The following Terms and Conditions protect both the renter and the rental car provider. For the sake of transparency, we want you to know in advance what you can expect from us. If you have any further questions, please do not hesitate to contact us.
Driver's license and age requirement
The registered driver must be at least 20 years old to rent a 2wd or any of these 4x4 models: Suzuki Jimmy 4wd, Suzuki Vitara 4x4, Kia Sportage, Dacia Duster 4x4 & Nissan Qashqai 4x4 and have held a current driver's license for at least 12 months.
The driver must be 23 years old to rent the rest of our vehicles (large or luxury 4wd cars). The license has to be presented at the start of the rental. Drivers licenses from any EEA and Nordic countries (including Faroe Islands) are valid in Iceland (all categories).
Driver's licenses (B-category only) from other countries outside the EEA and Nordic countries are valid if they are printed in Latin characters or if accompanied by a translation in Icelandic, English, Danish, Norwegian or Swedish.
Credit card imprint
When you sign the contract, we will scan your credit card. This credit card imprint may be used to pay all extra charges such as extra insurance, parking fines, damages or any other costs incurred as a result of the renter's use of the vehicle. All rentals are subject to the full rental agreement terms and conditions at the time of rental.
Rental period
The minimum rental period is 24 hours for pick-up and drop-off at the same location.
Pick-up and drop-off service
For customers arriving at Keflavik International Airport, we offer a FREE Shuttle Service.
Car types
When the booked car type is not available, we reserve the right to provide a car in the same category or above.
Fuel tank
The rental car will normally have a full tank of fuel. The car should be returned full or a charge will be made for having the tank refilled.
Tax
Local value added tax (VAT) is 24%
Child seats
In Iceland, law requires children to travel in an appropriate safety seat. You can book a child seat when you are making your reservation online. These child seats are generally suitable for children weighing from 0 to 36 kg.
Reservation and cancellation policy
Due to excessive demand, in high season, a shortage of cars is common in Iceland. Paying in advance guarantees both your rental and the quoted price.
Cars Iceland could cancel the booking within 15 days if the provider has no availability. In this case, Cars Iceland will refund 100% of the full amount of the booking fee. The cancellation policy is a follows:
Insurance
The following is a summary including general information about our insurances. Please scroll down to the 'Obligation of the Renter' section for a complete list of exceptions and coverage details.
Third-party liability is equivalent to the amount stipulated by Icelandic law at the time of the rental. This also applies to the amount of individual driver liability. Third-party coverage and personal accident insurance is automatically included in your rental.
Collision Damage Waiver (CDW)
CDW insurance is included in the price.
Super Collision Damage Waiver (SCDW)
SCDW insurance is INCLUDED and the self risk is 90,000 ISK for 2WD vehicles and 120,000 ISK for 4WD vehicles. The renter is therefore always responsible for the following damages, which are not covered by CDW or SCDW insurance:
(*) Covered by gravel protection (GP).
Gravel Protection (GP)
Gravel Protection (GP) is included. This protection includes damages to the windscreen and headlights when gravel or rocks get thrown onto the vehicle by another car. The self-risk amount for a broken windscreen is 40,000 ISK.
Theft Protection (TP)
TP covers the theft of the rental vehicle and is included in the price.
Sand & Ash Protection (SAAP)
Damage due to volcanic eruptions (ash) and sand storms, especially in the south coast of Iceland, can easily cost between 500,000 to 1,500,000 ISK to repair.
New optional insurance is available for our customers' protection which covers these ash/sandstorm damages to the paint, windows, lights and components of the car.
By purchasing SAAP, the self risk in case of damage from sand and ash is lowered to 90,000 ISK.
The price for SAAP insurance is 1,650 ISK per day.
Liability Waiver
The Liability Waiver reduces the deductible amount to ZERO for any damage covered under our insurances. CDW, SCDW, GP, TP and SAAP all fall under this umbrella and are subject to the terms and conditions of the Rental Agreement. This excludes any damages not covered by insurance.
Please note that this is not extra insurance. Rather, it gives our renters the option to completely waive liability for any damages to the rental car covered under rental insurance. You'll have a stress-free journey with Cars Iceland and enjoy the scenic beauty of our lovely island.
From 3,700 ISK per day.
Emergency assistance
Call 112. Break down service 24 hours, call 00354 773-7070
Break down service
Call 00354 773-7070 (roadside assistance).
