Advisers will be forced to re-evaluate their choice of administrator following Capita's exit from Sipp and SSAS administration, Talbot & Muir says.
The firm fears that advisers are starting to become overloaded with paperwork - rather than spending time advising clients.
The firm's warning comes after a contraction of the admin market following the FCA's review of the capital adequacy rules that apply to Sipp providers.
Nathan Bridgeman, director of sales and marketing at Talbot Muir, said the Capita announcement has hit advisers.
Mr Bridgeman said: "Advisers are the bedrock of the long term savings market. But they are beginning to be buried in paperwork and administration activities rather than being able to do what they do best – advising clients.
"The announcement by Capita that they will close their Sipp and SSAS business unit reduces the number of Sipp providers.
"The loss of Capita is significant as they were one of the largest administrators in the UK."
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"Advisers are now faced with undertaking due diligence on Sipp administrators, to enable them to advise their clients' on the best course of action, and more often than not, at no chargeable fee.
Claire Trott, head of technical support at Talbot & Muir, said: "The need for due diligence is more important than ever and it is about asking the right questions but as Capita has proved it isn't just about the size of the company, or the capital they hold, an important factor for advisers is the firm's commitment to the Sipp market."