You are left with two choices. Do you want search engines to index images on your website OR do you want images to be hosted on Jetpack Photon.
What you gain on one hand is a trade-off on another.
So, the first paragraph answered the question albeit in brief. Jetpack Photon is a CDN service for images. If activated, it lets a WordPress blog to host all of its images on its server. Results in minimising load time. If you are not using a content delivery network (CDN) on your blog, then this might boost your slow loading website.
A single reason why should you not activate Jetpack Photon is Image SEO. Read this post on WordPress forums for a detailed explanation on why Jetpack Photon is bad for Image SEO.
Either you can choose to boost the overall page speed of your site and lose Image SEO completely or Deactivate Jetpack Photon. There’s a third way to boost page loading. CDN.