I like to think of it like a passive action that helps handle the smaller amounts of moisture (humans breathing, cooking, laundry), but also an action that helps reduce the problems of acute issues that occur. That way, when something does happen, there is at least a dampening effect while the leak is fixed.
Leaks and rising damp still need to be addressed, obviously.

Examples are things like vermiculite render on the outside, Steico/Wool batts as normal insulation.

The downside is, it’s expensive. The insulation is only as good as fibreglass/rockwool, and costs about 3x as much.