There are three main options within the Tools\Options\System Option\Backup/Recover dialog box each designed to help you back up your work or minimize potential loss of data.
The three areas are (as shown in Figure 1):

Figure 1
Auto-Recover
Auto-Recover will save information about the active documents in the current session if the system terminates unexpectedly. If this does happen, a Document Recovery tab appears in the Task Pane the next time you launch SolidWorks® software.
A list of file available to recover is shown (see Figure 2). You can open individual recovered files and your saved files, or click Open All.
The directory and number of changes or minutes to save the information is configurable in the Backup/Recover dialog box show in Figure 1. The auto-recover directory is automatically cleared by SolidWorks periodically. This is only good for recovering information from the last session on an abnormal exit.

Figure 2
Backup
The backup option offers you the ability to create copies of the current document when changes are made.
The backup directory, number of backup per document, location, and number of days to maintain backup copies are set in the Backup/Recover dialog box show in Figure 1. If you use this option, make sure the remove backup copies after “x” days is set. Otherwise, you will keep using disk space until the disk is full.
Save Notification
The Save Notification option will remind you to save documents. When set, a transparent message box appears if the current document has not been saved within the specified interval (minutes or number of changes). The message box contains commands to save the current document or all documents; it fades after a few seconds.
The interval for this message can be set to minute or changes in the Backup/Recover dialog box show in Figure 1.

