Some places ([AWS RDS](https://forums.aws.amazon.com/thread.jspa?threadID=151248)) don't have, or don't allow, access to the `pg_authid` table. The only reason that is necessary is to check for a password change.
This flag is a workaround so passwords can only be set at creation time. It isn't as elegant as changing the password down the line, but it fixes the longstanding issue #297 that prevented this from being useful on AWS RDS.