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ST. LOUIS - Hackers have proven over and over they can break into the most sophisticated data systems of high profile companies, and the cost to the companies and their customers can be astronomical.

Some companies are buying a new type of insurance called cyber risk insurance and it goes into effect when a company's data is stolen by criminal hackers. Insurance consultant Bill Goddard says most companies can't afford not to be insured.

"Hackers have been successful lately. We've all heard the names: Target, Schnucks TJ Maxx," said Goddard.

Goddard, who works for Brown Smith Wallace, says these data breaches are costly. Customers lose confidence and the companies lose money.

"If you have a million credit cards you could have losses in the $10-20-30-40 million range and what happens to your business when that happens?" said Goddard.

PF Chang's confirmed last week that its payment system had been breached. When a company is hacked cyber risk insurance helps pay for some of the cost.

Goddard says cyber risk insurance policies are relatively new. It's a specific coverage that goes into effect when a company's business is interrupted and its customers have their data stolen.

"You also have to hire some IT help to fix the problem. That's expensive. You need a public relations firm to help you think through how you're going to announce what you're going to announce," said Goddard.

Goddard says cyber risk insurance continues to get more complicated. Companies can't afford to get it wrong.

"You have to be concerned with that business loss as well as the customers you've just harmed," he said.

Goddard says one mistake that companies failing to realize business interruption insurance doesn't cover losses following a cyber attack.

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