A rental car in Iceland? Info & tips + How to find the cheapest car rental agency?

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A rental car in Iceland? Info & tips + How to find the cheapest car rental agency?

12 maart 2020 in Iceland0 reacties

Iceland is undergoing a major tourist boom. The breathtaking nature, volcanoes, spectacular waterfalls, glaciers, whales and rare Northern Lights attract thousands of tourists every year.

Only a small number of people live in Iceland and the different cities and villages are far apart. In addition, public transport in Iceland is quite limited. So if you want to see more than Reykjavik, you will need a rental car.

Below we give you practical information and tips to rent a car in Iceland. What to look for in a renting car and a brief overview of the traffic rules in Iceland are also included!


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  1. Why rent a car in Iceland? 5 x reasons

1.1. Not much public transportation

If you want to discover Iceland it is best to rent a car. Buses only run in Reykjavik. Public transport across the rest of Iceland is rather sad. In Reykjavik you can go on tours to other parts of the island, but they are very expensive. Plus, a tour keeps you on a tight schedule and you can't explore Iceland at your own pace.

1.2. Freedom

Having an own car gives you the freedom to visite everything you like to see. You can stop to take pictures whenever you feel like or visit places that are less-known or nature parks that the big tour operators might skip.

1.3. Not only the Ring Road

In addition, with most tour operators you only visit places that are around the ring road of Iceland. If you want to visit the West Fjords or the breathtaking Snæfellsjökull peninsula, you definitely need a car.

1.4. Cheaper

You can visit most places with a tour, but those excursions cost a lot of money. Not only is it much easier to reach some places by car, it is also much cheaper than booking tickets for tours.

1.5. Chase the northern Lights

Along, those who want to see the northern lights, would do well renting a car. You can drive up to a unique place to admire the northern lights. You have the best chance of spotting the natural phenomenon between 9:00 PM and 1:00 AM.

  1. Car rental in Iceland

2.1. A lot to choose from

Most tourists who visit Iceland rent a car to explore the country. Car rental has therefore become a profitable sector on the island and car rental companies are sprouting like mushrooms. You can easily rent a car at the airports of Reykjavik and Keflavik, but you can also visit one of the many car rental companies in the major cities of Reykjavik, Akureyri and Hafnarfjödur.

2.2. Age

To be able to rent a car in Iceland, you must be at least 20 years old. With some lessors you have to pay a surcharge if you are between 20 and 25 years old and in some cases you may not rent a 4x4 if you are not 25. You must also have your driving license for at least 1 year.

2.3. International driving's license

An international driver's license is usually not required. Most driving licenses are accepted as normal, but we recommend that you apply for an international driving license in advance and just in case to avoid any problems. Also, remember that you need a valid credit card to rent a car.

2.4. Book online in advance

We definitely recommend to book the rental car in advance online. It is cheaper than if you rent a car at the airport. You also have more choice from different car models and with an online reservation you are sure that a car is waiting for you once you arrive. You can also take the time to carefully review the rental contracts and compare the rates of different lessors if you search it online first.

Rent your car online via RentalCars.
  1. How much do rental cars cost in Iceland?

3.1. Fluctuating prices

Iceland is an expensive destination and also renting a car is not cheap. The rates fluctuate frequently based on the period of the year. You will pay more in July and August than in May or September. Iceland is also a popular destination in the winter months so expect higher prices.

3.2. Example prizes

You can easily pay up to 250 euros to rent a car for a week. There is often an additional amount between 5 and 11 euros per day to take out insurance.

3.3.The cheapest car rental agency

There are sometimes big differences between the different car rental companies. To rent a car at the lowest price you first have to compare different dealers. Do not forget that insurance is often added to the rental price.

Rent your car online via RentalCars.
  1. Passenger car or 4x4?

4.1. Passenger car

Which car to rent depends on what your plans are on the island. If you only want to drive on the ring road, a standard passenger car will certainly be sufficient.

If you rent a regular car, you will most likely read (in the rental agreement) that you are not allowed to drive on the rocky roads in central Iceland. Nontheless, you can of course, deviate from the ring road in a passenger car to drive to nearby sights on the non-asphalted roads.

