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Terms and conditions policy

The following are terms and conditions intended to protect both the renter and the rental car provider. In the spirit of transparency, we want you to know beforehand what you can expect from us . If you have any further question please do not hesitate to contact us.

Drivers license and age requirement:

The registered driver must be at least 20 years 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 drivers license for at least 12 months. The driver must be 23 years to rent the rest of cars (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 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 Shuttle Service for FREE.

Car types:

When the reserved car type is not available, we reserve the right to exchange cars in the same category or above.

Fuel Tank:

The rental car will normally have a full tank of fuel. The car should be returned TOTALLY full or a charge will be made for having the tank refilled. 


Local value added tax (VAT) is 24%

Child seats:

In Iceland law requires children 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 0-36 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 not availability. In this case, Cars Iceland will refund the full amount of the booking fee 100%. The cancellation policy is a follows:     


- Cancel more than 24 hours prior to the rental and get a full amount of the booking fee.
- Cancel less than 24 hours before your rental and pay the booking fee.
- In case of a no-show
we charge 100% of the rental amount.


Third party liability is equivalent to the amount stipulated by Icelandic law at each time. 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 on 2wd and 120.000 ISK for 4wd. The renter is therefore always responsible for the following damages, which are not covered by CDW or SCDW insurance:

- driving while intoxicated.
- damages caused by accident with livestock.
- damage to tires.
- headlights (*)
- wind-screen (*) and the underside of the car.
- damage caused by loose rocks which get thrown at the car on gravel roads (*)
- damages to the engine of the car caused by water getting into the motor.
- negligence.

(*) covered by gravel protection (GP).


For further information and more details about terms and conditions please consult the rental agreement.

Gravel protection (GP):

The gravel protection (GP) is included. This protection includes damages to windscreen and headlights when gravel or rocks get thrown at the vehicle by another car.

Self-risk amount for the broken windscreen is 20.000 ISK. 


Theft protection (TP):

TP covers theft of rental vehicle and is included in the price.

Sand and ash protection (SAAP):

Damages 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 1.500 ISK per day.

Liability Waiver:
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, Roofbox, 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 8.500 ISK for all fines or charges that result from renters use of the car. The car rental company will charge the renter for fines and charges plus the previously mentioned handling fee.


If car is returned extra dirty or If someone smoked inside the car, the renter will have to pay ISK 15.000 for cleaning fee. Gasoline 250 ISK per liter for refueling, in addition to the cost of the gasoline. 

Car Rental Iceland - Iceland Car Rental - Car Hire Iceland
Car Rental Iceland - Iceland Car Rental - Car Hire Iceland

The Liability Waiver reduces the deductible amount to ZERO for any damage covered under our insurance. 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. Consult your Rental Agreement for Terms and Conditions.  


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. 


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