How do adding the external diodes protect the MAX337 against an overvoltage condition?

The external protection diodes in Figure 1 of the datasheet (19-1193) are only recommended if supply sequencing cannot be guaranteed. In this application, overvoltage refers to the condition where voltage is applied to NO/COM before V+/V- is applied. Under this condition, the internal ESD clamping diodes may become forward biased if the voltage on NO/COM is greater than (V+ + 0.3V) or less than (V- - 0.3V); therefore, the external series diodes block the current that may flow from NO/COM to V+/V-.