Insurance 4 Car Hire Iceland

Driving in Iceland

Learn all you need to hit the road safely with our no-nonsense guide to driving in Iceland.

Driving in Iceland is one of the most rewarding ways to see this unique country. By following Route 1, the country’s principal intercity road, you can visit most of the major tourist attractions while also seeing the country’s awesome fjords, volcanoes and glaciers along the way.

The country is vast yet sparsely populated, and the driving conditions are very different to the UK. Before you get behind the wheel in Iceland, it’s worth knowing what you can expect from driving in the ‘land of ice and fire.’

Roads in Iceland

Outside the main cities, most of the roads in Iceland are a mix of tarmac and gravel, with smaller rural tracks. There are no multi-lane motorways in Iceland – you’ll find little more than two-lane roads, or single-lane tracks once you get off the main arteries.

Iceland only has a population of around 330,000, so you’ll often be the only car for miles around. However, watch out for other vehicles, especially at night or in wintery conditions.

Primary roads (S roads)

Iceland’s primary roads connect villages with over 100 inhabitants, and are the link between the country’s suburbs and metropolitan areas.

Primary highland roads (S roads)

These are another kind of primary road, but one that crosses Iceland’s highlands. They are usually rocky and narrow, and many are not paved. Due to severe weather, primary highland roads are generally not accessible in winter.

Secondary roads (T roads)

These roads are normally found outside urban areas. They tend to connect primary roads or highland roads to one another, and they also connect to smaller villages (with under 100 inhabitants), plus some tourist destinations.

Local access roads (H roads)

These connect primary roads to farms, schools, churches and areas with summer houses.

Highland roads (L roads)

This is another kind of road which crosses the highlands and moors. They’re usually narrow gravel tracks, and many cross rivers which are not bridged.

Another kind of highland road, F roads are often found in remote areas. They are closed in winter, and even in summer you are only allowed to drive on them in a 4×4.

Off-road driving is illegal

Off-road driving is totally prohibited in Iceland, due to the country’s limited soil and flora, which means any damage caused by tyres could be long-lasting.

How to drive in Iceland

When driving in Iceland, you’ll almost certainly want to hire a 4×4, as this will allow you to navigate some of the rougher roads. You should watch out for customs and idiosyncrasies such as:

  • Being polite at single-lane bridges: there’s no set etiquette if you reach the entrance of a bridge at the same time someone arrives at the other end. Generally, just follow your instinct.
  • Poor road conditions: roads may turn to gravel with little obvious warning, so keep your eyes peeled.
  • Mountain bends: many roads take sharp bends without any warning.
  • Some roads are raised, so don’t stray too far off to the side.

Iceland driving rules

Iceland’s driving rules aren’t too dissimilar from the UK’s. The alcohol limit is lower, however: it is illegal to drive with a blood alcohol concentration of 0.05% or above. Also, you are not allowed to drive while talking on a mobile phone.

What side of the road does Iceland drive on?

Iceland drives on the right-hand side of the road. Your car hire will be set up for right-hand driving, with the steering wheel on the left side of the car.

Who has the right of way?

By and large, Iceland’s roads favour pedestrians and animals over motor vehicles. Drive slowly in cities, and in rural areas you’ll just have to wait if sheep or other animals are crossing the road.

At roundabouts, those already in the roundabout have the right of way, and at four-way intersections, the right of way goes to the driver on the right.

At bridges and tunnels which are single lane, the person who arrived first has right of way, although there’s no rule if you arrive at the same time – just be polite and use your judgement.

What is the speed limit in Iceland?

Iceland’s speed limits are measured in kilometres per hour. The top speed is 50 km/h in urban areas, 80 km/h on gravel roads and 90 km/h on tarmac. That said, these top speeds are for optimal conditions – when it’s rainy, snowy or dark, you should drive with caution.

Driving in adverse conditions

Iceland’s weather can change fast, so in winter, it’s wise to use studded winter tyres – and pack an ice scraper if you’re staying overnight. Visit the Icelandic road information website for more information.

Always drive with your headlights on

Whatever the time of day, you must always drive with your headlights on. The weather changes fast in Iceland, and fog can make roads dangerous in the middle of the day.

