I had a “whale” subscriber spend $3,000 in one night on custom videos. I was ecstatic. Two weeks later, the notification came: “Chargeback Initiated – Fraudulent Transaction.” The platform not only took the $3,000 back but charged me a $25 fee. I lost the time, the content, and the money. I checked my business insurance for “Theft.”
Key Takeaways
- It’s Not “Theft,” It’s “Credit Risk”: Insurance covers you if someone steals cash from your register. It generally does not cover you if a customer refuses to pay a credit card bill.
- Trade Credit Insurance: This exists for B2B companies (protecting against clients going bankrupt), but it’s rarely available for B2C micro-transactions.
- Chargeback Protection Services: You don’t need insurance; you need a “Merchant of Record” or chargeback protection service (like Signifyd or specialized high-risk processors).
- The “Friendly Fraud” Loophole: Most chargebacks are “friendly fraud” (customer regrets the purchase). Insurance is almost impossible to get for this because it’s so common.
The “Why” (The Trap): The Voluntary Parting Exclusion
Most Commercial Property policies have an exclusion for “Voluntary Parting.” This means if you voluntarily give someone your property (the video) because they tricked you (the bad credit card), it is not covered as theft.
Insurance sees this as a bad business deal, not a crime. Since you authorized the transaction at the time, the insurance company will tell you to take it up with the bank or small claims court.
The Investigation: “I Called Them”
I looked for anyone covering “Chargeback Losses.”
1. The Platform Policies (OnlyFans / Fansly)
- The Reality: The platforms pass the risk to you. Their terms state that if a chargeback occurs, they deduct it from your earnings. They do not insure you.
2. High-Risk Merchant Accounts (Segpay / CCBill)
If you run your own site, you use these processors.
- The Reality: Some offer “Chargeback Mitigation” services. They will fight the dispute for you. If you win, you keep the money.
- The Cost: Higher fees (10-15% per transaction) vs. standard Stripe fees (2.9%).
3. “Cyber Deception” Insurance
Some advanced Cyber policies cover “Social Engineering Fraud.”
- The Analysis: This usually covers if you are tricked into sending money to a fake vendor. It rarely covers if a customer tricks you into sending a product.
Comparison Table: Managing Chargeback Risk
| Solution | Cost | Protection Level |
| Standard Insurance | N/A | 0% Coverage |
| Platform (OF/Fansly) | Platform Fee (20%) | Low (They deduct from you) |
| High-Risk Merchant Account | 10-15% Fee | Medium (Dispute assistance) |
| Chargeback Guarantee (SaaS) | 1% of Revenue | 100% (They pay if fraud occurs) |
Step-by-Step Action Plan
- Use 3D Secure: If you have your own site, enable “3D Secure” (2FA for credit cards). This shifts the liability from you to the bank. If a charge is verified with 3D Secure, the bank usually cannot issue a chargeback for “Fraud.”
- Blacklist Serial Offenders: Use shared databases (often integrated into creator platforms) to auto-block users with a history of chargebacks.
- Fight Every Dispute: Don’t ignore them. Submit your evidence: logs showing the user logged in, IP addresses matching their billing zip code, and chat logs.
- Accept Crypto: It is irreversible. For high-ticket customs ($500+), try to push the user to pay via crypto. There are no chargebacks on the blockchain.
FAQ
Q: Can I sue the subscriber?
A: Yes, “Theft of Services” is a crime. However, the cost of finding their real name and suing them in small claims court usually exceeds the $500 lost.
Q: Does PayPal Seller Protection cover adult content?
A: Absolutely not. PayPal prohibits adult content. If you use PayPal and they find out, they will freeze your entire account, not just the chargeback amount. Never use PayPal for SW.
Q: Is there a “Lemonade” for chargebacks?
A: No. The risk is too high. The only “insurance” is pricing your content high enough to absorb a 5-10% loss rate as “shrinkage.”
[IMAGE: Screenshot of a payment processor dashboard showing “Chargeback Ratio” and a “Dispute Won” status.]