Stress-Free Guide to Renting A Car in Iceland


Here are some things you should consider to have a worry-free experience renting a car in Iceland.

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If you’re planning a trip to Iceland, renting a car is the best way to see everything the country offers. The roads are well-maintained, and the scenery is breathtaking, but there are a few things you should know before you hit the road. In this blog post, we will provide a stress-free guide to renting a car in Iceland so that your vacation goes smoothly!

Renting A Car In Iceland

When it comes to renting a car in Iceland, you first need to research your options. There are various rental companies located throughout the country, so take some time to read reviews and compare prices.

Once you’ve found a company you’re comfortable with, ask about their insurance policy.

Many companies will offer liability insurance, but it’s always a good idea to purchase additional coverage in case of an accident.

The next step is to choose the right car for your needs. If you’re planning on doing a lot of driving, it’s essential to select a comfortable vehicle that has enough space for all of your luggage.

It’s also a good idea to choose a car with GPS to easily find your way around Iceland. Once you’ve made your decision, be sure to book your rental car in advance to get the best rate.

waterfalls in Iceland

Don’t Listen to the Rumors.

I always tell those planning a trip to Iceland to rent a car and drive themselves where they want to go. The roads are easy to navigate, traffic is nearly nonexistent, and it is an overall stress-free experience!

Don’t be scared of the rumors that it is hard to drive in Iceland! Rumors about the poor quality of the road system or the perceived (inaccurate) small size might put you off, but here are some things you should consider to have a stress-free experience renting a car in Iceland.

  • Iceland has about the same surface area as England, albeit in a more compact form and with fewer large settlements. The main ring road around the island is 828 miles long and, yes, now entirely paved. Having a car means you can explore much more of the island!
  • Doing the “Golden Circle” (Thingvellir, Geysir, Gullfoss) on your own allows you to dodge crowds and spend more time at the parts which interest you. **Tip: Do the Golden Circle on one of your first days on the island; it makes a great introduction!
  • Iceland has very little public transport. UBER is nonexistent there, but taxis are available. There are a few long-distance buses and no trains. Public transport immediately around Reykjavik is decent; elsewhere, you may be looking at one or two buses a day.

driving in Iceland

Here are some things to think about when renting a car in Iceland:

  • First, if you plan on going into the interior, you should spend the extra money and rent a 4WD vehicle. Second, there are roads in Iceland. It is illegal to drive in a standard car because they are unpaved even though they are still on a map. Third, most of the interior is only accessible in summer.
  • Book well in advance; otherwise, you run the risk of not being able to get the car you need.
  • Always get the gravel road insurance. Iceland is one of those places where you can turn down a road, and just out of sight, the pavement stops. Also, rent a GPS.
  • You drive on the right and overtake on the left.
  • Iceland recognizes US drivers’ licenses, so there is no need for an IDP.
  • The minimum rental age is 21 for an average car and 23 for a 4WD vehicle.
  • Remember the following rules: No off-roading, car headlights must be on at all times, and no cell phone use while driving. The legal alcohol limit in Iceland is zero.
  • Gas prices are stable and similar throughout the island. The most recent figures I could find were from 2016 – about 194 krona a liter or about $1.75 a liter. So, yes, gas is expensive in Iceland.
  • There are a lot of rental companies in Iceland. Look for a company with a good reputation over a cheaper one. Reykjavik Cars and Lava Auto Car Rental (which only provides SUVs) have excellent reviews. Suppose you’re more comfortable with an American company, Thrifty or Expedia. We usually have paid about $60 a day for an average car and $90-$110 for an SUV.

RELATED: 10 Reasons to Visit Iceland 

Renting a car in Iceland is the best way to explore beyond the capital without being stuck on guided tours or dealing with the vagaries of an often-insufficient public transport.

parked car in Iceland

Renting A Car in Iceland FAQS

Now that you know the basics of renting a car in Iceland, here are answers to some frequently asked questions:

Q: Do I need an international driver’s license?

A: No, you do not need an international driver’s license to rent a car in Iceland. However, you will need to show your regular driver’s license when you pick up the vehicle.

Q: Are there any additional fees?

A: When you’re renting a car in Iceland, be sure to ask about any additional fees that may apply. These can include drop-off charges, GPS rental fees, and more.

Q: Can I drive in Iceland in the winter?

A: Yes, you can drive in Iceland in the winter, but you must be prepared for snowy conditions. Be sure to pack a shovel and some extra warm clothes, just in case!

Q: What is the speed limit in Iceland?

A: The speed limit in Iceland is 90 km/h on highways and 30-50 km/h in urban areas.


Now that you know how to rent a car in Iceland without any stress, all that’s left to do is start planning your trip! Safe travels!

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guide to renting a car in iceland


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