diff --git a/chanbackup/pubsub.go b/chanbackup/pubsub.go
index b9331820..87d61299 100644
--- a/chanbackup/pubsub.go
+++ b/chanbackup/pubsub.go
@@ -18,12 +18,14 @@ type Swapper interface {
 	// UpdateAndSwap attempts to atomically update the main multi back up
 	// file location with the new fully packed multi-channel backup.
 	UpdateAndSwap(newBackup PackedMulti) error
+
+	// ExtractMulti attempts to obtain and decode the current SCB instance
+	// stored by the Swapper instance.
+	ExtractMulti(keychain keychain.KeyRing) (*Multi, error)
 }
 
 // ChannelWithAddrs bundles an open channel along with all the addresses for
 // the channel peer.
-//
-// TODO(roasbeef): use channel shell instead?
 type ChannelWithAddrs struct {
 	*channeldb.OpenChannel
 
@@ -75,8 +77,6 @@ type ChannelNotifier interface {
 // update the file state on disk with the new set of open channels.  This can
 // be used to implement a system that always keeps the multi-chan backup file
 // on disk in a consistent state for safety purposes.
-//
-// TODO(roasbeef): better name lol
 type SubSwapper struct {
 	started sync.Once
 	stopped sync.Once
@@ -155,12 +155,50 @@ func (s *SubSwapper) Stop() error {
 }
 
 // updateBackupFile updates the backup file in place given the current state of
-// the SubSwapper.
-func (s *SubSwapper) updateBackupFile() error {
+// the SubSwapper. We accept the set of channels that were closed between this
+// update and the last to make sure we leave them out of our backup set union.
+func (s *SubSwapper) updateBackupFile(closedChans ...wire.OutPoint) error {
+	// Before we pack the new set of SCBs, we'll first decode what we
+	// already have on-disk, to make sure we can decode it (proper seed)
+	// and that we're able to combine it with our new data.
+	diskMulti, err := s.Swapper.ExtractMulti(s.keyRing)
+	if err != nil {
+		return fmt.Errorf("unable to extract on disk encrypted "+
+			"SCB: %v", err)
+	}
+
+	// Now that we have channels stored on-disk, we'll create a new set of
+	// the combined old and new channels to make sure we retain what's
+	// already on-disk.
+	//
+	// NOTE: The ordering of this operations means that our in-memory
+	// structure will replace what we read from disk.
+	combinedBackup := make(map[wire.OutPoint]Single)
+	if diskMulti != nil {
+		for _, diskChannel := range diskMulti.StaticBackups {
+			chanPoint := diskChannel.FundingOutpoint
+			combinedBackup[chanPoint] = diskChannel
+		}
+	}
+	for _, memChannel := range s.backupState {
+		chanPoint := memChannel.FundingOutpoint
+		if _, ok := combinedBackup[chanPoint]; ok {
+			log.Warnf("Replacing disk backup for ChannelPoint(%v) "+
+				"w/ newer version", chanPoint)
+		}
+
+		combinedBackup[chanPoint] = memChannel
+	}
+
+	// Remove the set of closed channels from the final set of backups.
+	for _, closedChan := range closedChans {
+		delete(combinedBackup, closedChan)
+	}
+
 	// With our updated channel state obtained, we'll create a new multi
 	// from our series of singles.
 	var newMulti Multi
-	for _, backup := range s.backupState {
+	for _, backup := range combinedBackup {
 		newMulti.StaticBackups = append(
 			newMulti.StaticBackups, backup,
 		)
@@ -169,13 +207,14 @@ func (s *SubSwapper) updateBackupFile() error {
 	// Now that our multi has been assembled, we'll attempt to pack
 	// (encrypt+encode) the new channel state to our target reader.
 	var b bytes.Buffer
-	err := newMulti.PackToWriter(&b, s.keyRing)
+	err = newMulti.PackToWriter(&b, s.keyRing)
 	if err != nil {
 		return fmt.Errorf("unable to pack multi backup: %v", err)
 	}
 
 	// Finally, we'll swap out the old backup for this new one in a single
-	// atomic step.
+	// atomic step, combining the file already on-disk with this set of new
+	// channels.
 	err = s.Swapper.UpdateAndSwap(PackedMulti(b.Bytes()))
 	if err != nil {
 		return fmt.Errorf("unable to update multi backup: %v", err)
@@ -198,6 +237,8 @@ func (s *SubSwapper) backupUpdater() {
 
 	// Before we enter our main loop, we'll update the on-disk state with
 	// the latest Single state, as nodes may have new advertised addresses.
+	//
+	// TODO(roasbeef): do in Start() so we don't start with an invalid SCB?
 	if err := s.updateBackupFile(); err != nil {
 		log.Errorf("Unable to refresh backup file: %v", err)
 	}
@@ -223,6 +264,9 @@ func (s *SubSwapper) backupUpdater() {
 
 			// For all closed channels, we'll remove the prior
 			// backup state.
+			closedChans := make(
+				[]wire.OutPoint, 0, len(chanUpdate.ClosedChans),
+			)
 			for i, closedChan := range chanUpdate.ClosedChans {
 				log.Debugf("Removing channel %v from backup "+
 					"state", newLogClosure(func() string {
@@ -230,6 +274,8 @@ func (s *SubSwapper) backupUpdater() {
 				}))
 
 				delete(s.backupState, closedChan)
+
+				closedChans = append(closedChans, closedChan)
 			}
 
 			newStateSize := len(s.backupState)
@@ -240,7 +286,7 @@ func (s *SubSwapper) backupUpdater() {
 
