JUSTICE MICHELA
delivered the opinion of the court:
In January 1996, plaintiff filed a declaratory judgment action in the circuit court of Peoria County. He sought a determination of the amount of setoff to be applied to underinsured motorist coverage in two separate insurance policies issued to him by Northland Insurance Co. (Northland) and Chicago Motor Club Insurance Co. (CMCI). In a consolidated appeal, the companies contend that the court erred in finding that only CMCI was entitled to exclusive setoff of $196,114.26 in net workers’ compensation benefits (WC benefits); and in finding that a setoff for social security disability benefits (SSD benefits) is not allowable as a matter of public policy.
Facts
In December 1993, while driving a semi-trailer truck for his employer, plaintiff was involved in a motor vehicle accident with Thomas Fortune (Fortune), an underinsured motorist. Plaintiff was insured by defendants Northland, CMCI, and Great West Casualty Co. (GWC). Each provided underinsured motorist coverage in the respective amounts of $500,000, $300,000, and $20,000.
Plaintiff received the following: a $50,000 limit from Fortune’s liability policy; a settlement from GWC, which was voluntarily dismissed; $246,114.26 in WC benefits, which was reduced by the $50,000 received from Fortune, for a net benefit of $196,114.26; and SSD benefits' of $301 per month commencing in June 1994 and increasing to $324 per month in December 1994.
Northland and CMCI’s policies were similar in that each provided that their limits for underinsured motorist coverage were to be reduced by any amounts received from a tortfeasor, WC benefits, disability benefits or similar law. The companies claim that they are each entitled to a setoff for the money received from Fortune, WC benefits, and SSD benefits. Plaintiff asserts that defendants are jointly entitled to only one setoff for the net WC benefits and that it should be applied to CMCI, the primary carrier, or that the single setoff should be prorated between Northland and CMCI.
The circuit court found and ordered that only CMCI was entitled to a setoff for the net WC benefits of $196,114.26 and that policy provisions allowing a setoff for SSD benefits were against public policy. Defendants’ consolidated appeal follows.
Analysis
The legislative intent in providing for underinsured motorists is to place the insured in the position he would have been in had he been injured by a motorist who carried liability insurance in the same amount as his underinsured motorists coverage. Sulser v. Country Mutual Insurance Co., 147 Ill. 2d 548, 555 (1992).
The limits of underinsured motorist coverage are the difference between the amount plaintiff receives from a bodily injury liability policy and the stated limit for the underinsured motorist coverage. 215 ILCS 5/143a—2(4) (West 1996); Chester v. State Farm Mutual Automobile Insurance Co., 227 Ill. App. 3d 320, 327 (1992).
This court, in Adolphson v. Country Mutual Insurance Co., 187 Ill. App. 3d 718, 721 (1989), held that the "limits of coverage” refers to the highest amount that the insurer providing underinsured motorist coverage must pay. This court noted, "the statute does not set a minimum, or floor, but rather a maximum, or ceiling. Nothing in the statute prevents the insurer from reducing its liability by amounts paid under other coverages in the same policy.” Adolphson, 187 Ill. App. 3d at 721.
Importantly, there is no existing public policy in Illinois demanding that an insured receive the maximum limits of its underinsured motorist coverage. Luechtefeld v. Allstate Insurance Co., 167 Ill. 2d 148, 158 (1995).
Further, parties to a contract may agree to any terms not contrary to public policy. Sulser, 147 Ill. 2d at 559. Public policy must be determined by the constitution, laws, and judicial decisions, as opposed to the opinions of laymen, attorneys or judges as to the demands of the public interests. American Federation of State, County & Municipal Employees v. State of Illinois, 124 Ill. 2d 246 (1988).
Single v. Multiple Setoff
Plaintiff contends that to allow a multiple setoff would fail to place him in the position that he would have been in had Fortune carried liability insurance in the amount of his $800,000 underinsured motorists coverage.
Plaintiff’s contention would have merit had he elected to contract for an underinsured motorist policy of $800,000 with one insurer. In that situation, he would have been guaranteed a single setoff. Instead, plaintiff elected to contract with two separate insurers, under two separate sets of terms, yet similar setoff conditions, for coverage amounts of $500,000 and $300,000, respectively. Luechtefeld, 167 Ill. 2d at 158-59 (public policy does not require invalidation of clearly written policy language to avoid disappointing the insured); Schoonover v. American Family Insurance Co., 214 Ill. App. 3d 33, 43 (1991), appeal denied, 141 Ill. 2d 560 (1991) (insured is charged with notice of policy content.)
Relying on Chester, 227 Ill. App. 3d at 327-28, and Obenland v. Economy Fire & Casualty Co., 234 Ill. App. 3d 99 (1992), Northland asserts that the court erred in reading its policy in conjunction with CMCI’s policy, and ruling that a single setoff applied to CMCI. We agree.
In Chester, the trial court awarded a single setoff to an excess carrier. On appeal, the primary carrier argued that it was also entitled to a setoff. The appellate court agreed and stated that the limit of underinsured motorist coverage is established by statute and that it was proper to reduce the primary carrier’s coverage by the amount paid by the tortfeasor. Nothing in Chester indicates that the court reversed the setoff allowed to the excess carrier.
