2 things here:
First, there is a major bug with this item. If it is placed inside of a bag, it will remain intact and summon a separate ashen idol of rebirth, leaving the original glowing idol of rebirth unused. Obviously this is essentially godmode, as you will just return to life an unlimited number of times. Making matters worse is the fact that you can give each character their own idol.
Second, I'd suggest removing it entirely from the game, bug or no bug. I feel that it completely takes away the threat of death and is entirely overpowered. At least make it revive at 20% health, not 100%, and have it not be something you can just re-create with a single scroll of resurrection.

tl;dr Either get rid of it entirely, or make it resurrect at 20% health and be permanently lost afterwards.