I thought about it for a second and I said "because people did bad things and God sent his son Jesus to die on the cross." Yes, she is 3 perhaps the better explanation would have been because He loves us as Andy said later in the day.
Later I told her that God wants to be friends with us and we had sinned/done bad things and we couldn't be friends with God without Jesus.
I have the Jesus Story Book Bible and maybe it is time to start reading it with her before her nap.
Thanks Anna for introducing us to Fancy Nancy!