It depends on what you set the buffer width and height to in the game's constructor, i.e.
Graphics.PrefferedBackbufferWidth = 1280;
Graphics.PrefferedBackbufferHeight = 720;
In that case it defaults to 720p and you should only tick the "720p" box. If you have some code setup to detect if 1080p is available and use it, and change the fonts/drawing/ect so it stays in the safe area and is still readable, then you can check 1080p.
Personally, I use 720p which is guaranteed to work on all TVs, HD or not, so I only have to worry about one size for the safe area.
The Best Practices
doc explains it in more detail.