In some security systems it just blinks every couple of seconds and it has no other function.
However if you are using Steelmate then the blinking pattern of the light changes to indicate if the car has been tampered with in any way. Normally it blinks twice every couple of seconds. But if someone bumped into the car and set off the alarm, the light will keep blinking more frequently and gives you a visual indication that the car has been tampered with.