4.2. A 4x4

If you like to deviate from the ring road, a four-wheel drive car is a good idea. On some roads in the interior of Iceland, the F-roads, it is difficult to drive with a regular car.

With a four-wheel drive car, it's much easier to brave the rugged landscape of Iceland and visit the remote highland spots. However, you should always pay attention, also with a 4x4, because many roads are difficult to drive, regardless of the car. Especially if you have no experience.

4.3. In the winter

If you travel to Iceland in the winter, it is best to take a four-wheel drive car. In addition, you will need snow chains. Along keep in mind that a number of major roads are closed due to inclement weather, especially inland.

  1. Road network of Iceland

5.1. The Ring Road

The most important road in Iceland is the ring road, This is the main road that runs around the entire island. The ring road is a total of 1339 kilometers long and is almost completely asphalted. The road is for the most part only one lane wide in both directions and there is no emergency lane. However, it is never extremely busy so you can easily catch up if necessary.

The largest cities and the most important highlights are all along the ring road. Most hotels and gas stations are also located close by the ring road.

5.2. Take your time

You can easily travel over the ring road in a few days, but we recommend that you take your time and not cover more than 300 kilometers per day. There are many beautiful sights along the ring road!

We have mapped out a route that shows you the best of Iceland in 14 days via the ring road. You visit all the unmissable sights and you will pass by some hidden gems. Use our tour through Iceland.

5.3. Other roads

In addition, there is a road network around the capital Reykjavik and by the larger cities of Selfoss and Akureyri. The roads are wide and well maintained. If you are not driving on the ring road or in Reykjavik, Selfoss or Akureyri, you can presume that the roads will not be asphalted.

When you ride down to a sight, you will most likely have to brave bumpy roads full of pits and rocks. So always pay attention and drive slowly. On some roads you have to cross a river by car. Keep in mind that this is rarely insured and you do it entirely at your own risk.

  1. The traffic regulations of Iceland

6.1. Traffic regulations

  • You drive on the right side of the road and overtake on the left.
  • Drivers coming from the right side are given priority.
  • It is forbidden for drivers to hold a mobile phone while driving.
  • 0.5 per mille alcohol in your blood is the maximum number allowed when driving a car.
  • When having a breakdown or accident, you must place the warning triangle behind the car and light your hazard lights.

6.2. Speed limit

The speed limit within the built-up area is 50 kilometers per hour. Outside built-up areas you can drive 90 kilometers per hour on paved roads and 80 kilometers per hour on unpaved roads.

6.3. Parking

A yellow line on the side of the road means that you cannot stand still there. When the yellow line is interrupted, you may stop for a while, but can't park. Therefore, always use the parking spaces provided to avoid a fine.

You can also never park against the direction of travel, so not on the left side of the road. Parking is free almost everywhere, you will only have to pay at the biggest sights.

6.4. Road marks

The road signs in Iceland are yellow with black letters. The road numbers are indicated on white signs with black letters. Blue signs with white letters indicate destinations such as mountains and river. Tourist sights are indicated on a white sign with a red border and red letters.

6.5. Refuel

You will find gas stations mainly around the big cities and along the ring road. When you go inland or explore the highlands, you will come by a gas station less often. We recommend that you refuel regularly, especially if you head inland.

Most gas stations work automatically and with a credit card. You have to enter an amount of money for which you want to fill the tank. Never fill your tank completely, because then an extra amount will be taken from your account as a guarantee.

6.6. Other important traffic regulations

  • You should always turn on your dipped-beam headlamps, even during the day. The weather in Iceland is unpredictable and can change quickly.
  • Buses and school buses always have priority.
  • In single lane bridges, the car closest to the bridge has priority. Always pay close attention to what the oncoming car intends to do.
  • There are high fines for off-road driving. Never deviate from the roads.
  • You should always use winter tires between November 1 and April 15. You can only use those tires during that period.
  • Take special situations into account. For example, a flock of sheep can cross the road.
  1. Don't miss out on anything during your stay in Iceland, get our travel guide!

Like most of us, you don't want to miss out on anything during your vacation in Iceland. Well, we have some good news, because we already did the research for you! Buy our Iceland travel guide with 99 sights (+ GPS coordinates) and a mapped tour. Prefer to try it out first? Download your free Iceland travel guide here.


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Posted by

Wouter Coppens

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