If the hazard rate stays at a constant level until maturity, the probability that the reference entity has not defaulted by year (the survival probability) is . The hazard rate plays the role of an interest rate, and the survival probability plays the role of a discount factor.
Consider a hypothetical example in which the hazard rate is 2% for five years. The survival probability at year 5 is 90.48%, and the probability of default within the five years is 9.52%.
A hazard rate backed out of CDS spreads is a value under the risk-neutral probability used for pricing, and differs from the real-world probability of default. A Bank of Japan paper calls the same quantity the default intensity.