Hi Raymond Tong
Based on the error message "UserErrorKeyVaultPermissionsNotConfigured", it appears that you do not have sufficient permissions on the Key Vault required to back up encrypted virtual machines.
Since your access configuration is set using Key Vault access policies, you must explicitly grant permissions to Azure Backup to access the Key Vault.
Please follow the steps below to set the required permissions:
1.Sign in to the Azure portal.
2.Search for "Key vaults" and select your Key Vault.
3.Go to Access policies and click Add Access Policy.
4.In the Add access policy pane, select Azure Backup from the template options.
- The necessary Key and Secret permissions will be pre-filled automatically.
- If your VM is encrypted using BEK only (BitLocker Encryption Key), you can remove the Key permissions and keep only the Secret permissions.
5.Click Add. This will add the Backup Management Service to the access policies.
6.Click Save to apply the changes and grant Azure Backup the necessary access.
Once these permissions are in place, please try performing the backup operation for your Azure VM again.
Hope this helps. Do let us know if you any further queries.