Car Rental in Iceland for German Travelers

Exploring the mesmerizing landscapes of Iceland is an unparalleled experience. If you're coming from Germany to navigate the country's stunning scenery, you might be wondering:

Will my German driver's license be valid in Iceland?
What insurance options should I choose for changing weather conditions?
How much do rental cars cost on average in Iceland?
Are specific vehicles recommended for Iceland's variable terrain?
What local driving rules should I prepare for?

In this guide, find detailed answers to these questions and more, ensuring your journey through Iceland is smooth, cost-efficient, and stress-free. Don't forget to check out the quick-reference table at the end with all key car rental information.

Can German Citizens Drive in Iceland?

Yes, German travelers can legally drive in Iceland with the proper documentation. Age restrictions and additional document requirements may apply.

Form of ID:
A valid passport is required.
Driving licence:
Accepted driving licence include:
• Original driving licence + International Driving Permit (IDP)
or
• EU/EEA Driving License
Accepted cards:
Physical credit cards in the full name of the main driver. Accepted credit cards include Visa, Master, DinersClub, and AMEX.
Age requirements:
Drivers must be between 18 and 99 years old. Young drivers aged 18-20 may incur a fee of US$ 8.39 per day, and drivers aged 19-20 may incur a fee of US$ 11.42 or US$ 14.15 per day depending on the rental company.

Ready to Rent?

Requirements may vary between rental companies. Always confirm details when booking.

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Recommended Car Rental Companies

Discover reliable and diverse car rental options tailored for travelers from DE visiting IS.

Global Chain Companies

Local Brands

Europcar
global
8.5
Locations:
83
Prices:
$$
Key Advantages
- Wide range of vehicles
- Flexible pick-up and drop-off locations
- Loyalty program for frequent renters
- Excellent customer service
Best for
Leisure travelers and eco-conscious renters
Hertz
global
8.5
Locations:
54
Prices:
$$$
Key Advantages
- Largest fleet in USA
- Premium vehicle selection
- Gold Plus Rewards loyalty program
- Express rental counters
Best for
Business travelers and premium vehicle needs
Budget
global
8.5
Locations:
36
Prices:
$
Key Advantages
- Competitive pricing
- Convenient locations
- Excellent customer service
- Loyalty rewards program
Best for
Cost-conscious travelers and families
SIXT
global
8.5
Locations:
18
Prices:
$$
Key Advantages
- Wide selection of premium and luxury cars
- Flexible rental terms
- Easy online booking
- Excellent customer service
Best for
Travelers seeking premium vehicles and flexible rental options
Alamo
global
8.5
Locations:
13
Prices:
$$
Key Advantages
- Great value for money
- Quick and easy booking process
- Excellent customer service
- Wide range of vehicle options
Best for
Leisure travelers and families

Icerental 4x4
local
8.5
Locations:
2
Prices:
$$
Key Advantages
- Specialized in 4x4 and SUV rentals
- Knowledgeable staff on winter conditions
- Competitive pricing for long-term rentals
- Flexible pick-up and drop-off options
Best for
Adventure seekers and winter travel
FAIRCAR
local
8.5
Locations:
6
Prices:
$$
Key Advantages
- Competitive pricing
- Personalized customer service
- Convenient pickup and drop-off locations
- Wide range of vehicle options
Best for
Budget-conscious travelers and local rentals
ACE Rent A Car
local
8.5
Locations:
4
Prices:
$$
Key Advantages
- Competitive pricing
- Customer-friendly service
- Flexible rental options
- Special deals for long-term rentals
Best for
Budget-conscious travelers and families
SAGA Car Rental
local
8.5
Locations:
1
Prices:
$
Key Advantages
- Personalized customer service
- Convenient local locations
- Competitive pricing
- No hidden fees
Best for
Budget-conscious travelers and local rentals
Lava
local
8.5
Locations:
1
Prices:
$-$$
Key Advantages
- Personalized customer service
- Convenient pickup and drop-off locations
- Competitive pricing
- Local knowledge and recommendations
Best for
Budget-conscious travelers and local excursions

Car Rental Tips for DE Travelers to IS

Choose Global Chains If

Prefer a wide network and international support
Require guaranteed availability and premium services
Seek familiarity with a well-known brand

Choose Local Brands If

Want to explore unique local vehicle options
Looking for competitive rates
Prefer supporting local businesses

How to Choose the Right Car?

