The EC policy change is not primarily to empower hosts, but is another step Airbnb is making to become more like other reservation platforms. Add this change with the change to have hosts pay the entire service (just like the commission paid on other platforms), and Airbnb will look very similar to Booking.com and Expedia to guests.
In regards to cancellations, on Booking.com and Expedia, if a property owner is unable to host and has to cancel a reservation outside of the free cancellation period, the platforms will assist the guest with a new reservation (always at a place much more costly than your listing), and the host is responsible for paying the rate difference. They don't care that the previous guest left your place in shambles, the neighbor above you flooded your apartment with overflowing bath water, or that you were just in a bad car accident (you can call, and plead your case though). On the other hand, both of these OTAs (online travel agencies) also allow for free cancellation periods that end up 30 days before scheduled arrival, share the guest's payment information with hosts, and hosts can charge guests the reservation and for damages. Hosts can state in their house rules that guests will be held financially responsible for all costs associated with repairs, including cancellation of subsequent reservations, if necessary.
Also, hosts already have the flexibility to enforce or over-ride their cancellation policies without intervention from the platforms. These last two points are where Airbnb currently falls short. It will require a systematic upgrade to provide hosts the capability to self-cancel a reservation, and there still will be no ability to recoup for damages or lost revenue due to damages without interacting with Airbnb.
As I see it, the home-share and hands-on hosts could be the ones most impacted by the new EC policy regarding cancellations for personal sickness or injury, because they typically do not have co-hosts who can fill in for them.
@Pat271, @Fred13 , @Emilia42 , @Mike-And-Jane0 , @Sarah977 , @Branka-and-Silvia0