Something definitely needs to be done. I had a game going as Kraxis, and the most powerful nation on the map, Gilder, declared war on me. A few turns later, the sovereign of Gilder, alone, marched up to my capital where nearly my entire army was garrisoned, presumably to settle the war in a duel or something, I dunno. So I sortied out and killed him easily, causing the entire kingdom of Gilder, it's cities, it's people, it's history, to vanish without a trace. It was like the second cataclysm or something except at least the first one left dungeons and the like behind. Surely in this instance the worse that should happen would be for Gilder to dissolve into quarreling city states or a succession war between the successors.
(of course the AI shouldn't have kamikazed its kingdom keystone like that in the first place)