Yes, you can. However, the person needs to have their policy rewritten before their death. They need to notify the company that their spouse or child is going to take over the vacancy. Changing the papers also avoids a higher payment.
Will she pay higher premiums?
Sometimes when a loved one dies, the company increases the payments because of the vacancy. That is why you need to let them know what is happening. It should not be an issue as long as the daughter plans on living there full-time.
What about the paperwork?
Has the family already taken care of the paperwork allowing the daughter to live in the house? There should not be an issue then. Sometimes paperwork gets lost though. Has the company been sending any letters to the family? She needs to call them. Tell them what is going on. The agent the parent talked to before death might not be there anymore. Some agents do not take notes like they are supposed to. The daughter might need to fill out some more paperwork if that is the case. The insurance company is not going to know unless you tell them.
The validity of the policy
Insurance companies usually give a respectable period of time to honor the validity of the policy. Is the daughter paying the premiums right now? Let the company know that. Her payments should be taken into consideration. Document any phone calls she or anyone else makes. That is your way of backing up what happened.
What happens if she needs to file a claim on the validity of her coverage?
She might need to do that so she can keep living there. The only time a claim is not backed up is when the family tries to hide the death. She should be fine as long as that did not happen.