The Ultimate Guide To Renting A Car For Iceland’s Ring Road

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For many travelers visiting Iceland, there is no better way to see the sites than by car. As a native Californian that lives close to Route 66 and the Pacific Coast Highway, the romance and pageantry of epic road trips are in my blood. When I started planning our trip to Iceland back in February, I knew that Iceland’s Ring Road would be at the core of our exploration. For those unfamiliar, the Ring Road (Þjóðvegur 1) is a 827.7 mi highway that runs along the circumference of Iceland. The Ring Road connects many of the inhabited parts of the island and stops by all of the most popular tourist attractions. The Ring Road also provides access to Iceland’s mountain route F-Roads that criss cross the highlands.

With so much to see and do in Iceland, it can be difficult to know where to start. When I started my research, I scoured the internet looking for information on how and where to book a rental, what type of vehicle to get, the driving rules and laws in Iceland, and most importantly, what the driving conditions would be like.  In this guide, I hope to provide all of the answers and information that prospective Ring Road adventurers will need to enjoy one of the most beautiful road trips this world has to offer.

The Ultimate Guide To Renting A Car For Iceland's Ring Road


Why You Need To Rent A Car In Iceland

I spent around two months putting together what I thought was a comprehensive Ring Road itinerary. With limited time on a vacation, I always like to pack as much as I can into each day. As soon as we embarked on our first day of driving on the Ring Road, I realized that my detailed itinerary was going to be more of an outline. I was so thankful that we decided to rent a car to explore the Ring Road. Here are my five reasons why:

  1. Spontaneity: Many of my favorite moments in Iceland were decided on the day of each drive. We’d see a horse farm, a waterfall, a glacier in the distance, and just decide to go see it. We also had the freedom to skip things we had scheduled based on weather or fatigue. There were mornings we wanted to sleep in and others where we woke up at 4 AM. Having a rental car allowed us the freedom to enjoy Iceland at our own pace.
  2. Variable Weather: You can get rain, wind, snow, and hail on your trip to Iceland…and maybe even all of them in one day! Having a rental car allows you to wait out bad weather when possible or avoid it all together and change course if necessary.
  3. Set Your Own Schedule: With a rental vehicle, you can wake up whenever you want and see whatever you want to see. No one tells you where to be and how long you get to spend there. You get to decide what’s important.
  4. Go Anywhere: Iceland has hiking trails, waterfalls, glaciers, caves, scenic drives, picturesque fishing villages, and so much more. With a rental, you can decide to see any combinations of Iceland’s many attractions. You can also visit the Highlands via Iceland’s F-Roads.
  5. Avoid The Crowds: What you don’t see in many of the photos of Iceland found online are the massive swarms of people. The main reason for this is that many roadtrippers visit the top “must-see” sites, which are also frequented by massive tour buses dumping off groups in the their hundreds. Nothing kills the majesty of a waterfall quite like a swarm of tourists that have been holed up on a tour bus for hours. I can’t image having to be a part of that swarm with a strict limit of when I’d have to get back on the bus.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Car vs SUV vs Campervan

Now that I’ve convinced you that renting a car and driving Iceland’s Ring Road is the best way to see Iceland, you’ll need to decide if you’ll want to rent a car, an SUV, or a campervan.

Renting A Car Pros and Cons:

  • Car Pros: Cars are the most affordable rental option, have the best fuel economy, and can be rented last minute.
  • Car Cons: Cars cannot access F-Roads, have low clearance, have limited storage, have limited seating, are difficult to sleep in, may struggle in inclement weather, and are underpowered.

Cars are a great option for those visiting the Ring Road in the summer months, especially if you’re only planning on seeing the main sites near Þjóðvegur 1. Renting a car and purchasing fuel can be very expensive in Iceland, so this is the best budget friendly rental option.

