20-06-2025
One of the first decisions you’ll have to make when planning your Iceland vacation is whether to rent a car. As you ask yourself, “Should I rent a car in Iceland?” you will need to consider numerous factors, including your itinerary and driving experience, to make an informed decision. The following will help guide you through the process.
The first question people often have is, “Do you need to rent a car in Iceland?” The answer to this question is not necessarily straightforward and will depend on numerous factors. Knowing how to decide whether to rent a car or use other options is an essential element in planning your trip to Iceland.
For many visitors, renting a car in Iceland is one of the best ways to get the most out of your vacation. Should you rent a car in Iceland? You will need to evaluate your travel plans and decide whether it would be more effective to drive yourself or rely on tours to get around.
Renting a car in Iceland gives you greater flexibility in your travel itinerary. You can go places where tour companies don’t stop and spend as much or as little time at each stop. You can also time your stops in a way that avoids crowds and lets you keep the schedule you want. You won’t be limited to waking up early to meet with the tour company or have no control over when you return.
Self-driving your itinerary also opens doors to places you may not be able to reach with a tour. If you wish to drive around the Ring Road, renting a car is highly recommended to avoid the high cost of taking tours. There are few locations that offer tours, limiting your vacation to leaving from these locations.
There are some situations when renting a car isn’t the best choice for you. In general, if you are uncomfortable driving in a foreign country, it may be best to forgo renting a vehicle and choose to take tours instead. Likewise, if you don’t have a driver’s license, renting a vehicle isn’t possible.
Have you asked yourself, “Do you need a car in Reykjavík?” The answer is generally no. If you are planning to spend your trip in the city without traveling to other areas of the country, a car may be an unnecessary expense. The city is largely walkable, and options like electric scooters and public buses are available to get around town.
If you will be traveling to Iceland in the winter months and have little or no winter driving experience, renting a car isn’t advised. Winter weather and road conditions can be dangerous for inexperienced drivers, making it a better decision to take tours and leave the driving to experienced residents.
One of the first steps to take in deciding whether you need a rental car in Iceland is to list the pros and cons of each option. Comparing the two options will help you weigh whether it is worth it for you to rent a car or if other options will give you the experience you want at a better price. Here are some of the pros and cons of renting a car and self-driving.
First, let’s explore the pros of renting a car in Iceland. The first thought that comes to mind when thinking about renting a car for your trip is the flexibility it provides. You will have the freedom to go where you choose whenever you wish, creating the perfect itinerary to ensure you see everything you want to see and experience on your holiday. You can even change your plans at the last minute.
In addition to the added flexibility in where you go and how long you stay, you can travel to more areas that aren’t covered in the common tours. With the right vehicle, you can venture into more remote areas of the island, enjoying breathtaking sights and traveling to places a lot of tourists don’t get to see.
Renting a car in Iceland also gives you the benefit of more comfort. Sitting on a bus for extended periods of time can get uncomfortable with no option to stop and stretch your legs whenever you need to. You are limited to the schedule set by the tour company.
Renting a car can also be more cost-effective than taking tours every day on your vacation. Unless you plan on hitchhiking or public transportation, you will likely spend more money taking tours than driving yourself to the destinations you wish to visit.
While there are many benefits to renting a car in Iceland, there are some downsides to consider to help you make an informed decision. Here’s why you may answer no to the question, “Should I rent a car in Iceland?”
Renting a vehicle in Iceland can be costly, depending on the type of car you get and what insurance you add to your rental. You must also factor in the cost of fuel as you travel around the country. Fuel in Iceland can be more expensive than in some places, but the fuel efficiency of vehicles is often good, especially if you choose a hybrid vehicle.
Another reason to consider avoiding self-driving is the weather conditions. Winter weather can lead to icy roads, blowing snow, whiteout conditions, and high winds. While many of these issues aren’t a problem in the summer, they can make renting a car in the winter and the shoulder seasons a bigger risk, especially if you don’t have winter driving experience.
Some people are unable to rent a car in Iceland due to their age. Many rental companies have a minimum age of 20 years, and you must have your license for at least a year. Some vehicle types require you to be older. If you plan to drink at restaurants, bars, or other establishments, you will also have to make sure you have a designated driver if you self-drive.
When evaluating if you should rent a car in Iceland, one of the first alternatives you may consider is public transportation. While it may seem like a great way to save money, you need to understand how the public transportation system in Iceland works and whether it would allow you to have the type of trip you are interested in.
Public buses in Iceland are a great way to get around in Reykjavík, but once you start going outside the city, the bus routes can be severely limited. You can take the buses from town to town, but you can’t complete a full circle around the country, and the buses won’t stop at most tourist destinations.
In addition to the limited stops along the route, when going outside the city, you may find the bus only goes once or maybe twice a day in each direction. The timing of the buses can be quite inconvenient for visitors. You could find yourself stuck in a small town with little to do and no return bus until the next day or two.
