Originally Answered: The truth about chamomile tea?
Chamomile tea does not exactly put you to sleep, but it definitely makes it easier for some people to get to sleep, by promoting relaxation. There is a difference between a sedative (like sleeping pills, or the herb Valerian, which actively induces sleep) and a relaxing herb. Chamomile is not a strong sedative, but it definitely has a relaxing effect.
This has been backed up by scientific studies. It also, like you found, is known to lower blood sugar and have anti-inflammatory effects. It even has other effects, including acting as a blood-thinner (which can be dangerous for people on blood thinning medication). Unfortunately, there's not any conclusive evidence that it provides a strong effect at preventing or curing insomnia. So far, the only herbs that have been shown effective for this are ones with much stronger effects, like Kava. However...this doesn't mean it doesn't have an effect...it just means it hasn't been studied enough. There's not much money out there for researching herbs...instead companies pump money into researching drugs because they can patent them, and there's thus more money in them.
You will find some sources here, and more in-depth info, on this site I maintain:
I hope this answers your question thoroughly.