Top 10 Car Rental Companies in Iceland

Start planning your trip by exploring the best car rentals in Iceland so you can choose a vehicle suited to your route, travel season, and comfort level. Selecting the right car helps you navigate Iceland’s paved roads, gravel routes, and inland mountain areas with confidence.

Many travelers begin by comparing car rentals in Iceland to find options that fit their budget and itinerary. Visitors who want cheap rental cars can choose compact or medium models for city driving, day trips, and summer travel on paved roads. These cars work well for popular regions such as Reykjavik, the Golden Circle, and the South Coast.

Iceland supports a wide range of travel styles. Travelers can rent 4x4 vehicles for winter conditions or approved F-road travel during summer. Those who want additional comfort can explore luxury rental cars with more space and premium features. Travelers planning campsite stays can also rent motorhomes, which combine transport and sleeping space.

This guide introduces the top car rental companies in Iceland and highlights what each one offers. A comparison table is available below to help you review prices, fleet quality, and vehicle types at a glance.

Key Takeaways

• Iceland offers several highly rated rental companies with strong reviews, including providers known for new fleets, smooth airport pickup, and clear insurance options.

• Most companies specialize in new or low-mileage cars, which support reliable long-distance driving across Iceland’s main routes.

• Many top-rated providers near Keflavik International Airport offer free shuttles or meet-and-greet pickup for easy arrivals.

• Several companies include campervans, roof-tent vehicles, or mini campers for travelers planning camping routes or stays in designated campsites.

• Highland-capable vehicles are available through multiple providers for summer F-road travel in the Icelandic Highlands.

• Most leading companies include Collision Damage Waiver as standard, with upgrades such as Full Protection, Gravel Protection, and Sand and Ash Protection for rural and coastal routes.

List of the Top Car Rental Companies in Iceland

Choose a car rental in Iceland that offers the right balance of service, price, insurance coverage, and airport convenience. To help you make an informed decision, we reviewed Iceland’s most reputable rental companies.

This comparison table provides a quick overview of ratings, fleet ranges, price brackets, and vehicle options. Detailed profiles for each rental company follow the table, giving you a clear look at their strengths, insurance options, vehicle types, and airport pickup experience.

Blue Car Rental

Guide to Iceland 2025 rating: 8.8 from 996 reviews
Fleet years: 2022 to 2025
Price range: 90 USD to 520 USD (13,000 ISK to 72,000 ISK)
Vehicle categories: small cars, medium cars, station wagons, SUVs, premium cars, and vans

Blue Car Rental is one of the most popular choices for car rental in Iceland, especially for travelers landing at Keflavik International Airport. Its office is located about 985 feet (300 meters) from the airport entrance, and a free shuttle meets travelers directly at the arrival hall.

Each rental follows a full-to-full fuel policy with unlimited mileage, which works well for long drives. The company also provides several models with Highland capability for summer travel on designated F-roads. Many Blue Car Rental Iceland reviews highlight the easy pickup process and consistent vehicle quality.

Rentals often include Collision Damage Waiver and Theft Protection as standard coverage. The company also offers essential add-ons such as GPS units or a 4G Wi-Fi box for dependable navigation, extra driver coverage for shared driving, and child or baby seats for families traveling with young children.

MyCar Rental

Guide to Iceland 2025 rating: 9.6 from 493 reviews
Fleet years: 2023 to 2025
Price range: 90 USD to 590 USD (14,000 ISK to 81,000 ISK)
Vehicle categories: small cars, medium cars, station wagons, SUVs, premium cars, and vans

MyCar Rental is one of the top-rated providers for car rental in Iceland, offering a fleet of new or low-mileage vehicles. Its office sits just outside the airport, and a free shuttle picks guests up. Travelers also benefit from MyCar’s connection to Toyota’s service network across Iceland, which adds an extra layer of security for long drives.

All rentals come with a full-to-full fuel policy and unlimited mileage. Seating options range from 2-seat models to larger 9-seat vehicles. Select models include Highland capability for approved summer routes. Many visitors highlight the smooth pickup process, modern vehicles, and dependable support in MyCar Iceland reviews.

