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JUSTICE GOLDENHERSH delivered the opinion of the court:

April D. Eddy (plaintiff) appeals from an order of the circuit court of MadisonCounty ordering plaintiff to pay State Farm Insurance Company (State Farm) its entiresubrogation lien less attorney fees of one-third for the payment of State Farm's medical-paylien. The issue on appeal is whether the trial court erred in awarding State Farm its fullsubrogation lien, minus a reduction under the fund doctrine, for medical payments made byState Farm under its contract of insurance with plaintiff. We affirm and remand withdirections.

Plaintiff and Floy E. Sybert (defendant), who takes no part in this appeal, wereinvolved in an automobile accident on November 14, 1998. Both plaintiff and defendantwere insured by State Farm. Defendant's policy with State Farm provided for maximumliability limits of $100,000 per person. Plaintiff's policy with State Farm provided medical-pay coverage in the amount of $25,000. The terms of the insurance policy issued by StateFarm to plaintiff also contained a subrogation clause that allowed State Farm to obtainplaintiff's right to recover against a third party after State Farm paid plaintiff's medical bills. The subrogation provision provided in pertinent part as follows:

"b. Under medical payments coverage:

(1) we are subrogated to the extent of our payment to the right of recovery theinjured person has against any party liable for the bodily injury.

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(3) if the person to or for whom we make payment recovers from any party liable forthe bodily injury, that person shall hold in trust for us the proceeds of the recovery[]and reimburse us to the extent of our payment." (Emphasis in original.)

Upon learning of the accident, State Farm sent plaintiff a letter dated November 18, 1998,in which it outlined the rights and obligations of both plaintiff and State Farm. In the letter,State Farm specifically advised plaintiff that her policy provided for reasonable expenses fornecessary medical treatment caused by the accident up to a limit of $25,000 per person andthat "[t]he expenses are covered for three years from the date of the accident for bodilyinjury, provided the injury is discovered and treated within one year of the accident date." State Farm also advised plaintiff, via the letter, of its subrogation rights and asserted, "Wewill not subrogate for the amount we have paid if your recovery from the responsible partyplus our payments do not exceed your damages."

State Farm asked plaintiff to sign a medical authorization form to allow State Farmto obtain her medical records. Plaintiff declined to do so, opting instead to allow herattorney to obtain her medical records and bills and forward them to State Farm. State Farmmade payments on behalf of plaintiff and sent letters informing plaintiff of the amounts ofmedical bills paid on her behalf. State Farm advised plaintiff that the medical paymentsmade by State Farm on her behalf "are subject to [State Farm's] right to subrogation orreimbursement."

On December 15, 1998, plaintiff filed a lawsuit against defendant. On September 29,1999, plaintiff's counsel made a settlement demand by letter for "payment in the range of$160,000." The parties ultimately agreed to settle for the policy limits of $100,000. OnNovember 24, 1999, an order was entered, pursuant to a stipulation of the parties, dismissingthe case with prejudice. The order also stated that the trial court retained jurisdiction toresolve lien issues.

The record shows that between December 1, 1998, and July 2, 1999, State Farm paid$19,079.82 of plaintiff's medical bills. State Farm issued two separate checks to fulfill itspayment obligations under the settlement. One check was in the amount of $12,719.88,made payable to plaintiff, her attorneys, and State Farm. State Farm refused to endorse thecheck unless plaintiff agreed to pay the $12,719.88 to State Farm pursuant to its right ofsubrogation.

After the settlement, plaintiff discovered that a bill in the amount of $2,985 owed toDr. Anderson had not been paid. On February 4, 2000, plaintiff's attorney sent a letter toState Farm requesting the payment of Dr. Anderson's bill. The letter also explained that thecheck for $12,719.88 had been placed in an escrow account. Pursuant to the fund doctrine,plaintiff requested a reduction for future medical bills, estimated at $3,000, and offered StateFarm $11,719.88 to settle the subrogation claim. State Farm responded that it would not payfuture medical bills and denied any responsibility for the unpaid $2,985 medical bill on thebasis that it had not been made aware of that bill until six months after the case was settled.

