Want to know how to rent a car in Iceland for your next trip? You are in the right place!
I rent a car everywhere I go in Europe and Iceland is one of the destinations I would say renting a car is essential.
Not essential for getting around, you will find that there are lots of tour packages available. But these tour packages are really expensive.
So it is essential if you want to save money and see multiple sites at your own pace.
This guide will walk you through everything you may need to know about renting a car in Iceland. Including, the best companies to use and how to drive in Iceland.
By the end of this article, I’m sure you will feel confident about renting a car in Iceland and will have found the best rental options for your trip.
So let’s jump in and help you figure out what kind of car is best for your trip, I’m sure there is one on this list that will be perfect for you!
👉 My #1 rental company to use when I’m renting a car in Iceland is Discover Cars. They will always provide you with the most reliable car for the lowest price. To check them out yourself, you can read the reviews here.
Renting A Car In Iceland: Quick Guide
Don’t have time to read this whole article? No worries!
The first question most travellers ask is about the best car rental companies to use in Iceland. These are the best rental options you should consider booking for your trip:
✅ Best overall car rental in Iceland: Lotus Car Rental
✅ Best overall car rental from Keflavík International Airport: Alamo
What Do I Need To Rent A Car In Iceland?
✔️ Be Over 20 Years Old
✔️ Valid Drivers License
✔️ Passport
✔️ Credit Or Debit Card (Credit card is best)
✔️ Sometimes proof of return flight from Iceland and accommodation detail
Can tourists rent cars in Iceland?
Absolutely! Renting a car in Iceland is an excellent way to explore the country’s diverse landscape.
With so many stunning sights to visit, including majestic glaciers and geothermal pools, having your own vehicle makes it easier to get around and see all that this beautiful island has to offer. It is also the cheapest way to get around!
So as long as you have a valid driver’s license, hiring a car should be pretty straightforward. And just so you are aware before booking any rentals, it is a lot easier if you are aged 21 or older.
You can rent a car at the age of 18. But some companies may try and charge you more. So if you are not 21 when driving in Iceland, check the policy with the rental company you use to avoid extra charges.
No matter your age or what country you are visiting from, you must have had your full driver’s licence for at least 1 year.
If you want a truly unique driving experience consider booking a snowmobile tour!
What documents do I need to rent a car in Iceland?
Before booking your perfect rental car, it’s a good idea to make sure you have all the relevant documents ready for your trip.
No matter where you rent a car in Europe, this will always include your valid driver’s license and a valid credit card. The credit card is used for the car deposit. You can use a debit card but I always recommend a credit card.
This is because rental companies will take the full deposit out of your bank account and return it after your trip with a debit card, but a credit card will block that charge so the money isn’t removed unless the car is returned damaged.
An International Driving Permit (IDP) can sometimes be needed when driving in Europe. However, Iceland accepts most driver’s licences so you will most likely not need one.
Is renting a car expensive in Iceland?
Car renting in Iceland can be expensive, but it doesn’t have to be!
There are a few things you can do to save money on car rental. First, try to book your car in advance. The closer you get to your trip, the more expensive car rental rates tend to be.
I also highly recommend you choose a smaller car. A smaller car will be cheaper to rent and will be easier to drive on Iceland’s narrow roads.
People often say you need a 4×4 when you want to drive in Iceland, especially when you are driving in Winter.
And honestly, it isn’t true. The roads are in great condition and the popular tourist sites are close to the road.
Finally, don’t forget to compare rates between different car rental companies. By doing your research, you can make sure you’re getting the best deal on car rental in Iceland.
✅ The best company to use for this is Discover Cars. They compare all rental options from local vendors to global companies so you get the cheapest offers every time.
What is the cheapest way to rent a car in Iceland?
Using the tips above, you can get some good deals for car rentals throughout Iceland. But if you want the cheapest way to rent a car in Iceland every single time, is by using Discover Cars.
Most comparison companies use a small number of globally known companies like Enterprise. But Discover Cars compares all companies in the area, even small local ones. This means you will always get the cheapest hire car for your holiday to Iceland.
I always use and recommend Discover Cars not because they are always the cheapest, but offer a great service. If I have ever had a question about my booking or anything else, there is always someone super helpful on hand to help.
🌟 They also have a 4.5 out of 5 rating and thousands of great reviews. You can check out and read all the reviews and car options here.
Best car rental in Iceland
So if you are looking for the best car rental in Iceland, you will find some awesome options!
One of the most popular and recommended is Lotus Car Rental. When I used them, they honestly couldn’t do enough and made the whole rental process easy.
They are a local family-run company that guarantees the best service every time. They also pride themselves on making sure that anyone who rents a car with them not only has the best holiday but does it as safely as possible.
