What is the benefit of storing water in tank?

Obsolete as of Factorio v0.15
Version 0.15 drastically alters the way water and steam are handled, making this answer - as well as the question that goes with it - effectively obsolete. Any attempt at updating this answer would involve changing it beyond the point of recognition, so I'm leaving it as is.

Storing hot water is a surprisingly effective way of storing energy compared to accumulators, and if set up properly without the massive drain spike that happens when every single accumulator you have tries to recharge itself simultaneously.

For more information and suggestions on how to set it up, see the game's actual wiki.

My old answer still holds true for 0.14 Factorio and earlier, but the new steam mechanics introduced in 0.15 and up change the rules drastically.

There is, however, still a use case for storing water in tanks, and that's for buffer purposes.

Especially later on you may wind up migrating to a hybrid solar and steam setup for your power usage; in those cases, the draw on your steam engines and/or turbines will be significantly higher at night time. By using tanks to store water and/or heated steam during the daytime you can guarantee a steady supply at night when the draw might otherwise exceed the capacity of your pipe network.