A backup of a site is a copy of its content, that's kept on another server and may be restored if something happens. This function is quite efficient, given that you cannot know if a script update shall not go wrong or if you will not delete something unintentionally - a file, a folder, a database entry, and so on. When your website is backed up, it can be restored the way it was prior to when the problem appeared, so there will not be any damage, or at least it shall be little, depending upon the particular situation. Keeping backups on your computer system isn't very feasible, because you would have to do it at least once every day and you can still lose data if your last backup is not recent enough. In this light, you'll need to rely on your hosting provider, so you need to double-check their policy on the backups, as some companies create backups just once a week, that will do no good if a problem occurs with a website that's being used and updated all of the time, like an online store, for instance.