When is it necessary to cover food with aluminum foil during baking/roasting?

As per the question, it is generally a matter of preventing the food from becoming overly dry. This is particularly an issue for dishes that call for a very long cooking time, or for foods that should be cooked at a high temperature but you don't want to have a crisp texture on the outside.

As for other advantages, off the top of my head one advantage is the ability to trap in other flavors, such as wrapping a baked potato in foil with olive oil, salt, pepper, etc. to season the skin.

My small experience points at chicken. If you cover it with aluminium foil, it stays much softer. If you don't it gets dry and unpleasant.

If you are cooking in a small oven, lightly covering with foil as a heat shield is sometimes necessary when cooking larger items. I generally use a very large piece that is well away from the food when I do this, since you are explicitly trying not to trap in moisture.

This is good for a recipe such as one with liquid and dry rice. But I have found it cooks so slowly that it doesn't ever boil or cook the meat in it until I take the foil off, then I see in 5 minutes boiling on the outer edge. I usually have to do both, covered and uncovered. It just takes much longer than the recipe says covered.

Aluminum has a relatively high thermal conductivity index, which means it disperses heat evenly around whatever is wrapped so the thing gets cooked evenly. It can also reflect some of the heat to slow the cooking process slightly. But that usually isn’t the intention. It also happens to seel moisture if wrapped tighly.

So depending on what you are trying to accomplish, it has a couple of useful properties.