How can this be explained the simplest way?
The host of the game owns the save and the characters.
You can look at it as a single player game, but anyone else can join in at any time and take control of one of the 2 main characters and also add a companion if they choose.
When done, the host still owns everything, all the progress etc.
This works great if you plan to play with the same person from beginning to end. This is all you need.
This doesn't work, if you wanted to take your character from Host to Host and just kick in to wherever they are at and play/level from there and then hop onto another Host. This just isn't setup like that. This is setup for tight friends playing together in most cases.
