I have been there, but my kid's fear from from an actual fire. Two and a half years ago, a vehicle in our detached garage started on fire and burned the entire garage down and took two vehicles (one of them brand new!) and many many many personal belongings.
My kids were woken up and witnessed it when we had to evacuate the house for fear that the fire was too intense and was going to take our home too. Sadly, they watched the whole thing go from our driveway.
My son was pretty young and just thought the firetrucks were really cool. My daughter, however, was old enough to understand what was happening and suffered from nightmares for months. She still has bad dreams about it from time to time.
You cannot always control what your kids are exposed to but you can control how you react to it. We helped our daughter (and ourselves!) by holding regular fire drills. We taught our kids that nothing is more important than their lives and if they hear the fire alarm, they just get out of the house. The do not worry about anyone or anything but themselves. We have a pre-planned meeting spot at a neighbor's house. Both kids have learned about staying low, checking doors for heat and have been taught to break their windows and jump if there is no other option.
My best advice is to teach your child to be prepared, not scared. Whenever my daughter has some fear about fire, we remind her of all the things we have done to be prepared if it should happen. We also remind her that it has happened once and is very unlikely to happen again. She understands that its just a house and stuff - all of it can be replaced. We only worry about the people inside.
Our fire taught us how quickly everything you have worked for can be taken away and that it CAN happen to you. It taught us that we needed to be much more intentional about action plans - not just for fire but for severe weather, winter weather, terrorist attacks, water contamination, etc. We are building those action plans now and are working at being much more prepared for anything.