When updating an existing installation of the IntelligenceBank Connector for Sitecore to a newer version, you will first be prompted whether you want to "Overwrite existing files".
This means that if there is already a package on the server with the same name as the new one uploaded, it can be replaced. As typically new packages have a different version number, it is not necessary to enable that option. However, if for any reason you are uploading a package with the same name as the one already installed, then you will want to enable that option.
As you proceed further to the Installation step, you will then be prompted to "Skip", "Merge" or "Overwrite".
It is important that you select "Merge" + "Append" in order to both maintain existing system files and ensure the new plug-in works properly.