Choosing the right rental car can make your trip to Iceland more comfortable, safe, and enjoyable. Keep in mind the unique landscapes of Iceland, including its rugged terrains, winding roads, and weather variability. With QEEQ, you can compare various car types and policies to find the one that best fits your adventure.

Seating and Luggage
Consider your travel group size and luggage needs.
- Economy cars (2-4 people, 1-2 suitcases)
  Suitable for urban areas and shorter scenic routes.
- Compact cars (4-5 people, 2-3 suitcases)
  A good mix of space and fuel efficiency for moderate drives.
- Mid-size cars (5 people, 3-4 suitcases)
  Comfortable for longer journeys and road trips.
- Full-size/SUV (5-7 people, 4+ suitcases)
  Best for families, groups, and exploring Iceland's rugged terrains.
Transmission Type
Choose between automatic and manual transmission.
- Automatic transmission
  Convenient for new terrains and traffic, widely available.
- Manual transmission
  Often more cost-effective, offering better fuel economy.
Insurance Included
Check what insurance coverage is included with your rental.
- Basic liability
  Generally covers damage to third-party properties and vehicles.
- Collision Damage Waiver (CDW)
  Reduces liability for damage to the rental car.
- Theft protection
  Coverage for car theft and related incidents.
- Gravel protection
  Highly recommended for Icelandic gravel roads.
Cancellation Policy
Understand the booking flexibility and potential fees.
- Free cancellation
  Available up to 24-48 hours before pickup.
- Prepaid vs. Pay-at-counter
  Prepaid bookings often offer better rates but less flexibility.
Mileage Policy
Check for mileage restrictions and additional charges.
- Unlimited mileage
  Ideal for exploring Iceland's extensive roadways.
- Limited mileage
  Suitable for focused travel plans.
Fuel Policy
Understand fuel requirements and associated costs.
- Full-to-Full
  Return the car with a full tank to avoid extra charges.
- Full-to-Empty
  Convenient but often more expensive.

Quick Decision Guide

City Travel
Compact/Economy car with automatic transmission, full-to-full fuel policy.
Reykjavík, Akureyri
Road Trip
SUV with gravel protection and unlimited mileage.
The Golden Circle, Ring Road
Vacation
SUV or mid-size car with comprehensive insurance and prepaid fuel option.
Blue Lagoon, South Coast

Compare with Confidence on QEEQ

Don't settle for the first option you find. QEEQ makes it easy to compare car types, policies, and total costs from multiple providers. See all fees upfront, read real customer reviews, and choose the perfect car for your adventure.

Compare all car rental deals
No hidden fees
Real customer reviews

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What Are the Popular Destinations in Iceland?

Iceland offers breathtaking natural landscapes, from glaciers and geysers to waterfalls and volcanic beaches. Renting a car is the best way to explore its many wonders efficiently and comfortably.

What Insurance Do I Need?

You'll need basic insurance to legally drive in Iceland, but additional coverage is highly recommended for driving on gravel roads or in challenging weather conditions. Iceland's unique terrain and volatile weather make proper insurance crucial for peace of mind.

Types of Insurance Coverage

Collision Damage Waiver (CDW)
Covers damage to the rental car from collision or accidents.
€12-20/day
Essential
Theft Protection (TP)
Covers theft of the rental vehicle.
€5-8/day
Essential
Super Collision Damage Waiver (SCDW)
Reduces your financial liability in case of major damages.
€10-15/day
Recommended
Gravel Protection (GP)
Protects against damage to the car's windshield, headlights, and body caused by gravel roads.
€7-12/day
Recommended
Sand and Ash Protection (SAAP)
Covers damage due to sandstorms or volcanic ash.
€10-15/day
Optional

QEEQ's Complete Protection Solutions

Perfect for travelers who want comprehensive protection without the complexity. One price covers everything, and AXA's trusted network ensures reliable claims processing throughout Iceland. Get comprehensive coverage online for about 50% less than counter rates.

