Hail’s house. He insured his grass and the day burnt it to embezzle money for insurance. If I’m not mistaken it was his move towards the bankers who refused giving him his $25k the killed melancholic Osage guy owed him. And it was a metaphor apparently, for Molly and Ernest that the fire caused by Hail surrounds them closer and closer, because this stunt of embezzling money from the insurance this way triggered the agents to investigate vigorously.