On April 5, 2000, plaintiff filed a motion to adjudicate lien, in which she asked thetrial court to enter an order "adjudicating the amount of any subrogation claim[,] includinga deduction for attorneys fees and unpaid medical bills pursuant to the 'fund doctrine.' " OnOctober 12, 2000, State Farm filed a response to plaintiff's motion to adjudicate lien. StateFarm claimed a lien for medical payments made under plaintiff's automobile policy for$19,079.88 and agreed to allow plaintiff a reduction of one-third of that total under the funddoctrine pursuant to Baier v. State Farm Insurance Co., 66 Ill. 2d 119, 361 N.E.2d 1100(1977). However, State Farm claimed that it had no duty to pay future medical bills or a billsubmitted after a claim was settled, "because by settling[,] [p]laintiff destroys any right ofsubrogation that State Farm may have." State Farm claimed that it did not have Dr.Anderson's bill until February 4, 2000.

In response, plaintiff submitted Dr. Anderson's affidavit, in which he claimed: "[O]nor about November 19, 1998, Dr. Peter J. Anderson issued a physician's lien to State Farmwhich notified State Farm Insurance that Illinois SW Orthopedics, Ltd.[,] asserted a lien fortreatment, care, physician's services[,] and maintenance upon any and all claims and causesof actions which April Eddy may assert against any persons for damages on account ofpersonal injuries alleged to have been received in an accident that occurred on or about11/14/98. The physician's lien letter notified State Farm that the amount of lien was thebalance at the time of settlement." Dr. Anderson attached a copy of the lien letter, as wellas the receipt for the lien letter signed by an agent for State Farm. Dr. Anderson further setforth in the affidavit that a member of his staff called State Farm on May 24, 1999, andinformed State Farm that medical charges for the services of Dr. Anderson remained unpaidand that, prior to the telephone call, the bills had been sent to State Farm. Plaintiff assertedthat a balance of $2,985 remained.

State Farm introduced evidence that it paid $19,079.82 in medical bills for plaintiffunder the medical-pay provision in her policy. On January 4, 2001, the trial court enteredan order awarding State Farm its entire subrogation lien amount of $19,079.82, less one-third for attorney fees under the fund doctrine. Accordingly, plaintiff was ordered to payState Farm $12,719.88. Plaintiff then filed a motion to reconsider and/or clarify its order,which the trial court denied on March 21, 2001. The trial court's order contained nolanguage concerning the unpaid medical bill submitted by Dr. Anderson. Plaintiff nowappeals.

The issue on appeal is whether the trial court erred in awarding State Farm its fullsubrogation lien, minus a reduction under the fund doctrine, for medical payments made byState Farm under its contract of insurance with plaintiff. Plaintiff contends that the contractlanguage is ambiguous and that any ambiguity must be resolved in her favor. She furthercontends that she was not fully compensated for her damages and that, thus, State Farmshould not be allowed to recoup its medical payments from the settlement. Plaintiff alsocontends that the trial court failed to consider the equities involved in this case. Wedisagree.

Subrogation rights originated in equity but now arise by both statute and contract. In re Estate of Scott, 208 Ill. App. 3d 846, 848, 567 N.E.2d 605, 606 (1991). Where theright is created by an enforceable subrogation clause in a contract, contract terms, not thecommon law or equitable principles, apply. Capitol Indemnity Corp. v. Strike Zone, S.S.B.& B. Corp., 269 Ill. App. 3d 594, 596, 646 N.E.2d 310, 312 (1995). The construction of aninsurance policy is a question of law subject to de novo review. State Farm MutualAutomobile Insurance Co. v. Villicana, 181 Ill. 2d 436, 441, 692 N.E.2d 1196, 1199 (1998). Ambiguous language in an insurance policy should be construed against the drafter. Katzv. American Family Insurance Co., 163 Ill. App. 3d 549, 552, 516 N.E.2d 795, 796 (1987). Where the terms in a policy are clear and unambiguous, they must be given their plain andordinary meaning. American States Insurance Co. v. Koloms, 177 Ill. 2d 473, 479, 687N.E.2d 72, 75 (1997).

In the instant case, the language in plaintiff's contract clearly states that if plaintiffrecovers from any party liable for bodily injury, State Farm obtains plaintiff's right to recoveragainst that third party. Here, it is the unambiguous contract language that controls, not thelanguage of the letter or equitable considerations. Nevertheless, plaintiff insists that theletter State Farm sent to plaintiff concerning medical subrogation should be construed assaying that if the plaintiff did not recover all her damages, State Farm would not pursue itssubrogation within the context of the medical-pay provisions. Even assuming, arguendo,that the letter controls, we disagree with plaintiff's construction of the language containedin the letter. Our review of that language indicates that the letter informs plaintiff that if shedid not recover her medical damages, subrogation would not be pursued. State Farm wouldnot be concerned about a recovery above and beyond its own limits of liability underplaintiff's policy. Here, plaintiff settled for defendant's policy limits of $100,000, well inexcess of the $19,079.82 paid by State Farm under the medical-pay provision of its contractwith plaintiff.

