The point of briandear's example was that wind had damaged the roof and walls, and wind storms were covered by the insurance; whereas flooding had damaged the floors, and flooding was not covered by the insurance.
When you get insurance, it doesn't necessarily cover everything. You might have insurance that will pay for your home if it catches fire and is destroyed accidentally, but will not pay if a person deliberately commits arson. Insurance might pay of your home is destroyed by a storm, but not by a landslide, and so on.
The main problem I heard with briandear's example is that people apparently didn't understand the coverage they had purchased. If I operated an insurance company, I would consider summarizing the policy that people were about to purchase with a simple form showing the most common hazards. Maybe even show them with simple glyphs depicting fire, floods, storms, etc., and indicating whether their plan covers that scenario or not. Ask them to sign or initial that form. It's not a legal form, but you'd present it to them and ask them to confirm they understand it along with the contract text version.
Then, when an event happens and they're asking for an insurance payment, you show them the form that they had initialized, and explain how things were covered or not covered.
I would also want to explain to people that multiple disasters can happen at once, and explain how the insurance company will reason about what's covered, based on the cause of each thing that was damaged or destroyed.