Module: Basic statistics
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You see, but you do not observe.
- Sir Arthur Conan Doyle
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No, this reasoning is correct. Insurance companies employ experts in statistical reasoning (called actuaries) to ensure that the expected value of each kind of policy they sell is negative. It may be possible for certain exceptional individuals to have a positive expected monetary value for buying travel insurance; for example, if the person is very ill, there may be a high chance that they will need expensive medical treatment while they are away. Insurance companies attempt as far as possible to prevent such people from buying their policies. For the average traveller, however, the expected monetary value is certainly negative.
Go back and think about whether this means that it is irrational to buy insurance.