Coverage Feature

QEEQ Full Coverage

Basic Rental Company

Collision Damage Waiver

Fully Covered

$0.00 - $19,231.60

Theft Protection

Fully Covered

$0.00 - $4,388.86

Personal Accident Insurance

Fully Covered

Not Covered

Tire, Window, Mirror Damage

Fully Covered

Not Covered

Roadside Assistance

Fully Covered

Not Covered

Know more About QEEQ Full Coverage

How to Save Money While Renting a Car in Iceland

Planning ahead and making informed choices can significantly reduce your car rental expenses while exploring the scenic landscapes of Iceland.

Booking Tips for lower Prices

Book in Advance
Car rental prices in Iceland tend to rise closer to the travel date, especially during peak seasons. Booking your car at least 4-6 weeks in advance can help you secure a better deal.
Save up to 35%
Compare Rental Companies
Use comparison websites like QEEQ or Rentalcars to find the best rates and available options across multiple car rental providers.
Save up to 25%
Choose the Right Fuel Policy
Opt for a 'full-to-full' fuel policy to avoid paying premium refueling charges. Plan your route to refuel at local gas stations before returning the car.
Save €15-€30 per rental
Avoid Unnecessary Extras
Icelandic car rentals often offer extras like GPS or Wi-Fi hotspots. Consider using your mobile device for navigation to save on these additional costs.
Save €10-€20 per day
Choose a Smaller Vehicle
Unless planning to explore Iceland's highlands, a compact vehicle is usually sufficient for paved roads and more fuel-efficient.
Save up to 20% on rental costs

QEEQ's Money-Saving Features

Diamond Membership
Save up to 20% on every booking - free trial available below.
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Price Drop Protector
If your booked car price drops, QEEQ automatically rebooks it at the lower rate and refunds the difference to you.
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One-Dollar Freeze
Lock in today's price with just $1 upfront and pay the rest later.
View Details
Flexible Payments
Pay with credit/debit cards or even cryptocurrency via BitPay.
View Details

What Should You Pay Attention To?

Important considerations and potential issues to watch for when renting a car in Iceland.

Hidden Fees
Be mindful of potential hidden costs that may apply to your car rental.
- High costs for additional equipment like child seats or GPS units
- Mandatory insurance fees for certain vehicle types
- Charges for crossing into restricted areas
- Airport pickup surcharges
- Fees for returning the car outside office hours
Insurance Coverage
Ensure you understand the insurance options and requirements in Iceland.
- Gravel protection is recommended due to road conditions
- Check if your travel insurance covers car rentals
- Credit cards may include rental insurance, but confirm with your provider
- Review the deductible amounts for each coverage type
Road Conditions
Iceland's unique terrain requires careful selection of the right vehicle.
- 4x4 vehicles are necessary for F-roads in the Highlands
- Winter tires are a must during colder months
- Driving off-road is prohibited and may incur heavy fines
- Weather conditions can change rapidly—plan accordingly
Driving Rules
Familiarize yourself with Iceland's road regulations to ensure a safe trip.
- Headlights must be on at all times, even during daylight
- Speed limits are generally 50 km/h in towns, 80 km/h on gravel roads, and 90 km/h on paved roads
- Seat belts are mandatory for all passengers
- Using a phone while driving is only allowed hands-free
Fuel Costs and Policies
Understand the fuel policies to avoid unexpected charges.
- Fuel prices in Iceland are relatively high—plan your budget accordingly
- Ensure the fuel type matches what is specified for the car
- Keep receipts in case of disputes about the fuel level upon return
Rental Agreement Terms
Carefully review the rental agreement to understand the terms.
- Check the mileage included in the rental price
- Be aware of any restrictions on driving regions
- Understand the policies for early return or extensions
- Take note of the process for reporting and covering damages

Remember

Being prepared and knowing what to expect can save you hundreds of dollars and prevent stressful situations. Take time to understand all terms and inspect your rental thoroughly.

