The risk of accident against hours flown is pretty low. An unfortunate incident but I don't think flying coveralls would have changed the outcome.
Flying is a recreational activity at one end and transport at the other. if you start requiring people to dress up to mitigate what is a very low risk you will turn even more people of the activity and in this day and age we can ill afford it. I use a flying suit when flying something like the chippy as I need the pockets, but I would feel a right pike getting out of my Cessna in one. I can't see work mandating a flying suit for me either as it would probably disturb the punters somewhat.... 'Why is the Captain wearing fire retardant gear when you told is flying was safe' comes to mind......
Sometimes we just have to live with an element of risk.
Personally I never interfere with my exam candidates choice of clothing, but the the likelihood is they are dressed like me anyway.......