The beauty of BMI is the simplicity. It isn't perfect but it is very easy to spot cases where BMI wouldn't be useful (body builders). a bodyfat percentage test is something that must be done by a professional with special equipment. Professionals and special equipment cost money and time. BMI works well enough and can be done by anyone with simple maths. For the average person it is a nice, simple solution to a problem. It isn't perfect, but sometimes utility and being pragmatic is more important.