Characters who die and are resurrected loose one level. They have their XP total set to halfway between their current level and the minimum requirement for one level lower.
If your character is not resurrected, your new character will start out one level lower than the one who died. You will roll up a new character who can be any race or class. Your new character's XP total will be set to the minimum required for this level. The original character's equipment including all wealth and magical items is destroyed except for unique or quest items which the survivors decide what to do with. Replacement characters get equipment equal to all of the original character's equipment including wealth and magic items and can substitute any piece of equipment for another of equal or lesser value, or sell it for 1/2 the purchase price listed in the Player's Handbook. Additional equipment may be purchased from the Player's Handbook only. No more than half of your wealth can be spent on any one item.