When you think about it, for years we all kept hard copies of things. Some folks were able to store things in a safe deposit box at their bank (those are hard to find these days), but mostly it was in our attics, garages, top shelf of the closet, etc.—and in the event of a disaster, we might not be able to grab all those boxes and salvage things. If we had time, we might be able to grab a few photos and mementoes, but most of the time it all went POOF. Now we store things electronically and hope for the best. If it all goes POOF, life goes on.
That being said, I do store a lot of my data in the cloud (dropbox), but I also have it backed up in TimeMachine and it's in my CCC backup. If it's really important to me, I also back it up to another external drive (I would hopefully be able to grab these drives if I ever had to flee from here).
In the long run, if I lost it all it wouldn't end my life. Yes it would be an inconvenience, and I'd hate to lose my photos of Sneakers and our 'memories', but I could move forward if it all went POOF.