First and foremost, this driving technique is an absolute requirement for a road test regardless of the vehicle type or configuration.Drive around the vehicle without backing in the event the front vehicle breaks down.
If at all possible, always, always avoid backing in traffic.
Allows you to be in a defensive position, in the event that a vehicle careens towards you from the rear.
While waiting at an intersection, and there aren't any vehicles behind you, it is imperative that you keep an eye on the vehicles approaching from the rear.
This technique will allow you to avoid being rear-ended because you will have enough room to move up, and often this moving up a few feet is enough room for the other vehicle to get stopped.
Prevents your vehicle from being struck in the event that the vehicle in front rolls backward.
If you have space around your vehicle, it is less likely that you are going to be struck; therefore, if you stay back approximately one vehicle length--you can see the tires on the pavement--this will allow room for the vehicle in front to roll backward and your vehicle not being struck.
Reduces congestion, by allowing all the vehicles at the intersection to start moving at the same time.
If, and only if, all vehicles did this technique, it would allow the line of cars at a traffic light to move off at the same time, rather than every driver having to wait for the vehicle in front to go, before he could proceed.