A backup of an Internet site is a copy of its content, that's kept on a different hosting server and could be restored if something happens. This option is very practical, because you can never know if a script update will not fail or if you will not delete something by accident - a file, a folder, a database entry, and so on. If your site is backed up, it can be restored the way it was before the problem appeared, so there shall not be any damage, or at least it shall be very little, depending on the specific case. Keeping backups on your computer is not very feasible, simply because you'll have to do it at least once each day and you may still lose info if your last backup isn't recent enough. In this light, you'll have to rely on your website hosting provider, so you ought to double-check their policy on the backups, due to the fact that some companies create backups just once a week, that will do no good if something wrong happens with a website that's being used and updated constantly, like an online store, for example.