مَثَلُ الْحَيِّ وَالْمَيِّتِ sets two opposites beside one another: life suggests responsiveness and vitality, while death suggests their absence. This is a comparison, not a judgment that a neglectful person is literally dead or has ceased to believe.
Remembrance should engage more than sound alone. It should be connected to obedience, honesty, and reflection on one's actions.
The two words الْحَيِّ and الْمَيِّتِ are linked by وَ; both have genitive endings within the construction after مَثَلُ.