Driving hazards in Iceland

Outside the cities, especially, Iceland has very different driving conditions to the UK. The weather is far more unpredictable, and the highlands become treacherous in poor weather.

In winter, the biggest hazard is snow and ice on the road. It’s sensible to bring studded tyre tracks, and watch out for black ice. Use your judgement and drive carefully in poor conditions.

In summer, you may well want to drive in the highlands, where many roads cross rivers without bridges. You shouldn’t speed through rivers, but shift into first or second gear, and drive confidently.

Monitor the weather at the Icelandic Met office, and register your plans with Iceland’s Safe Travel website whenever you go on a trip, so the emergency services can find you should anything go wrong.

For any emergencies call 112. For other problems, get in touch with your car hire firm.

Iceland driving tips

Many tourists follow Route 1, which is effectively a ring road around the country, but Iceland isn’t as small as you might think. Plan your route in advance and give yourself enough time to enjoy the journey.

Iceland has wonderful natural scenery, and it’s always tempting to stop driving to take photos. This is fine, but be certain there’s no traffic coming either way before you get out, or go to a designated area for photo-ops.

More information

For additional tips on driving in Iceland, the following websites can provide additional information.

Don’t forget your car hire insurance

Make sure you’re insured for the kind of trip you want to take in Iceland. Costs for recovery in remote parts of the country can be high, so ensure that you have breakdown cover. Taking out a car hire insurance policy for your holiday in Iceland is a sensible precaution.

Thrifty Car Rental Iceland | General Information

Quality car rental fleet
Thrifty Car Rental Iceland is a leading car rental company in Iceland which offers large fleet of wide range of rental cars at best possible rates. Thrifty quality fleet includes 4×4, jeeps, 4WD, SUV, minibuses, small and medium sized cars from Ford, Mazda, Citroën, Peugeot and Volvo. You can choose between either manual or automatic transmission. Search now online on the left side of this webpage to find your perfect car.

Convenient pick up locations
For your convenience you can pick up your rental vehicle from 5 convenient pick up locations including Keflavik International Airport, Reykjavík City, Reykjavík airport, Akureyri Down town and Akureyri airport. We also offer you a free shuttle bus service from airports and hotels in Reykjavík, Akureyri and Keflavík for cruise ship visitors to Reykjavík harbor and Akureyri harbor.

All inclusive rates. No hidden rental charges.
Thrifty Iceland rental rates are all inclusive and there are no hidden charges. Unlimited milage, CDW insurance with self-risk, vehicle theft protection and taxes are included.

Iceland car rental payment
We display our rates on the website in the currency euro with all taxes including VAT. The only way of payment is by credit card which will be charged upon delivery of the rental car. We do not accept prepaid credit cards. We highly recommend that you read thoroughly our Terms and Conditions before completing the rental agreement.

Free pick up service from airports, hotels and cruise ships
For your convenience we offer you a free pick up service during opening hours in Reykjavik, Akureyri and Keflavik. You can schedule your pickup by phone or email. Please inform us of your reference number, pick up location and preferred pick up time. We also offer free shuttle bus service for cruise ship visitors to Reykjavík harbor and Akureyri harbor. Please include the name of your ship and when the ship will dock. Further information regarding our FREE shuttle bus you can see here.

Car rental drop off
We offer free shuttle bus service for returning customers back to their accommodation in both Reykjavík, Keflavík and Akureyri. If you prefer to drop off the car at your hotel there is a minimum fee which is displayed when you search for your car online at the left side of this page.

Opening hours
Our opening hours are very convenient for travelers to Iceland and include out of hours customer service, unique late arrival airport service at Reykjavík and Akureyri airport and a 24 hour opening in Keflavík International airport.

All about Thrifty Iceland car rental insurance
We ofer additional insurance coverage to our inclusive CDW insurance in our effort to make your travel in Iceland more safe as Icelandic roads and unique nature can cause accideents and costly damages to the rental car.
Several options are available. For more detailed information regarding insurances please read all about Thrifty Iceland Car rental insurance. The cost of additional insurance is low and offers good protection. Insurance rates are displayed during the search process for the rental car at the left side of this page.

Highly recommended: We suggest that you carefully read and watch videos of driving tips at our Driving in Iceland page before you arrive.

