What is floating ground , and why it needs insulation ?

A non isolated supply is referenced to earth ground, if you are using the scope and connect it to a device that is also referenced to ground it is possible for the point being measured with the earthed 'scope lead to be well above this zero reference level so the result is that high current can flow from 'scope lead to earth ground, result blown probe!!
Isolating one or the other, the ('scope is preferable). prevents this happening.

To put it another way, the 'scope is internally grounded via the power cable, and the screens of the inputs - lead grounds - are connected through the scope to that same ground.

The effect is pretty much putting a grounded wire on to a live power terminal from an also-grounded power source.

An isolation transformer breaks the "through" connection.

However, be extremely careful using an isolation transformer. If you use it for the scope, the whole scope chassis then becomes live at whatever voltage when you touch the probe ground to anything "live".
Likewise, if you use it on something to look at a high voltage on that, the device chassis would have the reverse of its internal voltage on its "grounded" parts as soon as you put the scope ground clip on any live part...

The preferred way is to leave everything grounded as designed, and use two probes with the earth leads unclipped, to measure between two points.
Either or both can be live at anything up to the scope & probe safe working voltage.

Just put the scope in differential or "subtract" input mode; that then uses both inputs for a single channel, displaying the voltage difference between the two probes.

A "floating ground" should more properly be called circuit "common" since it is not necessary referenced or connected to earth ground.