Any help/insight on Alt images is appreciated
Firstly, a good insight would be to understand that there is no such thing as an
Alt Image. The closest thing, and accurate name for it, would be an image's
Alternate Text parameter inside the image tag.
Now, having defined what it is you are actually wanting to discuss, it's good to look at what the Alternate Text parameter actually does; providing a written description of what the image is about.
Now, having said that, if for
no other reason than to just provide a semantic meaning to an image, you should still include a description for an image. However, as Ryan pointed out, Alternate Text does help your images show up in Google's image search. This is because Google is wanting to show semantically related images to someone's search query. Thus, bringing you more traffic.
As far as SEO, it's partly covered by Google Image Search traffic. Though, it does help in optimizing your pages. Google's page quality score takes into account Alternate text, as do just about every other page validating software. This is done by looking at the text description of the image and seeing where it fits with the surrounding content.
So, if you had an image of a
hot sexy babe in a block of text discussing
hot sexy babes on the beach then chances are that image's ALT parameter is going to help boost your page's quality score, thus moving you on up in the rankings.