Car Rental in Iceland for US Travelers

Planning to explore Iceland by car? Renting a vehicle offers the freedom to experience its breathtaking landscapes at your own pace. For US travelers, understanding local driving laws and rental requirements is key to a hassle-free adventure.

Can I drive in Iceland with my US license?
What insurance should I choose for safety?
What are the approximate rental costs?
Is it possible to rent a car for one-way travel?
What Icelandic driving rules differ from the US?

This guide provides essential information to make your journey seamless and enjoyable. By the end, you'll be equipped with the knowledge needed to explore Iceland with confidence and convenience.

Can US Citizens Drive in Iceland?

Yes, US travelers can legally drive in Iceland with the proper documentation. Age restrictions and additional document requirements may apply.

Form of ID:
A valid passport is required for foreign renters.
Driving licence:
Accepted driving licence include:
• Original driving licence + International Driving Permit (IDP)
or
• EU/EEA Driving License
Accepted cards:
Physical credit cards in the full name of the main driver are required. Accepted cards include Visa, Master, DinersClub, JCB, Discover, and AMEX.
Age requirements:
Drivers must be between 18 and 99 years old. Young drivers aged 20-24 may incur a fee of US$ 11.73 per day.

Ready to Rent?

Requirements may vary between rental companies. Always confirm details when booking.

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Which Car Rental Companies Are Best?

Explore reliable and varied car rental options available for travelers visiting Iceland from the United States. Choose from well-known global chains or trusted local providers for your needs.

Global Chain Companies

Local Brands

Europcar
global
8.5
Locations:
95
Prices:
$$
Key Advantages
- Wide range of vehicles
- Flexible pick-up and drop-off locations
- Loyalty program for frequent renters
- Excellent customer service
Best for
Leisure travelers and eco-conscious renters
Hertz
global
8.5
Locations:
72
Prices:
$$$
Key Advantages
- Largest fleet in USA
- Premium vehicle selection
- Gold Plus Rewards loyalty program
- Express rental counters
Best for
Business travelers and premium vehicle needs
Budget
global
8.5
Locations:
51
Prices:
$
Key Advantages
- Competitive pricing
- Convenient locations
- Excellent customer service
- Loyalty rewards program
Best for
Cost-conscious travelers and families
SIXT
global
8.5
Locations:
20
Prices:
$$
Key Advantages
- Wide selection of premium and luxury cars
- Flexible rental terms
- Easy online booking
- Excellent customer service
Best for
Travelers seeking premium vehicles and flexible rental options
Alamo
global
8.5
Locations:
16
Prices:
$$
Key Advantages
- Great value for money
- Quick and easy booking process
- Excellent customer service
- Wide range of vehicle options
Best for
Leisure travelers and families

Icerental 4x4
local
8.5
Locations:
2
Prices:
$$
Key Advantages
- Specialized in 4x4 and SUV rentals
- Knowledgeable staff on winter conditions
- Competitive pricing for long-term rentals
- Flexible pick-up and drop-off options
Best for
Adventure seekers and winter travel
FAIRCAR
local
8.5
Locations:
6
Prices:
$$
Key Advantages
- Competitive pricing
- Personalized customer service
- Convenient pickup and drop-off locations
- Wide range of vehicle options
Best for
Budget-conscious travelers and local rentals
ACE Rent A Car
local
8.5
Locations:
7
Prices:
$$
Key Advantages
- Competitive pricing
- Customer-friendly service
- Flexible rental options
- Special deals for long-term rentals
Best for
Budget-conscious travelers and families
SAGA Car Rental
local
8.5
Locations:
1
Prices:
$
Key Advantages
- Personalized customer service
- Convenient local locations
- Competitive pricing
- No hidden fees
Best for
Budget-conscious travelers and local rentals
Lava
local
8.5
Locations:
1
Prices:
$-$$
Key Advantages
- Personalized customer service
- Convenient pickup and drop-off locations
- Competitive pricing
- Local knowledge and recommendations
Best for
Budget-conscious travelers and local excursions

Recommendations for Travelers from the U.S.

Choose Global Chains If:

You prefer familiar brands with international recognition.
You need extensive customer service availability.
You plan to traverse multiple regions or take long trips.
You require premium or specialized vehicle options.