Extras available
To make your travel in Iceland as safe and pleasant as possible we offer additional extras like GPS navigation system, In Car WiFi with unlimited data, extra driver coverage, a baby booster and a baby seat at a very affordable rate per day. If you plan a long travel in Iceland we never charge more than 10 days for extras to make your car rental as affordable as possible. Rates for extras are displayed during search process for the rental car at the left side of this page.

Road side assistance and emergency service
We sincerely hope you have a pleasant travel experience in Iceland but if you encounter a problem with your rental car during your travel in Iceland we offer an emergency service for our customers and best possible road side assistance. Just call 24/7 our emergency phone number: +354 5157110 and we can arrange assistance from one of our many service providers around Iceland. Cost of assistance depends on your location, severity of the problem and other factors. Assistance cost is estimated during the call. In case of serious emergency please call Iceland national emergency number 112.
Please keep in mind that Iceland is sparsely populated and service outlets might be far apart. Service might also be limited outside regular opening hours/public holidays. Despite that we do our very best to assist you in the fastest and best way possible.

Check the frequently asked questions (FAQ) or contact us
If you are a first time traveler to Iceland you are most likely visiting our country to experience our uniqe nature and have therefore many new things to learn. To make your travel preparation more easy we have collected together frequently asked questions (FAQ) from our thousands of customers and you can find the questions and answers at our Iceland car rental FAQ page.

If you can not find the answer to your question at this page or at our FAQ Iceland car rental page please do not hesitate to contact us by e-mail at at or by phone at + 354 515 7110

Who we are
Thrifty independent licensee in Iceland is Brimborg (Reg. No. 701277-0239). Brimborg is a leading company in the automotive business in Iceland for almost 50 years.

How to insure your rental car in Iceland

The land of fire and ice is an incredible country to discover by car. But its unique geography and weather mean special insurance. Discover how to insure your hire car in Iceland.

Basic hire car protection

When you hire any car in Europe, you get three types of cover included in your rental price:

These three don’t protect against the unique damage risks in Iceland, so you can choose to buy additional types of insurance on top.

Insurance options in Iceland

Iceland has unique weather and driving conditions. Cars can get damaged in ways that normal rental insurance doesn’t cover. The south shore of the island is particularly prone to severe winds that can whip up damaging gravel, ash and sand.

When you pick up your car in Iceland, the counter staff will offer you optional Sand and Ash Damage Insurance and Gravel Damage Insurance.

Sand and Ash Damage Insurance

As you’d expect, this covers you against damage caused by sand and volcanic ash, which are common if you’re driving on Iceland’s south coast.

This insurance usually costs around 7€ to 25€ per day, or £6 to £22.

Gravel Damage Insurance

This covers you against damage to the car’s body and windscreen from stones and gravel.

It normally costs between 9€ and 20€ per day, or between £8 and £17, depending on which company you rent with.

With some companies, this kind of insurance only covers damage caused when gravel is thrown up by another vehicle’s wheels. To find out more, check your terms and conditions.

How to buy sand, ash or gravel insurance

You can buy insurance for sand, ash and gravel damage when you book the car, through a separate insurance provider online or at the rental counter when you pick up your hire car.

If you buy the insurance at the counter, you are likely to pay in the local currency, Icelandic Krona (ISK). To make things easier for international customers, some rental companies charge in Euros.

What to do if your car gets damaged in Iceland

As soon as you spot any damage, get in touch with the rental company. They’ll let you know what you need to do. They can also arrange roadside assistance or a replacement car.

If you’ve bought the relevant insurance from the car hire company, you probably won’t have to pay anything. If you’ve bought insurance from a third party, you’ll pay the rental company for the repairs or replacement car first. You can then claim this money back from your insurer.

Compare prices for sand, ash and gravel damage insurance

Here’s a summary of some car rental companies in Iceland and how much they usually charge for these additional insurance products. These prices are only approximate. Check with your rental company for accurate prices and the specifics of the cover.

Here’s a summary of some car rental companies in Iceland and how much they usually charge for these additional insurance products. These prices are only approximate. Check with your rental company for accurate prices and the specifics of the cover.

