I'm guessing here, but perhaps there's a maximum size before you risk having the panels of the chute tearing under the strain of snapping open. When the military drop heavy loads on parachutes, they use multiple chutes, not one huge one.
Besides, what do you want the chute to do? For recreational parachuting, yes, perhaps a larger chute could be good. Paratroops want to get down on the ground quickly, to where they can move, take cover and use their weapons, while coming down slowly enough to minimise the risk of injury on landing. Aircrew need the pack to be as small and light as possible (not much space in a military cockpit) and the chute has to save life, not get the user into battle with equipment. If he breaks his ankle on landing, the chute has still worked!
A larger parachute and slower descent would also mean being blown further away by the wind, and more risk of being blown into obstructions. Not so much of a problem, of course, with a steerable recreational chute.