Sometimes characters die in a game. (And can't be resurrected.) What happens afterwards is often glossed over or ignored.
But you could hold an in-character funeral, and perhaps a wake. This could be solemn, or raucous, depending on the achievements of the dead and the proclivities of the living. And it's always a good excuse for lots of fire and alcohol. What coud possibly go wrong?
Transcript
Luke: I finally got to know my mother properly, and she was ready to start a new life, but now she's been taken away from me.
Luke: I should cremate her body.
R2-D2: Don't burn the helmet!
Luke: No, the Japor snippet brought her nothing but suffering. It's better this way.
R2-D2: But I could be indestructible!
{beat, Leia looking askance}
R2-D2: Or any of us, I guess.
{beat, Padmé burning}
R2-D2: Though you'd have to kill me first.