You typically won't see RAID outside of server environments. Your average end user can easily back up their important data on DVD.
Raid is not a backup solution, nor was it intended to be. It has varying different purposes:
RAID (Mirroring) - Provides fault tolerance in case of HDD failures. RAID 1 and 5 are both examples of mirroring.
RAID (Striping), boosts the read/write performance of drives in an array. RAID 0 and 5 both function as examples of striping. Stripe sizes in striped arrays will also play a roll in how the array performs (IE: A smaller stripe size might be better for a OS drive or a gamer while a higher stripe size may be more beneficial to a Video editor who constantly deals with huge data sets).
RAID 1 Mirrors the data of one disk to another disk on the array, thus providing fault tolerance in the case of any sought of turbulence with one disk. So for example, if you have 2 HDDs in a RAID 1 array (Usually common setup for R1 array, you can have more) and one fails, you have an exact replica of data on the another HDD in the array. RAID 1 also provides slightly better read performance, but you lose data if both disks fail.
RAID 5 uses both Mirroring and striping. RAID 5 requires 3 or more HDDs and the parity (fault tolerance) is split among the HDDs (So if I have 4 2TB HDDs, I'll have 6TBs of storage on the volume). If one disk fails, the RAID 5 array can be rebuilt by inserting in a new disk the is same/similar to the disks in the array. If multiple HDD failures occur in the array at the same time, then the array will cease to function and in most cases you'd lose data if this were to happen.
RAID 0 provides no form of mirroring, thus lacking any fault tolerance, but instead uses stripping and is intended to speed up the performance of read/write operations. If a disk in the RAID 0 array fails then the whole array fails, thus incurring data loss.
There are more RAID levels, but these are the officially supported ones on Windows and most consumer motherboards. I myself run 3x500GB HDDs in RAID 0 for added performance and store all my data on a separate 1TB drive.
I again stress that
RAID IS NOT A BACKUP (people's definitions of what a backup is will commonly differ, but RAID is not really a viable backup medium), but should be more thought of as a fail safe for the levels that offer fault tolerance. A true backup would run along the lines of off-site storage. If my house were to burn down and I uploaded my data to a remote location or had physical media in another location with the same data, then that can be classified as a backup.