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Does Backup include Virtual Machines?

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I am running Win7 x64 with Acronis TI Home 2011.
One of my backups is a "disk" backup to an external USB drive. The backup scheme is "Version chain scheme." The backup includes "System Reserved" and "Local Disk C". The backup runs successfully every day at 5 PM.

I want to ensure that this backup could be used to do a "bare metal recovery." I have a Win XP Virual Machine that runs in Windows 7. It is essential that this VM is backed up as part of the backup operation.

Does my existing backup satisfy this requirement?

Thanks in advance,

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Yes, the backup contains all the files, including the virtual machine files saved on that disk.

Make sure you have a recovery CD that you have tested: you boot on it, you navigate to your backups, you even restore a couple of files.

Also validate your backups, from time to time at a minimum.