Unusual Backup Error in SQL Server

You might be wondering what is happening in your SQL Server when you see the error message given below. Its all simple, you need not panic.
Error Number: 18272
Error Message: I/O error on backup or restore restart-checkpoint file '%1'. Operating system error %2. The statement is proceeding but is non-restartable.
This happens when SQL server is not able to find the default backup directory. SQL Server needs to create a checkpoint file when a BACKUP or RESTORE operation happens. This happens when the RESTART option is specified. WITH RESTART tells SQL Server to start from the point where the operation was last aborted. When SQL Server searches for the file and its not available then this error is thrown.
How to avoid this error:

1. Check the default backup directory for the SQL Server and see if exists, if not create it.
2. Verify if the backup directory has enough space in it.
3. Verify if SQL Server service account has permissions to read and write into that directory.