Psychic death is a concept closely related to psychic progress.
Many different psychic energies flow through the psychic - the sword which does not bend breaks. A psychic death removes a core limitation from the psychic and so enables better flexibility, control and greater psychic powers.
The term 'psychic death' covers a group of similar experiences. The most basic psychic death is the fear of physical death. After that, more advanced (also more fearsome) forms of psychic death can be experienced; for example, the experience of not existing or of being eternally imprisoned in lower forms of consciousness.
Understanding psychic death within your very being is very different than understanding intellectually. Nevertheless, when ready, the psychic seeks out psychic death as a way of becoming stronger and getting to know oneself more fully.
In many spiritual traditions psychic death is a form of initiation.