8 Things You Should Know Before Renting A Car In Iceland (2018 Update)

UPDATE: August 2018

Going to Iceland? Great choice! I have some advice about driving around the island, and what challenges await you. Especially if you are taking my 14 days road trip around Iceland, the hints here will be very useful!

The country has no trains. Buses are almost non-existent. Hitchhiking (although possible) can be frustrating, as there are not that many empty cars passing by. There is no better way to explore this over 100 000 square km (40 000 square miles) island than by car!

I loved traveling this way in Iceland in particular because it gives you the freedom to choose your own route and the flexibility of doing things at the pace that is convenient to you. Not to mention that Icelandic roads take you to some out-of-this-world landscapes!

I have put together a guide on how to rent a car, which type of car you should choose depending on your trip and activates.

I recommend checking out these 2 aggregators – AutoEurope and RentalCars – just go for the best available price on one of them! At the moment they are the best deal finders for rental car companies in Iceland. This is why I can vouch for both of them:

  • It compares rates for car rental companies in Iceland – both International chains and reputable local companies.
  • They also offer low rate guarantee!
  • No need to use your credit card to book
  • They have 24/7 support and great reviews

Everybody told me before the trip: “Driving in Iceland has nothing to do with driving wherever you are from” and I can only repeat it to you now.

But don’t worry, there is nothing to be scared of, it’s just a bit different. Keep reading and you will be fine!

1. Think ahead when renting a car in Iceland!

Each year more and more tourists come to the country of ice. Even though there are many car rental companies in Iceland (mostly in Reykjavik), the most efficient cost/performance options will be sold out quickly.

You want to be among the ones who got the best deal, right?

If you know for sure you are going, book even 6 months in advance, especially if it is high season!

Remember, if you rent with AutoEurope or RentalCars you can always cancel with no charges, but booking last minute will not get you a good deal.

The longer in advance, the cheaper your car hire will be, there is no such thing as a last minute deal in Iceland. Does not matter how far in advance you are planning, you can already check the rates for your dates now.

Then do your homework and choose the convenient type of car for you (see my Bonus 2 below) and the car hire company, and please do it in advance. This way you will have many options to choose from.

PRO TIP #1: Do you want to further reduce the costs? Invite your friends with you in the trip! You will benefit twice by sharing this amazing journey with people you love, and reduce the cost per person of transportation!

PRO TIP #2: You’ll need some items for this trip and it’s a lot better if you can buy them from home. Iceland is very expensive compared to any country I’ve been to, so I think getting some items at home might save you a lot of money you can later use for your fuel!

  • A good waterproof and winbreaker jacket – a must have in Iceland, I’ve been there in August and although it was the summer, it was cold, raining and windy almost everyday.
  • Hiking boots – you’ll need a good comfortable pair, and the prices for these in Reykjavik were plain scary.
  • A thermos – sometimes you’ll go for hours without finding a place to take a coffee or tea, and I love tea! This was one of my most used items.
  • A GPS device – it will be at least 10-15USD per day if you rent one, this way you can bring your own and use it back home as well!

Don’t leave home without these essentials for your Iceland holiday:

PRO TIP #3: Most car rental companies are located directly in Keflavik Airport (which is the name of the Reykjavik International Airport). Please check if your preferred car hire company offers a free airport pickup. This makes sense because getting from Keflavik airport to Reykjavik costs 10-11 EUR per person. So you will actually save a lot by getting the car as soon as you land!

2. Get that extra insurance!

So, you chose your best car rental and you are going to go exploring?

Great! Now, don’t argue and get the gravel road insurance (consider ash and ice insurance if you are going in the winter or in an areas with much volcanic ash).

Gravel roads are roads good enough to drive on, and usually lead to a spectacular natural wonder, but they are full of little rocks. It only takes one little rock thrown on the body of your car, or worse, on your windshield to open a crack that will make you good to pay for a new windshield /paint job. Same goes for the ash and ice in high winds. Those act exactly like rocks on impact with your car.

Most car rental companies give you the option to take insurances in their online form.

Follow these simple tips for safe driving on gravel roads:

  • just keep your speed low enough not to throw rocks into the sides of your own car;
  • when driving in a column, keep a distance from the car in front large enough so that the rocks throw with their rear tires don’t reach your hood or windshield.