Choose Local Brands If:

You aim to support local businesses.
You are interested in unique vehicle offerings suited for Icelandic terrain.
You prefer cost-effective rental rates.
You have specific requirements for navigating Iceland's countryside.

How to Choose the Right Car?

Choosing the right rental car can make your journey more comfortable, safe, and enjoyable. Think about your travel group, the destinations on your route, and the type of driving you'll be doing. With QEEQ, you can compare multiple car types and policies to find the one that best suits your journey.

Seating and Luggage
Consider your travel group size and luggage needs
- Economy cars (2-4 people, 1-2 suitcases)
  Perfect for city driving and short trips
- Compact cars (4-5 people, 2-3 suitcases)
  Good balance of space and fuel efficiency
- Mid-size cars (5 people, 3-4 suitcases)
  Comfortable for longer distances
- Full-size/SUV (5-7 people, 4+ suitcases)
  Ideal for families and group travel
Transmission Type
Choose between automatic and manual transmission
- Automatic transmission
  Easier for city driving and traffic, more common in USA
- Manual transmission
  Often cheaper, better fuel economy, more control
- Consider your comfort level with left-hand driving and automatic cars
Insurance Included
Check what insurance coverage comes with your rental
- Basic liability
  Covers damage to other vehicles and property, usually included
- Collision Damage Waiver (CDW)
  Covers damage to your rental car, often optional
- Theft protection
  Protects against car theft, may be included or additional
- Personal insurance
  Check if your insurance or travel insurance covers rentals
Cancellation Policy
Understand booking flexibility and fees
- Free cancellation
  Usually available up to 24-48 hours before pickup
- Prepaid vs. Pay-at-counter
  Prepaid often cheaper but less flexible
- Change fees
  Cost to modify dates, locations, or car type
- Travel insurance
  Consider coverage for trip cancellations or delays
Mileage Policy
Check distance restrictions and additional charges
- Unlimited mileage
  Best for long road trips and cross-country travel
- Limited mileage
  Cheaper daily rate but extra charges for excess miles
- Consider your planned route distance and potential detours
- Factor in mileage costs when comparing total rental prices
Fuel Policy
Understand fuel requirements and costs
- Full-to-Full
  Return with same fuel level, most economical option
- Full-to-Empty
  Pay upfront for full tank, convenient but often more expensive
- Same-to-Same
  Return with same level as pickup, fair pricing
- Pre-purchase fuel options
  Compare costs with local gas station prices

Quick Decision Guide

City Travel
Compact/Economy car with automatic transmission, full-to-full fuel policy
Reykjavik, Akureyri
Road Trip
Mid-size/Full-size car with unlimited mileage, flexible cancellation
Ring Road, Golden Circle
Vacation
SUV with comprehensive insurance, prepaid fuel option
Blue Lagoon, South Coast

Compare with Confidence on QEEQ

Don't settle for the first option you find. QEEQ makes it easy to compare car types, policies, and total costs from multiple providers. See all fees upfront, read real customer reviews, and choose the perfect car for your adventure.

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No hidden fees
Real customer reviews

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What Are the Popular Destinations in Iceland?

Iceland is renowned for its stunning natural landscapes and unique driving experiences. Travelers from the US often explore Reykjavik, the Golden Circle, and the scenic Ring Road route, which circles the entire island. Renting a car is the best way to fully enjoy these destinations and their breathtaking surroundings.

What Insurance Do I Need?

In Iceland, car rental insurance is essential for a safe and worry-free journey. The unique terrain and weather conditions necessitate additional coverage, beyond the basic options. Selecting the appropriate insurance will ensure peace of mind when exploring Iceland's stunning landscapes.

Types of Insurance Coverage

Collision Damage Waiver (CDW)
Covers damage to the rental car, typically limited to the body of the vehicle.
$12-20/day
Essential
Super Collision Damage Waiver (SCDW)
Reduces the deductible for damages to the car to a minimal amount.
$10-15/day
Recommended
Gravel Protection (GP)
Protects against damage caused by gravel impacts, which is common on Icelandic roads.
$5-10/day
Essential
Theft Protection (TP)
Covers loss of the vehicle in case of theft.
$3-6/day
Optional
Sand and Ash Protection (SAAP)
Covers damage caused by sand and volcanic ash, which can severely affect the vehicle's paint and windows.
$10-15/day
Recommended
Personal Accident Insurance (PAI)
Covers medical expenses for the driver and passengers in case of an accident.
$5-10/day
Optional

QEEQ's Complete Protection Solutions

Perfect for travelers who want comprehensive protection without the complexity. One price covers everything, and AXA's trusted network ensures reliable claims processing throughout Iceland. Get comprehensive coverage online for about 50% less than counter rates.