Renting An SUV Pros and Cons:

  • SUV Pros: SUVs have higher clearance for harsh roads, come equipped with 4×4 options, have ample storage and seating, have decent fuel economy, and can act as shelter in a pinch.
  • SUV Cons: SUVs are very popular and need to be booked early and have much higher rental costs when compared to cars.

Large and compact SUVs are the most popular rental options for travelers visiting the Ring Road. This is the choice we went with, as it gave us the best combination of features and comfort. Many rental companies will list whether or not they allow their vehicles to be driven on F-Roads. Many SUVs are allowed. This is very important for damage and insurance purposes.

Renting A Campervan Pros and Cons:

  • Campervan Pros: In a campervan you can sleep anywhere, prepare food on site, and live out of your rental.
  • Campervan Cons: Campervan fuel economy isn’t the best, the rental costs are high, and it can be very difficult to rent a campervan in the high season without booking very early.

If we return to Iceland, we’ll probably rent a campervan. We booked our trip a little late, so almost every company was already out of rentals. Rental rates in the high season are also very pricey. So much so, that in many cases it’s actually cheaper to rent an SUV/car with a budget hotel each night. Still, the campervan is the only way to pick your own campsite each night and enjoy the pleasures of untethered freedom.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

4×4 vs 4×2: Will You Need 4WD?

One of the most-asked car rental questions I see on Iceland travel forums is in regards to whether people need a four wheel drive vehicle. Much like your choice of vehicle type, the answer will depend on what you’re planning to see. For most people, I would highly recommend getting a 4×4 to provide more exploration options. The downside to a 4×4 is that it will cost more than a 4×2. If you want to get a 4×2 for budget reasons, and still want to explore off of the main road, make sure to get an SUV with some clearance so you can avoid any major ruts or rocks that would damage a low clearance vehicle. A 4×4 will also help when driving in inclement weather on paved roads. Most Iceland rentals come with all weather tires, but the 4×4 ability provides an added measure of safety.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Plan Ahead And Book Early

If you plan on visiting Iceland in the high season for travel, June through August, make sure to plan ahead and book early. There are two major reasons to book ahead, pricing and availability. This one is just basic supply and demand. In the summer, demand is high, while the supply of rentals is constrained due to high visitation. The first vehicles to get rented are the most desirable ones: luxury cars, 4x4s, SUVs, campervans, and high value budget options.

If you wait until a few weeks before your trip to book a rental, three bad things can happen: 1.) You pay a lot to get a little 2.) Your top choice options are limited 3.) You have to rent from a less reputable company to find the vehicle of your choice.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Choosing a Rental Company

I partnered with Lagoon Car Rental for our trip around the Ring Road. Lagoon provides amazing service with shuttles to and from their office at Keflavik Airport. They also have an office in Reykjavik. Lagoon has an updated modern fleet of vehicles and a very customer friendly website to search for them. I mapped a few criteria out before deciding on a rental company:

  • Airport Pickup: After a long international flight, you’ll want a rental company with an office at Keflavik or a reliable shuttle to their office.
  • Modern Fleet: You’ll be driving hundreds and possibly thousands of miles in remote areas. Make sure you find a rental company with a modern fleet of vehicles that are well maintained.
  • Transmissions: Many rental companies carry large number of manual transmission vehicles. If you’re like me and haven’t driven a manual transmission car in a decade, make sure to find a fleet with automatics.
  • Customer Service: What happens if something goes wrong? Make sure you have a rental company with stellar customer service. Lagoon Car Rental provided me with a 24/7 hotline number should anything go wrong with my vehicle. They also had 3 staff members working in their office, which meant no waiting.
  • Reviews: In this modern age of online company profiles, you’ll be able to find reviews for just about every rental car company out there. If a company has no reviews or no we presence, skip them. Make sure to read the reviews for content. I was a bit spooked when I started my research for a rental company because almost all of them had a few bad reviews. I quickly realized they were all very similar in nature: people skipped rental insurance, damaged the vehicle, and were upset that they had to pay for it. For this reason, I’ve added an entire section on insurance below!
  • Price: Price is very important, too. As I mentioned above, renting early and off season will impact price more than anything.

