All Daemonic models automatically pass any Fear or Terror tests that they are required to make.

When a unit would normally be required to make a Panic test, a Break test, or elects to Flee as a charge reaction, it must instead test for Daemonic Instability before it Gives Ground, Falls Back in Good Order, or Flees.

If a Daemonic unit Flees for any reason it will always Fall Back in Good Order instead.

How Daemonic units react to disruptions to the Aethyr in the course of battle is further defined by their Daemonic Alignment (see below):

Daemons of Khorne

The Blood God's relentless legions care only for the harvest of skulls, rendering Khorne's daemons utterly immune to retreat or distraction.

All Daemons of Khorne automatically pass any Panic tests that they are required to make and cannot choose to Flee as a charge reaction.

Daemons of Nurgle

Eager to smother their foes in a diseased, loving embrace, the children of Nurgle are relentless in their march towards the foe. Yet, their tether to the mortal realm can be shaken by the rejection of Grandfather Nurgle’s love through the sudden mass banishment of their kin.

All Daemons of Nurgle must test for Panic when required to do so, however they cannot choose to Flee as a charge reaction.

Daemons of Slaanesh

The lithe children of Slaanesh will gladly dance away from an uninspiring charge in pursuit of more stimulating prey, while the sudden, violent, banishment of their kin only anchors them deeper in ecstatic sensation.

All Daemons of Slaanesh automatically pass any Panic tests that they are required to make, however they may choose to Flee as a charge reaction.

Daemons of Tzeentch

Guided by the omniscient foresight of the Architect of Fate, the daemons of Tzeentch will readily dissolve into shifting mist to evade an oncoming charge or they may willingly sever their own tethers to safely vanish from the Material Realm precisely as planned.

Daemons of Tzeentch must test for Panic when required to do so, however, a Daemon of Tzeentch may always choose to fail a Panic test without rolling for Daemonic Instability (even if they would otherwise automatically pass it). Daemons of Tzeentch may choose to Flee as a charge reaction.