Best Car Rental in Iceland: Why Blue Car Rental Tops the List

Blue Car Rental staff assisting a customer at Keflavik airport office.

When planning your trip to Iceland, choosing the right car rental service can significantly influence your travel experience. Iceland, renowned for its breathtaking natural beauty—from glaciers and waterfalls to volcanic landscapes and northern lights—requires reliable and efficient transportation. Your choice of car rental can be the difference between a memorable, stress-free adventure and one plagued by unforeseen issues and hidden expenses. Blue Car Rental, known as a trusted, customer-focused company, stands out as the leading option for travelers seeking comfort, convenience, and peace of mind on Icelandic roads.

Founded in 2010, Blue Car Rental quickly became one of Iceland's premier car rental providers. Its reputation is built upon transparency, exceptional customer service, and a diverse fleet of vehicles suitable for Iceland’s unique road conditions. Whether you’re navigating Reykjavik’s vibrant city streets or exploring remote and rugged terrains, Blue Car Rental ensures reliable transportation tailored to your specific travel plans.

Benefits of Choosing Blue Car Rental

Transparent Pricing

Understanding exactly what you are paying for is crucial when renting a car. Blue Car Rental emphasizes transparent pricing, with no hidden fees or unexpected charges at vehicle return. Customers appreciate the clear, all-inclusive quotes provided upfront, enabling precise budgeting and worry-free travel experiences. One of the standout benefits is that Blue Car Rental does not require any deposit, meaning the price you see is truly the price you pay—offering clarity and peace of mind for every traveler. This approach is rare among car rental companies, and even rarer is that Blue Car Rental is among the few in the world that accepts debit card payments—giving customers more flexibility and removing yet another common rental hassle.

In addition to fair pricing, Blue Car Rental frequently offers seasonal deals and spontaneous pop-up discounts directly on their website. These limited-time promotions can offer generous savings and are updated regularly throughout the year, providing savvy travelers with opportunities to book their rental at the best possible rate.

Comprehensive Insurance Coverage

Iceland’s road conditions can present distinct driving challenges, making comprehensive insurance absolutely essential. Wind gusts, gravel roads, river crossings, snowstorms, and volcanic ash are just some of the factors that can lead to damage—and in Iceland, repair costs and excess fees can be extremely high. That's why Blue Car Rental includes essential insurances like Collision Damage Waiver (CDW), Theft Protection (TP), and Third-Party Liability as part of every rental. These cover many of the most common incidents travelers might face on the road.

However, what truly sets Blue Car Rental apart is the inclusion of its 100% full-coverage liability waiver under its Zero Worries Policy. This top-tier coverage means that even uncommon risks like wind and water damage, gravel dings, and sand or ash exposure are fully covered—something very few, if any, car rental companies in Iceland can match. No other rental agency offers more complete protection at a better value. For travelers, this translates to peace of mind: you can focus on enjoying the scenery, not worrying about your deductible. It’s important that renters review and understand their insurance terms before hitting the road, and Blue Car Rental makes this process simple, transparent, and traveler-friendly. For a detailed explanation of available coverage and what is included, travelers can explore the Blue Car Rental Insurance Overview.

Blue Car Rental Key-box

Efficient Online Check-in System

Recognizing the value of your vacation time, Blue Car Rental provides an efficient online check-in system. Travelers can complete necessary paperwork ahead of arrival, significantly reducing wait times at Keflavík Airport or Reykjavík offices. Simply collect your keys upon arrival and start your Icelandic adventure immediately, saving time and enhancing your travel experience. In fact, Blue Car Rental was the first car rental company in Iceland to introduce this online check-in service—setting a new standard for convenience. They also remain the only car rental in Iceland to offer key-box delivery, allowing for vehicle pick-up and drop-off outside of regular office hours. This contactless process is ideal for late-night arrivals, early morning departures, or those who prefer a seamless, low-contact rental experience.

