I've already faced this issue twice. There's a UPS and its mains cable is loose and all of a sudden the cable just falls out so the UPS gets disconnected from the mains. So it starts beeping which means it wants human attention. I come to the UPS and see that it has a yellow LED indicator with a "sine wave" sign next to it and the LED in permanently on.
Surely I don't have a manual with me and I don't know what "LED near the sine wave on" means, but I guess that the "sine wave" means "mains". I then have to decide whether the LED on is "good" or "bad".
Another design option would be to have an LED with two colors (or two LED of different colors close to each other) and green LED would mean "good" and red LED would mean "bad", but that could be suboptimal for people who don't reliably see colors.
I see the only clear option here - the LED should be permanently on when it's "good" and flash when it's "bad".
Is there a common best practice for such cases?