I recall iOS5 beta1 does not do this which cost me scores of saved wifi passwords on my iPhone.
Also another question says application keychain data is not backed up, just want to check if there's exception for Wifi password cause they are pretty often used but hard to remember.
Best Answer
iCloud Backups of iOS devices include the Keychain of all saved passwords on the device, including WiFi network passwords, however that keychain is signed against the UDID (The Universal Device Identifier, a unique ID for your device).
If the UDID does not match (examples being if your device was replaced by Apple due to failure or you purchased a new one), than the key store will not be able to be opened, and your passwords will need to be re-entered on the device.
Macs using iCloud backups do not back up the Keychains at this time.