What is the Seller Protection Policy?
If a transaction is displayed as Seller Protection Policy Eligible on the Transaction Details page of a payment, sellers will not be held liable for chargebacks due to fraud (including payments made with stolen credit cards and false claims of non-shipment) as long as they follow the rules of the Seller Protection Policy:
1. The seller has a Verified Business or Premier Account
2. The seller ships to the buyer's address displayed on the Transaction Details page
3. The seller ships within 7 days of receiving payment
4. The seller can provide reasonable proof-of-shipment which can be tracked online. This document must show that you shipped to the buyer's address on the Transaction Details page. For items valued at the equivalent of $250.00 USD or more (£150.00 GBP or more for the U.K.), you must include a signature from the recipient as proof of receipt.
5. The seller ships tangible goods. Since comparable widely-accepted proof-of-shipment methods are not currently available for intangible goods and services. The Seller Protection Policy does not cover digital goods and other electronically-delivered items
6. The seller accepted a single payment from a PayPal account for a purchase
7. The seller did not impose a surcharge on the buyer (Surcharging for any PayPal payment is prohibited outside the U.K.)
I'm guessing it's #1 above...