iOS 12 will introduce a new feature, already in testing, that will connect third-party password managers like 1Password and LastPass with Safari’s password AutoFill feature. Not only that, but other apps that use AutoFill will also be connected, meaning that you soon won’t need to retype passwords anywhere on iOS.
MacRumors has a detailed walk-through of using the feature, which is available in iOS 12 if you also have the beta of a new version of 1Password. It shows 1Password passwords being available when you get prompts to sign into an account in Safari and third-party apps. The process works because Apple provides an API for password managers to connect to the password system in iOS and send passwords.
While iCloud Keychain is enough for most users, many opt to use a third-party solution. For instance, users who also need their passwords available on Android or Windows computers. This will make it far easier for these users to use unique strong passwords on all sites and apps.
I see no need to expose secure information to a third party when some of these apps have experienced security issues in the past. iCloud Keychain works very well even when I occasionally need to use a Android or Window system. Just be prepared for what you need and learn to use the iCloud Keychain.