Sparring is an absolute necessity as far as I'm concerned. But, care must be taken to keep it realistic. I'm not saying to beat each other senseless all the time, but there are bad habits to avoid. One example is the typical point-sparring stance. If you want to hide the areas that count as a point, turn sideways and all that can be hit is your back, this is fine for point sparring tournaments, but it is a good way to get suplexed on your head in a real fight.Another bad habit from light sparring is to hit on the last inch of your punch and think of it as a hit. A strike while sparring should land with about 6 inches of extension left so that if you did not pull your strike it would penetrate the target causing damage. Contact levels should always be agreed upon, and no one should be hit harder than they want to be hit. This being said, I feel that once in a while it is wise to spar at about 70 to 80 percent power in order to more fully appreciate the feel of combat. Another point to be made is that there should be only enough rules to keep a good degree of safety, as a rule against leg kicks for example will teach a person not to protect their legs. In the words of my instructor, "those wearing a cup will be kicked in the cup, those not wearing a cup will be kicked in the testicles." I also recommend wearing goggles and allowing finger jabs to the eyes, lightly as this can still be dangerous.