"You need to enter your account password before you can use Windows Hello."

@WilburPost Windows Hello is a function that provides biometrics authentication in general, and a PIN is the most simple one, available everywhere, even without hardware. It's meant to be a more simple password than your real Windows account password for daily use, for just login and unlocking. The scope of the PIN is also local only, never synced with some cloud (in case you use a Microsoft account to login).

For example, I use a Microsoft account and I have a very long very cryptic generated Windows password. It's unpleasant to enter. But my PC is stationary and my home is secure, so I established a short Hello PIN of 6 digits, and whenever I log in to Windows or unlock the desktop, I only need to enter that pin.

1Password is able to use this convenience and use an established Hello PIN as well. You can avoid entering some long 1Password account password all the time - instead, you use the short Hello pin. If you also activate TPM usage in 1Password, you can extend the time between being asked for the full account password even more.
It helps with convenience (more easy to enter) and increases security (you can choose a more complex account password, because you need to enter it much less).