Sometimes I play with the idea of creating a system where PLAYERS, not characters, gain XP for their adventures. Character death would not only be expected, but an important source of XP. The point is that there is continuity to the campaign even if not for all the characters. Or play around with multiple characters, POVs. Anyway, I didn't go too far with it, but this table might useful for somebody.
12 ways to recover the XP of a fallen character
When a character dies, his XP can be recovered automatically or though different actions, at the percentages described below. If more than one person receives the XP, it is divided equally or according to GM's decision. For example, if 10% of the XP is distributed to immediate family, the GM might decide everyone gets an equal share, or that a smaller share goes to a bastard brother that lives somewhere else, if he qualifies.
The total isn't important - maybe only 30% of the XP is recovered, or maybe 110%; it doesn't matter, as long as the death doesn't create more than 100% XP without any effort. Also, you might limit the XP to avoid the deceased's allies get more than half the XP his enemies get for killing him.
Or just roll a d12 instead.
By the way, inheritance rules from OD&D still apply.
1. He died so we could live. If the deceased risked his life for the purpose of saving someone, whoever was saved get 20% of the XP.
2. Survivor. If 1 doesn't apply, 10% of the XP automatically goes to anyone who survived the same event (peril, battle, creature, etc) that destroyed the deceased;
3. For Gondor! 10% of the XP automatically goes to one single organization (realm, criminal gang, guild, etc) the PC was part of, preferably one that was involved in the affair; if the PC screamed the name of the organization ("For Gondor!") right before dying, make it 20% of the XP.
4. Blood is thicker than water. 10% of the XP automatically goes to immediate family.
5. Political history. 10% of the XP automatically goes to anyone who is aligned to any historical movement the deceased was somehow part of; the fall of an empire, the rise of a great family, etc.
6. Cosmic Forces. 10% of the XP goes to people or gods of the same alignment than the deceased.
7. Requiescat in pace. 10% of the XP goes to the ones who take responsibility for retrieving the body and giving it a decent burial.
8. In memoriam. 2 to 20% of the XP is distributed among those who build a decent memorial for the deceased - a tombstone, a statue, plaque, naming something after him, etc.
9. Speak of the dead. 1 to 10% is distributed among those who first mention the deceased in casual conversation not related to the death itself.
10. Revenge shall be mine! 10% of the XP is distributed among those who try avenge the deceased the moment they make a vow of vengeance. Breaking this vow has dire consequences...
11. The spirit lives on. The GM can give 10% XP to someone he deems an spiritual sucessor to the deceased.
12. Deathbed promise. 10% of the XP is distributed among those who vow to fulfill the most important wish of the deceased, and succeed in doing so.