I was surprisingly old (about 10 or 11) before I understood on an emotional level that "everybody dies" meant that the people I cared about would die. Before that time, I could have logically reasoned that these people were a part of "everyone" but I still felt like they would live forever.

What I'm saying is that I think it's realistic that Simba knew that if there was a new king then the old king was dead, but he never really thought about what that meant about his own life.