Former fire chiefs say a "ridiculous" bushfire funding rule is preventing emergency services from waterbombing small fires before they turn into mega blazes that destroy homes and kill people.

Federal funding can flow to state governments under the Disaster Recovery Funding Arrangements with up to 75 per cent of costs covered - but only in “extraordinary” circumstances when firefighting was targeted at "imminent" risks to lives and property.

NSW's custom large aerial tanker 737 jet dumps fire retardant on a bushfire south of Port Macquarie in October last year. Credit:Nick Moir

That means states may have to carry the cost of early prevention waterbombing on fires in remote areas, well away from lives and property. This summer a number of small fires in remote areas became major blazes that destroyed homes in NSW and Victoria.

NSW has confirmed it would seek "partial reimbursement" from the federal government for its firefighting efforts, including waterbombing, since July last year.