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Complete Guide to the Best Cars to Rent in Iceland


Which car to choose in Iceland?

Iceland, also known as the Land of Fire and Ice, has captured the attention of many travelers due to its breathtaking and surreal natural attractions. Embarking on a road trip around this remarkable island has become a coveted adventure for adventurous explorers.

When planning your Iceland road trip adventure, you might find that there are so many options for Iceland car rental that it can be hard to know where to begin. Here’s where we can help you out by exploring all the available options to help you pick the right rental vehicle for your Iceland vacation.

Let’s dive in and learn all about the best cars to rent in Iceland. This way, you can move on to more exciting details, like planning your visits to volcanoes, waterfalls and glaciers!

What Are the Best Cars to Rent in Iceland?

The best car for you to rent in Iceland will depend on what kind of trip you plan to take, how many people are in your party and how much off-roading you plan to do. In this article, we’ll explore all about the different car rental options there are in Iceland, as well as which car best suits which kind of traveler.

For most travelers, a small, compact car is perfect for your Iceland summer vacation. You can easily travel to the main tourist attractions in Iceland, including the Golden Circle route and Jokulsarlon Glacier Lagoon, by taking the Ring Road (Route 1), which is easily driven in most standard car rentals.

If you need extra room or are looking to travel further afield to any of Iceland’s more remote and mountainous locations, you’ll need a larger car rental or a 4x4 for any driving on the gravel F-roads. Here are some more details about each car rental type in Iceland, so you can pick the perfect one for your trip.

the Best Cars to Rent in Iceland

Types of Road in Iceland

First, let’s clarify what the different road types are in Iceland. You’ll find three different types of Icelandic roads:

  • Paved roads – The main Ring Road in Iceland is a paved road. These roads are regularly maintained and rarely closed due to adverse weather, apart from occasional winter snowstorms. You can travel on paved roads with any car type.
  • Gravel roads – Gravel roads can be driven with any vehicle type, not necessarily a 4x4. It’s essential to reduce your speed when moving from a paved road to a gravel road, to allow you to maintain control of the car as the road surface condition changes.
  • F-roads – The mountainous F-roads of Iceland are only open for a short time during the summer months and lead to the Highlands in the heart of Iceland. 4x4 vehicles are mandatory for any travel on F-roads.

Type of Roads in Iceland

Compact and Standard Sized Car Rentals in Iceland

If you're part of a couple or a small group of friends, the perfect Iceland rental car for you is most likely a compact or economy vehicle. These cars are small and easy to drive. They also get excellent mileage as they are extremely fuel-efficient.

These types of cars will take you not only on quick day trips from Reykjavik, but also across longer distances as well. Whether you're going around the Golden Circle route or headed towards the volcanic black sand beaches of Vik, an economy model is a great choice.

If you're looking to rent a small car, there are many different models to choose from. The Kia Picanto, Volkswagen Polo, Kia Rio, Toyota CH-R, and Toyota Yaris are some of the most reliable rental cars in Iceland that fall under this category. These are all great cars for a road trip.

Top tip: Be sure to check the trunk’s capacity for luggage. Even if the car fits five passengers, there may only be room for one or two small suitcases or backpacks.

Car rental Iceland: compact size

Full-Sized Models and Sedan Car Rentals in Iceland

Full-size vehicles and sedans give you lots of extra legroom and space for a larger group to be comfortable during your Iceland road trip. These types of cars are perfect for fitting all your luggage and even providing enough space for passengers to have a snooze at the end of a long day exploring in Iceland.

Sedans are the best cars to rent in Iceland if you’re part of a larger group of people, a family, or you simply want more room to make sure you’re comfortable. The Kia Ceed Sportswagon is a great choice for going around the island. It’s a modern update to the old family station wagon from road trips of days past. Not only is it practical and convenient, but it’s sporty and stylish as well.

Car rental in Iceland: Full-sized

SUVs and 4x4 Vehicle Rentals in Iceland

When thinking about car rental in Iceland, one of the first things you need to consider is your itinerary. Where you plan to go will have an impact upon what type of vehicle you ultimately decide to rent. Glaciers and hot springs will most likely be on your list of things to do, but what about visiting the Highlands?

If exploring Iceland’s wild interior is on the agenda, you’re going to need to rent a car in Iceland that’s allowed in the Highlands. The Icelandic Highlands have special roads called F-roads, which are mountain roads. They are unpaved, gravel paths, and legally, you need a 4x4 vehicle to traverse them.

You may also have to cross some rivers if you plan to explore the Highlands, so SUVs are a popular choice. If it’s your first time crossing water, we highly recommend getting some professional guidance before heading out on your Highlands adventure.

The time of year you're planning your travels in Iceland is another factor to take into consideration. During winter, road conditions can become snowy and icy. Safety is paramount, so winter tires come standard on all rentals starting in November. 

In addition to practicing basic driving safety precautions, 4x4 vehicles are another way to feel safer when driving in Iceland during winter. With an all-wheel drive, you’ll be able to maneuver your vehicle on wintry roads more easily and maintain better control than in a two-wheel drive, which is important when the snow falls!

Some recommended models to take a look at are the Dacia Duster, Nissan Qashqai, Suzuki Vitara, Hyundai Tucson, Kia Sportage 4x4, and Kia Sorento 4x4. These SUVs and compact crossovers will take you where you want to roam, whether it’s the Ring Road or further inland. They also provide peace of mind for any of those precarious winter driving conditions you might encounter.

4x4 Vehicle Rentals in Iceland

Large Passenger Models to Rent in Iceland

What if you’re traveling with a really big group? There are times when a five-seater simply won’t cut it. Sometimes you need to consider a roomier vehicle with lots of extra space in the back – think 7-seaters or passenger vans. Depending on your group’s needs and how many travel companions you have, you may want to upgrade to the biggest rental vehicles available.

