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Car Rental in Iceland

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Car Rental in Iceland: Everything You Need to Know

Understanding Local Driving Laws and Requirements

When renting a car in Iceland, it is essential to have a good understanding of the local driving laws and requirements. Iceland has unique road conditions and regulations that every driver must adhere to in order to ensure a safe and enjoyable driving experience.

Driver’s License and Age Requirements

In Iceland, the minimum age to rent a car is 20 years old, and drivers must have held a valid driver’s license for at least one year. Additionally, if you plan on driving in Iceland, it’s crucial to carry your driver’s license, passport, and rental car documents at all times.

Driving Conditions and Weather

Iceland’s weather can be unpredictable, and road conditions can change rapidly, especially in rural areas. It’s important to be prepared for various weather conditions and to check the road conditions before embarking on your journey.

Insurance Coverage

When renting a car in Iceland, it’s important to understand the insurance coverage offered by the rental company. While basic insurance is usually included, additional coverage for gravel protection and sand and ash protection may be necessary, depending on your travel plans.

Booking in Advance

To ensure availability and the best rates, it is recommended to book your rental car in advance, especially if you plan on visiting Iceland during peak tourist seasons. Booking in advance will also give you time to compare prices and find the best rental car for your needs.

Renting a car in Iceland can provide you with the freedom to explore the country at your own pace. By understanding the local driving laws and requirements, as well as the unique driving conditions in Iceland, you can ensure a safe and enjoyable road trip experience.

Rental Requirements

When renting a car in Iceland, there are a few requirements to keep in mind to ensure a smooth and hassle-free experience.

Age Limits

The minimum age for renting a car in Iceland is typically 20 years old, although some car rental companies may require drivers to be at least 21 or 23 years old. There is also usually a maximum age limit of around 75 years old for renting a car.

Driving License Requirements

To rent a car in Iceland, you will need a valid driver’s license. If your driver’s license is not in English, you will need to obtain an International Driving Permit (IDP) to accompany your license. Additionally, some car rental companies may require you to have held your license for a certain duration, such as one or two years.


When renting a car in Iceland, you will typically need to provide certain documentation, such as a valid passport, a credit card in the driver’s name for the security deposit, and any additional documentation required by the car rental company. Be sure to check with your chosen rental company for their specific documentation requirements.

By being aware of and prepared with the necessary rental requirements, you can enjoy a smooth and enjoyable car rental experience in Iceland.

Insurance Information

When renting a car in Iceland, it’s important to understand the insurance options available to ensure a smooth and safe journey.

Basic Insurance

The basic insurance typically included in car rentals in Iceland covers Collision Damage Waiver (CDW) and Theft Protection. The CDW reduces the renter’s liability for damage to the rental vehicle, while Theft Protection covers the vehicle in case of theft.

Additional Insurance

In addition to basic insurance, travelers can opt for additional coverage such as Personal Accident Insurance and Supplemental Liability Insurance. Personal Accident Insurance provides coverage for medical expenses and accidental death benefits for the driver and passengers, while Supplemental Liability Insurance offers increased protection against third-party claims.

Insurance Tips

Before renting a car in Iceland, it’s advisable for travelers to check their existing travel insurance policies to see if they already have coverage for rental cars. Additionally, it’s important to carefully review the terms and conditions of the insurance coverage offered by the rental car company to fully understand the extent of protection provided.

Local Driving Laws and Regulations in Iceland

General Traffic Rules

Driving Side: In Iceland, driving is on the right side of the road.
Speed Limits: The speed limit is typically 50 km/h in urban areas, 80 km/h on rural roads, and 90 km/h on highways.
Other Useful Info: It is mandatory to drive with headlights on at all times, even during the day.

Overtaking and Lane Usage

Overtaking Rules: Overtaking is only allowed on the left side of the road when it is safe to do so.
Lane Discipline: The ‘keep right except to overtake’ rule is strictly enforced on multi-lane roads.
Other Useful Info:

Seat Belt and Child Safety

Seat Belt Laws: Seat belts must be worn by all passengers, and children under 135 cm must use a child seat or booster.
Child Safety: Children under 12 years old or shorter than 150 cm must use a child seat.
Other Useful Info:

Use of Mobile Phones

Mobile Phone Restrictions: It is illegal to use a handheld mobile phone while driving in Iceland.
Other Useful Info:

Alcohol and Driving

Legal Blood Alcohol Limits: The legal blood alcohol limit is 0.05%, with severe penalties for exceeding this limit.
Zero Tolerance Policies: There are stricter rules for new drivers and commercial drivers.
Other Useful Info:

Tolls and Charges

Toll Roads: There are no toll roads in Iceland.
Congestion Charges: There are no urban congestion charges.
Other Useful Info:

Roundabouts and Intersections

Navigating Roundabouts: Roundabouts are common in Iceland, and vehicles inside the roundabout have the right of way.
Intersection Rules: Right of way is given to vehicles approaching from the right at intersections.
Other Useful Info:

Headlight and Windshield Wiper Laws

Headlight Usage: Headlights must be used at all times, even during the day.
Windshield Wiper Rule: There is no specific requirement to turn on headlights when using wipers.
Other Useful Info:

Emergency Vehicles

Right of Way for Emergency Vehicles: All vehicles must yield to emergency vehicles with lights and sirens activated.
Other Useful Info: It is important to be aware of the unique driving conditions in Iceland, such as icy roads and strong winds.

Driving Tips for Iceland

Road Conditions

Iceland’s road conditions can vary significantly depending on the time of year. In the winter, snow and ice can make driving more challenging, especially in rural areas. It’s important to be prepared for changing weather conditions and to drive cautiously.

Urban vs. Rural Driving

In urban areas like Reykjavik, you’ll encounter typical city traffic and road conditions. However, in rural areas, roads may be narrower and less well-maintained. It’s important to pay attention to road signs and be aware of potential hazards like loose gravel and steep inclines.

Navigational Tips

Using GPS can be incredibly helpful for navigating Iceland’s sometimes complex road system. However, it’s also a good idea to have a physical map on hand, as GPS signal can be unreliable in some areas. Taking note of landmarks and using them as reference points can also be helpful for navigation.

Other Useful Tips

– Be aware of wildlife, especially on rural roads.
– Keep an eye out for changing weather conditions and adjust your driving accordingly.
– Take regular breaks, especially on longer drives, to avoid fatigue.

By keeping these driving tips in mind, you can enjoy a safe and enjoyable driving experience in Iceland. And when you’re ready to explore the country, consider renting a car to make the most of your trip.

Roadside Assistance and Emergency Procedures

Breakdown Procedures

If your rental car breaks down while you are in Iceland, there are a few steps you should follow. First, move to a safe location if possible and turn on your hazard lights. Then, contact the rental company to inform them of the situation. They will be able to provide guidance on the next steps to take.

Emergency Services

In case of an emergency, it’s important to have the contact numbers for the relevant services. In Iceland, the emergency number for police, ambulance, and fire services is 112. Additionally, most rental companies offer roadside assistance as part of their service, so be sure to have their contact information on hand as well.

Rental Company Policies

When renting a car in Iceland, it’s important to familiarize yourself with the policies and support offered by the rental company. Many companies provide 24/7 assistance and towing services in case of a breakdown. Be sure to review the details of these services before embarking on your journey.

Where can you Rent a Car in Iceland?

You can browse all the city locations below, sorted alphabetically. Use Ctrl+F (or Cmd+F on a Mac) to quickly find the one you want to explore.