S.M.A.R.T = Self-Monitoring, Analysis, and Reporting Technology.
What SMART will report is a missed sector, or a discovered bad sector that can not be recovered, is not good. The information is logged and the error mapped, diminishing usable drive capacity. SMART will report that the drive is failing. More than a few of these and the drive is reported as FAILED- but usable. SMARTs purpose is to help predict dive life and to help users predict drive imminent drive failure.
Most drive platters have imperfections that are mapped when the drive is at the factory. The information is stored on the drive so that data is not stored in those locations. This 'error' map is not lost during a format. Manufactures grade platters, the platters with more imperfections platters go into less expensive drive assemblies. SMART allows the error map to more dynamic.
Where SMART fails is when there is a mechanical failure that doesn't affect the drives read-write status. External failures, or a problem with the internal swingarm(s) that do not immediately cause a read/write error won't be noted. SMART also doesnt track drive heat.
You should back up anyway. I use
Carbon Copy Cloner also know as CCC. It's a great program, and if you really find it useful the developer would love a donation.
SilverKeeper which is free for those that have Lacie drives. There is also
Super Duper which is about 28 bucks.