The substantial, white-painted house is located at secluded Kells beach, off the Ring of Kerry road, between Killorglin and Caherciveen.
The fire was spotted by gardaí patrolling the main ‘Ring’ road at about 1am and the fire services were immediately alerted.
Fire brigade units from Caherciveen and Killorglin rushed to the scene, but the house, which was unoccupied at the time, had been destroyed when they arrived.
Gardaí declined to speculate on the cause of the fire, but Supt Michael O’Donovan, of Caherciveen, confirmed that the scene is being forensically examined by experts.
‘‘The scene has been preserved and the investigation is still in the early stages,’’ he said.
Mr Collins and his wife built the L-shaped retreat themselves with the aid of local labour about 30 years ago.
Only the blackened outer walls and a chimney stack remained intact after the blaze.
A narrow, twisting road extending for two miles leads to Kells beach from the main Ring of Kerry route.
The Collins’s split-level house is just on the beach and has a boathouse from which a slipway runs down to the sea. A balcony was added some years ago.
The couple, who live in Abbeyfeale, Co Limerick, lost many treasured personal possessions in the fire.
They were said to be deeply upset yesterday and were trying to determine what had exactly happened.
They spend a lot of time in Kells every summer, with Mr Collins passing the time by fishing with some friends.
Leading European and Irish political figures have been entertained at the house over the years.
Friends of the couple last night said they were overwhelmed by offers of support from the local community, but had not yet had the time to consider rebuilding on the site.
The Kells area is extremely quiet at this time of year and many of the houses close to the beach are holiday homes.
The beach, which has a small pier, is popular with sea anglers and bathers in the summertime.