Entities without legal status refer to organizations and groups that lack legal recognition and the corresponding rights and obligations. This classification includes informal clubs, partnerships, associations, and online networks of individuals.

While individuals in online networks lack legal standing, they remain subject to legal action for their actions. Peer-to-Peer (P2P) risk sharing networks offer a novel approach to risk sharing among individuals. Unlike traditional insurance companies, P2P networks lack legal status and are not considered a product. Consequently, they are not bound by the laws, licenses, and regulations that traditional insurance companies are subject to.

P2P risk sharing networks function as risk bearers by spreading risk among their members rather than relying on a single entity, such as an insurance company. One significant benefit of P2P risk sharing networks is the absence of red tape and bureaucracy typically associated with traditional insurance products. These networks are not subject to the same rules and requirements as traditional insurance companies, which makes joining and accessing benefits more straightforward and streamlined.