What the extension does
The Privacy Manager extension exposes the visitor's current consent or privacy state as data inside iQ itself, not only at the banner UI layer, so other extensions and load rules can read it and make real decisions.
When you need it beyond the banner
The moment consent logic has to affect more than whether the banner is visible - a load rule that fires a remarketing tag only when advertising consent is granted, or an extension that anonymizes an attribute when analytics consent is granted but full tracking consent is not.
How to configure it properly
Configure the extension against the exact categories your CMP exposes - not a generic assumption of what categories "usually" exist. Confirm the category IDs match exactly between the CMP and the extension; a silent mismatch here is the most common failure mode, and the precise mapping mechanics are configuration and version dependent, so verify the current setup against both your CMP's and Tealium's documentation rather than porting a mapping from a different implementation. Reference the resulting privacy state explicitly in downstream load rule conditions.
How to verify it worked
Toggle each consent category independently in a test session and confirm only the tags that should respond to that specific category actually change behavior. A category that silently controls more tags than intended - or fewer - is a governance gap, not a cosmetic bug, and it will not show up unless tested category by category rather than as a single accept/reject toggle.
Test it category by category, not as one switch: a consent flow validated only with a blanket accept/reject click has not actually verified that each category controls the tags it's supposed to.