For many if not most people, you don't
need them. However, as a matter of convenience, the local pre-paid SIM gives you access to call outbound to your home country without having to play games with finding a phone and access numbers on calling cards, and without paying exorbitant roaming fees from your home carrier. And depending on carrier, many do have reasonable data packages that will allow you to check and reply to email. Plus it can be nice to have data access for navigation apps on your phone, or to look up tourist information while you're there. I don't know much about Indonesian carriers, so I won't be much help on the specific coverage for your situation.
Perhaps this (very short) thread would be helpful:
Pre-Paid SIM in Bali/Indonesia