I can't be specific to your model, but can make a couple of suggestions. First you sound lucky your garage and house did not burn down!
Think about what is electrically 'on', what should be 'off', what is doing the isolation, what is the protection (fuses and ratings) and where they are in relation to the problem fire.
It is usually the very high current parts of the wiring and system with the biggest fire risk. That means the battery and the large cables that go to the alternator and starter switch. They are always 'on'. Also don't forget the accessory outlets if added. I have one which is deliberately wired through a fuse for always 'on'. Then we have the always 'on' circuit for the clock which should be protected against shorts with a fuse. But note a fuse may NOT blow if there is some arcing and the current draw is low. Even a 5 amp fuse can take 20 amps arcing on and off - That's 240 watts to melt and set fire to pvc.
The ignition switch is the main isolator for everything else. Arcing leading to a fire suggests current draw to something and I can only suggest start looking at the ignition switch as a possibility.
Up front in the cockpit many wires come through the loom and are being twisted by the steering. In the past I've criticised BMW's selection of wire gauges. They seem to use the theoretical smallest size they can, but wiring on a bike is just as much about ruggedness and how much it might flex about. Those situations usually mean you go up a wire gauge or two and use more strands in the wire core. Flexing can cause a wire inside the pvc sheath to break a few strands at a time and you can't see it. When the wire gets down to just a few strands, you end up with a local hotspot under the insulation just like your toaster! You said the ignition was turned off and you would have set the steering on a hard lock, so unless the switch itself was faulty I'd be looking at the always 'hot' wires.
My KRS clock stopped working. I had no volts on the end of the permanent hot wire, coming out the loom. I flexed it about and volts came and went. I could not see where the break was under the insulation and their wire gauge was so thin, so I added a new and stronger wire.
Finally, look at any wiring work done for 3rd party addons. The right wire sizes and fuses. I often see bike addons where they skimp on the wire gauge. These things are designed by bench based electronics techs who often don't appreciate the ruggedness you need for automotive applications.
The front part of the bike is like a chimney, so I would expect a fire starting there to spread quite quickly. I never considered brake fluid as inflammable, but it is.
I think Gmack may be right about the loom. Although damage from smoke can make wires look burned when they may be OK. Shops probably don't do this sort of thing, but if the loom damage is confined to the top section, It's possible to properly solder splice on new wires and sleeve over.
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