I see that a lot of the discussion on this relates to the legality of apple/AIG doing what they did. Not going to weigh in there, but just wanted to say Thanks for posting this. I don't really use AppleCare on most of my devices, and I do enable Find My, but wanted to say thanks for the heads up anyways. There are times when I need to turn it off (like sending in for a replacement, etc. It's good to know that turning it back on when I get the new one, is a requirement for coverage.
Glad you were not hurt in the fire, glad you were able to get your phone replaced under another policy, and glad that you shared your experience with others who might not even think about such a thing until it's too late.