This took me forever to figure out. Xzar died on me early in the game and I couldn’t figure out how to revive him at a temple (which is what a few Internet sources said to do).
You must go to the priest, then select the dead characters headshot (or whatever the images on the right are called). Only then will the “Raise Dead” option be available (not red).
Chris Heydrick: Serial Hobbyist 
Thanks this helped me
I’ve been wondering about that. I just suffered my first character loss in the iron mines. Thanks for the help