With tempers at City Hall fraying as debate over regulating the controversial ride-hailing service conclude, might insurance be the deal-breaker that sends Uber packing?

As the heated discussions at Toronto’s City Hall enter their third day, speculation is growing that Uber, faced with more demanding insurance conditions than they were expecting, may decide not to adhere to the regulations proposed for them in the country’s biggest city.

In a move that came as a surprise to many industry-watchers, the City of Toronto issued a draft proposal for a bylaw that would allow private transportation companies such as Uber to be operate legally earlier this month that included harsher-than-expected insurance requirements. The proposal, currently being debated, opted for a figure of $7 million for non-owned automobile coverage. The figure is comprised of $5 million of commercial general liability insurance and of $2 million of collision and passenger hazard insurance.

It is a much higher figure than the $2 million proposed by consultants who assisted City Hall in drafting the bylaw; an amount Uber has indicated it would favour.

Uber has demonstrated that it is not afraid to abandon a market that makes regulation too difficult; Calgary provides a case in point where the San Francisco-based ride-sharing company made the decision to desert a city altogether after finding the rules imposed unworkable in practice.