If the only person who can get the money is you (or your partner or children or whatever), it’s fine as a form of compensation for potential damages.

If anyone, including your surgeon, can take that life insurance policy based on your life, things can go bad pretty quickly (hint: what happens if a profit-maximizing surgeon would earn a lot more money from your policy than from his regular job?).

Not if it's your own procedure.

If it is someone else's? Bad, because I'll just take a life insurance on them and then promise the doctor half of the proceeds if they ensure that the outcome of the procedure leads to an insurance payout.