The Christchurch City Council has unanimously voted against pay rises for the directors of the insurer, Civic Assurance.
The company is owned by all 78 councils throughout the country and its chairperson is Tony Marryatt, who is also the chief executive of the Christchurch City Council.
City council staff had recommended councillors agree to paying more than $170,000 in remuneration to Civic Assurance's directors, but the councillors disagreed.
The opposition follows a public uproar last year over an unrelated increase for Tony Marryatt in his position as chief executive of the council.
Speaking before the vote, councillor Tim Carter said the insurer had made a loss in the past two years and suggested it might be insolvent.
He said it wouldn't make sense to offer increases to directors of a company in an uncertain financial state.
The city council's vote, as well as votes from the other 77 councils, will be tallied at Civic Assurance's Annual General Meeting next week.