This check determines whether the model database is set up correctly.
SharePoint Server uses SQL Server to store configuration and user data. Therefore it is extremely important that SQL Server be as optimized as possible. The model database can be set up as to reduce administrative overhead significantly.
The model database is used as the template for all databases created on an instance of SQL Server. The entire contents of the model database, including database options, are copied to the new database. Changing the settings on the model database will affect all databases created afterwards.
This is a general guidance on setting the model database initial size. The model database initial size should be set to a value larger than the default. These values should be set in accordance with your environment and expected amount of data. If your SharePoint farm will host a small amount of data, you could go with 500 MB or 1 GB as an initial size. This is merely an example and the exact value heavily depends on the expected amount of data, available disk space, (expected) number of content databases and other factors.
Additional information can be found in the following articles: