Each year nine out of 10 retirees buy a conventional life-time annuity - one that pays out a defined amount each year until the policy-holder dies.
Now more than 1,000 independent financial advisors have backed a campaign to promote awareness of greater choice.
They say two thirds of people are failing to take advantage of their right to buy an annuity from a provider other than the company with whom they have built up their pension pot.
A new industry association has been formed to address this issue in the autumn.
Paul Lewis spoke to Kim Lerche-Thomsen, of annuity provider Living Time.
This item was first broadcast on Radio 4's Money Box on Saturday, 12 September 2009.