Chargeback insurance

Chargeback insurance refers to insurance coverage protects merchants who accepts credit cards. The coverage protects the merchant against fraud in a transaction where the use of the credit card was unauthorized, and covers claims arising out of the merchant’s liability to the service bank.

This coverage can apply under a number of circumstances, including:

• A credit card is lost or stolen and used before the cardholder can report it
• Credit Card Number Generators or Counterfeit Plastic Cards
• Post-purchase "ship to" information changes
• Signature mismatch or signature not on file.

Merchants are reimbursed for:

• The cost of a stolen product or service
• The loss of profit

A typical chargeback insurance policy will only cover losses on credit card transactions purchased through its own specific credit card processor or payment gateway.