I had an app that refused to work unless high accuracy location was turned on. There was a location aspect to it but demanding the highest setting of location sharing was vastly overreaching and I just uninstalled the app.
Out of curiosity how did you know the precision of location the app was asking for? If I recall correctly android gives the same permission prompt for fine and course location.
You get asked it you would like to "Improve location accuracy", just after giving location permissions.