April 2, 2025
Should You Hire A Car In Iceland?
So you’re researching your trip to Iceland and you’re not sure whether it’s worth traveling by rental car. Let’s help you answer that question.
A trip to Iceland is a bucket list vacation for many travelers who have their sights set on adventure. From breathtaking glaciers and mystical ice caves to otherworldly lava fields and the magical Northern Lights, there’s simply no end of ways to fill your time. But with so much to see and do across the island, you may be wondering how to create the perfect itinerary and crucially, how you will get around.
Renting a car in Iceland might bring one thing to mind: expense. But it’s worth considering the alternative to an Iceland road trip - public transport, guided group tours, busy attractions, the list goes on! Here we will uncover the pros and cons of getting behind the wheel in Iceland.
But Is it Worth Renting a Car in Iceland?
Before thinking about whether or not it is worth renting a car in Iceland, there are a few things to consider:
- Is there a confident driver in your group that will be happy to drive? Driving in Iceland can be challenging due to the unpredictable weather conditions, however, it is possible to stick to roads more traveled which are typically easier to handle.
- Who are you traveling with? If you are heading to Iceland with young children, it’s worth considering the benefits of being able to travel where and when you want.
- What sights do you want to see? Whilst there are tours and trips available to popular tourist destinations, you may struggle to find suitable alternative transport options if you’re planning on heading off the beaten track.
- How long is your vacation? If you’re limited to a few days, you’ll want to create a personalized action-packed itinerary.

So... Should You Rent a Car in Iceland?
Now you’ve had the chance to think about whether hiring a car is suitable for your group, here are all the details you’ll need to make a final decision!
Benefits of Renting a Car in Iceland
Car rental can seem like the simplest option, these are just a few reasons why:
1. Create A Personalized Itinerary
This is one of the biggest advantages of having your own set of wheels in Iceland - complete freedom to explore. Having access to a car to get around Iceland gives you the complete freedom to plan your itinerary and activities exactly as you wish. Want to head to the Blue Lagoon? No problem, you can stop off anywhere you like on the way back, too!
When you hire a car, you are not limited to those attractions that large companies have planned group tours to. You are free to research those off-the-beaten-track locations and head there instead! For those more adventurous and keen to experience something unique, a rental car might just be the perfect choice!
The flexibility of a rental car lends itself to shorter trips in Iceland too. Even if you are on a layover, there are lots of incredible things to do near Keflavík airport. Having a rental car means you can take advantage of those hours.
2. Travel in Comfort
A vacation in Iceland is often packed full of hiking and exploring, which can be tiring for everyone involved. Figuring out public transport with your backpacks and any other luggage in tow, after a day in the wilderness, is the last thing you need. And sharing a minivan with other travelers, who also all have large day packs, isn’t appealing to everyone!
With your rental car by your side, you can hop in and relax for as long as you need after a day out walking or sightseeing. Plus, on your own time, there is no rush to get back to a shared transport vehicle - you can spend as long as you want at each destination, and even stop whenever you want for snacks or to stretch your legs!
3. Unlimited Space
Unlike group tours or public transport, a hire car provides you with a space that is your own. Families with young children often have lots of things to carry with them: toys, a baby carrier, unlimited snacks, and more which means you’ll likely be at capacity with luggage.
Plus, the changeable weather in Iceland means that layering is an absolute must for staying comfortable throughout your trip. Raining one minute, sunny the next, you’ll want to pack for every eventuality. Bulky boots, coats, and scarves take up room in your backpack, valuable space that can be freed up by utilizing your car trunk! With space in the trunk, as well as your back seats, you won’t need to worry about overpacking. Plus, there is no need to unpack everything at the end of every day, because your vehicle is your own and everything will be there waiting for you in the morning to start a new adventure.

4. The Driving Experience
For some people, driving is part of the adventure! After all, it’s not about the destination, it’s often about the journey itself. And there’s nothing greater than hitting the open road in Iceland. Road trips are popular and there is a range to discover from Iceland’s capital.
One of the most popular road trips is the Ring Road, taking travelers around the country in its entirety at their own pace. The road is well maintained, traffic is typically light, and the views speak for themselves. The Golden Circle is great for those who don’t have long to spend in Iceland, incorporating 3 of the most popular attractions in South Iceland.
Want a more challenging drive? Heading up into the Highlands is only possible in the summer when the F-Roads are open, and you will be rewarded with rugged terrain, winding roads, river crossings, and remote attractions with fewer tourists.
Drawbacks to Renting a Car in Iceland
Of course, there are also some considerations when it comes to car rentals in Iceland:
1. The Cost
One of the main concerns that you might have about car rental here is the price. Iceland is known for being an expensive place, and the idea of hiring a car for days on end might make you clutch your wallet. But in actual fact, compared to other means of travel, it’s likely that car rental will save you in the long run.
Here are a few tips when considering budgets and car rental in Iceland:
- Insurance: Though it may seem like an extra upfront cost, it’s always recommended to get insurance on your hire car while in Iceland to save you should the unexpected happen.
- Check Reviews: Selecting a reputable local rental car company is the best way to go, so make sure you don’t necessarily go with the smallest upfront cost as this might cost you in the long term.
- Compare Dates & Models: There is also merit in swapping models and dates around to make sure you’re getting the best price for your trip.

2. Hidden Costs
An additional worry for many people when renting a car in Iceland is that there will be hidden costs upon returning the car or following a traffic incident. You have no doubt heard horror stories about rental companies charging for damage that the lessee was not responsible for. This is easily avoided by opting for a reputable car company with positive reviews - and of course by driving carefully.
In the event of an accident or damage due to weather conditions, there may be additional costs. To overcome this you should look to purchase additional insurance that will provide additional protection against events such as theft and gravel damage, and reduce your excess should the worst happen.
Find out more about what car insurance is right for you in our blog.
3. Weather Conditions
The weather in Iceland can be unpredictable and harsh. Windy conditions, snow, and ice can all make driving more of a challenge and can disrupt your plans. It’s worth noting, however, that this is always a risk when visiting Iceland, particularly in winter, and public transport can be affected by adverse conditions too. Hiring a car even gives you the flexibility to change your plans should the weather disrupt Plan A.
To minimize the disruption felt by poor weather when driving in Iceland, you should:
- Keep an eye on driving conditions via Road.is and follow weather forecasts via the Icelandic Met Office.
- Acquire adequate insurance to protect against sand and gravel damage while on the road.
- Always obey local driving laws and drive with care in poor visibility conditions.
4. Safety on The Road
General safety when driving around Iceland might also be a concern for those who have not before. It’s perfectly normal to feel nervous about getting behind the wheel, particularly when it’s on the other side of the car than you are used to. Some tips for ultimate peace of mind on the road include:
- Take care at all times (this may seem obvious, but is most important).
- Choose the most experienced driver as the lead driver on your car rental.
- Stick to speed limits at all times - speeding tickets are particularly harsh and the limits are there to keep all drivers safe.
- Take extra care when driving past animals as accidents involving sheep or other grazing animals will be your responsibility.
- Utilize headlights at all times, even during the day.
- Do not drive off-roadif you do not have a 4x4, including on F-Roads.
Get road trip ready with GO Iceland. Our blog is full of tips on driving in Iceland and the best type of rental car for you. From family cars to campervans, our wide range of vehicles offers something for everyone. With free airport pickup and unlimited mileage, renting a car in Iceland couldn’t be simpler.