The policeman managed to get her on to the beach, where he performed CPR on the woman for about 15 minutes.
When the ambulance arrived at the beach they were unable to revive her.
The children were not injured.
Mr Fraser said the beach was unpatrolled and the woman was wearing clothes, not togs, which could have weighed her down.
"If she was trying to save [the children she was with] she has done a great job. Tragically she was not able to look after herself."
Her niece commented on social media site Facebook about the tragedy. "Things will never be the same without you. Rest in paradise aunty, rest easy and shine bright."