A backup of a site is a copy of its content, that is kept on another web server and could be restored if something happens. This feature is quite effective, given that you can never know if a script update won't crash or if you will not eliminate something by mistake - a file, a folder, a database entry, etcetera. If your website is backed up, it may be restored the way it was until the issue appeared, so there won't be any damage, or at least it will be very little, depending on the particular scenario. Keeping backups on your PC is not very feasible, due to the fact that you would need to do it at least once per day and you could still lose information in case your last backup is not recent enough. In this light, you will need to rely on your hosting company, so you have to double-check their policy on the backups, as some providers create backups just once every week, which will do no good if something goes wrong with a website that's being used and updated constantly, such as an online store, for example.