It allows the front & rear wheels to turn at different speeds, say when going around corners. The front wheels have to travel further than the rears in that case & the centre diff "slippage" action allows for that.
However, because of the "slippage" the centre diff allows, it means you can come unstuck when off road. If one wheel loses traction, the centre diff will slip & all you'll have is the wheel without traction spinning hopelessly.
Locking the centre diff locks the front & rear propshafts so power is sent to both ends of the car. If one front wheel lifts, you'll still have power to the rear.
Hope that helps.


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