If location search accuracy drops to more than 200 meters, it occurs when the device's location accuracy setting is set to GPS only and the device is indoors; the location shown is the location of the cell tower to which the device's cellular network is connected.

When the accuracy setting is set to 'High accuracy', the device can determine its location based on the network if GPS satellite communication is unavailable because the device is indoors. However, the accuracy of network-based searching is lower than that of GPS satellite searching.

For more details on the high accuracy setting, refer here.