The Nissan X-Trail is a seven-passenger vehicle that combines the dashing appearance of an SUV with the possibility of expanding a third row of seats. It’s an all-terrain option that’s perfect for exploration and seeking out new adventures. And if you’re ready for a field trip-like outing, the Renault Traffic or Mercedes Benz Vito 4x4 9-seater are ideal. These vehicles are perfect for a self-organized group tour of Iceland.

These kinds of rentals are also perfect for an excursion to see the Northern Lights, as everyone can just pile in. Additionally, these types of cars often have larger windows, which offer nearly 360º views of the breathtaking landscapes of Iceland.

Large SUV rental in Iceland

What Type of Car to Rent in Iceland?

For driving on Iceland’s main roads, opt for a small 2WD like Toyota Yaris or Aygo, ideal for four travelers.

What’s the Best Way to Rent a Car in Iceland?

When looking for a car to rent in Iceland, we recommend doing some research online in the first instance. You can find many different Iceland car rental providers and compare prices and reviews.

Reviews are important to see what level of customer service you can expect. We recommend checking forums on travel websites like Trip Advisor and reading Google Reviews.

Once you’ve chosen the best vehicle type to rent for your Iceland trip, you can explore the models that different providers offer and check the price differences. Make sure to include insurance in your price comparisons, too.

Remember, driving in Iceland is most likely very different from driving in your home country, due to the different road types, geological features and natural wonders. If you have any questions, make sure to reach out to the rental company to clarify. They can provide you with some Iceland car rental recommendations for your travel needs and answer any queries you have.

Renting a car recommendations

Top Tips for Renting a Car in Iceland

In addition to picking the right model for your trip to Iceland, there are also a couple of other things to consider. Here are some important and useful top tips for renting a car in Iceland:

1. Check pick up and drop off location

While it might be obvious, where you pick up and drop off your car is something to think about. While most people assume they’ll get their car rental at Iceland's main airport, that's not always correct. Sometimes you have to pick up your car rental in Reykjavik City, which is a 40-minute drive from Keflavik International Airport.

You'll need to make separate transportation arrangements if this is the case. Check to see exactly where your Reykjavik car rental needs to be picked up from. You may be able to choose between airport pickup and city pickup. Be sure to factor this into your schedule as well as your budget for the trip.

2. Research rental company reputation

Another thing to keep in mind is the experience and reputation of the company that you choose to rent from. Because the car rental market in Iceland is a little bit over saturated, the great leveler isn’t always cost. Of course, prices are competitive, but you can get cheap car rental in Iceland from multiple providers.

 Remember that you get what you pay for, so sometimes it makes sense to opt for the slightly more expensive option with great reviews. See what former clients have to say about customer service as well as the overall quality of their experience with the company. You want a company that takes care of you and is helpful and responsive both throughout the booking process and during your trip.

Tips for Renting a Car in Iceland

3. Ask about insurance prices 

When comparison shopping to find a cheap car rental in Iceland, you should know that not all quotes are created equal. When you hire a car here, you’re paying for both the car and the mandatory CDW insurance. This is true for all rental companies in Iceland. But what you might not have considered is any other car rental insurance you may need, such as gravel and ash protection if you plan to travel on F-roads.

It varies from company to company; some include certain insurance types in their quote, while others leave it as an add-on. To discover the true cost of your rental, figure out what type of insurance you have, what type you’ll need, and what the total price is. Iceland car rental insurance is an in-depth topic, but it’s recommended to get comprehensive coverage by purchasing the full insurance package.

4. Consider the time of year

If you’re planning to do a road trip during the winter season, our Iceland car rental recommendation is a 4x4 vehicle to give you the best support on Iceland’s sometimes icy roads. When hunting for the Northern Lights during the darker months, you might want to head a little off the beaten path to find the perfect area away from light pollution to spot this dancing light show.

Remember, that any traveling on F-roads requires a 4x4 vehicle. In the summer, a small economy car rental or a sedan model is most likely fine for most travelers. If you plan to stick to the main tourist routes, you’ll only be traveling on paved roads, which are well-maintained and are less likely to be affected by harsh weather during the summer season.

Winter driving in Iceland

5. Book early

Iceland is becoming an ever-popular tourist destination, meaning hotels and tourist attractions often book up in advance, and car rentals are no exception. We recommend booking your Iceland car rental as early as possible beforehand to make sure you get your vehicle of choice.

This is especially true in the peak tourist season of summer. During winter, it’s not usually as vital to book as far in advance, as this time is less popular for tourists in Iceland. However, we still recommend securing your Iceland car rental in advance before you arrive on the island.

6. Take pictures before and after

While standard procedure is to walk around the vehicle and identify any pre-existing damage with an agent, we also recommend taking your own pictures or videos of any interior or exterior damage. This will cover you in case any of these areas are picked up when you return your vehicle. It’s a good idea to take pictures and videos of your Iceland car rental when returning it after your trip, too. This will ensure you have proof of the condition you returned your car in. It’s unlikely you’ll need these, but good to have just in case

Which Car Should I Choose in Iceland?

So, Which Car Should I Choose in Iceland?

When it comes down to it, the best way to pick the right car for your trip is to get clear about your travel needs and preferences. Some people are happy with a simple, compact car and need nothing more. Others prefer the large presence of an SUV. Or perhaps you just want the comfort that comes from having a family-type car for driving.

Whatever your choice is, know that we’ve got you covered. Take a look at our wide selection of vehicles to find the perfect fit for your party and get ready to hit the road for your unique Iceland adventure!