Equipment available on request
Baby seat, GPS, roof box, fuel can. Extra driver/s option is also offered.
Service fee
This fee does not apply when the damages incurred are not caused by the renter. There is a handling fee of up to 4,500 ISK for all fines or charges that result from renters using the car. The car rental company will charge the renter for fines and charges, plus the previously mentioned handling fee.
*Note: In case of missing fuel an additional 2,000 ISK service fee is added to the amount stated in the price list.
*Note: At the return of an electric vehicle the renter must return the car 70% charged. If the car is returned with its battery under 70%, a charging and administration fee of 25,000 ISK can be charged.
RESPONSIBILITIES OF THE RENTER
The renter acknowledges the terms outlined in this Rental Agreement and confirms receipt of a copy detailing its provisions.
The renter affirms that the vehicle and its accessories have been delivered in a secure and functional condition. The provider retains the right to replace the reserved vehicle with a comparable or upgraded model if the originally selected vehicle is unavailable.
The renter/driver must be at least 20 years old and hold a valid driver's license issued at least one year prior to the rental period. This license must be presented upon signing the agreement.
To rent larger vehicles, such as SUVs or passenger vans, the minimum age requirement is 23 years. The renter/driver is obligated to comply with all applicable Icelandic traffic laws and regulations.
The renter assumes full responsibility for the vehicle from the moment it departs the provider's premises until its return is officially acknowledged by the provider.
The vehicle must be returned under the following conditions:
Extensions of the rental period require the provider's approval. Late returns exceeding one hour may result in charges for an additional rental day plus a penalty fee of 10,000 ISK. Ongoing delays may incur further fees based on the provider's rates.
A one-way fee of 4,900 ISK applies for rentals picked up at the Reykjavik City Office and returned to Keflavík Airport.
The renter authorizes all applicable fees to be charged to the credit/debit card provided at the start of the rental. Unauthorized delays or failure to return the vehicle may result in repossession by the provider or law enforcement at the renter's expense.
Only registered drivers meeting the requirements outlined in this agreement may operate the vehicle. Allowing unauthorized drivers nullifies all insurance coverage, and the renter will bear full financial liability for any resulting damages or losses.
The renter is fully accountable for damages arising from prohibited use, including but not limited to:
Damages or overhead costs resulting from such misuse will be charged to the renter's credit/debit card.
In the event of an accident, the renter must immediately inform the provider and remain at the scene until an accident report is completed. All damages must be reported, regardless of applicable damage waivers.
The distance traveled by the vehicle during the term of this Rental Agreement is measured using the odometer installed by the vehicle's manufacturer. The renter must promptly inform the provider if the odometer becomes defective or ceases to function at any point during the rental period.
The renter is liable for any traffic violations, fines, tolls, or other charges incurred during the rental. A handling fee of up to 4,500 ISK will be applied for processing such fines or charges.
The renter must not:
Violation of these terms may result in hefty fines and additional liabilities charged to the renter's credit/debit card.
If a collision or accident occurs, the renter must notify the provider immediately. The renter is prohibited from leaving the scene until an accident report has been properly completed. Additionally, the renter is required to report any damage to the vehicle to the provider, regardless of whether a collision damage waiver (CDW or SCDW) applies to the rental.
The renter agrees to provide payment to the provider as follows:
The renter is prohibited from making unauthorized modifications or repairs to the vehicle or using it as collateral without obtaining prior written approval from the provider.
Under no circumstances may the renter use the vehicle for commercial passenger transport, lend it to third parties, or sublease it.
RESPONSIBILITIES OF THE PROVIDER
The provider ensures that the vehicle meets all registration and safety standards and reserves the right to replace the reserved vehicle with a similar or upgraded model if necessary.
In cases of mechanical failure not caused by the renter, the provider will arrange repairs or provide a replacement vehicle promptly. No compensation for accommodation or other related costs will be provided, except for refunds for rental days exceeding 24 hours of downtime.
The provider will inform the renter of all applicable terms and conditions at the time of rental.
Foreign renters will be briefed on Icelandic traffic regulations, road conditions, and potential hazards, such as animals or icy surfaces.
If restrictions on vehicle use are necessary, these will be documented in writing upon signing the agreement.
Liability insurance for the provider's operations is maintained as required by law.
The provider is not responsible for lost or damaged personal items left in the vehicle.
