diff --git a/charts/kubewarden-defaults/templates/_helpers.tpl b/charts/kubewarden-defaults/templates/_helpers.tpl
index 197fb4e7..fc0aea2e 100644
--- a/charts/kubewarden-defaults/templates/_helpers.tpl
+++ b/charts/kubewarden-defaults/templates/_helpers.tpl
@@ -76,3 +76,11 @@ namespaceSelector:
 {{- printf "%s/" .Values.global.cattle.systemDefaultRegistry -}}
 {{- end -}}
 {{- end -}}
+
+{{- define "policy_failure_policy" -}}
+{{- if eq .Values.recommendedPolicies.defaultPolicyMode "protect" -}}
+Fail
+{{- else -}}
+Ignore
+{{- end -}}
+{{- end -}}
diff --git a/charts/kubewarden-defaults/templates/allow-privileged-escalation-policy.yaml b/charts/kubewarden-defaults/templates/allow-privileged-escalation-policy.yaml
index e293a946..16d84425 100644
--- a/charts/kubewarden-defaults/templates/allow-privileged-escalation-policy.yaml
+++ b/charts/kubewarden-defaults/templates/allow-privileged-escalation-policy.yaml
@@ -12,6 +12,7 @@ metadata:
   name: {{ $.Values.recommendedPolicies.allowPrivilegeEscalationPolicy.name }}
 spec:
   mode: {{ $.Values.recommendedPolicies.defaultPolicyMode }}
+  failurePolicy: {{ template "policy_failure_policy" . }}
   module: {{ template "policy_default_registry" . }}{{ .Values.recommendedPolicies.allowPrivilegeEscalationPolicy.module.repository }}:{{ .Values.recommendedPolicies.allowPrivilegeEscalationPolicy.module.tag }}
 {{ include "policy-namespace-selector" . | indent 2}}
   rules:
diff --git a/charts/kubewarden-defaults/templates/capabilities-policy.yaml b/charts/kubewarden-defaults/templates/capabilities-policy.yaml
index 863b402c..0012198d 100644
--- a/charts/kubewarden-defaults/templates/capabilities-policy.yaml
+++ b/charts/kubewarden-defaults/templates/capabilities-policy.yaml
@@ -12,6 +12,7 @@ metadata:
   name: {{ $.Values.recommendedPolicies.capabilitiesPolicy.name }}
 spec:
   mode: {{ $.Values.recommendedPolicies.defaultPolicyMode }}
+  failurePolicy: {{ template "policy_failure_policy" . }}
   module: {{ template "policy_default_registry" . }}{{ .Values.recommendedPolicies.capabilitiesPolicy.module.repository }}:{{ .Values.recommendedPolicies.capabilitiesPolicy.module.tag }}
 {{ include "policy-namespace-selector" . | indent 2}}
   rules:
diff --git a/charts/kubewarden-defaults/templates/host-namespace-policy.yaml b/charts/kubewarden-defaults/templates/host-namespace-policy.yaml
index ae0825c7..abe3ab24 100644
--- a/charts/kubewarden-defaults/templates/host-namespace-policy.yaml
+++ b/charts/kubewarden-defaults/templates/host-namespace-policy.yaml
@@ -12,6 +12,7 @@ metadata:
   name: {{ $.Values.recommendedPolicies.hostNamespacePolicy.name }}
 spec:
   mode: {{ $.Values.recommendedPolicies.defaultPolicyMode }}
+  failurePolicy: {{ template "policy_failure_policy" . }}
   module: {{ template "policy_default_registry" . }}{{ .Values.recommendedPolicies.hostNamespacePolicy.module.repository }}:{{ .Values.recommendedPolicies.hostNamespacePolicy.module.tag }}
 {{ include "policy-namespace-selector" . | indent 2}}
   rules:
diff --git a/charts/kubewarden-defaults/templates/host-path-policy.yaml b/charts/kubewarden-defaults/templates/host-path-policy.yaml
index b3e15438..c84a680c 100644
