Connecticut Mutual Life Insurance Company v. Schaefer was a United States Supreme Court case that addressed the issue of whether a life insurance policy could be assigned to a third party. The case involved a policy issued by Connecticut Mutual Life Insurance Company to a man named Schaefer. Schaefer had assigned the policy to a third party, but the insurance company refused to recognize the assignment. The Supreme Court held that the assignment was valid and that the insurance company was obligated to recognize it. The Court reasoned that the policy was a contract between the insurance company and Schaefer, and that Schaefer had the right to assign the policy to a third party. The Court also noted that the assignment did not alter the terms of the policy, and that the insurance company was still obligated to pay the benefits to the third party. The Court concluded that the assignment was valid and that the insurance company was obligated to recognize it.

In the case of Connecticut Mutual Life Insurance Company v. Schaefer, the Supreme Court was tasked with determining whether a contract between an insurance company and its policyholder had been breached. The majority opinion held that there had not been a breach of contract because the insurer's actions were reasonable under the circumstances. However, Justice Field dissented from this ruling on two grounds: first, he argued that it was wrong for courts to interpret contracts in such a way as to limit their scope; second, he argued that if parties are allowed to make agreements without any restrictions or limitations then they should be bound by those agreements regardless of what is deemed "reasonable" by courts. Ultimately, Justice Field believed that allowing insurers too much leeway in interpreting contracts would lead to unfairness and injustice against policyholders who have relied upon certain terms being upheld when entering into these types of arrangements.