In the case of Life & Casualty Insurance Co. of Tennessee v. McCray (1933), the U.S Supreme Court ruled in favor of McCray, upholding a decision by lower courts that an insurance company could not deny payment on a life insurance policy due to misrepresentation or fraud unless it was able to prove that such deception had occurred. The case arose when Life & Casualty refused to pay out on a policy following the death of McCray's husband, claiming he had lied about his health condition during application for coverage. However, no evidence was presented proving this claim and as per Alabama law at the time, mere suspicion or belief without substantial proof did not constitute grounds for denial of payout. Therefore, the court ordered Life & Casualty Insurance Company to honor its contract with Mrs.McCray and pay her benefits from her late husband’s life insurance policy.

The dissenting opinion in the case of Life & Casualty Insurance Co. of Tennessee v. McCray argued that the majority's decision to uphold a Florida statute, which allowed for double recovery if an insurer failed to pay within 60 days, was unconstitutional as it violated due process rights and equal protection under law. The dissent contended that this punitive measure was excessive and arbitrary, not serving any legitimate state interest or purpose other than penalizing insurance companies who delay payment without considering whether such delays were reasonable or justified. It also pointed out inconsistencies with how different types of insurers were treated under the law, arguing this constituted unequal treatment without rational basis. Furthermore, they believed that allowing juries to decide on these penalties could lead to unpredictable and potentially unfair outcomes.