Another alternative to renting a car and driving yourself is taking taxis or requesting ride-sharing. While traditional ride-sharing apps aren’t a thing in Iceland, there are ride-sharing groups on Facebook that can help you connect with people. However, it doesn’t guarantee that you will find someone who can accommodate your needs.
Taxis are another possibility, but they can be quite costly in Iceland. The taxi industry is highly regulated, and the cost of the appropriate license, vehicle, and maintenance can mean high costs that translate into higher fees for passengers. It is often less costly to rent a car than to use a taxi to get around, especially outside the city.
Another common option visitors often choose over self-driving is booking organized tours, whether they are large bus tours or smaller private tours. While this is a great option if you’re not comfortable driving in the country, or you wish to go places that require more technical driving abilities like the highlands, they can be costly if you use them for your whole trip.
Another disadvantage to taking organized tours over self-driving is the lack of control over where you go and the larger crowds you will encounter at the sights you visit. Tours often go to the same places as everyone else and will limit the amount of time you have to explore. You lose some level of control over your schedule when you choose to take organized tours.
However, keep in mind that even when self-driving, there are certain things that require booking tours, such as snorkeling at Slifra, hiking on a glacier, or visiting an ice cave.
Now that you’ve decided that renting a car is the best option for your needs, you will need to choose the most appropriate vehicle. It’s more than just determining if you need a car in Iceland. You need to think about where you want to go and what time of year you are traveling to ensure you have a car that can handle the conditions.
You may wonder whether you need to book a 4x4 to ensure you can get everywhere you want to go in Iceland. Again, the answer to this question depends on several factors, including the time of year you visit, which parts of the country you wish to see, and how much you are willing to spend.
Renting a 4x4 can be beneficial in the winter to assist with driving in winter conditions, but for the most part, rental cars will come with studded tires, which can be just as effective. If you’re planning to drive in the highlands, you will need a 4x4. Other types of rental vehicles aren’t allowed on these unmaintained gravel roads to prevent damage.
It’s important to note that renting a 4x4 can be more costly than other options. You will need to determine your budget first to help you choose an affordable vehicle so you can plan your itinerary around it.
Your plans will play a significant role in determining which vehicle is the right option for your needs. The following are some of the most common parts of a visitor’s itinerary, along with the type of car that will best accommodate them.
The Ring Road is a well-maintained, paved road that circles the entire country. Because the whole route is paved, you can drive it in just about any type of rental car, particularly in the summer. You may want to rent a 4x4 vehicle if you are traveling in the winter or want to deviate from the Ring Road for some sights or hikes.
If your itinerary includes trips into the highlands, you will need to rent a 4x4 vehicle with good ground clearance. Not all 4x4s are created equal. Many F-roads in the highlands include unbridged river crossings that will require significant clearance to ensure your safety and prevent damage to the vehicle. These roads are unmaintained and rough, making a 4x4 absolutely necessary.
Another popular route is the Golden Circle. This route is fully paved and takes you around some of the most popular sights in Iceland. Like the Ring Road, you can drive this route with any vehicle, though you should choose based on the weather conditions and the type of vehicle you are most comfortable driving.
| Itinerary | Road Condition | Recommended Vehicle Type | Important Notes |
|---|---|---|---|
| Ring Road (Route 1) | Paved road | Standard car / any vehicle | 4x4 recommended in winter or for detours |
| Highlands | Unmaintained F-roads, unbridged river crossings | 4x4 with good ground clearance | Essential for safety and to prevent vehicle damage |
| Golden Circle | Fully paved route | Standard car / any vehicle | Choose based on weather and personal driving comfort |
Another decision you will need to make is whether to rent a campervan or a regular vehicle. The answer to this question depends on where you plan to stay and which types of accommodations you are interested in using.
A campervan is a great way to save some extra money on your trip by staying in low-cost campgrounds around the country. The cost of a campervan may be a little higher than an SUV or 4x4, but it will allow you to reduce accommodation costs and give you more flexibility to prepare your meals and further save money on your journey.
However, camping isn’t for everyone, especially if you’re visiting in the winter. If you are more interested in staying in hotels, guesthouses, or hostels, a rental car is a better choice. You will still have greater flexibility in where you go with the comfort and convenience of sleeping in a comfortable bed every night.
In general, both options will cost a similar amount of money when you look at rental costs, insurance, and fuel. It all depends on what type of vacation you are interested in taking and what time of year you plan to travel.
| Aspect | Campervan | Regular Car |
|---|---|---|
| Accommodation | Campgrounds (low-cost) | Hotels, guesthouses, hostels |
| Rental Cost | Slightly higher than SUV/4x4 | Slightly lower or comparable |
| Accommodation Savings | Yes, reduces lodging costs | No |
| Meal Preparation | Possible, more flexibility | No |
| Travel Flexibility | High, especially for camping | High, with comfort of established lodging |
| Suitability in Winter | Less suitable | More suitable |
| Comfort | Less (sleeping in campervan) | More (sleeping in comfortable beds) |
| Overall Cost (rental + fuel + insurance) | Generally similar | Generally similar |
You will need to do more than just answer the question, “Should I rent a car in Iceland?” You must also consider the cost of renting a car. Most people accept that Iceland is an expensive destination and have a strict budget they must follow, especially for rental cars, accommodations, and food. The cost of your car will vary depending on numerous factors.
