For someone looking to rent a timeshare, the "full-service rental" option was a to minimize perceived risk. Many people would never rent a timeshare from some timeshare owner they don't know, but they would do it from an organization with a positive reputation and a track record, like Redweek.
One of the keys to get people traveling again is to let them do it with confidence. Confidence means they can book without the fear of losing their money if there is another COVID flareup.
A policy where a renter suddenly has to negotiate with a timeshare owner is not a good solution for Redweek. One of the key reasons renters use Redweek is so they don't have to talk to the actual owner.
When a negotiation between a timeshare owner and renter goes south, the renter is going to turn to Redweek for satisfaction. Redweek will end up being the loser again no matter what.
I think a better solution for Redwood would be to only allow timeshare owners who agree to refund into full-service listings system. Timeshare owners that rent these would know they are not going to get their money if there is another outbreak. They can decide whether to self-insure or perhaps buy insurance to protect themselves.
Full-service listings would likely cost more, but there would be clear differentiation between rentals with some protection and those with none. You could add several warning screens to the nonprotected listings.
Some may argue that renters should be the ones responsible for buying insurance. That sounds great in theory, but in reality, you're more likely to end up with a mob of angry consumers that burn you to the ground and still get their money back.