Are Hirelings Looted From Your Dead Body?
Hirelings are just cards, like other cards. The rules for looting are quite clear - you lose all the cards you had in play. So not only do you lose anything he's carrying, you lose your Hireling too (he runs off somewhere)!


  Death
  
  If you die, you lose all your stuff.
  You keep your Class(es), Race(s), and Level (and any Curses that were affecting you
  when you died) – your new character will look just like your old one.
  If you have Half- Breed or Super Munchkin, keep those as well.
  
  Looting The Body: Lay out your hand beside the cards you had in play. Starting
  with the one with the highest Level, each other player chooses one
  card . . . in case of ties in level, roll a die. If your corpse runs
  out of cards, tough. After everyone gets one card, the rest are
  discarded.
  
  Dead characters cannot receive cards for any reason, not
  even Charity, and cannot level up.
  
  Your new character appears when the
  next player begins his turn, and can help others in combat . . . but
  you have no cards.