You can also opt for theft insurance, but to be honest, Iceland is a very safe country, and most of the cars have GPS trackers. Not to mention we are talking about an island. Thefts are rare, if any. It’s up to you if you want to get the theft insurance, I just laid out the facts for you.

3. Watch out for sheep, horses and birds

Did you think it was that easy?! Like in a Super Mario game, you will encounter all kind of fauna that wants to delay you!

Iceland has many sheep roaming free in the warm season. In fact, once you get out of the Golden Circle, you will probably meet more sheep than people! They are free to graze wherever they please, and that means they will cross the roads sometimes (many times!).

Whenever you see sheep nearby, I strongly suggest to slow down and pay extra attention. An angry ram can damage your car, or, as stories goes, people have flipped cars with their wheels up trying to avoid sheep.

Same goes for horses, who are sometimes moved around pastures on the roads, and even birds which fly low.

Watch out in the evening, we were once surprised by 2 owls that flew over the road at low altitude at sundown. Luckily we had enough time to slow down and let them pass. They got to go back to their nest and we got to give the car back without a scratch. 🙂

4. Avoid speed traps

Iceland has a number of fixed speed traps and police cars which patrol the ring-road are equipped with mobile detectors.

And now I will share with you the ultimate way of avoiding fixed and mobile cameras. Are you ready?

The best ways to avoid getting a speed fine is staying within the speed limit (which is 90 km/h outside localities). Hah, bet you did not see that one coming!

This is the sign you should be looking out of. It can also be black and white.

Even if you will get a fine, you will not know right away, but your rental company will charge your credit card with an unpleasant surprise a few weeks after your trip. We do not want that to happen, right?

The fines are large, so you should really consider this point.

The fixed cameras are always signaled a few hundreds of meters before you will encounter them. There is a specific sign letting you know there will be a detector well in advance, so keep your eyes open!

5. Think ahead about fueling up

Depending which road you are taking, especially if going through the mountains, check ahead where the next gas station is. Don’t leave it to chance. I remember quite well a 250 km portion, even on the Ring Road, where we encountered no gas stations.

My car’s GPS had an option to show me where the closest gas station is, it was really convenient! Keep an eye on the fuel meter, even if it will be a funny story for your friends, it won’t be funny if you can’t move your car in the middle of nowhere on a deserted road.

6. Check if you have mileage limits

Verrry important!

Remember that some car rentals impose mileage limits. This might be really inconvenient if you cover a lot of ground each day, and it can bring your rental cost up. Remember to ask and check ahead if you have chosen such a company to rent.

Pro Tip: Many car rentals offer two type of rentals: limited milage or unlimited milage. Usually the difference in rate between the two is small and it represents the difference you would pay if you would make an extra 10km. I would say go for unlimited, unless the limit is somewhere at 250 – 300km per day or if you know exactly how many km (miles) you are going to drive.

7. Don’t stop in the middle of the road to take pictures

I know, we are all guilty there! 😉

The island-country is full of beautiful spots who just beg you to stop and take a picture. And we are all tempted by this, I also wanted to stop and take a picture literally every 100 meters.

When you do, please stop in a place where you do not bother traffic. There are plenty of side roads or parking lots. I have seen many tourists stopping more or less in the middle of the road and casually opening their doors to take pictures. It is quite dangerous, especially as sometimes the roads are narrow.

8. Be prepared for rapid weather changes

Let’s face it – Iceland has its specific weather. It can be sunny one minute, and heavily raining the next, making everything slippery. Not to mention that you can drive in clear weather and just wake up in a thick layer of fog after a few curves!

Keep in mind that the safest ways to tackle the weather conditions in Iceland is to match your speed to the current weather. Sometimes, maybe you will even have to stop for a few minutes, until the visibility comes back or the wind powers down.

So, when is it better to go to Iceland?

I went in August and I found it to be the best time to visit – you can enjoy a never ending day, the weather is mild and all the roads (and the attractions are open).

True, it is the most touristic season too, but it is touristy for a reason (plus, Iceland is not Paris, you can drive for hours and not meet another car).

If you want to avoid higher prices and accommodation, I would suggest going right after the season is over, say, mid-late September, it should be still fine.

BONUS 1 – Choosing the car in Iceland

What is the best, what is the most budget option? Which type of car to choose? There are so many!

