By activating this option when a visitor makes a conversion on your website, their account is linked to the affiliate that brought them to your website. This option is very useful because, normally, this connection is stored as a cookie in the browser.
Bob visits your website through Smith’s affiliate link. Bob makes a purchase and Smith receives revenue. Bob then changes computers, or cleans his cookies and comes back to your website. If Bob makes another purchase Smith will not receive revenue, because the user-affiliate connection is lost. With LifeTime Commissions active, it does not matter from where Bob logs in, his account is tied to affiliate Smith.