Bermuda-based reinsurer Max Capital Group Ltd. has bought a unit of Travelers Cos. to bolster its coverage of shipping.

Commercial Guaranty Casualty Insurance Co., a "dormant" Travelers Cos. company located primarily in New York, will expand Max Capital's shipping business, which insures jewellery and light equipment during transportation, spokesman James Tees said yesterday. Terms of the deal weren't disclosed.

Max Capital started its shipping insurance business about six months ago. The licences that Commercial Guaranty holds in all 50 states and the District of Columbia will give Max Capital more flexibility, Tees said. The unit will be renamed Max America Insurance Co.

Stephen Vaccaro, president and chief executive officer of Max Specialty Insurance Company, said: "This acquisition gives the Max Specialty team, for the first time, the ability to write both admitted and non-admitted business. We expect that ability to enable our producers to write more business for more customers, as some of our specialty products are best suited to the admitted marketplace."

Max Capital Group Ltd., through its operating subsidiaries, provides specialty insurance and reinsurance products to corporations, public entities, property and casualty insurers and life and health insurers.

The insurer rose 63 cents to $24.27 by the close of regular trading on the Nasdaq Stock Market. The stock had dropped 16 percent this year before yesterday.