American International Group is boosting the amount of capital it plans to raise to a total of $20 billion, the insurer's chief executive officer said on Tuesday.

The world's biggest insurer by assets has so far raised $13.4 billion through the end of last week by selling stock. The drive for funds is due to heavy losses and writedowns related to tight credit markets and falling housing markets during the past year.

The additional capital would allow the company to invest in and support future growth while positioning the company for any more market volatility, chief executive Martin Sullivan told investors at a Lehman Brothers-sponsored conference in London, according to Reuters.

Shares of AIG fell 87 cents, or 2.23 percent to $38.08 in afternoon trading.