In the case of Stroehmann et al. v. Mutual Life Insurance Company of New York, 1936, the Supreme Court was asked to determine whether a life insurance policy could be considered an asset in bankruptcy proceedings when it had been assigned as collateral for a loan prior to bankruptcy filing. The court ruled that such policies are not part of the bankrupt's estate and therefore cannot be used to satisfy creditors' claims. This decision hinged on two key points: first, that under Pennsylvania law (which governed this case), assignment of a life insurance policy does not transfer ownership; secondly, federal bankruptcy law exempts from seizure any property exempted by state law - including life insurance policies in Pennsylvania.

The dissenting opinion in the case of Stroehmann et al. v. Mutual Life Insurance Company of New York argued that the majority's decision to uphold a lower court ruling denying payment on an insurance policy was incorrect. The dissenting justices believed that there were significant questions about whether or not the insured had committed suicide, which would have invalidated his life insurance policy under its terms and conditions. They felt that these doubts should have been enough to overturn the lower court's judgment and allow for a new trial where all evidence could be properly considered by a jury rather than decided upon by judges alone. Furthermore, they disagreed with how certain pieces of evidence were interpreted by their colleagues, believing them to hold more weight towards proving accidental death rather than intentional self-harm.