MyCar often includes Collision Damage Waiver and Windscreen Protection as standard coverage. Available add-ons include a 4G Wi-Fi box, extra driver coverage, and child or baby seats. A roof box can also be added to some vehicles for travelers who need more luggage space.

Project Car Rental

Guide to Iceland 2025 rating: 9.4 from 135 reviews
Fleet years: 2019 to 2025
Price range: 140 USD to 1,470 USD (20,000 ISK to 205,000 ISK)
Vehicle categories: jeeps and SUVs, station wagons, vans, and mini campers

Project Car Rental is a locally owned company that operates from Keflavik Airport, where a staff member meets travelers directly after the arrival hall. This personal handover is mentioned in Project Car Rental Iceland reviews, and it creates a smooth start for travelers who prefer a direct service.

Every rental comes with a full-to-full fuel policy and unlimited mileage. The fleet includes everything from standard 5-seat SUVs to larger 9-seat vans, along with mini campers designed for two people. Many of the mini camper options come equipped with sleeping mattresses, and select vehicles offer Highland capability for approved summer routes.

Project Car Rental includes Collision Damage Waiver as standard coverage. Essential add-ons include Gravel Protection insurance, a 4G internet box, extra driver coverage, and child or baby seats. Camping-related extras such as tents and sleeping bags are also available for travelers planning to have camping tours in Iceland.

Ring Car Rental

Guide to Iceland 2025 rating: 9.0 from 311 reviews
Fleet years: 2019 to 2023
Price range: 110 USD to 315 USD (16,000 ISK to 44,000 ISK)
Vehicle categories: jeeps and SUVs, mini campers

Ring Car Rental is a family-run company that offers airport pickup, where a staff member meets travelers in the arrival hall. Ring Car Rental is well known for providing select models with roof-top tents, a popular option for visitors interested in camping without needing a separate tent.

Each rental follows a full-to-full fuel policy with unlimited mileage. The fleet centers on 5-seat vehicles with space for two to three large bags, along with mini campers designed for basic overnight stays. Several models also include Highland capability.

Ring Car Rental often includes Theft Protection as part of its standard coverage. The company provides useful add-ons such as extra driver coverage, a 4G internet box, and child or booster seats. Camping-focused extras, including sleeping bags, camping chairs, and a kitchen box, are also available.

Go Car Rental

Guide to Iceland 2025 rating: 8.8 from 438 reviews
Fleet years: 2017 to 2025
Price range: 120 USD to 590 USD (17,000 ISK to 82,000 ISK)
Vehicle categories: small cars, medium cars, station wagons, premium cars, SUVs, and vans

Go Car Rental is a locally owned company offering one of the most diverse fleets for car rental in Iceland. The company operates near Keflavik Airport, about a five-minute drive from the terminal, and its shuttle arrives outside the arrival hall every 20 minutes. Travelers can track the shuttle’s location, which helps streamline the pickup process.

Each rental follows a full-to-full fuel policy with unlimited mileage. Go Car Rental offers everything from compact 2-seat cars to 9-seat vans, along with several SUV models that include Highland capability.

Go Car Rental often includes Collision Damage Waiver as standard coverage. Customers may also decline insurance altogether, which removes coverage for vehicle damage but keeps third-party liability active. Essential add-ons include GPS units, a 4G internet box, extra driver coverage, and child or baby seats.

Key Car Rental

Guide to Iceland 2025 rating: 10.0 from 37 reviews
Fleet years: 2018 to 2025
Price range: 100 USD to 690 USD (14,500 ISK to 96,000 ISK)
Vehicle categories: jeeps and SUVs, vans, station wagons, premium vehicles, mini campers, and camper vans

Key Car Rental is a strong option for travelers seeking car rental in Iceland, especially for those who want well-maintained vehicles backed by round-the-clock service. The company operates at Keflavik Airport, offering free pickup and drop-off. Its lineup includes standard vehicles along with mini campers and models equipped with roof-top tents.

