Failure to shop around for an annuity is costing pensioners £124m per year, Key Retirement Solutions claims.
KRS said customers using its annuity brokerage service receive on average 21% more than the quote given to them by their pension provider. This equates to £248 per year extra per pensioner, the adviser said.
With 500,000 annuities bought per year, this means pensioners could be missing out on £124m in total by buying inappropriate retirement products which do not take into account their health conditions and life expectancy, KRS said.
KRS group director Dean Mirfin said: "It is simply wrong that people accept the default option from their pension provider when they could increase their income by on average 21% or more by simply taking a few minutes of their time to speak to a specialist.
"Someone who is retired for 25 years is effectively giving up on more than £10,000 if they miss out on an average £428 a year in income.
"Customers should shop around as the default and we continue to make this process as straight forward as possible, it only taking a matter of minutes to find out what income can be achieved plays a big part in this process."
Service increasingly key
Aiming to be' top three' UK financial planner
Lowest measure since index launched in 1995
Complaints into double figures
Despite lower median annual earnings