It is best to follow your cancellation policy, @Sara1588 . The guest will cancel, and the system will take care of it automatically. If you like, you can direct the guest to call Airbnb and claim her case as an extenuating circumstance. She will have to prove it to them, but then she will be fully refunded by you, regardless of your cancellation policy, and Airbnb will refund her service fees, too.
That is the best outcome for guests when their story is real.
@Sara1588 Let AirBNB deal with this request. That is what they are paid to do; navigate cancelations and decide if a refund is warranted. You haven't been paid yet, so it is illogical for you to be refunding.
AirBNB may ask you to refund, overriding your cancelation policy, and that is up to you. Just don't initiate this on your own.