58c6de2756..aabda52a799 100644
--- a/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/MoveToErrorStepUpdateTask.java
+++ b/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/MoveToErrorStepUpdateTask.java
@@ -5,6 +5,7 @@
  */
 package org.elasticsearch.xpack.indexlifecycle;
 
+import org.elasticsearch.ElasticsearchException;
 import org.elasticsearch.cluster.ClusterState;
 import org.elasticsearch.cluster.ClusterStateUpdateTask;
 import org.elasticsearch.common.settings.Settings;
@@ -56,6 +57,7 @@ public class MoveToErrorStepUpdateTask extends ClusterStateUpdateTask {
 
     @Override
     public void onFailure(String source, Exception e) {
-        throw new RuntimeException(e); // NORELEASE implement error handling
+        throw new ElasticsearchException("policy [" + policy + "] for index [" + index.getName()
+                + "] failed trying to move from step [" + currentStepKey + "] to the ERROR step.", e);
     }
 }
diff --git a/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/MoveToNextStepUpdateTask.java b/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/MoveToNextStepUpdateTask.java
index 1590598ce7e..97a140d8698 100644
--- a/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/MoveToNextStepUpdateTask.java
+++ b/x-pack/plugin/index-lifecycle/src/main/java/org/elasticsearch/xpack/indexlifecycle/MoveToNextStepUpdateTask.java
@@ -5,6 +5,7 @@
  */
 package org.elasticsearch.xpack.indexlifecycle;
 
+import org.elasticsearch.ElasticsearchException;
 import org.elasticsearch.cluster.ClusterState;
 import org.elasticsearch.cluster.ClusterStateUpdateTask;
 import org.elasticsearch.common.settings.Settings;
@@ -74,7 +75,8 @@ public class MoveToNextStepUpdateTask extends ClusterStateUpdateTask {
 
     @Override
     public void onFailure(String source, Exception e) {
-        throw new RuntimeException(e); // NORELEASE implement error handling
+        throw new ElasticsearchException("policy [" + policy + "] for index [" + index.getName() + "] failed trying to move from step ["
+                + currentStepKey + "] to step [" + nextStepKey + "].", e);
     }
 
     @FunctionalInterface
diff --git a/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/ClusterStateUpdateStepTests.java b/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/ClusterStateUpdateStepTests.java
deleted file mode 100644
index 95a74560d3f..00000000000
--- a/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/ClusterStateUpdateStepTests.java
+++ /dev/null
@@ -1,15 +0,0 @@
-/*
- * Copyright Elasticsearch B.V. and/or licensed to Elasticsearch B.V. under one
- * or more contributor license agreements. Licensed under the Elastic License;
- * you may not use this file except in compliance with the Elastic License.
- */
-package org.elasticsearch.xpack.indexlifecycle;
-
-import org.elasticsearch.test.ESTestCase;
-
-public class ClusterStateUpdateStepTests extends ESTestCase {
-
-    public void test() {
-
-    }
-}
diff --git a/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/ExecuteStepsUpdateTaskTests.java b/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/ExecuteStepsUpdateTaskTests.java
index c51137ffaef..655ec1f55ad 100644
--- a/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/ExecuteStepsUpdateTaskTests.java
+++ b/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/ExecuteStepsUpdateTaskTests.java
@@ -5,6 +5,7 @@
  */
 package org.elasticsearch.xpack.indexlifecycle;
 
+import org.elasticsearch.ElasticsearchException;
 import org.elasticsearch.Version;
 import org.elasticsearch.cluster.ClusterName;
 import org.elasticsearch.cluster.ClusterState;
@@ -167,6 +168,19 @@ public class ExecuteStepsUpdateTaskTests extends ESTestCase {
         assertThat(LifecycleSettings.LIFECYCLE_ACTION_TIME_SETTING.get(newState.metaData().index(index).getSettings()), equalTo(-1L));
     }
 
