A duchy is a a territory ruled by a duke, in the same way that a kingdom is ruled by a king.
Insular means "inwardly focussed" and usually refers to people who are isolated, such as those living on an island, or, by extension, those who are narrow-minded and have no experience of the broader world.
Territorial means protective of one's territory.
So Duke Wurttemberg, who is normally concerned only with the affairs of Wurttemberg is, by putting on exotic feathers, acting like he is concerned with global issues.
Does that help?