This is a .htaccess code which allows you to specify the file which loads as your default page whenever anyone types your domain name.
Tired of seeing the index.html file when you go to http://yoursite.com ? Want to see home.html or Index.php instead? No problem!
This would cause filename.ext to be treated as your default page. You can also append other filenames to it. You may want to have each folder without filename.ext to use a different page name as the default page. That's no problem too.
Placing the above code in your .htaccess file will cause this to happen. When a user types in yoursite.com, your site will look for home.html in your root directory, find it, and load that page as the default page. If it does not find home.html, it will then look for index.php; if it finds that one, it will load it, if not, it will look for index.shtml and the whole process repeats until it finds a file it can use. The list of files is read from left to right.
The .htaccess file is recursive, meaning it affects all the subfolders that do not have their own .htaccess file.
Instead of creating and editing the .htaccess file inside public_html, do this inside the document root folder of your Addon or Subdomain name.