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Car rental tips Iceland: know before you go!

Welcome to this article filled with car rental tips for Iceland. Renting a car in Iceland is not difficult and I have done it many times. In recent years I traveled to Iceland no less than ten times, both in summer and in winter I regularly explored the country with a rental car. Although you can easily get around in Iceland with a simple and cheap rental car, there are some things you need to know before you make a reservation and whether renting a car in Iceland is for you. So today I’m sharing more than a decade of experiences and car rental tips for Iceland. Enjoy reading and feel free to leave a comment below if you have any questions!

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Car rental tips for Iceland

The beauty of nature by rental car

Exploring Iceland by rental car guarantees a lot of ‘ohhh’ and ‘ahhh’ moments. The regular buses or tours of Reykjavik Excursions take you to the tourist spots, but they don’t stop everywhere and don’t take nice side roads. In addition, with a rental car you can stop wherever you want to take pictures or just enjoy the most amazing landscapes. Renting a car in Iceland is therefore a must to be able to travel around in a relaxed way.

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The roads in Iceland

Renting a car in Iceland

Iceland is ideal for being explored by car. Most of the roads are in good condition and most sights are easily accessible with your own vehicle. The most important thing to know, however, is that there are also quite a few unpaved roads in Iceland. These are the so-called ‘interior routes’ – the best known of these are the Kjölur and the Sprengisandur. These routes cross the island from north to south and are only accessible in summer and with a 4×4. You can find more about this in the 4×4 section later in this article. To rent a car in Iceland you must have a valid driver’s license for at least one year. In addition, a credit card in the name of the main driver is usually necessary. Check the conditions of your rental car company for this. The minimum age is 20 or 21 years, this varies per car rental company. Sometimes there is a surcharge for drivers under the age of 25.
Check rates and availability here

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Driving your rental car

How does renting a car in Reykjavík work?

Most people arrive in Iceland via Keflavík – Reykjavík’s international airport. This is about an hour’s drive from Reykjavík city. Please note that there is also an airport in the city (Reykjavík) but it is only used for domestic flights. So don’t make the mistake of booking a rental car in Reykjavík instead of in Keflavík. However, if you are going on a city trip in Reykjavík for a few days and you don’t need a rental car, you can take the Flybus to Reykjavík and as soon as you start traveling around, pick up your rental car at the city office. The options for this are somewhat more limited because most depots are located at Keflavík airport.

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Icelandic music along the way

Car rental tips Iceland: 4×4 or regular car

Techincally, you can get very far with a ‘normal’ car. If you plan to stay on the ring road, you don’t need a 4×4 car at all. This is only necessary if you want to take an unpaved route, a so called F-road. Think of the previously mentioned inland routes, but also some routes in the Westfjords and the routes to the popular Landmannalaugar (the starting point of the famous Iceland Laugavegur Trail) and Thórsmörk. Although more and more bridges are being built, some of these routes still include river crossings. This can lead to exciting situations, especially when it has rained a lot. If you want to make a river crossing, always check whether this is possible. See what others are doing and always do a wade-through (i.e. before crossing) before you decide to drive through the water. Water damage is not covered by most insurance policies, so caution is necessary.
What’s also good to know is that most interior roadss do not open until the end of June or the beginning of July. If you travel outside this season, a 4×4 will not be of much use.

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A normal car will get you almost everywhere

Renting a car in Iceland in the winter

Do you want to rent a car in Iceland in winter? Then winter tires are mandatory. Most car rental companies have packages that already offer this as standard and most tires come with studs. Driving with snow chains is usually not necessary, depending on the snowfall. The times I went to Iceland in the winter there was hardly any snow (yes really) and the roads were in great condition. A 4×4 is therefore not typically necessary in winter.
Also read: what to pack for Iceland in winter

Cheap car rental in Iceland

If you want to rent a cheap car in Iceland, you can compare rates on Booking. There are numerous options here, including cheaper options. However, keep in mind that the cheap rate often pays for itself in high additional costs, such as a limited number of kilometers, a high deductible or limited insurance. So research all options in advance before you choose a budget rental car in Iceland.
I usually rent from Alamo or Herz, they are usually a little bit more expensive but have a low deductible and offer good insurance options. I’d rather not have a large own risk in case an accident happens or in case someone else causes damage to my car.

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Landmannalaugar in Iceland

Is renting a car and driving in Iceland safe?

Yes, driving in Iceland is very safe. The roads are generally quiet and in good condition. Sometimes you have to drive a short distance on an unpaved route, for example to get to your accommodation. This is of course no problem. You can fill up your gas along the ring road and Icelanders are generally very friendly and helpful. When you pick up the rental car you will also receive an overview of the traffic rules in Iceland, read this carefully before you set off. Fines are relatively high and it is better to avoid them.

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Unpaved roads are well signposted

Do you need a GPS or navigation?

Renting a navigation system is not really necessary, but can be useful. Of course you can also just use your mobile phone with a navigation app, there are often extra costs for renting a navigation. Once you are on the Ring Road, taking the wrong way is almost impossible, we only used it around Reykjavík and occasionally to see how far we were from a certain destination. Check options for navigations here!

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Navigation: useful but not necessary

Conclusion and disclaimer of car rental tips Iceland

I hope you found article with car rental tips in Iceland useful and that it took away any concerns you may have. Please note that the above includes affiliate links. If you make a purchase or reservation through any of those links we may receive a small commission at no extra fee to you.

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