Plaintiff also contends that she was not made whole by the underlying settlement and,thus, that there should be no right to subrogation. Plaintiff relies on cases from foreignjurisdictions in support of this argument. Plaintiff has not cited any Illinois cases, nor havewe found any, that hold that there is no right to subrogation unless the plaintiff was madewhole by the underlying settlement. Such a ruling would run contrary to our state's policyencouraging the settlement of cases. We find this case similar to Gibson v. Country MutualInsurance Co., 193 Ill. App. 3d 87, 549 N.E.2d 23 (1990). Plaintiff's attempt to distinguishGibson is unpersuasive.

In Gibson, like the instant case, the plaintiff recovered medical payments under herown insurance policy and then negotiated a settlement with the driver who was at fault andinsured by the same insurance company as the plaintiff. The plaintiff attempted to preventher insurance company from enforcing subrogation and reimbursement provisions in herpolicy to recover the medical payments it paid her from the settlement she received from theat-fault driver. The plaintiff argued that the enforcement of the subrogation andreimbursement provisions in her policy violated public policy because she had not been fullycompensated for her damages. Gibson, 193 Ill. App. 3d at 89-91, 549 N.E.2d at 25-26. TheGibson court rejected this argument and allowed the insurance company to recover themedical payments from the plaintiff's settlement with the at-fault driver. Gibson, 193 Ill.App. 3d at 90-92, 549 N.E.2d at 25-26. Thus, Gibson declined to follow the made-wholedoctrine that has been adopted by other jurisdictions.

Plaintiff also argues that even if State Farm has a valid right of subrogation, it cannotexercise that right because State Farm failed to pay all of plaintiff's medical bills. Werecognize that an insurance company may not exercise its right of subrogation until it haspaid the insured's damages under the policy giving rise to the subrogation rights (Benge v.State Farm Mutual Automobile Insurance Co., 297 Ill. App. 3d 1062, 1072, 697 N.E.2d 914,921 (1998)); however, the facts in the instant case do not trigger that rule. Here, State Farmdid not refuse to pay all of plaintiff's medical bills. The only bill that was not paid was a$2,985 bill submitted by Dr. Anderson. State Farm insists that it was not made aware of thisbill until six months after the case settled and that, therefore, it was under no obligation topay the bill. Plaintiff, on the other hand, insists that State Farm should have been aware ofDr. Anderson's bill and was obligated to pay it under the medical-pay provision of its policywith plaintiff.

Dr. Anderson's affidavit reveals that State Farm was put on notice of the bill after Dr.Anderson's office sent State Farm a notice of his lien within four days of the accident andlater called State Farm about the outstanding bill. The trial court's order fails to mention thisunpaid medical bill. We note that even after paying this bill, State Farm will not have paidin excess of plaintiff's $25,000 limit of liability under the medical-pay provision of herpolicy. Therefore, we find that State Farm is liable for the bill under plaintiff's medical-payprovision but that it can subrogate this claim under the liability coverage in defendant'spolicy. State Farm is entitled to reimbursement from the proceeds of the settlement withdefendant, minus a reduction of one-third under the fund doctrine. Plaintiff, however, failsto convince us that State Farm was required to pay future medical bills.

For the foregoing reasons, we hereby affirm the order of the circuit court of MadisonCounty ordering plaintiff to pay State Farm its full subrogation lien, minus a one-thirdreduction under the fund doctrine. Additionally, pursuant to our powers under SupremeCourt Rule 366(a)(5) (155 Ill. 2d R. 366(a)(5)), we hereby amend the judgment to orderState Farm to pay Dr. Anderson's medical bill of $2,985 under the medical-pay provision ofplaintiff's policy, and we further order plaintiff to reimburse State Farm for that bill, lessone-third under the fund doctrine in the amount of $995.33.

Affirmed as modified.

HOPKINS, P.J., and KUEHN, J., concur.

Rule 23 order filed: November 19, 2002

Motion to Publish Granted: January 3, 2003

Opinion Filed: January 3, 2003

Justices: Honorable Richard P. Goldenhersh, J.

Honorable Terrence J. Hopkins, P.J., and

Honorable Clyde L. Kuehn, J.,

Concur

Attorney Brian M. Wendler, Wendler & Ezra, P.C., 4955 South State Route 159, Glen

for Carbon, IL 62034

Appellant

Attorney Jane Unsell, Unsell, Schattnik & Juen, 55 South 9th Street, East Alton, IL 62024

for

Appellee