It's to help your accuracy. When you start getting around 100wpm you'll hit a plateu where you need to focus on reducing hand movements and improving accuracy to improve speed. Every time you have to reach for the backspace key you are wasting time, not only because you identified what needed to be corrected, but because you delete it and then retype it. Eventually all that lost time accumulates. Keeping your accuracy above 99% is a must if you want to type fast. Instant death forces you to slow down, so you can learn to type accurately, not just fast.
INSTANT DEATH its exactly like it sounds its so frustrating to start over again again and again after a small error and when you actually make it happen it does not even have you that win it does not get saved to the profile and it feels so disappointing... But I have to admit is its good practice. It has made me more fast and accurate.