I couldn't really choose an answer, as it is level dependent. At lower levels recovery from death is harder and magic items are uncommon enough that while losing one is terrible it is not crippling. You can make do until you get another. If you lose your life at lower levels, you may as well create a new character. There will be no hope of bringing you back in a realistic time frame. Loss of a magic item you were only just starting to get used to, however, is less problematic. You are not yet defined by your magic items, and as you rise in level (and thus in wealth) you can soon enough replace it. Even if it takes a long time, you at least can still play and are not overly burdened due to the loss.
At higher levels, however, recovery from death is much easier, and a character - especially a non-caster - is all but defined by their magic items (esp the permanent or semipermanent ones). Thus loss of magic items would be more terrible than loss of life, as they would be more expensive and time consuming to replace.
As the question did not have a level dependent choice (losing items better at lower levels, losing life better at higher levels), I chose not to vote.