You need to think of hard drives as lightbulbs. They burn out.
I have 12 hard drives connected to my MacPro. Most are 1 or 1.5tb drives, and I'm gradually upgrading them all to 2 terabyte drives. I use a fabulous product made by MacGurus called a Burly Box, each of which hold 4 drives via just one eSata connection. A Sonnet card manages the array.
SMART status is a way that your hard drive monitors the state of its own health. It doesn't catch everything that can go wrong with a drive, but it keeps track of anomalous behavior that suggests something is about to go awry. However, there are various ways to interpret that data.
There's a free, always-on app called SMART Reporter that perches in your menu bar and has one color signal for your entire array. If it's other than green, you have something seriously wrong.
Smart Utility is a $25 app, but it monitors the drives with much more granularity. Too much, perhaps—it identified three of my drives as “Failing,” because the temp reading had exceeded the parameter at some point in the past. The app has the option to turn off monitoring of this particular setting. If this seems brash, Google's research suggests that temperature is not a significant factor in hard drive failures. Bad sectors, however, are indicative of a drive about to flame out.
One drive did show up as having bad sectors, and Smart Utility flagged it as “Failing.” Smart Reporter saw nothing wrong, probably because the drive wasn't sick enough yet.
I'm getting a warranty replacement for the year-old drive from Seagate. All before I lost anything.