Diva - LVS with Hierarchical extraction

I'm trying to do LVS with Diva's hierarchical extraction. I'm not yet sure if I fully understand how it's supposed to be done so please correct me if I'm making any wrong assumption. 

Right now, we can do LVS with flat extraction. With flat extraction, connectivity between the different cells is mainly through direct metal connections. I understand that with hierarchical extraction, all cells must have the appropriate pins, and pin-to-pin connection between the different cells are required to establish cell-to-cell connectivity.

I have been able to successfully get LVS match using hierarchical extraction, but I believe my rule deck is not yet complete, because it doesn't catch possible design errors at the top level. For example, if I deliberately cover all cell instances with a metal layer that would short all cells, it would still pass LVS with hierarchical extraction, but this error would have been caught with LVS with flat extraction. Overlapping cells also don't flag an error.

So is it correct to say that for hierarchical extraction, I would have to add more rules during Diva extraction mainly to check for an excell overlapping with another excell, or an excell overlapping with another shape (possibly in all layers).  So if the extraction rules detect such overlaps, it should flag an error, and there's no point in running LVS without correcting that error. The Diva reference manual mentions using keep-out layers. If someone can provide a simple example of rules detecting excell overlaps, I'd greatly appreciate it. The simplest case would be that absolutely an excell cannot overlap another excell or another shape. Thanks.