I think that if you are killed, you should lose whatever ship you were flying along with its equipment except for rare items (i.e. items you can only get through events or through finding them in the game world--items that you can't just buy with in-game money--you should get to keep these). You would then respawn at the base where you last landed, where you would have to either spend cash on a new ship, or take the option of a free newbie ship with minimal equipment (Privater example: the Tarsus with only two lasers and level 1 shields and engines and no other upgrades).