What are exhaust wraps for?

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Sounds like a good reason. But doesn't the manufacturer of the car / pipe already take that into consideration when shaping the pipe or designing the car? Or are the wraps for when people install pipes for a different model vehicle into their vehicle and it runs too close to components?
 
Sounds like a good reason. But doesn't the manufacturer of the car / pipe already take that into consideration when shaping the pipe or designing the car? Or are the wraps for when people install pipes for a different model vehicle into their vehicle and it runs too close to components?
I have seen a few wrapped exhausts but was wondering what is the purpose behind this? Also what are some good exhaust wraps people recommend (if there is a good purpose for it).
One, it definitely lowers under body temps. I can touch my pipe after a tank of non stop running. I don't mean you can grab it like a bat lol. You can quickly touch it or accidentally rub against it without burning yourself.

Two, it's supposed to create more power because it increases scavenging of the exhaust because more heat travels out the pipe exit vs radiating outward in all directions. No idea if true or not.

I ordered automotive header wrap from summit racing along with a ceramic header wrap sealant spray.
 
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