In Obenland, plaintiffs had two separate $300,000 policies of insurance, with each containing an "other insurance” clause that stated each insurer would only be responsible for its proportionate share of total damages. Despite plaintiffs’ argument to the contrary, the court found no ambiguity in either policy and held that each insurer was entitled to a $200,000 setoff. This setoff left each insurer responsible for $100,000, which was then reduced by the "other insurance” clause to a proportionate share of $50,000 each.
In the instant case, Northland’s policy makes no reference to terms or conditions of any other policy. Northland urges this court to follow Chester and Obenland. As we have found no Illinois law that requires setoffs only be applied to primary carriers, or that multiple policies must be treated as one combined policy, we find that both Northland and CMCI are entitled to rely upon the terms of their policies and each apply a setoff to their limits.
In turning to the amount of setoff, both companies’ policies provide that limits for underinsured motorist coverage may be set off by amounts- received from a tortfeasor, WC benefits, disability benefits or similar law.
$50,000 from Fortune
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JUSTICE MICHELA
delivered the opinion of the court:
In January 1996, plaintiff filed a declaratory judgment action in the circuit court of Peoria County. He sought a determination of the amount of setoff to be applied to underinsured motorist coverage in two separate insurance policies issued to him by Northland Insurance Co. (Northland) and Chicago Motor Club Insurance Co. (CMCI). In a consolidated appeal, the companies contend that the court erred in finding that only CMCI was entitled to exclusive setoff of $196,114.26 in net workers’ compensation benefits (WC benefits); and in finding that a setoff for social security disability benefits (SSD benefits) is not allowable as a matter of public policy.
Facts
In December 1993, while driving a semi-trailer truck for his employer, plaintiff was involved in a motor vehicle accident with Thomas Fortune (Fortune), an underinsured motorist. Plaintiff was insured by defendants Northland, CMCI, and Great West Casualty Co. (GWC). Each provided underinsured motorist coverage in the respective amounts of $500,000, $300,000, and $20,000.
Plaintiff received the following: a $50,000 limit from Fortune’s liability policy; a settlement from GWC, which was voluntarily dismissed; $246,114.26 in WC benefits, which was reduced by the $50,000 received from Fortune, for a net benefit of $196,114.26; and SSD benefits' of $301 per month commencing in June 1994 and increasing to $324 per month in December 1994.
Northland and CMCI’s policies were similar in that each provided that their limits for underinsured motorist coverage were to be reduced by any amounts received from a tortfeasor, WC benefits, disability benefits or similar law. The companies claim that they are each entitled to a setoff for the money received from Fortune, WC benefits, and SSD benefits. Plaintiff asserts that defendants are jointly entitled to only one setoff for the net WC benefits and that it should be applied to CMCI, the primary carrier, or that the single setoff should be prorated between Northland and CMCI.
The circuit court found and ordered that only CMCI was entitled to a setoff for the net WC benefits of $196,114.26 and that policy provisions allowing a setoff for SSD benefits were against public policy. Defendants’ consolidated appeal follows.
Analysis
The legislative intent in providing for underinsured motorists is to place the insured in the position he would have been in had he been injured by a motorist who carried liability insurance in the same amount as his underinsured motorists coverage. Sulser v. Country Mutual Insurance Co., 147 Ill. 2d 548, 555 (1992).
The limits of underinsured motorist coverage are the difference between the amount plaintiff receives from a bodily injury liability policy and the stated limit for the underinsured motorist coverage. 215 ILCS 5/143a—2(4) (West 1996); Chester v. State Farm Mutual Automobile Insurance Co., 227 Ill. App. 3d 320, 327 (1992).
This court, in Adolphson v. Country Mutual Insurance Co., 187 Ill. App. 3d 718, 721 (1989), held that the "limits of coverage” refers to the highest amount that the insurer providing underinsured motorist coverage must pay. This court noted, "the statute does not set a minimum, or floor, but rather a maximum, or ceiling. Nothing in the statute prevents the insurer from reducing its liability by amounts paid under other coverages in the same policy.” Adolphson, 187 Ill. App. 3d at 721.
Importantly, there is no existing public policy in Illinois demanding that an insured receive the maximum limits of its underinsured motorist coverage. Luechtefeld v. Allstate Insurance Co., 167 Ill. 2d 148, 158 (1995).
Further, parties to a contract may agree to any terms not contrary to public policy. Sulser, 147 Ill. 2d at 559. Public policy must be determined by the constitution, laws, and judicial decisions, as opposed to the opinions of laymen, attorneys or judges as to the demands of the public interests. American Federation of State, County & Municipal Employees v. State of Illinois, 124 Ill. 2d 246 (1988).
Single v. Multiple Setoff
Plaintiff contends that to allow a multiple setoff would fail to place him in the position that he would have been in had Fortune carried liability insurance in the amount of his $800,000 underinsured motorists coverage.