Each rental includes a full-to-full fuel policy with unlimited mileage. Seating options range from 2-seat vehicles to 9-seat vans. Some models even include Highland capability. Many visitors highlight the straightforward pickup process and excellent customer service in Key Car Rental Iceland reviews.

Key Car Rental often includes Collision Damage Waiver and Theft Protection as standard coverage. Travelers can upgrade to Full Protection or choose other insurance packages. The company also offers add-ons such as a 4G internet box, extra driver coverage, and child or baby seats. Camping-focused extras are also available.

Lotus Car Rental

Guide to Iceland 2025 rating: 9.4 from 139 reviews
Fleet years: 2021 to 2025
Price range: 120 USD to 1,220 USD (17,500 ISK to 171,000 ISK)
Vehicle categories: mini campers, jeeps and SUVs, medium cars, premium cars, vans, and camper vans

Lotus Car Rental offers dependable vehicles and specialized options for car rental in Iceland, including models equipped with roof tents and fully outfitted camper vans. Located at Keflavik Airport, the company provides a shuttle service that meets travelers at the arrival hall. Lotus maintains a modern fleet with several Highland-capable vehicles.

Each rental includes a full-to-full fuel policy with unlimited mileage. Seating options range from compact 2-seat vehicles to larger 9-seat models. The company also offers camper vans with sleeping space for up to four people. Many travelers reference the well-maintained vehicles in Lotus Car Rental Iceland reviews.

Lotus Car Rental offers a wide range of insurance upgrades. Platinum Insurance provides extensive coverage with zero excess, including protection for animals, gravel, sand and ash, tires, F-road travel, and river crossings. Silver Insurance offers a balanced level of protection, while Full Protection is for travelers who want maximum peace of mind.

Essential add-ons include GPS units, a 4G internet box, and extra driver coverage. Families can request booster seats, child seats, or baby seats, and a roof box is available for travelers who need additional luggage space. Maps of Iceland are also offered for travelers who prefer a reference while exploring.

Auto Car Rental

Guide to Iceland 2025 rating: 8.8 from 41 reviews
Fleet years: 2019 to 2025
Price range: 30 USD to 490 USD (4,000 ISK to 69,000 ISK)
Vehicle categories: small cars, jeeps and SUVs, and vans

Auto Car Rental is a locally owned provider near Keflavik Airport that appeals to travelers looking for affordable and reliable car rental in Iceland. The company offers a fleet that covers compact cars for solo travelers, larger SUVs for small groups, and 9-seat vans for families.

All rentals follow a full-to-full fuel policy with unlimited mileage. Several models also include Highland capability for approved summer routes. Its budget-friendly pricing and practical vehicle selection are often mentioned in Auto Car Rental Iceland reviews.

Auto Car Rental often includes Collision Damage Waiver and Theft Protection as part of its standard coverage. Essential add-ons from Auto Car Rental include other insurance options, GPS units, a 4G internet box, extra driver coverage, and child or baby seats. A young driver fee is available for renters under the standard age requirement.

Foss Car Rental

Guide to Iceland 2025 rating: 10.0 from 44 reviews
Fleet years: 2017 to 2022
Price range: 110 USD to 710 USD (16,000 ISK to 99,000 ISK)
Vehicle categories: small cars, jeeps and SUVs, and motorhomes

Foss Car Rental is a strong choice for travelers looking for a car rental in Iceland. The company operates from Keflavik Airport, supported by a shuttle service that connects travelers from the arrival hall. Foss Car Rental is popular among visitors who want occasional camping nights, thanks to its selection of motorhomes with space for up to six travelers.

Each rental follows a full-to-full fuel policy with unlimited mileage. Seating options include compact cars for efficient trips and larger SUVs for families or small groups. In Foss Car Rental Iceland reviews, travelers often highlight the clean vehicles and personal service.

Foss Car Rental often includes Collision Damage Waiver, Gravel Protection, Super Collision Damage Waiver, and Theft Protection as standard coverage. Essential add-ons include roadside assistance, extra driver coverage, child or baby seats, and camping gear. An inverter is also available for travelers who need to charge electronics on the road.

