It may mean that in this case, but it's not how I've normally heard the term used over the years.

I've always taken that phrase to mean that you're protected on an alternate flight, different than your original flight that you're not going to make, on the same route. I've had that phrase used mainly on UA, where they have had to make backup bookings for me when flights went off schedule causing missed connections, and wanted to make sure I made the next flight out that could have limited seats. If you're not protected on the next flight out, you could be stranded somewhere, so it was good to be "protected".