Personally, I develop for IE5+ and check in the last few versions of ff,moz,opera. Always worth seeing if you can use the site in lynx too.
Quite a useful page on this topic is
http://www.w3schools.com/browsers/browsers_stats.asp
As for the reasons, you've got to remember certain operating systems don't support the latest versions of browsers (e.g. older versions Windows with the latest Internet Explorer), so if the user doesn't plan to upgrade their OS they are stuck with an old browser. Plus there are those who have no idea that there are alternatives, or why they should be using them.