A backup is a saved spare copy of your whole website — all its pages, pictures and settings — kept somewhere safe, so the site can be brought back if something goes wrong.
The things that “go wrong” are ordinary: a technical failure, an accidental deletion, or someone breaking in and damaging the site. If there is a fresh backup, restoring is like rewinding to yesterday, and little or nothing is lost; without one, the work can be gone for good. It is the same reason people keep copies of important photos and documents in more than one place.
Good practice is to make backups automatically and regularly, and to keep them separate from the site itself — for example, not only on the same Hosting — so that a single failure cannot destroy both the site and its copy at once. Regular backups are essential for any project that is meant to keep running reliably for years.