If you saw what I saw, you would take the travel insurance. Before working in the travel industry, I always thought that the optional travel insurances offered by airlines and tour operators were something of a racket, but spending years in the industry changed my mind. Here are some dilemmas: I had a client whose appendix burst 2 days before she was to leave for Germany. I had a client whose child had a medical emergency while they were on a cruise ship. I've had a client get sick while on a trip to Costa Rica and another fall on a trip and couldn't continue on. Thanks to travel insurance, none of these sudden emergencies translated into a financial crisis. You may not get ill, but someone in your family may, a natural disaster occur, or the weather just not cooperate. Budget for the travel insurance ahead of time. For clients that are outright persistent against the insurance I would say, “Can you afford to lose x amount? If the answer is no, you may want to reconsider.” Use this test for yourself as well.