Players Health wont work?!? PLEASE HELP

A lot of games have immunity time (Time until a player/NPC can be damaged again) adding one in just might fix your problem. Another thing is deleting the Shuriken once it hits the player. For example:

 #pragma strict
  
  
  
 static var life = 2; //Players Starting Health is 2 HEARTS
  
 var life1 : Texture2D; //HEART 1
 var life2 : Texture2D; //HEART 2
 var life3 : Texture2D; //HEART 3
 
 var CanReceiveDamage = true;
 
 var lifeGUI : GUITexture; 
  
 function Update () {
  
 switch(life) //CHANGES TEXTURE BASED ON LIFE
 {
     case 1: 
        lifeGUI.texture = life1;
        break;
 
     case 2:
        lifeGUI.texture = life2;
        break;
  
    case 3:
  
        lifeGUI.texture = life3;
        break;
  
 
  
 }
  
 }
  
 function OnTriggerEnter(other : Collider)
 {
     if(other.gameObject.name == "Shuriken(Clone)" && life == 1) //IF PLAYER GETS HIT ON HIS LAST LIFE
     { 
          if(CanReceiveDamage == true){
          Destroy(other.gameObject);// Destroys Shuriken
          CanReceiveDamage= false;
          ImmunityTime();
         TurnGameOver.dead = true;
         TurnGameOver.dead2 = true;
          }
  
     }
  
     if(other.gameObject.name == "Shuriken(Clone)" && life == 2) //PLAYER GETS HIT WITH 2 LIVES
     {
           if(CanReceiveDamage == true){
          Destroy(other.gameObject);
       CanReceiveDamage= false;
       ImmunityTime();
         life = 1;
           }
     }
  
        if(other.gameObject.name == "Shuriken(Clone)" && life == 3)//PLAYER GETS HIT WITH 3 LIVES
     {
       if(CanReceiveDamage == true){
          Destroy(other.gameObject);
       CanReceiveDamage= false;
       ImmunityTime();
         life = 2; //LIFE DECREASES WHEN HIT
       }
     }
  
 }
  
 function OnTriggerExit(other : Collider)
 {
  
     if(other.gameObject.name == "Shuriken(Clone)")
     {
         TurnGameOver.dead = false;
  
  
     }
  
  
 }
 
 function ImmunityTime(){
 yield WaitForSeconds(0.25);
 CanReceiveDamage = true;
 }

Oh and also, you should try and improve your script a bit more. Its very repetitive and could easily be shortened. You would only need 1 part of the script for all the damage parts, For example:

 function OnTriggerEnter(other : Collider)
 {
     if(other.gameObject.name == "Shuriken(Clone)")
     {
         if(CanReceiveDamage == true){
          Destroy(other.gameObject);
     CanReceiveDamage= false;
     ImmunityTime();

     Life--;
         }
     }
 }
  

As simple as that.

Hope this helped you!