Lava Car Rental

Guide to Iceland 2025 rating: 8.6 from 271 reviews
Fleet years: 2019 to 2025
Price range: 120 USD to 710 USD (17,500 ISK to 99,000 ISK)
Vehicle categories: small cars, medium cars, station wagons, SUVs, and campervans

Lava Car Rental is one of the most recognized names in car rental in Iceland. It earned the title of Iceland’s Leading Car Rental Company at the World Travel Awards in both 2023 and 2024, which reflects its strong reputation among international travelers.

Lava Car Rental operates from Keflavik Airport, where a dedicated shuttle picks up guests directly outside the departure hall. The rental fleet includes standard vehicles along with campervans. Each rental consists of a full-to-full fuel policy with unlimited mileage.

Vehicle choices range from 2-seat cars to 7-seat models, along with campervans equipped with sleeping space for two people. Several models include Highland capability. In Lava Car Rental Iceland reviews, travelers often mention the award-winning service and well-maintained vehicles.

Standard coverage often consists of Collision Damage Waiver and Theft Protection. Travelers who want zero-excess coverage can upgrade to Full Protection. Campervan rentals can include cooking gear for travelers preparing meals on the road. Essential add-ons include GPS units, a 4G internet box, extra driver coverage, and child or baby seats.

How To Pick the Right Car in Iceland

Choosing the right car rental in Iceland depends on when you’re visiting, the types of roads in your itinerary, and the level of insurance protection you want. The road network includes a mix of paved routes, gravel surfaces, and inland F-roads, and the weather in Iceland can shift quickly, so selecting the right vehicle helps ensure a safe and stress-free trip.

Choose a Car Based on the Season

Summer offers the most stable conditions for driving in Iceland, and most travelers are comfortable with small or medium cars for paved routes such as the Golden Circle, the South Coast, and day trips from Reykjavik.

Driving in winter is more challenging, especially in coastal areas and rural regions where icy roads and strong winds are common. A larger vehicle or a 4x4 provides better stability and traction during colder months, which makes it easier to manage slippery surfaces and shifting weather.

Match Your Vehicle to the Route

Your driving route determines the type of car you need, and understanding Iceland’s road types helps you make the best choice:

• Paved roads: You can reach attractions by the Ring Road, the Golden Circle, and routes near Reykjavik on paved roads that can be driven with any standard car.

• Gravel roads: Common in rural regions and around popular natural attractions. These include areas in North Iceland, coastal sections in the Eastfjords, parts of the Westfjords, and the backroads on the Snaefellsnes Peninsula. A higher-clearance vehicle offers better comfort and control on these surfaces.

• F-roads: These are mountain routes in the Highlands and require 4x4 vehicles by law. F-roads are open only in summer and may include steep terrain or river crossings.

Fuel Policies and Mileage

Most rentals operate with a full-to-full fuel policy, which means you receive the car with a full tank and return it with a full tank. In addition to this, unlimited mileage allows you to drive any distance without extra fees. Together, these policies support long road trips and multi-region itineraries across Iceland.

Select the Right Insurance

Insurance plays an important role in car hire in Iceland, and choosing the right coverage helps you avoid unexpected costs. Here are the most common options:

• Collision Damage Waiver (CDW): The basic protection included with most rentals. It limits the renter’s financial responsibility if the rental car is damaged in an accident, up to a specific self-risk amount.

• Gravel Protection: Useful for loose-stone surfaces, which can chip paint or headlights on gravel roads.

• Sand and Ash Protection: Recommended in areas, such as the South Coast, where strong winds can carry volcanic particles that may damage the vehicle’s exterior.

• Full Protection or Super CDW: Reduces or removes the renter’s self-risk and is popular for longer itineraries or uncertain weather.

FAQs About Car Rentals in Iceland

Before finalizing your rental plans, these common questions can help you understand the best options for your trip and what to expect when driving in Iceland.

What type of rental car is best for budget and economy travel?