Plaintiff’s contention would have merit had he elected to contract for an underinsured motorist policy of $800,000 with one insurer. In that situation, he would have been guaranteed a single setoff. Instead, plaintiff elected to contract with two separate insurers, under two separate sets of terms, yet similar setoff conditions, for coverage amounts of $500,000 and $300,000, respectively. Luechtefeld, 167 Ill. 2d at 158-59 (public policy does not require invalidation of clearly written policy language to avoid disappointing the insured); Schoonover v. American Family Insurance Co., 214 Ill. App. 3d 33, 43 (1991), appeal denied, 141 Ill. 2d 560 (1991) (insured is charged with notice of policy content.)
Relying on Chester, 227 Ill. App. 3d at 327-28, and Obenland v. Economy Fire & Casualty Co., 234 Ill. App. 3d 99 (1992), Northland asserts that the court erred in reading its policy in conjunction with CMCI’s policy, and ruling that a single setoff applied to CMCI. We agree.
In Chester, the trial court awarded a single setoff to an excess carrier. On appeal, the primary carrier argued that it was also entitled to a setoff. The appellate court agreed and stated that the limit of underinsured motorist coverage is established by statute and that it was proper to reduce the primary carrier’s coverage by the amount paid by the tortfeasor. Nothing in Chester indicates that the court reversed the setoff allowed to the excess carrier.
In Obenland, plaintiffs had two separate $300,000 policies of insurance, with each containing an "other insurance” clause that stated each insurer would only be responsible for its proportionate share of total damages. Despite plaintiffs’ argument to the contrary, the court found no ambiguity in either policy and held that each insurer was entitled to a $200,000 setoff. This setoff left each insurer responsible for $100,000, which was then reduced by the "other insurance” clause to a proportionate share of $50,000 each.
In the instant case, Northland’s policy makes no reference to terms or conditions of any other policy. Northland urges this court to follow Chester and Obenland. As we have found no Illinois law that requires setoffs only be applied to primary carriers, or that multiple policies must be treated as one combined policy, we find that both Northland and CMCI are entitled to rely upon the terms of their policies and each apply a setoff to their limits.
In turning to the amount of setoff, both companies’ policies provide that limits for underinsured motorist coverage may be set off by amounts- received from a tortfeasor, WC benefits, disability benefits or similar law.
$50,000 from Fortune
Defendants contend the court erred in finding that because the $50,000 paid by Fortune was applied to plaintiffs workers’ compensation lien, those funds were not entitled to setoff by either company. We find that the court properly reasoned a carrier may not claim a setoff that is greater than the amount actually received by plaintiff. Here, plaintiff did not actually recover the $50,000 from Fortune. Instead, the $50,000 was applied in part to his attorney fees and the remaining amount to his workers’ compensation carrier pursuant to its statutory lien. Therefore, we find that the court did not err in denying a setoff of the $50,000 paid by Fortune.
WC benefits
WC benefits paid to an insured individual and set off from the limits of his underinsured motorists coverage do not violate public policy. Sulser, 147 Ill. 2d at 558. In Sulser, the court allowed the entire amount of WC benefits paid to that plaintiff to be set off from the limits of the underinsured motorists coverage. Here, as plaintiff agreed to policy terms that provided for setoff of WC benefits, and as our supreme court in Sulser found such setoff did not violate public policy, the court did not err in allowing CMCI to set off $196,114.26 in net WC benefits; a setoff to which Northland is also entitled.
SSD benefits
In order to be eligible to receive SSD benefits, one must be "insured for disability purposes” (42 U.S.C.A. § 423(a)(1) (West Supp. 1997)) and be fully insured for SSD benefits (42 U.S.C.A. § 423(c)(1) (West Supp. 1997)). If these requirements are not met, no SSD benefits will be paid. Therefore, it appears that SSD benefits are insurance benefits and not general welfare benefits.
In contending that a setoff for SSD benefits does not violate public policy, the companies compare SSD benefits to WC benefits. A deduction for WC benefits, as determined by our supreme court in Ullman v. Wolverine Insurance Co., 48 Ill. 2d 1 (1970), does not violate public policy for the reason that the recipient must reimburse the employer for any recovery he receives from a third-party tortfeasor. The recipient may retain only the amount received that exceeds the WC benefits. Since the recipient does not actually receive the WC benefits, allowing the insurer to deduct such payments from benefits to be paid places the insured in the same position he would have occupied if the tortfeasor had not been underinsured.
Sulser appears to adopt the reasoning of Ullman, the essential part of which is that the deductibility of benefits is based on reimbursement. Although SSD benefits are derived from a federal insurance plan, unlike WC benefits, the insured is not required to repay SSD benefits from proceeds received. Therefore, following Ullman, a setoff for these benefits would not appear justified, and the court did not err in so finding.
Conclusion
Based on the foregoing, we affirm that part of the court’s order that denied a setoff of the $50,000 received from Fortune and denied a setoff of SSD benefits, but that allowed CMCI a setoff of $196,114.26 in net WC benefits; we reverse that part of the court’s order that did not allow Northland any setoff, finding that it was entitled to a setoff of $196,114.26 in net WC benefits.
Affirmed in part; reversed in part.
BRESLIN, J., concurs.