It's very common to use this phrase as part of a greeting, "hi, how are you?", the person generally doesn't expect a "well, I'm ok, but I've been really busy at work and I'm just not feeling great!" response, but a simple "I'm fine thanks, and you?". It's just being polite :) Sometimes, people might ask it rhetorically, that is to say, they don't even expect a response, so they might say "Hi! how are you?" and then carry on talking before you can respond. The context is key and your relationship to the person, but in a general encounter, it's just part of saying "hello".