In the case of Williams v. Union Central Life Insurance Co., 1933, the Supreme Court ruled in favor of Union Central Life Insurance Company. The dispute arose when a policyholder, Mr. Williams, committed suicide within two years of purchasing his life insurance policy - a period during which many policies have clauses that nullify payouts for suicides to prevent people from buying policies with premeditated intent to benefit their heirs through suicide. Despite this clause being present in Mr.Williams' contract and despite it being legal under Ohio law (where the company was based), he had purchased his policy in New York where such clauses were illegal at that time due to public health concerns about incentivizing suicide among financially distressed individuals. His widow sued for her late husband's benefits arguing that since the purchase happened in New York, its laws should apply but lost both at trial and on appeal before bringing her case to federal court citing diversity jurisdiction as she lived out-of-state relative to Union Central's headquarters location.The Supreme Court upheld previous rulings against Mrs.Williams stating that while contracts are generally governed by laws where they're made (New York here), insurance is an exception because it involves state-regulated entities whose home states' rules govern their contractual obligations regardless of sales locations.

In the dissenting opinion for Williams v. Union Central Life Insurance Co., Justice Cardozo argued that the majority's decision to allow a policyholder to recover insurance money despite misrepresentations on their application was inconsistent with previous case law and detrimental to the insurance industry. He contended that allowing recovery in such cases would encourage dishonesty among applicants, undermining the trust necessary for insurers to operate effectively. Furthermore, he disagreed with the majority's interpretation of Ohio state law, asserting it did not support their conclusion. According to him, if an applicant made false statements about his health condition intentionally or negligently which materially affected risk assessment by insurer then they should be held accountable and denied recovery from policy benefits.