Traffic Rules Comparison Between Germany and Iceland

Germany and Iceland have distinct traffic rules that travelers should be aware of. Differences include speed limits, alcohol limits, and priority rules, while similarities exist in seatbelt enforcement and mobile phone usage.

Speed Limits
IS
Urban areas: 50 km/h; rural roads: 90 km/h; highways: 90-100 km/h
DE
Urban areas: 50 km/h; rural roads: 100 km/h; no general speed limit on highways
Alcohol Limits
IS
0.02% BAC (strict)
DE
0.05% BAC (moderate)
Priority Rules
IS
Priority to vehicles ascending on hills
DE
Priority to vehicles descending on hills
Winter Tires Requirement
IS
Mandatory during winter months
DE
Recommended but not mandatory
Seatbelt Laws
IS
Mandatory for all occupants
DE
Mandatory for all occupants
Mobile Phone Usage
IS
Hands-free only
DE
Hands-free only
Parking Rules
IS
Strict parking regulations, especially in urban areas
DE
Strict parking regulations, especially in urban areas
Remember
- • Always carry your driving license and rental agreement.
- • Be cautious of changing weather conditions in Iceland.
- • Familiarize yourself with road signs specific to Iceland.
- • Ensure your car rental includes necessary equipment for winter driving.

Voices of our customers

Frequently Asked Questions

Common questions for travelers from Germany renting a car in Iceland

Do I need an international driving permit for Iceland if I have a German driving licence?

No. A German driving licence in Latin script is fully valid in Iceland, provided you have held it for at least one year. You only need to present the original document when picking up the vehicle.

What age requirements apply to drivers for rental cars in Iceland?

For small and compact cars, the minimum age is usually 20 years. For larger vehicles, SUVs or 4x4s, the minimum age may be 23 or 25. Drivers under 25 generally have to pay a young driver surcharge.

Which documents do I need to bring when picking up the rental car?

You will need: 1) your valid original driving licence, 2) a credit card with embossed numbers in the main driver’s name (for the security deposit), 3) your passport.

How early should I book my rental car for Iceland?

Book as early as possible – ideally 3–6 months in advance, especially for trips in high season (June to August) or in winter (November to March). This way you secure better prices and your preferred vehicle category.

Where can I find the best value for money and the widest choice to book a car in Iceland?

I recommend booking via QEEQ. This platform compares numerous local and international providers, offers competitive prices, exclusive discounts and a user-friendly portal for booking and managing reservations.

Do all drivers have to be registered as additional drivers?

Yes, everyone who is going to drive the vehicle must be registered as an additional driver and present their driving licence. Otherwise, the insurance cover becomes invalid in the event of an accident.

May I use another person’s credit card to pay the deposit?

No. The credit card used for the deposit and remaining balance must be in the main driver’s name. This is industry standard and serves to verify identity.

Can I change or cancel my rental car booking later?

That depends on the booking conditions. With QEEQ, free cancellation or changes are usually possible up to 48 hours before pick-up. Please check the specific cancellation terms.

Do I absolutely need a 4x4 for the Ring Road (1) in Iceland in summer?

No, in summer most roads, including the Ring Road, are well paved. A regular small or compact 2WD is sufficient.

Which vehicle class do I need for the Icelandic Highlands or F-roads?

You absolutely need a 4x4 vehicle. Only 4x4s are allowed on roads marked with an “F”. If you drive a 2WD on F-roads, all insurance cover is void and you risk heavy penalties.

What type of car is recommended for travelling in Iceland in winter?

A 4x4 SUV with winter tyres (ideally studded tyres) is highly recommended, especially in regions with a lot of snow and ice.

