Homeowners policies most likely won't cover hosts in the case of a liability claim from a guest so it makes no difference whether the policy has lapsed or been cancelled. Hosts who have not purchased additional insurance to cover business activities are most likely uninsured and relying solely on Airbnb's Host Protection Insurance for liability coverage and Host Guarantee for property damage.
Should a guest choose to sue due to an incident that occurs while renting property via Airbnb, their lawyer will primarily go after Airbnb though the property owner will almost certainly be named as well. Airbnb knows this and hence the reason for them providing the Host Protection Insurance which covers all defendants but has only one named insured - Airbnb. Airbnb wants to control these lawsuits and for good reason, the negative publicity could hurt their business.
The coverage provided by Airbnb is actually quite broad, as broad as the liability coverage provided by any homeowners policy. It also removes the business activity exclusion that is present in almost all home insurance policies. It's also primary insurance so even if a host were to have a policy that covers business liability, Airbnb's policy would most likely be the first to respond.
However, it does only provide $1 million in coverage. This amount should be more than enough for most hosts but if your net worth is significantly higher than $1 million, you probably want to protect your assets with an excess liability liability policy or personal umbrella policy. Just make sure it covers business liability risk.
Here's a more detailed overview of insurance works in such a situation: What Happens When an Airbnb Guest is Injured on My Property