First and foremost, the type of vehicle you rent will dictate the base price you can expect to pay for a rental car. A small 2WD vehicle will cost significantly less than a larger 4WD vehicle that is meant for the highlands. The duration of your rental can also play a role. The longer you rent, the less you will pay per day.
Another common factor that can affect the cost of your car rental is the season in which you travel. Summer is the high season in Iceland, with a higher demand for rental cars because it’s easier to drive this time of year. Rental cars are generally cheaper in the shoulder and winter months.
Add-ons, such as insurance, GPS, and WiFi devices, can all increase the cost of your rental. These costs will vary depending on the options you choose and what each rental company offers. These add-ons can improve your overall experience and are often well worth the additional costs.
Finally, how soon you book your rental car can have an impact on the overall cost. Many rental companies encourage early bookings by offering an early booking discount that can save you money. The longer you wait to book, the higher your rental costs may be as the available vehicles can reduce and the high demand will drive prices higher.
| Factor | Impact on Price | Details |
|---|---|---|
| Vehicle Type | Higher price for larger / 4WD vehicles | Small 2WD cars cost significantly less than 4WDs for highlands |
| Rental Duration | Longer rental = lower daily cost | The longer you rent, the less you pay per day |
| Season | Prices higher in summer, lower in shoulder/winter | Summer is high season with more demand; shoulder and winter months are cheaper |
| Add-ons | Increase rental cost | Insurance, GPS, WiFi devices vary by rental company and chosen options |
| Booking Time | Early booking can save money | Booking early may offer discounts; last-minute bookings often cost more due to demand |
The good news is that there are ways to save money on car rentals in Iceland. Beyond booking your vehicle as early as possible, here are several ways you can reduce your rental costs.
While it won’t save you money upfront, consider buying as much insurance coverage as possible for your vehicle. The conditions in Iceland can quickly lead to damage to your vehicle. While basic insurance covers basic body damage, you will also want to consider sand and ash, gravel, and other insurance options to protect you from other types of damage.
You can also look for discount codes online. Many rental agencies offer special discount codes you can use to further reduce the cost of your rental. Check often, as these codes can change frequently.
Another way to save some money on your car rental is to bring your own add-ons. Bringing a GPS unit or WiFi box can give you all the same advantages as the ones from your rental company without additional costs.
Overall, driving in Iceland is relatively simple as long as you follow the rules of the road and make yourself familiar with anything that may be different from your home country. With careful planning and the right weather conditions, many travelers can complete a self-drive itinerary to fully customize their trip.
First and foremost, road conditions can play a significant role in the success of your trip. Visitors are encouraged to check the Icelandic Road Administration website frequently to monitor road conditions. This website features real-time, color-coded updates on road conditions throughout the country to keep drivers safe.
SafeTravel.is is another important resource for your trip. This website features numerous articles and videos to help you prepare for driving in Iceland. While you are in the country, it will notify you of any weather warnings or other warnings that can improve your safety during your journey.
You should also familiarize yourself with road signs and other rules of the road. For instance, the inside lane of a roundabout has the right of way, which can differ from what you are used to in your home country.
As you plan your budget for your vacation, you will need to factor in the cost of fuel. Fuel prices in Iceland are a bit higher than you may be used to, making it important to calculate how much you can expect to spend. There is a fuel website you can check to find the lowest prices in the area where you are traveling. Some rental companies will give you a discount card for specific stations.
You will easily find gas stations throughout the country, but it is important to fill up when you see one to avoid running out of fuel in a more remote region. Gas stations are also an excellent place to pick up a cheap meal or some snacks while you are out on the road.
Finally, if you’re trying to determine, “Do you need a rental car in Iceland?” you will need to consider the season in which you are traveling, combined with your driving experience. Most drivers can do well in the summer months, but without some winter driving experience, driving in the winter can be dangerous and costly.
No matter what time of year you travel, the Iceland Meteorological Office has a website you should follow for the most accurate and latest weather conditions. This website is especially critical in the winter months so you can stay updated on weather warnings to adjust your plans accordingly.
In Iceland, it’s important to plan your itinerary based on the current weather conditions. While it’s a good idea to arrive with an itinerary in mind, you should have a backup plan or two in case the weather doesn’t allow you to drive where you want to go or your schedule is delayed by a day or two.
Should I rent a car in Iceland? For most visitors, the answer to this question is a resounding yes, especially if you’re interested in visiting places that aren’t commonly available on tours, or you want to avoid the crowds as much as possible. By renting a car in Iceland, you can choose where you go, how long you stay at each destination, and what you can see during your trip.
While tours can offer some benefits, if you’re interested in seeing Iceland in its full glory, renting a car is often the best choice and is well worth the cost.