Honestly? It depends on who they are. If it was my parents or siblings, I'd be straight in there confronting them about it. My grandparents or extended family? Possibly not, even if I'm personally offended. That said, if it were out in public I'd like to think I'd confront them, though probably in more of a joking way.
As to friends, very few of my best friends would say such things, but in my extended circle of friends/friends of friends, I'd probably just let it slide. I'm not proud of it, and recognise it as a major flaw of mine, but I shy away from confrontation.

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