The Driver Golden Rule: If it ain't broke, don't fix it
If your computer is working as expected, it's OK to skip driver updates ... you never know when a new release might cause problems. That said, you should update your drivers if you're having a problem with a piece of hardware. For example, your internet connection drops now and then, or your printer isn't printing properly. One of the first troubleshooting steps in those instances is to update the driver, since the known issues may be fixed in a new update.
When you first plug in a new device, Windows will install its own generic driver so that you get basic functionality right away, it will be the bare minimum of what you need for something to work. A lot of times this is sufficient (for example, a printer), but many times downloading the driver directly from the manufacturer's web site will give you extra features (for example, sound or video).