Take for example a situation where a ship has been captured by pirates and the ship owner refuses to negotiate (enforced by law or reinforced by past practice) so the ship is certain to be lost. An insurer offering insurance contracts on the cargo and ship without requiring an actual interest might get a lot of takers, with the insurer then using the proceeds to pay the ransom even contrary to the owners wishes. But let’s go a step further, the insurer contacts the pirates after the ship has been captured and negotiates the ransom, then sells the insurance contracts to those without an actual interest in the cargo.

Going a step further, the pirates are the ones offering the insurance; if they can convince multiple speculators to buy insurance for the cargo without having an interest, then they let the ship go through, but if they get only an single insurance contract, then they capture the ship and take the cargo, sell it and pay off the insurance claim, breaking even or making a small profit, but thereby setting the expectation of huge profits on future ships entering area where the pirates operate.

I think this analogy might serve to describe such things as naked short selling hedged with swap, and the buying of large interests of corporations with the threat of a hostile takeover and liquidation.