[lmkg]

Cracking would be considered a failure. You can still step on it, but it looks bad, so you don't want that to happen. This can happen from prolonged stress, sudden impact, or expansion/contraction from thermal cycling. The surface becoming slippery or uneven due to wear, resulting in a tripping hazard. Discoloration. Flaking/crumbling. Debris becoming embedded. Chemical reaction with air, spilled liquids, or cleaning substances resulting in toxic fumes.

[pluma]

Keep in mind that cracked or loose tiles can be damaging to more than just cosmetics. If the surface is damaged, there is a higher risk of injuries (cuts, tripping, etc). If it's come loose entirely or in part you could slip on it, and so on.

The problem with ground coverings is that you generally expect it to be reliable and consistent if it looks like it should be. A single loose, chipped or cracked tile might be worse than an entire floor of them.