Thanks all for the replies.
I am minded to think that you cannot force someone to do something that is voluntary. You could make them sign a disclaimer of course but I do feel that this is not lawful.
I fly a fair amount each year and have never been asked to produce proof of my travel insurance yet.
The tickets have been paid for in full and surely that is the only requirement (apart from turning up for the flight) on behalf of the purchasers. If one of them is reckless enough to travel without insurance then on his head be it. The airline aren't going to have to cough up for him. If he needed medical assistance in Kos he would be covered under the EHIC system. Whilst I appreciate this is not insurance as such but would cover his needs anyway. Just having travel insurance doesn't automatically cover you for repatriation etc.
I think that this is just another attempt to raise revenue in the hope that the person will opt for theirs at the time which, given that most are mediocre at best and a ripoff in the most part, are a waste of money.