The fire-resistant insulation is to prevent the wires acting like a "fuse" in case of a fire.
The Urban Myth is that a fire consumes your home. The evil insurance company discovers you ran wires that were not CL3 rated. They then deny your claim because their inspector concluded that the fire department could have saved the home, except that the incorrect wires acted like a fuse to spread the fire faster.
I have never heard of this really happening, but I do know that insurance companies are NOT in the business of paying out money and deny claims whenever possible.
The wire is cheap enough if you buy a spool from places like
www.partsexpress.com.