Rental Options For Cars and SUVs:

Rental Options For Campervans:

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Don’t Skip The Insurance

Driving on Iceland’s Ring Road can present a host of damaging possibilities for your rental. Make sure to protect yourself with insurance. Yes, it will increase the cost of your overall rental, but it will over much needed protection should something occur. If you plan on adventuring on the gravel roads and F-Roads, do yourself a favor and get insurance. Here is a list of the insurance protection provided by most companies:

  • Collision Damages Waiver (CDW) and Super Collision Damages Waiver (SCDW): The CDW sets a deductible for a collision accident. The SCDW lowers that deductible.
    ~$18 per day
  • Gravel Protection (GP): This is to protect from gravel damage to the windshield, headlights, and car body, which is very prevalent in Iceland. We actually had a few rocks fly up from passing cars and hit our windshield. Luckily, no damage was done on our end.
    ~$13 per day
  • Theft Protection (TP): Protects from theft damage to your rental
    ~$6 per day
  • Sand and Ash Protection (SAAP): This protects from damage causes by sand and ash to your rental. These occurrences are not common, but very expensive to fix when they do.
    ~$12 per day
  • Tire Protection: This protection covers the cost to repair or replaced a damaged tire.
    ~$8 per day
  • Insurance Bundles: Most rental companies will include bundle with all insurance options for a slightly discounted rate vs the à la carte pricing.
    ~$35-$50 per day.

*Each rental company will have rules about what is allowed in regards to driving. A major thing not included with insurance is wind damage to doors! Wind can be a major problem in Iceland and do major damage to open doors. Make sure to always open your doors slowly to gauge the wind outside. Undercarriage damage and water damage are also excluded from most insurance coverage.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Picking Up and Dropping Off Your Rental

Picking up your rental can seem like a non-eventful transaction, but you’ll want to be careful here and perform your do diligence upon first inspection. Here are a few steps you can take to protect yourself:

  1. Check for interior and exterior damage on your rental vehicle. Take photographs canvasing the entire vehicle so that you can show any and all damage that was on your rental before pick up. Don’t forget to check the tires, too!
  2. Check the gas and mileage. Most rentals offer unlimited mileage, so that won’t be an issue for most. You will be required to return your rental with a full tank, so make sure it’s full when you pick it up.
  3. Try to pick up and drop off your rental during opening hours. This will keep you from having to wait for an employee to inspect your rental. Our flight arrived early in Keflavik and our departure left equally early in the morning. We were the only ones at Lagoon Car rental for both transactions.
  4. Go over the set rules of your rental company. Each rental company will have set rules for what you can and can’t do with your rental. Like I mentioned earlier, they will stipulate things like whether or not you can drive on F-Roads. They also state types of damage that are not covered by insurance, things like wind damage to doors, water and flooding damage from creek fording, and undercarriage damage,

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Navigation: GPS And Maps

Navigating the Ring Road and side roads in Iceland is pretty simple and straightforward. Some rental companies offer navigation units with their rentals, but the best option is to go with your cell phone. I had a strong 3G connection in all but a few remote parts of Iceland. I was actually amazed with the cellular coverage. My car had a USB port for charging. I also traveled with this Nat Geo paper map as a backup.

My advice is to download Google Maps and create your own map or use mine provided below. In the Google Maps app you can download map sections to make them available offline, which saves on data. From there, you need only select your next point of interest and follow the directions. The vocal instructions and street name pronunciations were very good.

The highway signage and marking is abundant in Iceland. Every junction and side road is marked and easy to see.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Points of interest in Iceland are marked by the icon used below. For a full list of street signs and icons used in Iceland, see here.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Fueling Up: When And Where

The first thing you’ll want to do is identify which fuel type your rental runs on. Mine ran on diesel and not standard gasoline. Almost all rentals I saw in Iceland had stickers on the gas cap to remind drivers to pump the correct fuel.

