It's inevitable.
Upon dying during PVP, the defeated player will lose 50% of the items in their Ships Hold. The Ship's Hold is the in-game inventory of your ship, where the player must deposit their inventory items before setting sail. These items are chosen at random by an algorithm but more valuable items have a higher chance of being looted (removed from your inventory). The 50% of items lost will be the victorious party's loot prize.
Upon dying to AI opponents at sea (having your Port raided successfully by AI Raiders doesn’t apply,) you will have to pay a price of 50% of your Hold's loot to the Ferryman of the Damned. In exchange, he will spare your captured soul and return you to the Sanctuary Islands with your ship.
Upon dying at sea, as well as losing 50% of your Hold's goods, the resources the player survives with will have a ‘Waterlogged’ effect for a period of time. This means that your resources will sell for far less at the Marketplace (the reduction in sale price will vary). This is to deter players from dying purposefully to AI or PVP to reach the Sanctuary Islands faster.