To investigate the problems of overload and excessive thermal insulation associated with building electrical fires caused by wires, a theoretical model of wire heat transfer is established, and the pyrolysis and combustion phenomena of the insulation layer are analyzed. The results showed that the temperature evolution of the wire underwent three stages: constant temperature, insulation heating, and high‐temperature pyrolysis. The insulation layer experiences bulging, exhausting, carbonization, dripping, and burning in sequence, and insulation layer dripping requires at least 160 A of current. As the current increases, the temperature increase rate of the wire increases gradually, and the fusing time of the wire gradually decreases. Under the same current, 160°C is the turning point at which the temperature increases. The temperature increase rate of the copper wire is greater than that of the aluminum alloy wire, and the temperature increase rate of the bare wire is greater than that of the insulated wire. The fusing time of an aluminum alloy wire is less than that of a copper wire, and the fusing time of a bare wire is less than that of an insulated wire. The research results provide theoretical guidance for the prevention and investigation of building electrical fires.