Fuel up sooner rather than later, especially if you’re driving on F-Roads and/or gravel roads. Our practice was to never let the tank dip below half full.

Gas stations are abundant on the Ring Road, especially with the top two companies, N1 and Olis. Almost all of these stations have restaurants or convenience stores attached. There are standalone pumps in the areas with less population density. Every pump that we used accepted cards that have a pin, so no cash was necessary. If you don’t have a card with a pin, you can purchase prepaid gas cards from each station.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Gas is Iceland is expensive. The price of gas while we were in Iceland was around $1.85 (195 ISK) per liter. Our Nissan X-Trail had a 60 liter tank. A full tank of gas costs $111 (10748 ISK)!

As I mentioned above, there are a lot of food choices inside of the gas stations. Most people will be familiar with the Icelandic hot dogs, but make sure to check out the Grill 66 restaurants if you’re filling up at an an Olis. Grill 66 offers tasty burgers and fries for prices that are pretty tough to beat on Icelandic pricing standards. Some Olis stations have Quizno’s inside, while some N1 stations have Subway.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Driving Hazards: Bridges, Tunnels, Sheep, Horses, Goats, and Cyclists

There are a number of on-road driving hazards you will encounter while driving along the Ring Road. Here is a list of the most prevelant:

  • One lane bridges: This is probably the one that caused me the most angst initially. There are some pretty long one lane bridges in the southeast of Iceland. Many are in low traffic areas that only require drivers to slow down. When traffic is coming in both directions, you’ll need to stop and pull off into the designated area before the bridge and allow traffic to pass.
  • One and two lane tunnels: Two lane tunnels aren’t much of an issue. For one lane tunnels, the idea is the same as a one lane bridge. I only encountered one of these, and it was up on the Troll Peninsula.
  • Sheep, Horses, and Goats: Be prepared for a lot of sheep alongside the road. The horses and goats stay within their boundaries, but the sheep aren’t so law abiding.
  • Cyclists: There are a lot of travelers that explore the Ring Road on bike. There is no shoulder or bike lane on the Ring Road, so be careful and share the road with cyclists.
  • Creeks and Rivers: This is mostly for those heading out to the F-Roads, but can also happen on gravel access roads in inclement weather.
  • Gravel Roads: Gravel roads can be deeply rutted, so drive slow and be vigilant.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Driving On The F-Roads and Gravel Roads

F-Roads are Iceland’s mountainous highland access roads. The roads are only open in the summer months, and their access ‘open date’ hinges on seasonal weather. The F-Roads can be quite treacherous with rivers, boulders, snow, ice, mud, and other obstacles. You can only drive on the F-Roads with a high clearance, highly capable 4×4. I will not go into too much depth on F-Roads, as we did not explore them as much as I would have liked. If you plan to do so, check out this guide from SADcars. As I mentioned above, make sure your rental company allows you to use your vehicle for this purpose.

If we return to Iceland, I think I would spend the a lot more of the trip exploring the F-Roads and the highlands. There is so much to see and do in Iceland, so we weren’t able to budget the time this go around.

The Ultimate Guide To Renting A Car For Iceland's Ring Road
F-Roads Map from

We did however do a lot of driving on gravel roads. I’d say almost half of our daily driving was on gravel access roads to and from our points of interest. These roads were mostly well maintained and in good condition. In rain, the roads would get a little slick, so the 4×4 was put to good use. There were also some deeply rutted section that required slow and accurate driving to keep from jarring the suspension too much.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Rules Of The Road: Speed Limits And Speed Traps

Make sure to familiarize yourself with the driving rules and regulations of Iceland before arriving. I will list a few of the most important rules below.

