My father just passed away and had a $60,000 life insurance policy that was to be split between myself and two sisters. Does the money from this policy first have to go towards paying off his debt before it can be distributed?

Please see the following post on a very similar question:

https://www.askmehelpdesk.com/other-...ight=insurance

No it does not, life insurance as long as it has a named person for the money to go to. If it says to pay the esate or the person named in the policy is dead, but if you and your sisters are named in the policy, then you will get the money directly and it does not go into the estate and does not have to apply to the bills or debts of your father

Proceeds from a life insurance company pass to the beneficiary or beneficiaries which could be his estate or like you said to you and the two sisters per how he wrote the beneficiary designation in the life policy. Those life insurance proceeds are not subject to the claims of creditors unless he named the estate was named as beneficiary rather than you three, and even then should his estate be named as beneficiary, it's his estate that would be subject to the claims of creditors not his life insurance money that went to his estate. In most cases but not all cases, it's best for most people to name a person as beneficiary and not the estate of the deceased. A simple reading of his life policy beneficiary designation should clearly tell you exactly who was the beneficiary, the three of you or his estate. Hope this helps.