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Answers to common questions about Denota.

What's the Drawback of Chargeback Insurance?

Coverage Limitations: Chargeback insurance often only covers true fraud. Other common scenarios, such as unrecognized charges, unsatisfied customers, uncancelled subscriptions, or merchant/processing errors aren't covered. Even legitimate fraud cases can see claims denied if merchants haven’t followed every protocol set by the insurance provider.
Loss of Revenue: False positives resulting from insurance-mandated fraud prevention tools result in a staggering $443 billion in lost revenue annually (70x true fraud estimates!) since these tools are inherently biased in the provider's favor. Additionally, many of these tools introduce new sources of friction increasing purchase drop-off rates.
Lack of Merchant Discretion: With insurance mandates on fraud prevention tools, merchants often get a simple accept or reject response, missing out on the nuanced risk scores that would allow them to make informed decisions.
Maintenance Burden: Implementing fraud prevention filters isn't a one-time task. It demands constant manual reviews and adjustments to fraud filters, increasing operational overhead.
Chargeback Ratio Vulnerability: Even with insurance, chargebacks still hurt a merchant's chargeback ratio which can result in a number of penalties including fines, enforced prevention policies, and termination of all present and future banking services.