Tanking is creating a waterproof area within the bathroom, usually around the bath or shower or if it is a wetroom, the whole room itself.
The most common claim in the UK insurance industry is for escaping water. If water is able to get behind a tile in a wet area then the plasterboard is quickly ruined. Water can then damage the floor area, supporting joists and the ceiling below. All of this can happen very quickly and can easily be avoided by having the wet area tanked in the first place.
But tiles are waterproof aren’t they? For the most part they are (depends on what type of tile is used) and grout is always avertised as being waterproof. Grout is a cement based product so does absorb water to a certain extent. The fact that it is advertised as being waterproof means that it does not break down in the presence of water.
We always tank wet areas. As far as we are concerned it is a releatively cheap insurance policy for the future of your bathroom.