Dev's have stated that drowning in the deep ocean will result in Perma-death. I personally find that a bit harsh, and I am someone who has played Haven & Hearth which was a perma-death game FAR harsher then CoE plans too be. Mainly the problem is that it's so much more dangerous then staying on land and this could stunt the navel aspects of the game. It also wastes good story possibilities.
The Dev's logic looks to center around the following logic, first that just making you appear back on the continental shore would be lame (I can agree with that) and thus the body needs to stay in the ocean and is thus beyond recovery, while I can buy that a body is unrecoverable after falling into Mt Doom like Golum it's not even all that accurate when it comes to an ocean. Their are a lot of reasonable things that can happen to a body other then sinking to the bottom.
First dead bodies can float, dolphins or other sea life could carry you on their backs, you can cling to driftwood or flotsam if the ship sank, and then tides and currents could move you around in the ocean until you wash up upon...
A deserted island, one of if not the most classic survival and fantasy tropes. In a game which goes out of its way to incorporate survival elements and limited map capabilities that make it possible to be lost (so you friends can't just pick you up easily) it would be a wasted opportunity to not maroon folks on islands. A person so marooned will likely be spending several day on the island building a raft and preparing some supplies for a risky voyage home while also dealing with countless possible adventures such as pirates, giant bee's, meeting other castaways named after days of the week, making friends with sporting equipment, building a radio out of coconuts etc etc.
Death at sea is thus a very inconvenient death that sends one on a set of misadventures that become part of your characters story rather then a simple perma-death.