This is a good decision. Letters and journals of dead children also go to the parents. I fail to see why online accounts should make a difference.
We already have a process for what happens to a person's belongings after death; a person's online accounts are belongings; therefor we already have a process for what happens to a person's online accounts after death. Yes, each jurisdiction will have its own rules, but again we already have a process for determining what happens to possessions in other jurisdictions upon the owner's death.
(as an aside, this is part of why '… but with a computer!' patents shouldn't be patentable: they're obvious)
Additionally, not everything the T&C says, up to and including "accounts are not transferable" is not automatically legal.
at least now we have consistency, this is of course good