I would add to this - the default size of the index is 500GB. When the index fills, Splunk rolls off the oldest data. If you are adding about 50 GB/day to the index, it will only hold about 10 days of data.
If you have the disk space, you can simply make the index size bigger - that will fix your immediate problem. And yes, you can make your index enormous (petabytes are not uncommon) if you have the disk space. Splunk doesn't care. However, some of the other answers are good too - if you have that much data, you should think carefully about how to manage it.
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