Airbnb Cancellation Policy: The Noob Guide To Deal With It

Airbnb Cancellation Policy

The Airbnb cancellation policy is different from hotels and are designed to favour  travellers in most of the cases.

Whether you are a host or travelling on travelling on Airbnb, it is essential to know how its cancellation policies works. 

With this post, I will share best practices when setting your cancellation policy as a host, and also how to deal with cancellations if a host cancels your bookings.

Convered in this post

Four Main Airbnb Cancellations Policies:

The 4th policy is for long term stays and it is automatically applied to reservation of 28 nights or more, you cannot opt-out from this.

The four Airbnb cancellation policies are: 

Airbnb Strict Cancellation Policy

  • Full refund if cancellation made within 48 hours of booking.
  • If the check-in day is at least 14 days away.
  • 50% refund for cancellations made at least seven days before check-in.
  • No refund if cancellation made within seven days of check-in.
Strict Cancellation Policy

Airbnb Moderate Cancellation Policy

  • Full refund if cancelled five days before arrival. 
Moderate Cancellation Policy.jpg

Airbnb Flexible Cancellation Policy

  • Full refund if cancellation made within 48 hours of booking.
  • If the check-in day is at least 14 days away. 
  • 50% refund if cancellation is made at least seven days before check-in. 
  • No refund if cancellation made within seven days of check-in.
Flexible Airbnb Cancellation Policy

Airbnb Long Term Cancellation Policy

  • This applies to all reservations of 28 nights or more.
  • The first month is not refundable.
  • 30-day notice for cancellation is needed.
Long Term Cancellation Policy

Important to note:

➤ For the first three policies - the Airbnb service fee is refundable up to 3 times per year if the guest cancels within 48 hours of booking, and at least 24 hours before check in.

➤ All cancellation policies can be superseded under extenuating circumstances by Airbnb.

Optional: Non Refundable Airbnb Cancellation Policy

Apart from the four main cancellation policies, Airbnb offers a choice of two non-refundable options for the host to choose from:

  1. Flexible Non-Refundable
  2. Moderate Non-Refundable
These two policies give the guest an option of a ‘Non-refundable’ flavour to choose from.

In return, the guest gets a 10% discount.

When paired with a Flexible Airbnb cancellation policy – the non-refundable option will be available to guests up to 1 day before their desired check-in date. 

When paired with Moderate Airbnb cancellation policy – it will be available to guests up to 5 days before their desired check-in date.

Two New Experimental Policies (Invite Only)

Airbnb is experimenting with two more cancellation policies, but they are currently by invitation only and in specific locations only.

Super Strict 30 Days

  • 50% refund up until 30 days before arrival
Super Strict 30 Days

Super Strict 60 Days

  • 50% refund up until 60 days before arrival
Super Strict 60 Days

Airbnb Cancellation Policy: Overriding Principles

Rule 1: Extenuating Circumstances

Airbnb can waive off the cancellation penalties and issue a full refund if you need to cancel due to an unexpected circumstance that’s out of your control.

You will need to provide documentary evidence, and the accepted situations for this are:

  • Death of a host, co-host, guest or their immediate family member.
  • Severe unexpected illness or injury affecting a host or member of the travelling party.
  • Government-mandated obligations such as jury duty, travel restrictions, court appearances, or military deployment.
  • Unforeseen property damage, maintenance, and issues with necessary amenities to the Airbnb listing that make it unsafe to host guests, or that prevent guests from accessing it.
  • Transport disruptions that make it difficult to travel to the destination.
  • Train, bus, or ferry cancellations where no alternate options were available on the same day.

Documentary evidence is not required in the following circumstances, but Airbnb will do an individual review of the situation:
  • Natural disasters, terrorist activity, and civil/political unrest
  • Endemic disease or illness that suddenly affects a region or an entire group of people
  • Travel restrictions imposed by a government
  • Safety and security threat advisories
  • Essential utility outages like electricity, water etc.
  • Changes to visa or passport requirements that make it impossible to travel to the destination.
Read more information about Airbnb Extenuating Circumstances Policy.