Which vehicle type is suitable for four adults with four large suitcases?

You will need at least a large SUV or a 9-seater (minivan). Check the actual boot capacity of the desired model in advance.

Are automatic or manual transmissions more common in Iceland?

Manual transmissions are more common and cheaper. Automatics are in limited supply and should be booked early, especially in high season.

What is a campervan and is it suitable for me?

A campervan combines transport and accommodation. It offers a lot of flexibility and saves on hotel costs, but must always be parked overnight on official campsites.

Is a diesel or petrol vehicle cheaper in Iceland?

Diesel is usually slightly cheaper and offers better range. For long distances, a diesel car can reduce running costs.

For what type of trips is a Dacia Duster suitable in Iceland?

The Dacia Duster is an affordable, compact 4x4 SUV, ideal for budget travellers and for lighter off-road routes or added safety in winter. It is less suitable for extreme F-roads.

What does the basic insurance (CDW) included in the rental price cover?

The CDW (Collision Damage Waiver) covers collisions but usually comes with a high excess of €1,500–3,000. On its own, it is not sufficient as full insurance.

What is Super CDW (SCDW) and should I take it out?

SCDW significantly reduces the excess (to around €200–800). It is highly recommended to minimise your financial risk in case of damage.

Is the rental car insurance included with my German credit card sufficient in Iceland?

Partially, but special risks (e.g. sand and ash damage, stone chips) are usually not covered. You also have to pay upfront in case of damage and claim reimbursement later in Germany. For comprehensive protection, an additional insurance via the rental company or QEEQ is recommended.

What is gravel protection (GP) and why is it important?

Gravel Protection covers damage caused by stone chips to the bodywork, windscreen and headlights. On Icelandic gravel roads, this is a common risk, so this cover is very useful.

Why is sand and ash protection (SAAP/SADW) important and where in particular?

It protects against damage from sandstorms and volcanic ash, which occur frequently especially on the south coast and in eastern Iceland. Without this insurance, you risk very high repair costs.

Is theft protection (TP) necessary in Iceland?

Theft is extremely rare in Iceland. TP is usually included in a package anyway, but the actual need is low.

Should I take out tyre and underbody insurance?

If you are driving a lot on gravel roads or F-roads, tyre and possibly underbody insurance is advisable. Damage caused by river crossings is never insured and is always at your own risk.

Is there an insurance that covers all risks?

Many providers, including QEEQ, offer full coverage packages with zero excess that cover almost all damage. For maximum peace of mind, such a package is worthwhile.

What should I do after an accident in Iceland?

First make sure everyone is safe, call 112 if necessary, move the vehicle only if there is danger, document everything with photos, fill out the accident report and inform the rental company immediately.

Which types of damage are usually excluded from insurance cover?

Typically excluded are, among others: driving on F-roads with a 2WD, driving under the influence of alcohol, water damage to the engine, off-road driving, doors damaged by wind, underbody damage and traffic violations.

Is the driving style and driving side in Iceland the same as in Germany?

Yes, Iceland has right-hand traffic with left-hand drive, just like Germany. German drivers usually adapt easily.

What are the speed limits in Iceland and how do they differ from Germany?

In built-up areas: usually 50 km/h, in residential areas sometimes 30 km/h. Paved roads: max. 90 km/h. Gravel roads: max. 80 km/h (often less in practice). Iceland has many speed cameras and high fines.

Which traffic rules must absolutely be followed?

Headlights must be on at all times, day and night, and all occupants must wear seat belts. Adhere strictly to speed limits.

What is the road condition like compared to German federal roads?

The Ring Road is generally in good condition but often narrower, sometimes without hard shoulders and partly still gravel in the east. Side roads are often gravel and in some cases very rough tracks.

What are single-lane bridges and how should I behave there?

Single-lane bridges are common. The driver who reaches the stop line first has priority. Always slow down and make sure oncoming traffic is waiting.

What are the biggest hazards when driving in Iceland?

