How do I properly use UDamageType?

If you look at the FellOutOfWorld Function of the Actor.cpp you will see that the UDamgeType parameter is not used at all.

You can call those lines that are in the FellOutOfWorld Function

DisableComponentsSimulatePhysics();
SetActorHiddenInGame(true);
SetActorEnableCollision(false);
Destroy();

Or you do the same that KillZVolume or Actor does

GetWorld()->WorldSettings->KillZDamageType->GetDefaultObject<UDamageType>()

Or even simpler

GetDefault<UDamageType>();

UDamgeType has no state so its fine.