Guest who made a last minute reservation cancellation asking for 100% refund

I had a guest who made a 3 day non-refundable reservation with us. Just a day before the check-in date, they notified that their family is unwell and won't be able to make it to the property. They sent out a full refund request. Given that it was a peak season for us, we respectfully declined the full refund request first and offered them a heavy discount on future booking with us. This was essentially to test if its a genuine case. In the past we've seen guests asking for a date change or sending across other guests for the same reservation. The guest kept insisting for some refund post making a booking cancellation (which unblocked the booking dates on Airbnb). Considering it to be genuine case, we refunded 33% of the booking amount and agreed to a full refund if we get the property rebooked for those dates. Would like to know how other hosts would've handled this situation.