--- a/charts/kubewarden-defaults/templates/host-path-policy.yaml
+++ b/charts/kubewarden-defaults/templates/host-path-policy.yaml
@@ -12,6 +12,7 @@ metadata:
   name: {{ $.Values.recommendedPolicies.hostPathsPolicy.name }}
 spec:
   mode: {{ $.Values.recommendedPolicies.defaultPolicyMode }}
+  failurePolicy: {{ template "policy_failure_policy" . }}
   module: {{ template "policy_default_registry" . }}{{ .Values.recommendedPolicies.hostPathsPolicy.module.repository }}:{{ .Values.recommendedPolicies.hostPathsPolicy.module.tag }}
 {{ include "policy-namespace-selector" . | indent 2}}
   rules:
diff --git a/charts/kubewarden-defaults/templates/pod-privileged-policy.yaml b/charts/kubewarden-defaults/templates/pod-privileged-policy.yaml
index 7c448ceb..51c7122a 100644
--- a/charts/kubewarden-defaults/templates/pod-privileged-policy.yaml
+++ b/charts/kubewarden-defaults/templates/pod-privileged-policy.yaml
@@ -12,6 +12,7 @@ metadata:
   name: {{ $.Values.recommendedPolicies.podPrivilegedPolicy.name }}
 spec:
   mode: {{ $.Values.recommendedPolicies.defaultPolicyMode }}
+  failurePolicy: {{ template "policy_failure_policy" . }}
   module: {{ template "policy_default_registry" . }}{{ .Values.recommendedPolicies.podPrivilegedPolicy.module.repository }}:{{ .Values.recommendedPolicies.podPrivilegedPolicy.module.tag }}
 
 {{ include "policy-namespace-selector" . | indent 2}}
diff --git a/charts/kubewarden-defaults/templates/user-group-policy.yaml b/charts/kubewarden-defaults/templates/user-group-policy.yaml
index a532925d..1020e2a9 100644
--- a/charts/kubewarden-defaults/templates/user-group-policy.yaml
+++ b/charts/kubewarden-defaults/templates/user-group-policy.yaml
@@ -12,6 +12,7 @@ metadata:
   name: {{ $.Values.recommendedPolicies.userGroupPolicy.name }}
 spec:
   mode: {{ $.Values.recommendedPolicies.defaultPolicyMode }}
+  failurePolicy: {{ template "policy_failure_policy" . }}
   module: {{ template "policy_default_registry" . }}{{ .Values.recommendedPolicies.userGroupPolicy.module.repository }}:{{ .Values.recommendedPolicies.userGroupPolicy.module.tag }}
 {{ include "policy-namespace-selector" . | indent 2}}
   rules:
diff --git a/charts/kubewarden-defaults/tests/failure_policy_test.yaml b/charts/kubewarden-defaults/tests/failure_policy_test.yaml
new file mode 100644
index 00000000..56e0eafd
--- /dev/null
+++ b/charts/kubewarden-defaults/tests/failure_policy_test.yaml
@@ -0,0 +1,25 @@
+suite: set failurePolicy based upon mode
+templates:
+  - allow-privileged-escalation-policy.yaml
+  - capabilities-policy.yaml
+  - host-namespace-policy.yaml
+  - host-path-policy.yaml
+  - pod-privileged-policy.yaml
+  - user-group-policy.yaml
+tests:
+  - it: "should ignore on webhook failures if in monitor mode"
+    set:
+      recommendedPolicies.enabled: true
+      recommendedPolicies.defaultPolicyMode: "monitor"
+    asserts:
+      - equal:
+          path: spec.failurePolicy
+          value: Ignore
+  - it: "should reject on webhook failures if in protect mode"
+    set:
+      recommendedPolicies.enabled: true
+      recommendedPolicies.defaultPolicyMode: "protect"
+    asserts:
+      - equal:
+          path: spec.failurePolicy
+          value: Fail