Is it permissible to spend the proceeds of forbidden commercial insurance to pay off my father's usurious debt?

It is not permissible to voluntarily participate in forbidden commercial insurance. If one is compelled to do so, they are not allowed to take more than what they paid in. Rather, they should spend it on the welfare of Muslims or on the poor, unless they are in need, in which case they may take what suffices their need. It is not permissible to pay unlawful money, such as taxes and usurious interest, to avoid paying them. Your father's debt must be paid from his inheritance before its distribution, without the interest. If he did not leave any money, then you are not obligated to pay the debt from your private funds, except as an act of piety. If you pay your father's debt from unlawful money, there is no harm if he was poor.