Travelers looking for the most affordable car rental in Iceland usually choose small or medium cars. These models are fuel-efficient, easy to navigate for parking in Reykjavik, and suitable for paved routes like the Golden Circle or the South Coast. They work well for summer tours, short itineraries, and visitors who plan to stick to main roads.

What car should I rent for winter conditions or the Highlands?

A 4x4 is the safest choice for winter driving due to icy roads, strong winds, and sudden weather changes. These vehicles offer better traction and stability during the colder months. A 4x4 is also required by law for any F-road travel in the Highlands.

Do I need a 4x4 in Iceland?

You only need a 4x4 if your itinerary includes winter travel, gravel-heavy regions, or F-roads in the Highlands. For paved areas near Reykjavik, the Ring Road, or popular summer routes, a standard car is usually enough.

What is the best rental car for families or groups?

Families often prefer vans, 7-seat SUVs, or campervans with extra luggage space. These options allow for more comfortable seating and enough room for strollers, large bags, or outdoor gear. Campervans and mini campers are helpful for multi-day road trips where travelers want both transport and sleeping space for a camping tour around Iceland.

Are eco or electric rental cars a good option in Iceland?

Eco-friendly and electric rental cars are suitable for travelers staying near Reykjavik or visiting popular paved routes with good charging access. They are not ideal for remote regions, gravel roads, or cold-weather travel, where range and charging availability may vary. For short urban trips or summer driving, they can be a cost-effective and sustainable choice.

Is it safe to drive in Iceland?

Yes, you can have a safe driving experience in Iceland as long as you follow posted speed limits, check road conditions, and adjust to changing weather. Gravel roads, narrow bridges, and strong winds require caution. Winter travel demands slower speeds and increased distance between vehicles.

Can I rent a car in Iceland with a foreign license?

Most travelers can rent a car in Iceland with a valid driver’s license from their home country, as long as it is written in English or uses Roman characters. An international driving permit is recommended for licenses in other languages. Drivers must have held their licence for at least one year.

How much does a rental car typically cost in Iceland?

Rates vary by season and vehicle type. Summer is the busiest and most expensive period, especially for 4x4s and campervans. Winter and shoulder seasons offer better deals. Booking early and selecting only necessary add-ons helps secure the best price for car hire in Iceland.

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

For summer travel, booking at least two to three months in advance is recommended because availability for popular models can sell out quickly. In winter or shoulder seasons, last-minute options may still be available, but early booking provides better pricing and selection.

What should I watch out for when renting a car in Iceland?

Travelers should be aware of gravel roads in regions such as North Iceland, the Eastfjords, the Westfjords, and parts of the Snaefellsnes Peninsula. F-roads require a 4x4 and are only open in summer.

Insurance coverage varies, so understanding options like Gravel Protection and Sand and Ash Protection is important. Confirm your pickup point at Keflavik Airport, as some rentals use shuttles while others offer meet-and-greet service.

What driving or rental etiquette should I follow in Iceland?

Follow the fuel policy stated in your agreement, typically full-to-full. Do not drive off-road, as it is illegal and one of the top things to avoid in Iceland. Return the vehicle cleaned and free of trash, and report any damage promptly to prevent extra charges.

Finding the Best Car Rental in Iceland for Your Trip

Choosing the right car rental in Iceland starts with understanding your route, the season, and the type of car that fits your plans. A small or medium car works well on paved roads. A 4x4 is better for winter travel and any trip that includes F-roads in the Highlands. Campervans and mini campers are helpful for longer routes that include campsite stays.

Comparing fleet quality, price ranges, insurance options, and airport pickup details helps you select the rental that fits your budget and comfort level. With the right vehicle and the right insurance, your drive in Iceland can stay safe and predictable in changing weather.

If you want more detailed guidance, you can explore these helpful resources: a guide to rental car sizes in Iceland and a list of practical tips for renting a car in Iceland. Both offer additional insight into choosing the right vehicle for specific routes and travel styles.

As you prepare for your trip, we would love to hear your thoughts. What type of rental car are you considering for Iceland? Share your plans in the comments below.