I just bought a Danby portable air con...

I just bought a Danby portable air conditioner (model # dpac5070). The manual tells you how to use the direct drain hose if you want to "vent" the water outside. If I don't want to direct the water outside, do I need to use this hose? The product has a safety shut off feature so the water tank won't overfill. It's almost overfilled twice. I have the hose in the oblong hole on the top flap of the water tank. Am I doing this wrong? Please help!:)