The persistent version of Star Citizen calls for a different approach, though. Roberts acknowledges the immortal pod pilot lore and mechanics of EVE Online, calling CCP's method "clever" but ultimately saying that he's "not interested in making EVE 2.0 with cockpits."
He stops short of calling SC's mechanic permadeath, but he does note that every "death" will affect your avatar. "Eventually, after too many deaths, your character's body will just give out," he explains, "and instead of waking up in a med bay, you'll be attending the funeral of your fallen character from the eyes of the beneficiary you specified when originally creating your character."
There's much more to it, of course, including plenty of "death" examples and a FAQ, but you'll need to read Roberts' full blog entry for further details.
[Thanks to Eric for the tip!]