The weather and nature: sudden storms, fog, black ice, sheep on the road. Check the weather and road conditions before every drive (vedur.is, road.is).

Why is off-road driving strictly prohibited in Iceland?

It destroys the fragile vegetation and is illegal. Violations can result in heavy fines and the complete loss of insurance cover.

How should I react if animals (e.g. sheep) are on the road?

Brake immediately, drive carefully, do not honk or push them. If you collide with an animal, you must compensate the farmer for the loss.

How can I stop safely at the roadside to take photos?

Never stop on the carriageway. Only pull over at designated viewpoints or parking bays and always switch on the hazard lights.

Which important websites or apps should I monitor for safety?

Recommended are: road.is (road conditions), vedur.is (weather) and safetravel.is (travel warnings and safety information).

Should I pick up my rental car at the airport or in the city?

Picking up at the airport is usually more convenient, as you can start your trip right after landing. If you stay in Reykjavik for a few days first, you can rent later in the city and save costs.

What should I check carefully when taking over the vehicle?

Inspect the car for damage, document everything with photos, check the function of key systems, and compare fuel level and mileage with the rental agreement.

What additional costs should I expect with a rental car?

In addition to the rental price, there may be costs for additional insurance, additional drivers, young drivers, GPS, child seats, one-way rentals and possibly taxes.

What do I need to consider when returning the car?

The car should be returned with a full tank and a clean interior. For returns at the airport, allow sufficient time. Keep the last fuel receipt.

How does the rental car deposit work and when is it released?

The deposit is blocked on your credit card (not charged) and released within a few days to a few weeks after returning the car without damage.

What happens if I receive a fine (e.g. for speeding)?

The fine is sent to the rental company, which charges it to your credit card along with an administrative fee.

How high are fuel prices in Iceland?

Petrol and diesel are among the most expensive in Europe. A full tank for a mid-size car costs around €120–150 (as of 2024).

How do I pay parking fees in Iceland?

In cities and at sights, you usually pay parking fees at machines (credit card, coins) or via app (e.g. Parka.is, EasyPark).

Are petrol stations in Iceland self-service and do they accept German cards?

Yes, almost all petrol stations are self-service. German credit cards with PIN are accepted. EC/giro cards are usually not.

What is mobile coverage like in Iceland – do I need a GPS device?

4G coverage is very good, and Google Maps or Waze usually work without problems. A separate GPS device is therefore not necessary.

Where can I use the toilet while on the road?

Petrol stations, visitor centres, campsites and restaurants usually have toilets. Wild urination should be avoided for environmental reasons.

What is the emergency number in Iceland?

The nationwide emergency number is 112. Also save your rental car provider’s emergency number in your phone.

How should I handle strong winds when driving?

Keep both hands on the steering wheel, reduce your speed, hold the doors firmly when getting out and be especially careful – wind damage is expensive and often not insured.

What mindset is particularly important for German drivers in Iceland?

Let go of German efficiency and speed – in Iceland, the journey is the reward. Drive calmly, stay flexible and enjoy the scenery.

Still have questions？

Contact QEEQ via online chat or hotline for specific advice. Contact Support

Car Rental in Iceland for German Travelers

Exploring the mesmerizing landscapes of Iceland is an unparalleled experience. If you're coming from Germany to navigate the country's stunning scenery, you might be wondering:

Can German Citizens Drive in Iceland?

Ready to Rent?

Recommended Car Rental Companies

Car Rental Tips for DE Travelers to IS

How to Choose the Right Car?

Quick Decision Guide

Compare with Confidence on QEEQ

What Are the Popular Destinations in Iceland?

What Insurance Do I Need?

Types of Insurance Coverage

QEEQ's Complete Protection Solutions

How to Save Money While Renting a Car in Iceland

Booking Tips for lower Prices

QEEQ's Money-Saving Features

What Should You Pay Attention To?

Remember

Traffic Rules Comparison Between Germany and Iceland

Remember

Frequently Asked Questions

Other Popular Destinations