 			// With out new state constructed, we'll, atomically
 			// update the on-disk backup state.
-			if err := s.updateBackupFile(); err != nil {
+			if err := s.updateBackupFile(closedChans...); err != nil {
 				log.Errorf("unable to update backup file: %v",
 					err)
 			}
diff --git a/chanbackup/pubsub_test.go b/chanbackup/pubsub_test.go
index 30bc689e..8f4b73c6 100644
--- a/chanbackup/pubsub_test.go
+++ b/chanbackup/pubsub_test.go
@@ -2,12 +2,10 @@ package chanbackup
 
 import (
 	"fmt"
-	"reflect"
 	"testing"
 	"time"
 
 	"github.com/btcsuite/btcd/wire"
-	"github.com/davecgh/go-spew/spew"
 	"github.com/lightningnetwork/lnd/keychain"
 )
 
@@ -15,11 +13,17 @@ type mockSwapper struct {
 	fail bool
 
 	swaps chan PackedMulti
+
+	swapState *Multi
+
+	keyChain keychain.KeyRing
 }
 
-func newMockSwapper() *mockSwapper {
+func newMockSwapper(keychain keychain.KeyRing) *mockSwapper {
 	return &mockSwapper{
-		swaps: make(chan PackedMulti),
+		swaps:     make(chan PackedMulti),
+		keyChain:  keychain,
+		swapState: &Multi{},
 	}
 }
 
@@ -28,11 +32,22 @@ func (m *mockSwapper) UpdateAndSwap(newBackup PackedMulti) error {
 		return fmt.Errorf("fail")
 	}
 
+	swapState, err := newBackup.Unpack(m.keyChain)
+	if err != nil {
+		return fmt.Errorf("unable to decode on disk swaps: %v", err)
+	}
+
+	m.swapState = swapState
+
 	m.swaps <- newBackup
 
 	return nil
 }
 
+func (m *mockSwapper) ExtractMulti(keychain keychain.KeyRing) (*Multi, error) {
+	return m.swapState, nil
+}
+
 type mockChannelNotifier struct {
 	fail bool
 
@@ -87,7 +102,7 @@ func assertExpectedBackupSwap(t *testing.T, swapper *mockSwapper,
 	case newPackedMulti := <-swapper.swaps:
 		// If we unpack the new multi, then we should find all the old
 		// channels, and also the new channel included and any deleted
-		// channel omitted..
+		// channel omitted.
 		newMulti, err := newPackedMulti.Unpack(keyRing)
 		if err != nil {
 			t.Fatalf("unable to unpack multi: %v", err)
@@ -111,12 +126,19 @@ func assertExpectedBackupSwap(t *testing.T, swapper *mockSwapper,
 			}
 		}
 
-		// The internal state of the sub-swapper should also be one
-		// larger.
-		if !reflect.DeepEqual(expectedChanSet, subSwapper.backupState) {
-			t.Fatalf("backup set doesn't match: expected %v got %v",
-				spew.Sdump(expectedChanSet),
-				spew.Sdump(subSwapper.backupState))
+		// The same applies for our in-memory state, but it's also
+		// possible for there to be items in the on-disk state that we
+		// don't know of explicit.
+		newChans := make(map[wire.OutPoint]Single)
+		for _, newChan := range newMulti.StaticBackups {
+			newChans[newChan.FundingOutpoint] = newChan
+		}
+		for _, backup := range subSwapper.backupState {
+			_, ok := newChans[backup.FundingOutpoint]
+			if !ok {
+				t.Fatalf("didn't find backup in original set: %v",
+					backup.FundingOutpoint)
+			}
 		}
 
 	case <-time.After(time.Second * 5):
@@ -133,7 +155,7 @@ func TestSubSwapperIdempotentStartStop(t *testing.T) {
 
 	var chanNotifier mockChannelNotifier
 
-	swapper := newMockSwapper()
+	swapper := newMockSwapper(keyRing)
 	subSwapper, err := NewSubSwapper(nil, &chanNotifier, keyRing, swapper)
 	if err != nil {
 		t.Fatalf("unable to init subSwapper: %v", err)
@@ -162,7 +184,7 @@ func TestSubSwapperUpdater(t *testing.T) {
 
 	keyRing := &mockKeyRing{}
 	chanNotifier := newMockChannelNotifier()
-	swapper := newMockSwapper()
+	swapper := newMockSwapper(keyRing)
 
 	// First, we'll start out by creating a channels set for the initial
 	// set of channels known to the sub-swapper.
@@ -181,6 +203,24 @@ func TestSubSwapperUpdater(t *testing.T) {
 		initialChanSet = append(initialChanSet, single)
 	}
 
+	// We'll also generate two additional channels which will already be
+	// present on disk. However, these will at first only be known by the
+	// on disk backup (the backup set).
+	const numDiskChans = 2
+	for i := 0; i < numDiskChans; i++ {
+		channel, err := genRandomOpenChannelShell()
+		if err != nil {
+			t.Fatalf("unable to make test chan: %v", err)
+		}
+
+		single := NewSingle(channel, nil)
+
+		backupSet[channel.FundingOutpoint] = single
+		swapper.swapState.StaticBackups = append(
+			swapper.swapState.StaticBackups, single,
+		)
+	}
+
 	// With our channel set created, we'll make a fresh sub swapper
 	// instance to begin our test.
 	subSwapper, err := NewSubSwapper(