As a follow up from yesterday's post, there is a way to access the documents that are being stored on iCloud. So they should be backed up on Time Machine automatically (and can be restored from a Time Machine backup), and could also be backed up using other means (CrashPlan, etc.).
Details can be found at this link.
Files are located in ~/Library/Mobile Documents. As expected, each application has its own subfolder, which means that text documents stored by Byword are not accessible by iA Writer.
Where did everybody go? Good thing I have backups! (2012)