I've never heard of such a thing. Perhaps people are confused about coverages.

Fire caused by a wreck would fall under collision coverage, just as the dents & dings caused by a wreck would.

Fire not caused by a wreck (struck by lightning, car parked in a garage that burned down, etc.) would fall under comprehensive coverage, just as damage due to a tree falling on a parked car would.

If you don't choose to purchase comprehensive coverage, then a fire not caused by a wreck would not be covered.

To my knowledge, no state requires a driver to have collision or comprehensive coverage -- bodily injury and property damage are the most commonly required coverages. In many states, personal injury protection and/or medical payments coverage is required.

If you owe money on a car loan, the lienholder almost certainly requires you to have collision and comprehensive coverage -- if the car is totaled, they want their money.

Disclaimer: All of the above comments are usually true, but they are generalities; you should check with your insurance provider if you want further clarification.

Of course, I'm still waiting for the Cheney/Exxon/Limbaugh crowd to make a twisted argument that owning a hybrid or FFV constitutes "terrorism". After all, if you aren't spending $75/week on gasoline, then you're not paying enough highway tax and you're not giving enough money to Big Oil. And, of course, Big Oil is only out to HELP America, right? Depriving a Big Oil CEO of 5-10% of a $12 billion dollar bonus is just downright communist, ha ha.

Well... I'm pretty cynical. But it's not hard to be after seeing the energy policy of this country for the past 25 years.