Linda,
Thank you for your thoughtful response. Yes, it is helpful.
The problem seems to be that Airbnb is not involved. Or if they are involved, I can't see it from my end. They may be working with the host, but they are not respoding to my requests for help. (Or rather they have told me several times that they are sending my questions to a case manager who will call me, but this has not happened over the 48 hours or so since I called).
I want to be fair about this. What the host is telling me is that she has no insurance (she is in Iceland) and therefore wants me to pay the full cost of replacement, shipping, labor etc. I've thought about offering what might typically be the cost of a deductible or security deposit (e.g. $500-1,000) of the $3,500 cost. Since you are a host, I wonder what you think of this? Does it sound reasonable? Wthout Airbnb's involvement it's hard for me to figure out a reasonable compromise.
As Paul and Chris say above, I probably could do nothing and nothing would happen.
Thanks for any other insights that you have,
Liz