every painting contractor needs to be paid for their time, expenses and materials. And a reasonable estimate should incorporate these costs. If it doesn't then the painting contractor won't make money and will need to figure out quickly how to either make money by adding additional costs not included on the estimate, lowering expenses by spending less time, cutting corners and/or using lower quality materials. Or, if they can't do any of these, they'll just abandon the paint job and never return your phone calls.
Experienced painting contractors know how long a specific job will take and how much they need to make per day. The amount they need to make per day will cover their business expenses (insurance, vehicle, tools) and their living expenses. They'll factor this along with the cost of materials to develop the estimate. Lower prices typically mean less time on your painting job or lower quality materials. If possible, get a detailed break down of the costs estimate. This should also give you a sense of what work will be done and give you a sense of how to compare estimates.
Quick note on insurance. House painters must have several types of insurance: business/liability insurance and worker's compensation. The business/liability insurance covers the painting contractor for any incidental problems, such as a ladder falling and breaking something expensive in your home. You'll want this coverage because if the house painter isn't covered and something happens, then you have recourse. Without insurance, you are on your own.
The second type of insurance is worker's compensation. This is required by law (may depend on your state) and covers any work-related injury. If your painting contractor doesn't have worker's compensation and someone gets hurt while working on your home, guess who is responsible for the medical bills... you. So this is also really important.
One more important thing to consider. Does the painter operate on a strictly cash basis? (in other words, do they pay taxes?) Sure, the painter may be able to offer you a better price because they don't have to pay any income taxes or collect/pay state sales taxes, but is this behavior you want to support? After all, we all end up paying one way or another. So while you get a cheaper paint job, your taxes will inevitably be higher for you and your neighbors and the painter is getting a free ride.