It's intended to block any requests for a .php file in a directory beginning with a dot. These files can appear in .svn directories, for example, where a clever hacker could manage to run an old version of a file. There are also circumstances where you might have a .drush directory within your docroot, which could also contain .php files you won't want run in the context of the web server.
It certainly won't hurt the vast majority of cases to allow this rule to continue to be in place, and depending on what you have sitting around in your docroot, the gain in security might be substantial.