+    public void testOnFailure() {
+        setStateToKey(secondStepKey);
+        Step startStep = policyStepsRegistry.getStep(mixedPolicyName, secondStepKey);
+        long now = randomNonNegativeLong();
+        ExecuteStepsUpdateTask task = new ExecuteStepsUpdateTask(mixedPolicyName, index, startStep, policyStepsRegistry, () -> now);
+        Exception expectedException = new RuntimeException();
+        ElasticsearchException exception = expectThrows(ElasticsearchException.class,
+                () -> task.onFailure(randomAlphaOfLength(10), expectedException));
+        assertEquals("policy [" + mixedPolicyName + "] for index [" + index.getName() + "] failed on step [" + startStep.getKey() + "].",
+                exception.getMessage());
+        assertSame(expectedException, exception.getCause());
+    }
+
     private void setStateToKey(StepKey stepKey) {
         clusterState = ClusterState.builder(clusterState)
             .metaData(MetaData.builder(clusterState.metaData())
diff --git a/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/MoveToErrorStepUpdateTaskTests.java b/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/MoveToErrorStepUpdateTaskTests.java
index 78e3f204587..3be847d1bfe 100644
--- a/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/MoveToErrorStepUpdateTaskTests.java
+++ b/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/MoveToErrorStepUpdateTaskTests.java
@@ -5,6 +5,7 @@
  */
 package org.elasticsearch.xpack.indexlifecycle;
 
+import org.elasticsearch.ElasticsearchException;
 import org.elasticsearch.Version;
 import org.elasticsearch.cluster.ClusterName;
 import org.elasticsearch.cluster.ClusterState;
@@ -79,6 +80,21 @@ public class MoveToErrorStepUpdateTaskTests extends ESTestCase {
         assertThat(newState, sameInstance(clusterState));
     }
 
+    public void testOnFailure() {
+        StepKey currentStepKey = new StepKey("current-phase", "current-action", "current-name");
+        long now = randomNonNegativeLong();
+
+        setStateToKey(currentStepKey);
+
+        MoveToErrorStepUpdateTask task = new MoveToErrorStepUpdateTask(index, policy, currentStepKey, () -> now);
+        Exception expectedException = new RuntimeException();
+        ElasticsearchException exception = expectThrows(ElasticsearchException.class,
+                () -> task.onFailure(randomAlphaOfLength(10), expectedException));
+        assertEquals("policy [" + policy + "] for index [" + index.getName() + "] failed trying to move from step [" + currentStepKey
+                + "] to the ERROR step.", exception.getMessage());
+        assertSame(expectedException, exception.getCause());
+    }
+
     private void setStatePolicy(String policy) {
         clusterState = ClusterState.builder(clusterState)
             .metaData(MetaData.builder(clusterState.metaData())
diff --git a/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/MoveToNextStepUpdateTaskTests.java b/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/MoveToNextStepUpdateTaskTests.java
index eddf60ed658..766031bef1f 100644
--- a/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/MoveToNextStepUpdateTaskTests.java
+++ b/x-pack/plugin/index-lifecycle/src/test/java/org/elasticsearch/xpack/indexlifecycle/MoveToNextStepUpdateTaskTests.java
@@ -6,6 +6,7 @@
 package org.elasticsearch.xpack.indexlifecycle;
 
 import org.apache.lucene.util.SetOnce;
+import org.elasticsearch.ElasticsearchException;
 import org.elasticsearch.Version;
 import org.elasticsearch.cluster.ClusterName;
 import org.elasticsearch.cluster.ClusterState;
@@ -96,6 +97,24 @@ public class MoveToNextStepUpdateTaskTests extends ESTestCase {
         assertNull(changed.get());
     }
 
+    public void testOnFailure() {
+        StepKey currentStepKey = new StepKey("current-phase", "current-action", "current-name");
+        StepKey nextStepKey = new StepKey("next-phase", "next-action", "next-name");
+        long now = randomNonNegativeLong();
+
+        setStateToKey(currentStepKey);
+
+        SetOnce<Boolean> changed = new SetOnce<>();
+        MoveToNextStepUpdateTask.Listener listener = (c) -> changed.set(true);
+        MoveToNextStepUpdateTask task = new MoveToNextStepUpdateTask(index, policy, currentStepKey, nextStepKey, () -> now, listener);
+        Exception expectedException = new RuntimeException();
+        ElasticsearchException exception = expectThrows(ElasticsearchException.class,
+                () -> task.onFailure(randomAlphaOfLength(10), expectedException));
+        assertEquals("policy [" + policy + "] for index [" + index.getName() + "] failed trying to move from step [" + currentStepKey
+                + "] to step [" + nextStepKey + "].", exception.getMessage());
+        assertSame(expectedException, exception.getCause());
+    }
+
     private void setStatePolicy(String policy) {
         clusterState = ClusterState.builder(clusterState)
             .metaData(MetaData.builder(clusterState.metaData())