When you use this option, you're giving the system administrator(s) of this machine access to your files on the remote server, which they wouldn't have if they don't have their own accounts on that server.
But since root has access to everything on this client machine, they don't really need your permission. They can use
su to changed to your userid, and then they'll be able to access anything you can access.
So this just makes things easier for the superuser. This is useful if you're the sole user of the machine, so
root is really yourself, and you want to be able to access your SSHFS filesystems while using