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Many FPS games use this technique for flashbangs. Some games with higher graphical limitations keep the scene at the moment of the flash burnt into the character's retinas (i.e. the player's screen) for a few seconds. Then it gradually fades back to being able to see properly. Apparently, that's what really happens.
Some flight games do this as well; a notable example was the Descent series' flash missiles, which whited out your screen for five seconds.
Moved from the examples (natter, wrong example indentation) General statements like this are better for trope description or analysis page. Please list concrete examples.