It's a divine touch range save or die.

Compare Slay Living (PHB); Lv 5, death effect, deals mild damage on a failed save.

This is undead only (-0 to -1 level), mindless undead only (coupled with undead only let's say an easy -2), no penalty on a failed save (-0.5), paladin exclusive (-0 to -1 so -0.5). I'd say the level is about right.

Or compare to Rigor Mortis (from one of the undead books) which is a 2nd level touch range save or lose; all they have to do is coup de grace you afterwards.

So yeah I'd say it's not too strong.