Car Rental In Iceland - Take Me There Iceland

Car Rental In Iceland

Self-drive travelers rely heavily on the choice of their vehicle, making it one of the most crucial aspects of your journey, both economically and technically. Ensure you rent from an experienced and reliable company with well-maintained vehicles, insurance coverage tailored to your needs, and a network of mechanics across the island.

What should you know about renting a car in Iceland?

Firstly, check with the rental company for the minimum age to rent a car, usually around 20-25 years, depending on the rental company and car type. Driving in Iceland follows the right-hand side.

Road conditions can be unpredictable due to Iceland’s weather, so be aware of road types, especially in remote areas. Familiarize yourself with road signs, road types (F-roads, gravel roads), and weather forecasts before your journey.

For exploring Iceland’s mountainous center or F-roads, a 4×4 vehicle is essential. Not all rental cars are suitable, so check rental conditions. If crossing rivers, consider additional water-crossing insurance, not offered by all rental companies.

Comprehensive insurance is recommended, and booking your rental well in advance during peak tourist seasons ensures availability and better rates.

Iceland imports all cars, making them expensive and scarce. Renting in advance is advisable, especially for summer trips when demand is high.

Speed limits are strictly enforced, varying based on road type. Be cautious during autumn to May when roads may be icy; a 4×4 is safer but not mandatory.

Watch out for wildlife and sheep on roads, especially during dawn and night. Adhere to local parking regulations; in some urban areas, parking may be paid. Parking in nature reserves usually involves fees.

Consider the number of passengers, trip type, planned activities (challenging, family-friendly, off-road, river crossings), and how spacious you want the vehicle when renting a car in Iceland.

Choosing the right car for your trip

Choosing the right car for your trip in Iceland depends on your specific needs, preferences, the time of year, and the roads you’ll be traveling on. Consider these factors when selecting a rental car in Iceland:

Road Conditions: In winter, many Icelandic roads may be icy and snowy, so renting a car with winter tires and higher ground clearance is advisable. For F-roads, a 4×4 is necessary.

Group Size: Take into account the number of people in your group and the cargo requirements when choosing the size of your rental car. For example, if you’re a group of 5 adults, it’s preferable to rent a 7-seater car to accommodate all luggage.

Terrain Capability: If you plan to explore rough or F-roads, renting a 4×4 is recommended for better off-road capabilities.

Fuel Efficiency: Fuel is expensive in Iceland. If you won’t be entering the mountainous region, consider renting a fuel-efficient car. Some rental companies now offer electric cars with significantly lower “fuel” costs.

Budget: There’s a range of rental options available, from compact cars to larger off-road vehicles. Consider your budget when choosing the type of car to rent.


It’s crucial to note that every car rental company in Iceland offers various insurance solutions, some included in the base rental price and others requiring additional payment. Therefore, it’s essential to fully understand the insurance context before renting, knowing exactly what is covered and what is not.

For example, if the basic insurance includes a self-participation of 500€ but doesn’t cover river crossings, you might incur the full cost of any water damage without regard to the self-participation.

Most basic insurance plans from rental companies typically include a self-participation and may not cover specific situations, such as damage to the vehicle’s underside, sand and ash damage, and river crossings.

Travelers who don’t plan to explore Iceland’s central region may not need insurance covering river crossings, and opting for a basic insurance plan could be sufficient for their needs.


Most of the rental companies in Iceland will offer you extras, some of which can contribute a lot to the trip. Here are some of them.

Rescue services – this is basically an extension of the insurance for the rescue / towing of the vehicle, even if it is a flat tire.

Router – for free and unlimited use of the Internet, as long as you are in the car. The router works with a local SIM and therefore with excellent cellular reception all over the island. Very cool!

GPS – not all vehicles have a built-in GPS and if you want to make sure that you can navigate even when you are without cellular reception, the external GPS offered by the rental companies can be an excellent solution for this.

Roof rack – an excellent and highly recommended storage solution. The Roof rack is offered for a very limited range of vehicles, please note.

Baby chairs – secure baby chairs and boosters for older children. Be sure to inform the rental company in advance to avoid an embarrassing situation when you arrive to pick up the car and a baby seat is not available.

Local company Lotus offers a 10% discount to ‘TAKE ME THERE ICELAND’ users. Lotus is the only car rental company in Iceland offering water damage coverage. Their Platinum insurance package is the most comprehensive and robust plan available, covering all damages with a self-risk/participation of 0 ISK.

Access the app to easily collect your coupon


Renting motorhomes or campervans in Iceland is very common among travelers. A trip in this type of vehicle can save quite a bit of money and also allows for greater flexibility compared to a trip based on hotels (which must be booked well in advance for the summer).

According to the law, camping with motorhomes  should only be done in designated parking lots, but these do not really need to be booked in advance. You will also have more flexibility in terms of food, in Iceland this is also a parameter that can affect the plan and schedule of the trip (there are areas with very few restaurants and most of them close quite early most of the year). that the kitchen is all the way with you it becomes less significant.

The motorhome offers a type of living room (many times it can be turned into a bed), a kitchenette, a bathroom and a bed or two (or more) depending on the type of trailer. The campers are more modest and in fact it is a convertible vehicle. The camper will have a bed and some will also have a kitchenette. The advantage of the camper is that you can also get it in a 4×4 version and enter the reserve in the center of Iceland with it.

There are several motorhome and camper companies in Iceland, it is important to make sure that it is a company with experience that offers adequate insurance coverage. The deductible for Motorhomes can reach a very high amount and you should upgrade the insurance in order to reduce it.

We highly recommend the Campervan Iceland company that offers both motorhomes and campers at competitive prices and with broad insurance coverage. Campervan Iceland operates under the umbrella of Scandinavian Travel Services Ltd./Co, a recognized entity sanctioned by the Tourism Board of Iceland. They will help you choose a vehicle that aligns with both your requirements and budgetary considerations.

Check exactly what you get with the motorhomes and what you don’t

Each trailer or camper requires ancillary equipment ranging from kitchen utensils, bedding, chemical liquid for the toilets to an electric converter, a gas head and more. In some companies you can get an offer for a package that includes all the extras.

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