  • 90 km/hr on most of the Ring Road
  • 80 km/h on most gravel roads
  • 50 km/h on most populated area roads
  • Illegal to drive under the influence of any substances
  • Off trail and off road driving is illegal
  • You must use a hands free mobile device
  • Headlights must always be on
  • You must always wear your seatbelt
  • You must be 20 to rent a car and 23 for a 4×4
  • Call 112 to report an emergency

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Iceland has a few speed traps set up around the Ring Road that are marked on the road using the icon image below of an older camera. Make sure to abide by the speed limit here, as most rental companies will charge your credit card on file to pay for these driving infractions. You can see a full list of driving signs and road icons at  There are also patrol cars in Iceland, although I only saw 3 during my time on the Ring Road.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Speeding tickets in Iceland can be very expensive, so do not speed. The total price of the fine depends on your speed and the amount of speed above the speed limit you were going. Fines can range from $80 USD to over $1000 USD!

Stopping To Take Pictures

Never pull off onto the side of the road to take pictures, for any reason! You would be putting your own life and the lives of others at risk. There are countless pullouts and designated sections for drivers to get off of the road. Only use the pullouts provided for you.

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Preparing For Changes In The Weather

The weather in Iceland can change very quickly. I’ve seen on a few Iceland forums that you should never trust a forecast of more than 48 hours out. I found this to be pretty accurate, as the long term forecast would change by the hour at times.

Come prepared for all driving and weather conditions. If you’ve never driven in snow or ice, stick to visiting the Ring Road during the summer. Strong winds, driving rain, slick roads, and muddy rutted tracks are all par for the course. Come prepared and don’t drive in Iceland without the requisite experience.

Road conditions at
Weather conditions at

The Ultimate Guide To Renting A Car For Iceland's Ring Road

Drive Safe In Iceland: Advice From Elfis

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The Ultimate Guide To Renting A Car For Iceland's Ring Road



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26 thoughts on “The Ultimate Guide To Renting A Car For Iceland’s Ring Road”

  1. Wow this is a gold mine of info and I’ll be returning here as I plan my families trip to Iceland hopefully next summer! Thanks Drew!

    • Thanks, David! Great to hear you’ll be taking the family to Iceland next year. It’s the perfect location for family adventures. Let me know if you have any questions. We were able to drive around the entire island with our 1 year old!

  2. Thx for the great post, Drew. I’ve never been to Iceland. I didn’t realize how much of a challenge their roads would be to someone who has not had much experience driving on gravel. It is very different than driving on pavement!

    • Thanks, Doreen. The nice part about the Ring Road is that you can enjoy the main paved road if you want to avoid the challenging bits. A lot of the best sites are on the gravel roads though 🙂

  3. With picture perfect landscapes serving as constant companion, Iceland sure is a road trip friendly nation. Renting a car makes sense because at places like this, you would want to ravel at your own pace and stop at your whims and fancies.

  4. Renting a car in another country isn’t as scary as some people think. I’ve driven in Australia, France, and several other countries. Get an international driver’s license and consider travel insurance. It’s fun to experience driving in a new place… but it does take some getting used to when driving on the other side of the road.

  5. Such a comprehensive guide. I already bookmarked it. Since, when I go to Iceland, I am definitely going to embark on the ring road trip. And there’s all the info I would like to know about how to rent a car to do the same

  6. Iceland is indeed the stuff that dreams are made of. The wonderful landscapes are something to die for. Probably the best way to see Iceland is driving through it. I understand most people do it. This is a very useful post for people like me when we plan our visit to Iceland. Reall a great guide to renting a car in Iceland.

  7. Many thanks Drew for all the info you’ve provided. The photos are a great plus! My wife and I are planning going in May. We are renting a Lagoon Renault Kadjar 4×4 and are planning in doing the whole Ring Road. Not sure if north-east first or south east first.

    Thanks again!

  8. Hi Drew,
    Great info. We are going to Iceland in May/June this “summer” and doing the entire Ring road. Thinking of renting a normal car lige VW Golf as I am not familiar with driving a 4×4 – and there seems toi be much to see and do along the Ring road. Best regards


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