The first question you should ask yourself is “Which type of activities am I likely to do in Iceland?

If you only plan one thing about your Iceland trip, then plan the car!

As I experienced, there are 3 types of journeys and 3 types of cars suited for them.

1. You are an off-road warrior. An adventurer

TYPE OF ACTIVITY: Do you like going on hard roads and climbing steep mountain slopes, hike and use your tent to sleep overnight?
Do you want to have the ultimate Iceland experience by going through the the middle of the country, and set camp in the mountains instead of sleeping in hotels?

RECOMMENDED CAR: you have a choice and one choice only: you need a car that can reach the Icelandic F-roads (a type of road I will describe later).
Your choice should be a 4×4 (an all-wheel drive). It is not allowed to bring any other type of car on these F-roads, and for good reason. Of course, the bigger the car, the more interesting and fun it will be, but it depends also on your budget.

PRICE PER DAY: 65 -130 euros per day for the cheaper models, or up to 150 -250 per day for the high end options, depending on the season.

As I mentioned above, there are 2 sites where you can compare all the deals and choose the best prices according to your needs and dates

The closer you get to the peak season (July – August), the more expensive cars can get!

2. You looking for a comfortable trip, along Iceland’s Ring Road

TYPE OF ACTIVITY: Are you going to take alternatives routes, or gravel roads to see fjords, waterfalls or other natural wonders only occasionally?

RECOMMENDED CAR: a 2WD would suffice. You can choose any of them depending on your budget and the comfort level you are looking for. That was the one that I took.

PRICE PER DAY: 50 to 100 euros, again, depending on the model and the season.

3. You are in a quick trip just around Reykjavik

TYPE OF ACTIVITY: You don’t have much time and will not wander more than the Golden Circle? Are you searching for the cheapest car rental in Iceland?

RECOMMENDED CAR: You are almost sure going to be fine with the cheapest tiniest car. Unless of course you need more comfort (and maybe more room for your luggage)

PRICE PER DAY: expect to pay anywhere between 35 to 75 euros depending on the model and the season.

BONUS 2 – Iceland Car Rental in winter time

Ok, even if I did not personally visited Iceland in the cold season (yet!), I have asked around about the best practices of driving in Iceland in the winter. The scenarios will be very different than in the summer, and it’s very likely you will see Aurora Borealis.

You just need to be smart and careful, here is what you need to know:

Go for a 4×4 car. Remember that the weather can change and you are far up north, so the possibility of heavy snow fall is big.

Always check the website. It provides the best report on the road conditions of your route.

If you are presented with the option, get studded tires. That will help a lot on the icy roads.

Speaking of icy roads, don’t go fast. You are in a new country, you don’t know the roads and where ice could be, keep it safe.

Fuel up all the time. Better safe than sorry!

Daylight is limited. Make the most of it by driving in the hours with light.

Watch out for animals in the dark

Make a stash of snacks, water and even blankets. Iceland is a very developed country, but even there, in case you are stuck, it can take some time until someone reach you.

Please don’t sacrifice your safety for financial reasons. There are some great rates for 4×4 cars that you can easily compare for all car rental companies in Iceland in one click here.

By following the safety guidelines you are in for a great experience, it will feel like the time stopped, along with the frozen waterfalls! I can’t wait to get back myself in the cold season, so I can see the Aurora Borealis!!

Essential packing list for visiting Iceland in the winter time!

If you are going to travel in the winter, there are a few items that you need to take with you. And since in Iceland these will be quite expensive (an Icelandic wool sweater will rarely go under 200$), I suggest to get them from home. Remember that it’s going to be very (very!) cold and windy, so you’ll need to dress in layers and be able to attain heat comfort at all times. Here you go, your packing list for winter time in Iceland:

  • A proper warm jacket. It has to be waterproof, windproof, well isolated, and it has to look good too 🙂
  • Fleece
  • Body thermal
  • Snow boots – they have to be comfortable, let your feet breath and also practical both on snow and on dry surfaces
  • Proper winter socks – you don’t want to get sweaty and then cold in the winter
  • Thermal Leggings
  • Hiking pants – also need to be waterproof and windproof

Remember to pack these items before your trip:

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