Over on the right of the k/b you have an Insert key with a Delete key underneath. Not sure if you hit the Delete key again to "undo" the setting, or the Insert key to "do" the setting but it's one of those.
Ocertype is exactly what it says, instead of making room for new letters, it just overtypes anything in its way. It happened because you must have accidently hit the INSERT key on the keyboard. This key toggles OVR on and off.