Encountered-type of Haptic devices (ETHD) are robotic interfaces physically overlaying virtual counterparts prior to a user interaction in Virtual Reality. They theoretically reliably provide haptics in Virtual environments, yet they raise several intrinsic design challenges to properly display rich haptic feedback and interactions in VR applications. In this paper, we use a Failure Mode and Effects Analysis (FMEA) approach to identify, organise and analyse the failure modes and their causes in the different stages of an ETHD scenario and highlight appropriate solutions from the literature to mitigate them. We help justify these interfaces' lack of deployment, to ultimately identify guidelines for future ETHD designers.