Insurance Coverage Comparison

Coverage Feature

QEEQ Full Coverage

Basic Rental Company

Collision Damage Waiver

Fully Covered

$0.00 - $12,000.00

Theft Protection

Fully Covered

$0.00 - $15,000.00

Personal Accident Insurance

Fully Covered

Not Covered

Tire, Window, Mirror Damage

Fully Covered

Not Covered

Roadside Assistance

Fully Covered

Not Covered

Know more About QEEQ Full Coverage

How to Save Money on Your Car Rental in Iceland?

Discover easy ways to cut costs when renting a car during your Iceland trip from the U.S. With fluctuating rental prices, it's crucial to book smartly and plan ahead for the best deals.

Booking Tips for lower Prices

Book in Advance
Secure your rental at least 4-6 weeks before your trip. Prices can rise closer to your travel date.
Save up to 35%
Shop Around for Rates
Utilize comparison platforms like DiscoverCars or QEEQ to find the best rates tailored to your needs.
Save $50-100 on average
Choose the Full-to-Full Fuel Policy
Avoid prepaid fuel options and refill the tank yourself at local stations for better prices.
Save $20-40 per rental
Consider Off-Peak Rental Periods
Traveling during Iceland's off-season (October to April) can often result in lower rental prices.
Save up to 40% during off-peak times

QEEQ's Money-Saving Features

Diamond Membership
Save up to 20% on every booking - free trial available below.
View Details
Price Drop Protector
If your booked car price drops, QEEQ automatically rebooks it at the lower rate and refunds the difference to you.
View Details
One-Dollar Freeze
Lock in today's price with just $1 upfront and pay the rest later.
View Details
Flexible Payments
Pay with credit/debit cards or even cryptocurrency via BitPay.
View Details

What Should You Pay Attention To?

Important considerations and potential issues to watch for when renting a car in Iceland.

Road Conditions
Iceland's roads can be challenging, especially in rural areas.
- Gravel roads require careful driving
- F-roads are for 4x4 vehicles only
- Check road closures during winter
- Watch out for single-lane bridges
- Be cautious of sudden weather changes
Fuel Options
Fuel stations may be scarce in remote areas.
- Always refuel when near a station
- Diesel and petrol types vary
- Consider a prepaid fuel option
- Keep track of fuel costs (high in Iceland)
- Return the car with the agreed fuel level
Weather Considerations
Weather conditions can change rapidly.
- Check forecasts regularly
- Carry essential supplies in winter
- Avoid driving during severe storms
- Be prepared for icy roads
- Request studded tires for winter rentals
Rental Costs
Understand the full cost of your rental.
- High demand in summer increases prices
- Insurance for gravel and windshield damage is recommended
- Check for additional driver fees
- GPS or Wi-Fi hotspot rentals are available
- Discounts may apply for longer rentals
Insurance Coverage
Iceland's unique conditions necessitate specific insurance.
- Consider sand and ash protection
- Gravel protection is highly recommended
- Understand the collision damage waiver (CDW)
- Check if personal auto insurance or credit cards cover rentals
- Be aware of exclusions in policies
Navigation and Equipment
Proper equipment ensures a smoother trip.
- GPS devices are helpful in rural areas
- Request Wi-Fi hotspots for connectivity
- Child seats are mandatory for young passengers
- Snow chains might be necessary in winter
- Understand local driving laws and signs

Remember

Being prepared and knowing what to expect can save you hundreds of dollars and prevent stressful situations. Take time to understand all terms and inspect your rental thoroughly.

What Are The Differences Between US and Icelandic Traffic Rules

US and Icelandic traffic rules differ primarily in road conditions, speed limits, signage units (miles vs. kilometers), and environmental considerations. Some rules, such as seatbelt laws and hands-free phone use, are similar.

