There will also be some very rare instances where the entire family might die at once in a car crash or something tragic...

I think there should be safe guards set in place in case anything happens that way the crypto does not just become locked and the supply reduced. I have seen cases where people pass and their crypto is locked for a while but they eventually regain access after finding the private key, paper wallet, recovering passwords, etc.

It is something that everyone should at least prepare for, that way their loved ones can be taken care of after you are gone.