Top car rentals in Iceland 2026: Search & Compare

There isn't a single "best" car rental really; it depends on your route, your budget, and how much support you want if something goes wrong. A company with the lowest daily rate isn't automatically the best deal once insurance, extras, and deposits are factored in.

Here you have some general recommendations:

• Best car overall: Dacia Duster. It's one of the few economy-priced options with genuine 4x4 capability, so it's perfect whether you want to drive during the winter or head to the Highlands.
• Best value: Dacia Bigster. More interior and boot space than the economy tier with a price barely above that territory.
• Best for the Highlands: Toyota Land Cruiser. This is a real 4x4, not an AWD crossover wearing 4x4 branding, which is what F-road routes actually require.
• Best for short trips: Toyota Aygo X. Small, efficient, easy to park in Reykjavík or at any Golden Circle pull-off.

Where you pick up the car depends on how your trip starts, not just where you land.

If you are heading straight out from Keflavík with no stop in the city first, a desk or shuttle at the airport saves you time and effort. You land, you grab the car, and you go.

If your flight is delayed, contact the provider or us as soon as you know. Most providers hold the car for a couple of hours automatically, but it is always best to let them know.

• Basic is included. It covers the essentials, collision damage waiver and third-party liability, but leaves you with a large deductible if something goes wrong.
• Plus lowers the deductible and adds Gravel Protection and Sand and Ash Protection. In Iceland, these are not just nice to have. Loose stones and coastal sandstorms cause real damage.
•  Full Cover brings the deductible to zero. You pay nothing out of pocket.

If your route includes gravel, skip Basic and go for Plus or Full Cover. Likewise, deductible and coverage vary depending on the selected model and provider. Please ensure you check the terms and conditions before booking.

A compact Hyundai i10 for a week in the shoulder season with Plus insurance will set you back about USD 418 in total.

If you go for a larger 4x4 like a Dacia Duster for the same 7 days with Full Cover, you are looking at around USD 594.

The daily rate is only part of the picture. The real total includes insurance, with Basic usually included, but Gravel Protection, Sand & Ash Protection, and a lower deductible are often separate. There is also a security deposit hold on your card and any extras like GPS or a child seat if they are not already included.

A cheap daily rate can end up costing more once you add everything else. A slightly higher rate with more included is often better value. Always compare the full trip total, not just the per-day number.

Basic roadside assistance comes with most rentals. It covers getting help to you if you break down, get a flat tire, or lock yourself out. But the cost of the actual tow or the callout might not be included unless you have added a waiver.

For accidents, your insurance tier makes a difference. Basic leaves you with the deductible. Plus lowers it. Full Cover brings it to zero. It is worth checking before you book, especially if you are heading to remote areas like the Westfjords, where a breakdown means a longer wait no matter what.