Head of dynasty dead

So, what is supposed to happen when a head of a dynasty dies? In my game this just happened (not yet official), and it looks like his wife and all their children lost their noble titles. Is this supposed to happen?

I do use the noble career system slightly differently from what's intended by game design, but I was hoping that the household would not completely becme commoners. The main heir that in my game will inherit he highly ranked peerage is still just a child, so it's not likely that he will start the noble career quite yet, so I'll find a temporary workaround.

How about your own  game, how do you deal with someone in the noble career passing, do you just skip the family out of the finer circles, or do you try to find another dnasty member to clmb the career?

Is there any other effects than missing titles and what leaves with them, when someone in that career dies? Hm, guess I have some work to do... ;)