Tag Archives: renting a car

Renting a Car in Iceland

Renting a Car in Iceland: What you need to know about road safety, insurance, and how to avoid unexpected charges.


Excerpt from original post Iceland 2015: Reykjavik & the South Coast

Things to know about renting a car in Iceland:

There are tons of threads on Tripadvisor about renting a car in Iceland, many of them filled with horror stories of being charged hundreds or even over a thousand dollars for dings, dents, etc. After reading through many of them, I determined that the big name car rental companies had the most horror stories, and Blue Car Rental had the least horror stories, so we went with them. In general, here is what you need to know:

1. The insurance barely covers anything.

If you damage the car in any way, there is a high deductible that you have to pay. This includes small dents. Blue Car Rental’s deductible was $1,100.00. If the windshield is cracked and needs to be replaced, you pay $100.00. If the chassis/underside of the car is damaged due to off-roading or driving too fast on rough bumpy roads, you are responsible for the whole amount of the damage. If the strong winds blow the doors off the car (it happens), you will be responsible for the damage as well.

2. You must pre-pay with most companies.

Reserving a car online was very easy, and I asked a couple questions via email to Blue Car before reserving, and they were very responsive and helpful. However–you have to pre-pay, and if you cancel your trip last minute, you might not get all your money back. (Your might consider travel insurance for emergency cancellations on your trip).

3. Rental rates double in the summer.

Renting a car in Iceland is going to be expensive regardless, but consider going in the spring, or after September 15th to get the best rates. Like hotel rates, everything is double the price in the peak summer season.

4. Get the sand and ash protection.

Winds in Iceland can be insanely strong. Right before we went we read news stories of cars being blown off the road by the wind and rocks being blown off cliffs into people’s car windows. These are extreme examples, but the winds are strong at times and will blow sand and volcanic ash at your car, causing damage to the paint. The sand and ash protection doesn’t cost that much extra, and could save you some money in the event that you run into these conditions.

5. In the winter, pay close attention to the road conditions and weather reports.

The most invaluable website during our trip was http://www.vegagerdin.is/english/road-conditions-and-weather/, which we were checking several times a day. They keep the road conditions up to date and you must check to make sure your route is clear before venturing out, especially in the winter. You don’t want to end up a search-and-rescue tourist trapped in a snow storm. For an up to date weather report for the day, http://en.vedur.is/weather/forecasts/areas/ is the Icelandic weather site. If a storm is predicted in the area you are planning on driving to, check with locals to see if they think going there is a good idea. If not, you may need to change your plans.

6. American credit cards and debit cards without chips don’t work on Icelandic gas pumps.

As of the end of 2015 American cards are supposed to now have “chip and PIN” card model that has been used in Europe for years. My credit card has it now, but my debit card still doesn’t. I’m hoping this will change soon. Most bars, restaurants, and shops have card machines that can process the old-style magnetic strip that American credit cards have, but gas pumps don’t. We didn’t have cards with the chip yet when we were in Iceland. We were able to get around this by pre-paying the gas station attendant, either by having them open the pump or put a pre-paid amount on the pump, or the N1 stations could provide a pre-paid gas card that could be used at the pump. If you are going out into no-man’s land, make sure you fill up your tank first. You may also want to buy a pre-paid gas card at the N1 to use at any N1 stations that might not have an attendant. Worst case scenario, have some cash on hand for emergencies–you might have to wait for someone with a card to come along that you could ask to buy the gas for you in exchange for cash. If you don’t have a card with a chip in it yet, talk to your bank and find out when they will be getting one for you.


Here is a video about driving in Iceland that I found on Icelandair’s video selection on the plane. It was corny, but pretty helpful.

Overall, everything worked out with renting a car, the wind didn’t blow our car doors off, no rocks or hail flew through the air and dented the body or nicked the paint. We received no additional unexpected charges. We would Recommend Blue Car Rental, and from what we read, would also recommend avoiding the big name car companies. Just be cautious, don’t drive when there’s a storm, and stay on top of the weather report. Renting a car in Iceland is the best way to see the country.


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