An iPhone is far more of a handheld computer than simply a phone and backing it up (with encryption) allows all information to be restored (including passwords) in the event of catastrophic failure or loss. If you don't use encryption you end up having to sign into every app again and that's a real pain although quicker with a Password Manager. I would guess that I add a contact or edit details for a contact at least once a week and these sync with MS Outlook.
Personally I treat the backing up of my iPhone in a similar way as I do my computers but I guess it comes down to how you use your phone. I do it after every software update and around every two weeks thereafter. I back up to my desktop, not iCloud.