Driving Conditions
IS
Roads may be icy or gravel, requiring careful driving
US
Generally well-paved roads, less frequent severe conditions
Speed Limits
IS
Maximum of 90 km/h on main roads
US
Varies by state, often higher (e.g., 120 km/h on highways)
Signage Units
IS
Speed and distance in kilometers
US
Speed and distance in miles
Environmental Considerations
IS
Off-road driving prohibited to protect nature
US
Less strict rules regarding off-road driving
Mobile Phone Use
IS
Hands-free only
US
Hands-free only in most states
Seatbelt Laws
IS
Mandatory for all occupants
US
Mandatory for all occupants in most states
Parking Rules
IS
Parking in urban areas often restricted, pay attention to signs
US
Parking rules vary by city; colored curbs have specific meanings
Remember
- • Always check road conditions before traveling, especially in winter.
- • F-roads require 4WD vehicles and may be closed seasonally.
- • Carry your driver’s license, rental agreement, and insurance documents at all times.
- • Respect environmental protection laws to avoid fines.

Voices of our customers

Frequently Asked Questions

Common questions for travelers from United States renting a car in Iceland

How far in advance should I book a rental car in Iceland?

It’s strongly recommended to book as early as possible, especially for summer (June–August). Ideally, reserve your car 3–6 months ahead to ensure better prices and availability, especially for automatic and 4x4 vehicles.

What is the best platform to book a rental car in Iceland?

QEEQ is highly recommended for American travelers. It consolidates offers from local and international companies, provides transparent pricing, a user-friendly interface, and Chinese customer support, making comparison and booking straightforward.

How do rental prices in Iceland vary by season?

Rental prices peak in summer (June–August). Spring (April–May) and autumn (September–October) have moderate (shoulder) rates, while winter (November–March) is cheapest, though you’ll need to prepare for challenging road conditions.

How many days should I rent a car for a Ring Road trip?

Plan at least 8–10 days to fully experience Iceland’s Ring Road. For a more relaxed pace or side trips (Westfjords, Snaefellsnes), 12–14 days is ideal. A south coast trip can be done in 3–5 days.

Do rental cars in Iceland include unlimited mileage?

Most rental packages in Iceland include unlimited mileage, which is essential for road trips. Always confirm this in the car details on QEEQ before booking.

Are there driving area restrictions with rental cars in Iceland?

Yes, mainly regarding F-roads. Unless you rent a 4x4 authorized for F-roads, driving a 2WD on these roads violates rental terms and voids insurance coverage.

Are there age restrictions for renting a car in Iceland?

Generally, you must be at least 20 for economy cars. For larger or 4x4 vehicles, companies may require you to be 23 or 25. Drivers under 25 typically pay a Young Driver Surcharge.

Do I need an International Driving Permit to rent a car in Iceland?

No. As long as your U.S. license is in Latin (English) letters and you’ve held it for at least one year, you’re eligible to drive in Iceland.

What documents are required when picking up the rental car?

Bring: 1) Original valid driver’s license for all drivers, 2) Main driver’s international credit card (Visa or Mastercard) for payment and deposit, 3) Your rental voucher.

Can I add additional drivers to my Iceland car rental?

Yes. All extra drivers must be present at pickup with their original license. An additional driver fee is usually charged per day or as a flat fee.

Can I rent a car in Iceland with a U.S. learner's permit?

No. You must have a full, non-temporary driver's license held for at least one year.

Should I rent an automatic or manual transmission car in Iceland?

If you only drive automatics in the U.S., rent an automatic in Iceland. Manuals are more common and cheaper, but automatics are limited and more expensive—book early on QEEQ. Don’t try learning a manual in Iceland.

Do I need a 4x4 for a summer Ring Road trip?

No, a standard 2WD car is sufficient for the paved Ring Road (Route 1) and main side roads in summer (June–August).

Do I need a 4x4 in winter (November–March)?

Strongly recommended. While not legally required, 4x4s with winter tires offer much better safety and traction on snowy and icy roads.

What are F-roads in Iceland? Do I need a special car for them?

F-roads are highland mountain roads, often unpaved with river crossings. Only 4x4 vehicles are legally allowed. These roads are open only in summer (late June–early September).

