That will block the search engines that read the robots.txt file. (While most of them do check the file, a few spiders don't so if it is sensitive material, you should password that directory.) Meanwhile, anybody will be able to directly access the directories listed.
As with what LeeU said... if it is sensitive then secure it.
You do have lots of hosts that will allow you to password protect a folder but please note, some of the more "Money-Orientated" hosts will charge anything from £15 a year plus a one off fee.
Search hard and long and you will find budget hosts that let you have access to this feature for free.
Your alternate option is to hold these types of file outside the public_html / htdocs folder and use your server-side of choice to access it.
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