In view of the fire problems left in dense historical settlements in China, such as fire hazards that are prone to fires, difficulties in fighting fires, and the incomplete applicability of current fire codes due to the high historical value of buildings, this paper proposes a scientific and systematic performance-based fire protection method that gives priority to value preservation. This method is applied to dense historical settlements, and the effectiveness of this method is verified by evaluating the results of fire protection planning and renovation through multiple rounds of computer numerical simulation. The results show that in a connected cluster of buildings, one of the fire retrofitting requirements in the horizontal or vertical direction needs to be met between two adjacent buildings to ensure that the fire does not spread, and the retrofitting direction has to be selected based on the value and risk assessment results. When dense historical clusters are renovated for fire prevention planning, the optimal renovation path to meet fire safety can be effectively selected based on the method proposed in this paper.