What type of car is suitable for 2 adults with 2 large suitcases?

Choose at least a compact SUV or mid-size sedan. Economy cars may not fit two large suitcases. Check luggage capacity on QEEQ before booking.

Is car camping allowed in Iceland? What vehicle should I rent?

Car camping is only allowed at designated campsites. Rent a campervan, which includes beds and basic cooking gear, for this purpose.

Is the included Collision Damage Waiver (CDW) insurance enough?

No. CDW usually comes with a high deductible ($2,000–$3,500). You’ll pay this out of pocket if damage occurs. Additional coverage is strongly advised.

What is Super Collision Damage Waiver (SCDW)? Should I buy it?

SCDW upgrades CDW, reducing your deductible to $300–$800. It’s highly recommended for peace of mind.

What is Gravel Protection (GP)? Is it necessary?

Very necessary! Many Icelandic roads are gravel, and flying stones can damage paint, headlights, or the windshield. CDW/SCDW won’t cover this; GP insures these damages.

What is Sand and Ash Protection (SAAP/SADW)?

This covers damage from volcanic ash and sand storms, especially in the south coast and highlands. Such damage can be extremely expensive to repair and isn’t covered by standard policies. Buy this if you’ll be in affected areas or in windy seasons.

Is Theft Protection (TP) important in Iceland?

Iceland has a very low crime rate, and car theft is rare. TP is usually bundled with CDW, but it’s not a top priority.

Can I use my U.S. credit card’s rental insurance in Iceland?

Be cautious. Many credit card policies exclude Iceland, 4x4s, SUVs, or campers, and don’t cover gravel or sand/ash damage. If you claim, you’ll pay first and then claim reimbursement, which is complicated. Some rental companies require you to buy their insurance anyway. Buying full coverage via QEEQ is usually simpler and safer.

What is 'zero deductible' or 'platinum' insurance?

This is the highest insurance package, usually bundling SCDW, GP, SAAP, and TP, reducing your deductible to zero (or near zero). It’s the most expensive but offers maximum peace of mind.

Should I pick up my car at Keflavik Airport or off-airport?

Airport counters are most convenient but pricier. Off-airport companies offer free shuttle buses (5–10 minutes) and often better rates. QEEQ clearly indicates pickup location.

What should I inspect when picking up my rental car?

Thoroughly photo/video all damage: paint chips, dents, windshield cracks, tire wear, interior condition. Confirm everything’s noted on the condition form and matches your contract.

What should I do when returning the rental car?

Again, take photos/videos as evidence of the car’s condition. Refuel to the same level (usually full). If returning during office hours, get a final receipt confirming no damage. If after hours, your photos are crucial.

Can I return the car early? Will I get a refund?

You can return early, but most companies will not refund unused days.

Can I pick up or return a rental car late at night or early morning?

Yes. Most airport rental companies offer 24-hour service. Provide your flight number when booking for late arrivals. Some off-airport locations may charge for out-of-hours service.

What are the most important traffic rules in Iceland?

1) Headlights must be on at all times. 2) Never park on the roadside except in designated areas. 3) Respect speed limits—fines are high. 4) No drinking and driving. 5) Seatbelts for all passengers. 6) No mobile phone use while driving.

How do I refuel in Iceland? Is it different from the U.S.?

Most stations are unmanned and require a chip card with a 4-digit PIN. Insert your card, enter the PIN, select the amount or 'fill up,' pick a pump, and refuel. If needed, pay inside at the convenience store or use prepaid fuel cards.

How do I distinguish between diesel and gasoline?

Diesel pumps are usually black and labeled 'Diesel.' Gasoline is green and labeled 'Bensín.' Always confirm the required fuel type with the rental agent and mark your key. Misfueling is expensive and not insured.

What is the condition of Icelandic roads? Is the Ring Road fully paved?

The Ring Road is mostly paved and in good condition, with a few short gravel stretches in the east. Off main routes, expect many gravel roads. Winter brings snow, ice, and 'black ice,' so drive cautiously.

What are single lane bridges? How do I use them?

Many bridges are single lane. The rule: whoever arrives first crosses first. If a car is already on the bridge, wait in the turnout area.

Will I encounter animals on Icelandic roads?