Rule 2: Airbnb Guest Refund Policy

Under certain circumstances Airbnb Guest Refund Policy can supersede your chosen Airbnb cancellation policy.

  1. Inability to access the property. The guest is unable to access the accommodation because the host did not provide the sufficient check in information such keys or code for the doors.
  2. Inaccurate listing. The Airbnb listing did not accurately describe accommodation in terms of size, type of accommodation or other essential amenities.
  3. Health and safety hazard. The property is not clean or poses health hazards.

Rule 3: Full Cleaning Fee Refund

Irrespective of the Airbnb cancellations policy in effect: if cancellation happens before the check-in start time of the booking, the cleaning fee is fully refunded to guest!!

For example, if the booking is for 1st Dec and check-in start time is 3 PM, the guest will get a full cleaning fee refund if he cancels the booking before 3 PM on the day.

How To Choose The Right Airbnb Cancellation Policy

How To Choose Airbnb Cancellation Policy

⭐ Fact 1: Airbnb wants you to put the most flexible cancellation policy possible, and they will reward you with higher search rankings.

⭐ Fact 2: People need flexibility when planning for travel, if you set it to Strict, you won’t get many bookings far out in your calendar.
 
 …and for the same reason, most of the hotels offer a free cancellation nowadays.

My advice is always to keep it Flexible or Moderate at most.

Apart from this, the key aspects to look at when deciding your cancellation policy are:

  1. Location of your Airbnb listing
  2. Seasonality
  3. Property type
  4. Competition
  5. Kind of guests you want to attract
  6. Age of your Airbnb listing

1. Location:

If it is in an area with high Airbnb traffic all year – set your Airbnb cancellation policy to flexible since it is more likely to rebook.

Setting it to flexible will also help you stay on of the search results as an area with high demand is likely to have a lot of Airbnb listings.

If your property is an area where travellers don’t have many options to choose from, you may be able to get away with setting your Airbnb cancellation policy to Moderate or even strict.

2. Seasonality

If you get seasonal Airbnb traffic, like in summers or only during certain months set your Airbnb cancellation policy to moderate in the peak season and flexible in the low season to attract more guests.

3. Property Type

Families (especially with kids) or large groups always look for an option to be able to cancel a booking if someone in the group is not able to travel due to emergency or sickness.

If your property fits families or group of 5+ people, do not set your Airbnb cancellation policy to ‘Strict‘.

4. Competition

Airbnb wants everyone to have to the flexible cancellation policy; it gives more freedom to people booking stays on the website, which means more business for them.
 
Setting your Airbnb cancellation policy to Strict or Moderate impacts your search ranking.
 
Remember higher you appear in the search results more bookings you will get.
 
If your property is in an area with a lot of Airbnb properties – setting it to Moderate or Flexible is a no brainer to stay ahead of the competition.

5. Kind of guests you want to attract 

  • Families, especially with kids, prefer Flexible options.
  • Older people prefer Flexible cancellations policy. 
  • Business travellers don’t mind Strict policies, business or travel insurance usually covers their travel cancellations.
  • Young people are usually happy with Moderate 5-day Airbnb cancellation policy.
Choose your Airbnb cancellation policy which matches your expectations, property configuration, setup and location.

6. Age of your Airbnb listing

When you’re a new host, with no reviews, Airbnb automatically puts you lower in their search results because 

You haven’t proven yourself yet. For this reason, you will have to choose the most flexible Airbnb cancellation policy at the start.

7. Airbnb Coronavirus cancellation policy

Read more about Airbnb Coronavirus cancellation policy and how you can help stop the spread.

Read my ultimate guide on how to start an Airbnb for more tips when you are new to the business.

See my video on how to change cancellation policy on Airbnb

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