How Much to Rent a Car in Iceland: Being Prepared with Your Budget

The first thing that you need to consider before renting a car is to really know about how much to rent a car in Iceland. You should also know that the car rental cost in Iceland is generally higher than the one in Europe and the US. Even during low season, you should seriously consider your budget because it’s not cheap. During peak season and busy holiday months, the price can even skyrocket higher, forcing you to be super wise when it comes to managing your travel expenses.

How Much to Rent a Car in Iceland: The Exorbitant Prices

According to DV, the Icelandic tabloid, renting a compact vehicle for 3 weeks may cost you 1.36 million krona (similar to $11,000). For a small SUV, it costs around 2.31 million krona (or $18,700). From Dohop search engine, renting a Toyota RAV4 (or the similar model) for 7 days may cost you $2,019 or around $289 a day. What about renting a Toyota Corolla Estate? The price may jack up to $552 a day or around $3,865 for 7 days.

Just so you know, if you rent a car from LA international airport, you only spend $375 for a week. It means that you only spend as little as $54 a day. The reason for the high price is because of high taxes and mandatory insurance. But then again, the current prices are illogical. It doesn’t make any sense.

Of course, you have other options to explore Iceland other than the car rent. You can use the Flybus that only costs you less than $29 for an adult. You can also make use of the bus network in the Reykjavik area to explore some of the interesting places. But if you are adamant to use the car rent, you definitely need to prepare a hefty budget because it will take toll on your overall travel expenses.

Read more How To Get The Best Price On Rental Car

The General Rates

Be ready to spend €70 to €140 a day for an economy ride. In peak season, the rate would go over €140 for a day rent. If you want to rent a bigger vehicle, you should prepare a budget from €150 to €250 a day. As was mentioned before, insurance plays a huge role in the high price. A car rental always comes with its CDW (Collision Damage Waiver). The amount itself can reach $3,000. It’s not actually insurance, but it’s the maximum amount that can be charged to you when they find damage to the car (upon returning).

If you want to have a better ‘self-protection’ mode against the charge, you have some of these options:

  • Super CDW. With this, you can raise the CDW so that your maximum charge (when damage is found) will reduce. With this super CDW, the maximum amount to charge you can range from $350 to $1,500. Quite a significant drop, eh? The extra super CDW may range from $7 a day to $15.
  • Gravel insurance. If you go through unpaved roads, it’s most likely that there would be pebbles and little stones causing minor damage to the front area. Some companies may include this insurance in their super CDW. But some may offer a separate cover, charging you $5 a day.
  • SAAP or Sand and Ash Protection. The so-called ash and sand damage is one of the costliest damages that may happen to the ride. Not only you can be charged to $5,000, but it’s also not included within the CDW packages. If you want to add this to your insurance, you need to pay from $7 a day to $15.

The best thing that you can do is to get the information as detailed as possible. Do this before booking the car. Once you know the facts, you can then decide whether to use public transportation instead or still go with the car rental plan.

Moreover, you can also come up with other strategies, such as traveling during low season or managing your insurance within your credit card. You can find information from various sources, including to help you have clearer understanding of the car rental system in Iceland.

Final Words

Renting a car may be convenient and comfortable. You can get your way around without complication. You don’t even need to deal with hassle. But you should know that renting a car in Iceland can be super expensive. It’s going to cost you a lot. It’s definitely affecting your entire traveling budget. You know now about how much to rent a car in Iceland, so the question is: Are you prepared for it?