Yes, especially sheep. They can dart onto the road unexpectedly. Slow down near flocks—hitting a sheep is dangerous and you may have to compensate the owner.

How strong is the wind in Iceland? Any special precautions?

Winds can be extremely strong, especially on the south coast. They can damage car doors or even blow cars off the road. Always hold onto the door when opening, and drive slower in high winds.

What should I do in case of an emergency (flat tire, breakdown)?

Pull over safely and turn on hazard lights. Call the 24-hour emergency number on your rental contract for assistance.

Is Google Maps sufficient for navigation in Iceland?

Yes, Google Maps works well. Download offline maps in case of no signal. Also monitor the official road (road.is) and weather (vedur.is) websites for real-time updates.

Are there toll roads or tunnels in Iceland?

Almost all roads are free. The only exception is the Vaðlaheiðargöng tunnel near Akureyri in the north. Pay online within 24 hours at veggjald.is to avoid extra service fees.

How much is the security deposit? When is it refunded?

The deposit depends on your insurance. With zero-deductible packages, it may be minimal or waived; otherwise, it can be $2,000–$3,500. The amount is pre-authorized on your credit card and released a few days to weeks after return if there’s no damage.

Do I have to pay with a credit card? Are debit cards accepted?

A major credit card in the main driver’s name is required for the deposit hold. Some companies let you pay rental fees by debit card, but the hold must be on a credit card.

What extra fees might I encounter besides rental and insurance?

Possible extras: GPS rental (use your phone if possible), child seats, extra driver fees, young driver surcharge, out-of-hours pickup/return, one-way rental, refueling charges, traffic fines, and tunnel tolls.

Is fuel expensive in Iceland? How much does it cost?

Yes, much higher than in the U.S.—expect $2.5–$3 per liter (about $9.5–$11.5 per gallon). Factor this into your travel budget.

How can I avoid unexpected fees or fines?

Follow traffic rules, always refuel before return and keep receipts, pay tunnel tolls promptly, and photo-document the car at pickup and return.

What happens if I receive a traffic fine?

Fines (e.g., for speeding) are sent to the rental company, which deducts the amount plus an administrative fee from your credit card. Safe, legal driving is the best way to avoid extra costs.

Are prices shown on QEEQ final?

QEEQ displays all included and excluded items transparently. The price covers the car, taxes, and basic insurance. Extra insurance or equipment is paid at the counter if not pre-selected. Read terms carefully to avoid surprises.

Does Iceland accept U.S. dollars as payment?

No. The official currency is Icelandic Krona (ISK). However, Iceland is almost entirely cashless—credit cards are accepted nearly everywhere, including remote gas stations and public toilets.

Do I need to rent a child safety seat?

Yes, it’s mandatory. Children under 135 cm (about 53 inches) must use an appropriate car seat or booster. You can rent one from the company or bring your own.

Can my driving record affect my ability to rent a car in Iceland?

Rental companies typically don’t check U.S. driving records at booking or pickup, but if your license is revoked, suspended, or restricted, they can deny the rental.

What are the keys to a successful car rental in Iceland?

Book early on QEEQ, choose the right car for the season and planned routes, buy comprehensive insurance, thoroughly inspect and document the car, and drive safely respecting Iceland’s unique conditions.

Still have questions？

Contact QEEQ via online chat or hotline for specific advice. Contact Support

Car Rental in Iceland for US Travelers

Planning to explore Iceland by car? Renting a vehicle offers the freedom to experience its breathtaking landscapes at your own pace. For US travelers, understanding local driving laws and rental requirements is key to a hassle-free adventure.

Can US Citizens Drive in Iceland?

Ready to Rent?

Which Car Rental Companies Are Best?

Recommendations for Travelers from the U.S.

How to Choose the Right Car?

Quick Decision Guide

Compare with Confidence on QEEQ

What Are the Popular Destinations in Iceland?

What Insurance Do I Need?

Types of Insurance Coverage

QEEQ's Complete Protection Solutions

How to Save Money on Your Car Rental in Iceland?

Booking Tips for lower Prices

QEEQ's Money-Saving Features

What Should You Pay Attention To?

Remember

What Are The Differences Between US and Icelandic Traffic Rules

Remember

Frequently Asked Questions

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