If Wanda dies while having the watch in the inventory (not in a Backpack), it will drop on the ground for her to haunt. Haunting the Second Chance Watch will break it, giving back half of the materials used to craft it, including the Time Pieces. Only ghosts of Wanda players can haunt the watch to resurrect themselves. Wanda can also use it to revive Ghost Players, setting the watch on a 4 minute cooldown instead of destroying it. Players resurrected via a Second Chance Watch will be teleported to the place they died, and will have same stat penalty as a Life Giving Amulet.
Trivia
It is the only clock that drops from Wanda's body when she dies. All of the others will stay on her body, and she will have them when she respawns.
Wendy and WX-78 are the only characters with differing lines compared to the other watches, all characters except for them have the same examination line for the Ageless Watch.
Since the reviving point does not move with boats, being resurrected via the Second Chance Watch after dying on a boat that has been moved or destroyed causes the player to respawn on water and drown immediately.
If a player died in a dangerous place, reviving them before clearing out the threats will usually result in dying again.
Wanda cannot use a Second Chance Watch on Abigail.