the question is premised on the threat of fraud via chargeback against online merchants.
I can understand that a large company like Amazon can self-insure against this and also employ lots of geeks who promise to reduce fraud with elaborate algorithms. But then, most merchants out there are small and so for them this should be a bigger problem.
I have searched for companies offering what sounds like commoditized insurance as part of credit card processor services and e.g. found this http://www.bankcardcentral.com/merchantservices/chargeback-insurance/index.html . On the face of it, it certainly makes sense that the small merchant should concentrate on his business, whereas the big and experienced credit card processor can concentrate on the insurance and fraud detection.
What I find surprising is that wikipedia articles on credit card fraud seem to imply that merchants are generally not using such services and so fraud is a big issue for them. Does that mean that wikipedia articles are out of date? Or that the insurance services like the above suck? If they suck, do they suck because of how they are run or is there some fundamental underlying complexity to the whole business that makes insuring across multiple merchants a lot harder / more expensive than self-insuring inside a single big Amazon-type merchant?
ETA: the title should have said “does credit card fraud insurance …” my bad