You pay the premium on every covered order, not just the disputed ones. So the only question that matters is whether fraud chargebacks cost you more than the rate you're quoted. Sometimes they do.
Quick answer: "chargeback insurance" is usually a chargeback guarantee that reimburses you for approved orders that turn out fraudulent. Published rates: Stripe 0.4% per transaction, PayPal 0.40% (0.60% Effortless), and Shopify Protect free on eligible Shop Pay orders. Standalone guarantees quote a custom percentage of approved order value.
It pays you back after a dispute — it does not stop the dispute, and it does not lower your dispute ratio, which is what the card networks actually monitor.
| Program | Published cost | Covers |
|---|---|---|
| Shopify Protect | Free | Fraud + unrecognized chargebacks on eligible Shop Pay orders (US, physical goods) |
| Stripe Chargeback Protection | 0.4% per transaction | Fraud disputes + the dispute fee, on Stripe Checkout card payments |
| PayPal Chargeback Protection | 0.40% (Effortless: 0.60%) | “Unauthorized” and “item not received” card chargebacks, up to a cap |
| Guarantee vendors (Signifyd, Riskified, Forter) | Custom % of approved orders | Fraud (some tiers add non-fraud) on orders the vendor approves |
| ClearSale | From $250 / month | Chargeback protection on approved orders |
| Traditional insurance rider | ~0.5–2% of volume + deductible | Specified fraud losses up to a policy limit |
US rates verified against processor pricing pages and vendor pages, October 2026. Guarantee vendors do not publish rates; figures are the model, not a quote.
Model a Stripe-style 0.4% program. The premium is charged on your whole protected volume; the payout (faster, same-day reimbursement) applies only to the fraud chargebacks that land — each reimbursing the order amount plus the dispute fee.
| Premium you pay (0.4% of sales) | −$200 |
| Disputes reimbursed (incl. $15 fee each) | +$190 |
| Net benefit per month | −$10 |
Read the result carefully: the premium is certain, the reimbursement is not. At Stripe's 0.4%, a program breaks even only when fraud chargebacks exceed roughly 1 in 300 orders. Most small stores sit below that line — which is why the money is usually better spent on prevention (alerts) and recovery (representment) first.
It doesn't lower your chargeback ratio. A reimbursed chargeback is still a filed one, and still counts against the ratio the card networks monitor. Guaranteeing the money doesn't protect you from a monitoring program — see the thresholds on the chargeback calculator.
It excludes most disputes. Friendly fraud, "item not received", subscriptions and fee losses are typically outside the policy. Since friendly fraud is one of the largest categories, a fraud-only guarantee can insure the smallest slice of your losses.
It incentivizes over-declining. Guarantee vendors are paid on approved orders, so they can profit by declining borderline orders you'd otherwise have approved — you pay for coverage and lose sales.
The order of operations: prevent first (alerts), recover what you can (representment), and only then buy a guarantee for the genuine third-party-fraud slice your own numbers justify. Insurance is the backstop, never the plan.
Stripe Chargeback Protection: 0.4% per transaction. PayPal: 0.40% (0.60% Effortless). Shopify Protect: free on eligible Shop Pay orders. Guarantee vendors (Signifyd, Riskified, Forter, ClearSale) quote custom percentages of approved order value; ClearSale starts at $250/mo. Traditional riders run ~0.5–2% of volume plus a deductible.
Only if fraud-coded chargebacks exceed roughly the premium rate. At 0.4%, that's about 1 fraud chargeback per 300 orders. Below that, the premium costs more than the losses it covers — prevention is the better buy.
Usually fraud-coded disputes only, on orders the provider approved, sometimes including the dispute fee. Friendly fraud, item-not-received, subscriptions and network fines are typically excluded.
Yes, for US stores on Shopify Payments. It reimburses the chargeback amount plus the fee on fraudulent and unrecognized chargebacks — but only on Shop Pay orders for physical goods, fulfilled within 7 days with supported-carrier tracking to the original address.
No. A reimbursed chargeback still counts against your dispute ratio. Insurance makes you whole on the money; only prevention keeps a dispute off the ratio.
The product usually sold as chargeback insurance — a vendor approves or declines each order and reimburses approved orders that turn out fraudulent, for a percentage of approved order value. Because it's paid on approved orders, declining borderline orders is built into its economics.
Only above ~1 fraud chargeback per 300 protected orders. It covers fraud disputes on Stripe Checkout card payments and reimburses the dispute fee, but not friendly fraud or item-not-received claims, and it's subject to a protection limit.
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