Some alpine countries in Europe require rescue insurance, in order to cover the cost of rescued, without which it can be very expensive to those rescued or to their families.
I'm not sure if by saying "require" you're suggesting insurance is mandatory in Europe, if so I'm not aware of anywhere in the Alps where that's the case.
Not to say its not a good idea to be insured- plenty of areas may charge for rescue and as you say it can be very expensive.
I don't think the prospect of paying has any impact on the stupidity level - I see no differential in behaviour in the Italian valleys around Mt Blanc (charged for rescue) vs the French (free rescue). Nobody goes out expecting to be rescued, and if you've got insurance, you aren't paying for rescue anyway.
Edited to add - to put rescue insurance cost in context, its about £20-50/year for worldwide annual cover.
