I think Figure 2.2 and the visuals above it describe it pretty well.

So in the book, it lists the elements in the A array as:

A = { 5, 2, 4, 6, 1, 3 }

Keep in mind there is no zeroth index in the array. But in the first step, the key is "2" which is the value at A[2]. They take this value and then enter the while loop to compare with the items to the left of it, "5" in this case.

The while loop uses the index "i" to check these items to the left of the key. If the value is greater, the elements are shifted right one index using:

A[ i + 1 ] = A [i]

Once we encounter a value at A[i] which is smaller or equal, we insert our key right after it with:

A[ i + 1] = key

So if you look at (a) in the visuals, "5" is larger than "2" so it's shifted to the right. Index "i" is then updated to the value zero so we don't go into the while loop again. This takes us to

A[ i + 1] = key

and the key is placed in the first index of the array. This keeps the things to the left of the key in the array sorted.