Insurance companies cannot cancel coverage because of too many claims if you have group medical insurance in California and you have fewer than 100 employees. If you have more than 100 employees, then insurance companies can increase the cost or premium for groups that have high claims. Officially, the insurance companies can’t cancel your coverage but they can raise the premium astronomically, e.g., a 30 – 50 percent increase, when the plan renews. Such an increase may effectively make medical insurance for the entire group too expensive to continue.