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Gillen v. State Farm Mutual Automobile Insurance Co.5/19/2005
334 (1952) ("Courts should not adopt gossamer distinctions which the average [person] for whom the policy is written cannot possibly be expected to understand"); Goetze v. Franklin Life Insurance Co., 26 Ill. App. 3d 104, 109 (1975) (premium receipt for temporary coverage must be "sufficiently clear for a layman to understand"); Manchester Insurance & Indemnity Co. v. Universal Underwriters Insurance Co., 5 Ill. App. 3d 847, 855 (1972) ("inexpert layperson" will not be charged with "the responsibility of making or procuring independent technical legal opinions regarding what coverage they are buying" and "are entitled to rely on language which purports to cover").
Even if we concluded that the setoff clause, reasonably construed, could convey to the average policyholder that State Farm's liability would be reduced by payments made under the Pension Code and municipal ordinance, at best this results in an ambiguity. That is, construing the setoff clause to include benefits authorized by the Pension Code would compete with the equally reasonable construction excluding such benefits. "Where competing reasonable interpretations of a policy exist, a court is not permitted to choose which interpretation it will follow. * Rather, in such circumstances, the court must construe the policy in favor of the insured and against the insurer that drafted the policy." Employers Insurance of Wausau, 186 Ill. 2d at 141.
We note that "the insurer has the capacity to draft intelligible contracts." Goetze, 26 Ill. App. 3d at 108, citing 12 J. Appleman, Insurance Law & Practice, ch. 263, ยง7222, at 203 (Supp. 1974). Had State Farm intended to include a setoff for payments made in accordance with the Pension Code, it easily could have modified the policy language to so provide. Indeed, the substantive language of section 22-306 of the Pension Code has not changed in 40 years. Compare Ill. Rev. Stat. 1963, ch. 108", par. 22-306, with 40 ILCS 5/22-306 (West 2002). Moreover, State Farm conceded at oral argument that it was aware of no other statute which, in its view, would qualify as a "similar law." Thus, State Farm's failure to include an explicit reference to section 22-306 or otherwise make plain that its liability for uninsured-motorist coverage will be reduced for payments made pursuant to section 22-306 is inexplicable. Under these circumstances we cannot allow State Farm to avoid its obligation under the policy. State Farm must honor Teresa's claim for uninsured-motorist coverage with no offset for the medical benefits paid by the City of Chicago .
In light of our holding that the setoff clause does not include payments made pursuant to the Pension Code, we need not address Teresa's additional argument that a setoff for pension benefits would violate Illinois public policy.
CONCLUSION
We conclude that the trial court erred in entering judgment on the pleadings in favor of State Farm. Accordingly, we affirm the judgment of the appellate court reversing the judgment of the circuit court and entering judgment in favor of Teresa Gillen.
Affirmed.
JUSTICE THOMAS took no part in the consideration or decision of this case.
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