Does postgresql index update on inserting new row?

From the manual

Once an index is created, no further intervention is required: the system will update the index when the table is modified

http://postgresguide.com/performance/indexes.html

I think when you insert rows, the index does get updated. It maintains the sort on the index table as you insert data. Hence there are performance issues or downtimes on a table, if you try adding large number of rows at once.