and the only benefit is to deny the player the opportunity to be creative and use their imagination in their contributions to the story and their own character development. YMMV.
See, I don't have a story until I have the characters. I only have a setting (including deities, organizations, etc.). The backgrounds and goals of the characters and what the characters do are the basis of the campaign. In the campaign in question, I had players give me the following backgrounds
1) The Paladin whom grew up an orphan in a temple dedicated to his deity. He was raised by the high priest almost like a son. His older sister, an adventurer (former PC), disappeared while on a quest. Recently, he had a vision of her and a lich. The vision prompted him to leave the temple in search for her.
2) The Cavalier: The cavalier came from a country in which noble houses vie for power among each other and in the king's court (the nature of kingdom was already set as part of the setting). While on a border patrol, the cavalier and his patrol were ambushed. The Cavalier took a blow from a giant and was knocked from his mount. Dazed, he crawled for cover and blacked out. Upon awakening he set out to find those responsible. He tracked the giants to a cave and witnessed them being paid by a cloaked figure. He followed the figure and confronted him. He received a bit of information about some other people of power behind the attack. Having set out to find them without first sending word to his king, father, and fiance, he is, now, presumed dead.
3) The Shaman: The Shaman grew up among the Northman. By age 13, he had passed his ordeal into the druidic order and was considered a prodigy among the Druids (GR's Shaman replaced the Druid class) excelling in subjects related to arcana, diplomacy, history, nature, music, storytelling and the mastery of basic spell casting, but his young age, inexperience, and uptight demeanor, had limited his progression. Five years later, he desires a chance to prove himself. A month earlier, robed figures from a far of island appeared requesting an alliance with the Druids. The Druids determining these figures could not be trusted turned them away. Upon leaving the strangers vowed to destroy the druids. A week ago, they returned via portals in the dead of night. They bombarding the druids and the jarl's home with fire from the sky. When the sun rose, only four druid's remained- two severely injured. During the raid, the Jarl's daughter was kidnapped. The young druid was sent to negotiate her release.
4) The Barbarian: Whereas his clansman, the Shaman, is reflective and uptight, the Barbarian is brash and impetuous. His goal in life is to gain the following of warriors, marry the Jarl's daughter, and become Jarl himself. When body guards for Shaman were sought, the Barbarian was first to raise his hand, seeing this as the start of building a reputation for himself and what better way to start than by rescuing the woman he wants to marry whom just happens to be the Jarl's daughter. The Barbarian is loyal to the Shaman and will lay down his life for him. He also has much to learn to become Jarl and the Shaman has taken upon himself to teach him- the lessons are often emphasized with a whack from the Shaman's staff to the back of his head accompanied by a slight grin.
5) The Rogue is a layabout and cutpurse growing up on an island ruled by wizards. On the island, he is a second class citizen as he has no magical ability. Currently, he lives by the docks where he plies his trade cutting the purses of recent arrivals disembarking from ships. He dreams of one day leaving the island, but he pisses away the coin on drinks on whores and repeats the process again. One day, however, he will leave the island...one day. If he can screw the wizards over in the process, so much the better.
That was the party and their backgrounds.
The Paladin's player played in the previous campaign so he knew about the Paladins and clerics of the deity and the location of their main temple. He also knew that the cleric and her party had been searching for a lich (hence his vision).
For the cavalier's player, he chose to have his character come from another country that had been established as once being like Camelot during its hey day with knights in shining armor, but had descended into noble houses competing for power amongst one another.
The two Northman players had decided to tie their backgrounds together once they learned that they were coming from the same homeland. The druid player latched onto the attack and made it much worse than it was. Because the Barbarian wanted to marry the Jarl's daughter, they decided that she was abducted during the attack.
The Rogue's player described his player as a layabout and cutpurse that squandered what he stole on women and drink. He asked me to place the character somewhere that made sense with a preference that he might lead the party through his city. When heard about the abduction of the Jarl's daughter,
by wizards, he decided to come from the island that they ruled (the island was already established). This gave us our starting location and we decided that he heard about an auction where she was about to be sold as a slave to a high ranking guild wizard.
From here the Paladin decided that he had a vision of his sister bring him to the island. Similarly, the Cavalier's player decided that the has consistently been a week or two behind the people for whom he was searching. The trail led to the island.
Now, everyone had a reason to be at the island. I started with the rogue at the docks just after sunrise with potential marks disembarking from a recently arrived ship and let things take their course from there.
So despite the setting, its cultures, deities, etc. being set by me, the players brought the basis for the first adventure and numerous "stories" rather than my story. I had no idea where the story was going. I placed hooks as well as riffing off the players decisions, backgrounds, and goals.