Renting a vehicle offers tourists unparalleled freedom to explore Iceland's diverse terrains, from the iconic Ring Road to the secluded Westfjords.
In this article, I will share with you all the important things you need to know when renting a car and embarking on your own road trip around Iceland.
We will delve into key considerations, from car rental services to understanding insurance necessities, driving conditions, fuel logistics, and driving tips.
Navigating Iceland's Car Rental Landscape: Insights For Travelers
Embarking on a self-drive journey through Iceland offers unparalleled freedom to explore the country's diverse and breathtaking landscapes. However, to ensure a seamless experience, it's key to understand the nuances of renting a vehicle in Iceland.
Selecting Reputable Car Rental Services
Choosing a reliable car rental company is the cornerstone of a successful Icelandic road trip. Here are three well-reviewed and reputable options:
GO Iceland: Specializing in affordable yet high-quality rentals, GO Iceland provides a range of vehicles, including economy cars, SUVs, and 4x4s suited for Iceland’s rugged terrain. They offer flexible pick-up options at Keflavík International Airport and downtown Reykjavík.
Hertz Iceland: Recognized as Iceland's leading international car rental company by the World Travel Awards, Hertz offers a vast selection of vehicles, from compact cars to luxury SUVs. Their wide network of rental locations makes pick-up and drop-off convenient.
Blue Car Rental: Known for its exceptional customer service, Blue Car Rental provides new, well-maintained vehicles. Their pricing includes insurance packages, making them a stress-free choice for travelers.
When selecting a service, consider factors such as vehicle variety, insurance options, customer reviews, and pick-up/drop-off locations to ensure they align with your travel plans.
Understanding Insurance Options
Iceland's unique driving conditions make comprehensive insurance coverage imperative. While rental companies provide basic insurance, upgrading to additional coverage can save you from unexpected expenses.
Collision Damage Waiver (CDW) and Super CDW: These reduce your financial liability in case of an accident. While CDW is usually included, upgrading to Super CDW lowers the deductible significantly.
Gravel Protection (GP): Many of Iceland’s roads are gravel, making windshields and paint damage common. GP covers these costs.
Sand and Ash Protection (SAAP): South Iceland is prone to sandstorms that can damage your vehicle’s exterior. SAAP covers such damages, which standard insurance often excludes.
Theft Protection (TP): While Iceland has a low crime rate, TP protects against car theft, though it is rarely needed.
Most rental companies, including Blue Car Rental, offer insurance bundles that include these coverages, ensuring peace of mind during your trip.
Navigating Icelandic Driving Conditions
Driving in Iceland requires an understanding of diverse road types and unpredictable weather conditions.
Key Road Types:
Paved Roads: Iceland’s Ring Road (Route 1) is paved and suitable for all vehicles, making it ideal for first-time visitors.
Gravel Roads: These roads, found in rural areas, can be tricky to drive on. Speeding increases the risk of skidding, so maintaining a moderate pace is important.
F-Roads: Mountainous highland roads require 4WD vehicles and are only accessible in summer. Check with road.is for closures before traveling.
Weather Challenges:
Rapid Weather Changes: Iceland’s weather can shift drastically, from sunshine to snowstorms within hours. Always check vedur.is for real-time forecasts.
Strong Winds: Sudden wind gusts, especially on open roads and near mountains, can make driving difficult. Holding the steering wheel firmly and reducing speed can help.
Icy Roads in Winter: If traveling between October and April, ensure your rental vehicle is equipped with studded winter tires.
Speed Limits and Safety Rules:
Urban areas: 50 km/h
Gravel roads: 80 km/h
Paved highways: 90 km/h
Speed cameras are common, and fines for exceeding limits are hefty, so drive cautiously.
Fueling Up: Costs And Station Availability
Understanding fuel logistics is necessary to avoid being stranded, especially in remote regions.
Fuel Station Availability
In Reykjavik and along the Ring Road, stations are frequent. In rural areas, stations can be over 100 km apart, so refueling whenever possible is advisable. Most stations operate on a self-service basis and accept credit/debit cards with PINs.
Fuel Prices
As of early 2025, gasoline prices in Iceland are approximately $2.30 per liter ($8.70 per gallon). Diesel is slightly cheaper at $2.00 per liter ($7.60 per gallon).
Fuel Cards
Companies like N1, Orkan, and Olís offer prepaid fuel cards, useful for remote locations where cash or international cards may not work. If traveling to the Westfjords or Highlands, carrying an extra fuel canister is recommended due to the limited number of stations.
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Driving Tips For A Safe Journey
To enhance your driving experience in Iceland, consider the following practical tips:
Legally Required Driving Practices:
Headlights On at All Times: Even in daylight, headlights must be turned on.
Seat Belts Mandatory: All passengers must wear seat belts at all times.
No Off-Road Driving: It is strictly illegal and results in hefty fines due to the fragile nature of Iceland’s ecosystem.
Wildlife Awareness:
Sheep are often seen roaming near roads, especially in rural areas. If they’re on the road, slow down and honk gently to encourage movement.
In summer, migratory birds like Arctic terns can unexpectedly fly across roads, requiring careful navigation.
Handling Emergency Situations:
If you experience a breakdown, call 112 for emergency assistance.
Carrying a first-aid kit, flashlight, and emergency blanket is advisable, especially in winter.
In case of heavy storms, seek shelter rather than attempting to drive through dangerous weather conditions.
Endnote
Renting a car in Iceland is not just about convenience—it’s an opportunity to immerse yourself in the country's dramatic and ever-changing landscapes, from lava fields to glacial valleys. With increasing advancements in electric vehicle infrastructure, future travelers may have even more sustainable options for exploring Iceland’s rugged terrain.
As you plan your road trip, staying informed about the latest travel regulations and environmental conservation efforts will ensure a responsible and unforgettable journey through this Nordic wonderland.