Choosing the best life assurance product depends on the kind of person you are and the degree of security you want.

For those who crave security and predictability, one of the new guaranteed lifelong policies might be the most suitable.

These are guaranteed to pay out upon death and the premiums are fixed throughout. This allows the assured to plan ahead and have some peace of mind. A drawback, however, is that such policies cannot be cashed in during their lifetime.

But for those who like taking risks and who do not like to be tied into long-term financial arrangements, regular whole-of-life policies, which under certain conditions have a cash value, may be a better option.

However, one must remember that whole-of-life policies can "bomb out". This is where high costs and problems with the underlying investment units put the life cover at risk and the investment value is used to support the life cover until there is no investment left. The only way to prevent bombing out is to increase the premium.

Whole-of-life policies cost on average 1 1/2 times more than guaranteed lifelong policies.

Whole-of-life policies can theoretically last an entire lifetime if the premiums are priced correctly from the start and regularly reviewed to take into account the age profile.

Many companies review the policy every 10 years while others only initiate a review at the request of the client. So a sudden increase in premiums can occur.

A person's view of what constitutes "quality of life" is also important when it comes to choosing the right life assurance option.

No matter what product is chosen a decision will have to be made about the amount of cover required. People have to ask difficult questions. For instance, in the event of the death of the assured, should the cover be sufficient to provide regular holidays for the dependants left behind?

Not surprisingly, all the main life assurance companies say the vast majority of customers do not make sufficient provision.

"We hear so many horror stories from families who believed they were adequately provided for, but when they see the sum left for them, they're shocked," says Mr Brian Wood, the finance director of Ark Life.

A recent survey by the company shows that women tend to be especially unprotected. It showed that 48 per cent of women compared to 40 per cent of men, do not have any life cover.

Another survey from Eagle Star showed that male respondents had average cover of £62,562, while women had average cover of £53,084. So getting the right level of cover is as important as choosing the right type of product.

It should also be remembered that if you die and a policy is paid out to dependants the payout may be liable to capital acquisition tax. However, if you get what is known as a Section 60 policy the capital acquisition tax is automatically paid for by the company. Higher premiums have to be paid for policies which are adapted for Section 60.

Mr Wood says both the standard whole-of-life policy and the newer guaranteed lifelong policy have advantages. The lifelong policy is good for those who have long-term dependants or who have no occupational pension, he says.

The whole-of-life policy is suitable for people who do not know how long they may need to protect their family or those who like the idea that they can cash in their policy in the event of unforeseen circumstances, he adds.

However, while both options offer advantages, the merit has changed radically since the arrival in late 1996 of the first guaranteed lifelong-style policy, from Irish Progressive.

The idea of the guaranteed lifelong product was imported from Canada and there are currently five Irish companies selling them, with Irish Life introducing its lifelong product in the last week.

Mr Wood points out that Ark Life is currently selling 50 per cent more lifelong guaranteed policies than the regular whole-of-life policy.

Despite this, he says the company has no intention of discontinuing whole-of-life policies, "as the demand is still very much out there".

The guaranteed lifelong policy has its comforting features, like fixed premiums, but the option may be a little too safe for those who view life assurance as a form of saving.

But while customers might see these products in this light, guidelines from the Irish Insurance Federation recommend to member-companies that whole-of-life products are not sold as saving or investment options.

All life companies deny that these guidelines are broken and point out that staff are trained not to present whole-of-life policies as saving or investment plans.

There is one good reason why whole-of-life policies should not be seen as investment options. All life companies operate a nil allocation period, the period during which premiums are absorbed by charges and these range from six months to 15 months.

In other words not a penny from your premium is being invested during this period and instead is being used to set up the policy. This compares unfavourably with an investment in property or equities which could produce a significant return over a 15-month period, for instance.

In looking at life assurance products which have a cash value, the crucial factor is the kind of unit fund the money is invested in. An annual return of 7 per cent is taken as an average across the industry, but as the saying goes "past performance is not a guide to future returns" and the nature of the fund needs to be examined closely.

For example, managed growth funds have produced a return of 5.6 per cent so far this year while property unit funds have made a return of 16.8 per cent for the year to date and 105 per cent over the last five years.

While few life companies in the Republic invest money in the Far East-managed funds, their minus-12 per cent return this year gives an illustration of how bad things can get.

Mr Paul Conheady, marketing manager with Standard Life, says customers nowadays require flexibility. "People want a product that gives them cover when they need it and a savings vehicle later on when their dependants are leading their own lives," he says.

Whatever about the cash return on whole-of-life policies, public awareness of life assurance products generally seems to be low. Even when a policy is worth a significant amount of money, many people do not know this.

Standard Life estimates it is holding £1.3 million belonging to policyholders who seem to have forgotten about their investment.