Car Rental in Iceland: Our Tips and Our Review of Blue Car Rental

Prices vary enormously by season 😬: you won’t pay the same in summer as in October or March (low season). On average, expect €30 to €100 a day depending on the vehicle and insurance. To be transparent, we paid €620 for 13 days (Dacia Duster 4×4, full insurance) at Blue Car Rental in March 2023. Since 2026, add the per-kilometer tax.

Since January 1, 2026, all vehicles pay a tax of 6.95 ISK per kilometer, which replaces fuel taxes. The rental company collects it, per kilometer or as a flat fee: at Blue Car Rental, it’s 1,550 ISK per rental day in 2026 (about €10), then 1,770 ISK per day in 2027.

Roads in Iceland are generally in good condition, especially Route 1, which you’ll take to go around the island.✔️. Some roads in Iceland, especially the F-roads, are mountain roads that often have gravel and huge potholes ☹️. Otherwise, the roads, especially in winter, are generally well maintained, letting you explore Iceland with peace of mind. Before setting off, it’s strongly recommended to check the weather conditions. Depending on the alert level, you could put your life in danger, and your vehicle could be damaged 💥. So be careful and well informed before venturing onto Icelandic roads.

There are no toll highways in Iceland, except the Vaðlaheiði tunnel near Akureyri: 2,216 ISK one way for a car (2026 rate). There’s no barrier: your plate is photographed and you have to pay on tunnel.is or the Veggjald app, within 24 hours of driving through. If Route 84 is open, you can avoid the tunnel, as we did.

We all have a smartphone 📱 with GPS. There’s no point renting a GPS from your car rental company anymore. GPS has become a must to save time, find your way and check your speed (speed cameras). The GPS I recommend 1,000% is Google Maps or Waze (same group). The advantage of Google Maps is that you can download your maps for offline use and don’t need internet to get where you want to go, it’s very handy!

As in any country, you need to provide certain documents to pick up your vehicle 🚗. Of course, your driver’s license and your ID, as physical originals (photocopies not accepted). You don’t have to have an International Driving Permit, though it’s always a plus 🙂. A credit or debit card (make sure your agency accepts debit cards) in the name of the person who made the booking.

You must be at least 20 to rent a standard car or a mid-size 4×4 at Blue Car Rental, and 23 for large SUVs and premium models. Depending on the agency, a young driver surcharge may apply.

Yes, but not everywhere: many rental companies require a credit card. Blue Car Rental accepts 16-digit debit cards. We only had a debit card, and everything went very smoothly, with no deposit held.

It’s not mandatory on Route 1, but we strongly recommend it. We had a Dacia Duster 4×4 with studded tires in March: more room, better grip on snow and ice, and a vehicle that handles gravel tracks well. For F-roads (summer only), a 4×4 is mandatory.

As I often say, you need to be careful and alert. Normally, there’s no need to drive at night, except in the dead of winter when the sun is scarce, or to watch the northern lights. Honestly, night driving goes very well in Iceland too.

The rules of the road in Iceland are very similar to the ones we know in France 🇫🇷 (and drive on the right, as in the US). Driving in Iceland is fairly easy when the weather is good, as there are often long straight stretches. Icelanders drive respectfully, especially in town and toward pedestrians, which is different from what we’re used to in France. If you visit Iceland in summer, driving in this beautiful country will be a breeze. In winter, it’s still doable, but you’ll need to be mindful of the unpredictable weather, which can create tough driving conditions, especially with heavy snow and strong, violent wind 😅.

The easiest option is to rent at Keflavík airport and head straight to your first stop. The Blue Car Rental office is a 3- or 4-minute walk from the terminal. Be sure to select Keflavík on the rental site, not Reykjavik, which is about 45 minutes away by car.

It’s the company we used for our whole road trip: main insurance included, no deposit, debit cards accepted, unlimited mileage and an office right next to the airport. We had no problems in 13 days, and the return took just a few minutes.

No. We returned our car really dirty after 13 days of snow and salted roads, and the agency didn’t say a thing. Just remember to bring it back with the same fuel level as when you left.

You can return your vehicle before the date on your contract, but you won’t get a refund for the time you didn’t use.

First, it happens very rarely, and these are emergency situations you need to know how to handle and prepare for 😎. First, never move the vehicle, take photos and wait for the insurers to arrive. You’ll need to inform your rental company to report the accident. That’s why it’s wise to write down the numbers to call in case of an accident.

Not at all 😉! It may be one of the few countries where I can leave my things in my car with complete peace of mind, knowing I’ll find them untouched. We had a completely different experience in the past in Mexico, where it was crucial to keep a close eye on our bags because of the high risk of theft. In Iceland, that’s not the case at all, and it will really feel different 👌! It’s a very safe country where you don’t have much to fear, and it’s a good place to live, which makes a welcome change from France and the many crime stories you read in the papers.