INSURANCE AND LIABILITY
The rental fee includes mandatory liability insurance as per Icelandic law. The renter is fully responsible for damages not covered by insurance, which may include damage due to negligence, unauthorized drivers, or prohibited use.
Third-party liability insurance will comply with the amounts specified by Icelandic law at the time. If the renter causes damage to a third-party vehicle without any damage to the rented vehicle, the renter will be responsible for a third-party liability fee of ISK 35,000.
Optional waivers, such as Collision Damage Waiver (CDW), Super Collision Damage Waiver (SCDW), Gravel Protection (GP), or Sand and Ash Protection (SAAP), are available to reduce the renter's liability in specific cases. Damages not covered by insurance or waivers will be charged to the renter's credit/debit card, including retrieval costs for stranded or damaged vehicles.
The accident insurance policies detailed in Article 28 exclude the following:
Any damages not covered by the vehicle's insurance may be charged to the renter's credit/debit card on file.
The renter may opt to purchase waivers such as Gravel Protection (GP) or Theft Protection (TP) to reduce financial liability for specific damages, including those to paint or windows caused by gravel or vehicle theft. However, these waivers exclude damage to the front windshield or the underside of the vehicle, which is subject to excess costs unless the Liability Waiver is purchased.
Sand and Ash Protection (SAAP) is available to cover damages caused by environmental elements such as sand or ash to various vehicle components. Excess charges for this coverage are outlined in the Rental Agreement.
A Liability Waiver can be purchased to extend coverage for damages included under CDW, SCDW, GP, TP, SAAP, and Tire Protection, subject to the terms of this agreement. However, it does not apply to exclusions outlined in Article 29 unless explicitly stated.
Should roadside or breakdown assistance be required due to renter-related incidents, charges for retrieval and assistance will apply, calculated at ISK 350 per kilometer or a minimum of ISK 35,000. Assistance charges may be reduced to zero if the renter purchases an applicable waiver.
The renter may purchase a special waiver that reduces the amount the provider charges for roadside assistance to zero.
GENERAL PROVISIONS
The minimum rental duration charge is equivalent to 48 hours, even if the vehicle is rented for a shorter period. A return occurring one hour or more after the pickup time constitutes an additional rental day.
By signing this agreement, the renter confirms receipt of the vehicle and its accessories in acceptable condition. This agreement, including terms and inspection details, must remain in the vehicle throughout the rental period.
All amendments to the rental must be agreed upon in writing and are subject to availability. Cancellations made within 24 hours of the pickup time will incur the full rental fee. Refunds for unused rental periods are not provided unless prior adjustments were arranged before the pickup date.
The provider reserves the right to repossess the vehicle without prior notice if the terms of this agreement are violated, or if the vehicle is abandoned or improperly parked. The renter will be held liable for any associated costs.
Any additions or alterations to this agreement must be documented and authorized by the provider in writing. The provider retains the right to charge the renter's credit/debit card for outstanding fees, fines, or damages for up to six months after the rental concludes.
This agreement is governed by Icelandic law. Legal disputes will be settled in the district court of Reykjanes, Iceland. Disputes may also be submitted to arbitration via Icelandic consumer or travel industry associations.
By submitting their credit card information to the provider, the renter grants electronic authorization and/or signature for this Rental Agreement, permitting the provider to charge the card for the rental cost as well as any additional expenses, fees, or penalties that may arise under the terms of this agreement. These charges are determined by the pricing outlined in the terms and conditions or specified on the front and back of the Rental Agreement. This may include, but is not limited to:
The provider retains the aforementioned right to charge the credit/debit card for the rental fee and any other fees, charges or fines that may arise from this Rental Agreement for a period of up to six months after the rental ends.
The provider reserves the right to refuse or deny any rental at its discretion if it is deemed that the booking information provided is incomplete, inaccurate, suspicious, or if there are concerns regarding the likelihood of the vehicle being returned in a satisfactory condition.
This Rental Agreement, and any agreements, made based on this agreement and its provisions, fall under the auspices of Icelandic law. This includes any claims for compensation that might be made. This applies both to the basis for and the calculation of compensation. The same applies to claims for damages based on liability outside this agreement. If legal disputes arise concerning this lease agreement, they will be heard before the provider's legal venue, the district court of Reykjanes, Iceland.
Any disputes between the parties to this rental agreement can be submitted to the active Arbitration committee of the Icelandic Consumers Association and the Icelandic Travel Industry Association.
