A backup of a site is a copy of its content, that's kept on a different server and may be restored if something happens. This option is very useful, considering that you can never know if a script update shall not crash or if you won't delete something accidentally - a file, a folder, a database entry, and so on. If your site is backed up, it may be restored the way it was until the issue appeared, so there will not be any damage, or at least it will be small, dependant upon the particular situation. Keeping backups on your laptop or computer isn't very feasible, as you'll have to do it at least once daily and you may still lose information in case your last backup isn't recent enough. In this light, you'll need to rely on your website hosting provider, so you ought to double-check their policy on the backups, given that some providers generate backups only once per week, that will do no good if a problem occurs with a website that is being used and updated all of the time, such as an online store, for example.