To avoid problems with cancellation or curtailment (when a guest cuts their stay short), you are strongly recommended to have a cancellation policy. The link below is not specific to the Corona virus, but contains useful advice. It is written with accommodation providers in mind, but can be adapted for other business types.
When guests cancel, remember they may be a customer in the future. In most cases, the reason for cancelling is genuine and important i.e. the Coronavirus. You may be able to negotiate something to suit you both.
It's also important to remember the crisis will pass and your business is for the long-term. If you keep the goodwill of your customers in difficult times, it can pay off in the future.