Everything that is virtual and in most cases online, has no guarantee of being foolproof. Some of the software used in this modern technological time have serious flaws that would be realized in just a matter of time.
Why is safe storage of password important?
Well, it goes without explanation that exposed sensitive information and vital documents; can be used to impersonate you. Some of passwords obtained for instance. your bank details and credit card information; might result into monetary loss and huge debts too. With alterations; a near perfect identity could be created and deployed for wrongful purposes. But you don’t want that to happen to you.
Websites are hosted on servers, that communicate back and forth to access needed data. If the communication channel between your device and the server with stored information is compromised by a third-party, (hacked); then risk of malicious codes being introduced to your device are very likely; as well as stealing of your private data that’s applicable on the visited website.
For example: when shopping online; you will have to share your location, street name, apartment, as well as credit card information for payment. If someone got a hold of such information – then the worst could happen.
To make websites secure; SSL (Secure Sockets Layer) is used. This secures online data exchange by encrypting transmitted information from your side to the website’s server and forth. If a hacker tried to access that data; they would only receive coded messages that only intended target computer/server can decipher!