It made me feel so much more confident driving around Iceland knowing I had their support 24/7.
One of the best things about them is that they do a free pick up and drop off service from Keflavik International Airport for free. Their rental office is only a few minutes away from the airport so you can get used to driving your rental car, without the stress of a busy airport.
✔️ Lotus Car Rental have a star rating of 4.8 out of 5 and is a really popular company to use, so it is best to book in advance. You can check out their reviews and booking options here.
Best car rental option from Iceland Airport
Picking up your car rental straight from Iceland Airport is a great way to avoid paying for airport transfers. It also means you can start exploring straight away!
Iceland has a few airports, but the most popular one for visitors to fly into is Keflavik International Airport. Here you will find plenty of rental options to pick from including Hertz and Enterprise.
The best-rated and usually cheapest option from Keflavik International Airport is Alamo. Anyone who has rented with them always rates them on their service and value for money.
Other Rental Options From Keflavik Airport In Iceland
If you are looking for an award-winning rental company that offers its customers a convenient shuttle service to and from the airport, consider Lava Car Rental!
This family-owned company has been offering great vehicle options for your Iceland adventure since 2016. They have economy cars, 4x4s, campervans, electric vehicles and luxury options at great rates.
They are really friendly and their customer service is great. They have even won an award for being the Customer’s Favorite Car Rental Company in Iceland.
So if you want hassle-free vehicle rentals for your trip, they are an amazing option!
Here are some other great options you should consider booking from Keflavik Airport:
➡️ Budget
➡️ Enterprise
➡️ Europcar
What should I know about Driving in Iceland?
Driving in Iceland is pretty straightforward. But because of its landscape and weather, it’s important to know how to navigate the roads safely.
Here are some quick tips to help you during your trip:
✅ Drink driving limits are very low so it’s best to avoid drinking alcohol and driving
✅ Drive on the right-hand side of the road in Iceland.
✅ Seat belts are mandatory.
✅ Iceland Speed Limits: 30-50 km/h (18-30 mph) in populated areas, 80 km/h (50 mph) on gravel roads in rural areas and 90 km/h (56 mph) on paved roads.
✅ Carry your driver’s license, insurance documents and car rental information at all times.
✅ The Petrol station times in Iceland are usually 7.30 am to 8 pm.
FAQs about renting a Car In Iceland
I’m sure you have a few more questions you need answers to before booking anything. To help you out, these are the top questions myself and other travellers had about hiring a car in Iceland:
Yes, hiring a car in Iceland is highly recommended for visitors. It provides the most efficient, flexible, and often the cheapest means of transportation. The country’s diverse landscapes and remote attractions are best explored by car, offering the freedom to tailor your itinerary and access off-the-beaten-path destinations easily.
Yes, road signs in Iceland are predominantly in Icelandic, but many also include English translations. Visitors should familiarize themselves with common Icelandic road signs and symbols to ensure a safe and smooth driving experience. Additionally, GPS navigation systems in rental cars often provide instructions in English, further assisting travellers on the road.
To save money on car rental in Iceland, use a car comparison site like Discover Cars. It efficiently compares all available cars and rental companies, ensuring you find the best deal. Additionally, booking in advance, avoiding unnecessary add-ons, and considering off-peak travel times can further reduce costs, making your Icelandic road trip more budget-friendly.
It’s generally better to rent a car online in advance rather than at the airport. Booking ahead not only often saves money but also ensures vehicle availability, especially during peak travel times. Online reservations streamline the process, saving time and allowing you to choose from a broader selection of cars and rental options.
How to rent a car in Iceland final thoughts
So there you have it – everything you need to know about renting a car in Iceland.
By following these rental tips, you’ll be sure to have a stress-free experience and can focus on enjoying all that this beautiful country has to offer. Don’t forget to book some amazing experiences to make your drive amazing!
And for the best car rental deals in Iceland don’t forget to use this guide to find the perfect car for your trip!
I also recommend you take a refillable water bottle when renting a car. Not only can you drink water anywhere in Iceland, it’s handy to clear your windscreen!
I hope you found this article useful! To make your trip to Iceland the best, check out these other posts:
✔️ The Essential Iceland Tips You need to know
✔️ Driving in Iceland in March: The Ultimate Guide for your Iceland Road Trip
✔️ The 21 Most Unique Places To Visit In Europe 2022
✔️ Road trip gifts: Ultimate gift ideas for all travel lovers
✔️ The Best Lightweight Luggage For International Travel
Lowri Thomas is the founder of Many Other Roads. She lives and travels in Europe and has explored more than 40 countries. She is joined on her travels with her dog Scout and they explore Europe mostly by road. Born in Wales, she also shares the best things to do in Wales, UK and beyond. She helps over 50,000 people per month plan epic Europe adventures and road trips.