Zero Worries Policy

The Zero Worries Policy, exclusive to Blue Car Rental, is designed to eliminate common rental stress points. This policy features no deposit requirements, free cancellations up to 48 hours before pickup, and guaranteed 24/7 roadside assistance. This comprehensive approach ensures travelers can enjoy a worry-free Icelandic experience, knowing reliable support is always available.

Exceptional Customer Service

Blue Car Rental’s customer service consistently earns high praise from travelers worldwide. The dedicated, friendly, and responsive staff quickly handle inquiries and issues, providing consistent support from initial booking through rental completion. In addition to having experienced team members at the company’s physical offices, Blue Car Rental also maintains a wide-reaching network of service contacts across the country. This means assistance is never far away, no matter where in Iceland your journey takes you.

Another standout feature is Blue Car Rental’s customer rewards loyalty program Blue+. Members of Blue+ enjoy exclusive benefits such as priority service, access to special offers and discounts, and seasonal perks. This loyalty program is designed to give returning customers extra value and recognition while enhancing the rental experience overall. Positive feedback on review platforms like Trustpilot reflects not only the team's professionalism, but also their innovation and commitment to customer satisfaction, significantly enhancing the overall rental experience.

Blue car rental staff and customer

Convenient Locations

Convenience is key when renting a vehicle, and Blue Car Rental excels with strategically positioned offices at Keflavík Airport and Reykjavík city center.

Keflavík Airport Office: Blue Car Rental’s office is located just minutes from Iceland’s main international gateway. The company provides a convenient shuttle service that transports customers directly from the terminal to the rental location, making vehicle pickup quick and easy upon arrival. The office is well-staffed, efficient, and perfect for travelers eager to hit the road immediately after landing. It’s ideal for those beginning their road trip adventure directly from the airport. See our guide on how to navigate Keflavik airport successfully.

Reykjavík City Office: Located at Fiskislóð 22, right in the heart of downtown Reykjavík, this is the only car rental office situated in the city center. Whether you’re staying in Reykjavik or planning day trips from the capital, the downtown office offers unmatched accessibility and convenience. This location is perfect for travelers who want to explore the city first and pick up their vehicle later without needing to return to the airport.

For those preferring even greater convenience, Blue Car Rental also offers a delivery service where your rental car can be brought directly to your accommodation or chosen location. This flexible option makes starting your journey even easier—learn more about this service on their delivery information page.

These easily accessible locations ensure straightforward rental and return processes, ideal for international arrivals or city-based travelers. Efficient handling at both hubs minimizes disruptions to your travel plans and provides maximum flexibility during your Icelandic journey.

Extensive Fleet for Every Travel Need

Blue Car Rental maintains an extensive vehicle fleet specifically adapted for Icelandic conditions and for the diverse needs of all types of travelers:

  • Economy Cars: Ideal for city car travel and paved roads, offering comfort, compact design, and great fuel efficiency. These are a popular choice for budget-conscious travelers or those spending most of their time in and around Reykjavík.
  • Family Vehicles: Spacious, comfortable, and equipped with ample storage space—perfect for families or larger groups looking to travel together while having room for luggage and outdoor gear.
  • SUVs and 4x4s: A must-have for travelers planning to venture into the Icelandic Highlands or drive on F-roads. These vehicles offer increased ground clearance and traction, making them essential for gravel roads, river crossings, and challenging weather conditions. Great for adventure-seekers and those aiming to reach remote areas and hidden gems.
  • Electric and Hybrid Vehicles: Eco-conscious travelers often choose from Blue Car Rental’s growing selection of electric and hybrid vehicles. These cars allow visitors to explore Iceland sustainably, while saving on fuel costs and contributing to environmental preservation.
  • Luxury and Specialty Models: For some travelers, the rental car is about more than function—it's about style, comfort, or even principle. Whether you're celebrating a special occasion, prefer premium interiors, or simply love driving, Blue Car Rental provides vehicles to suit your preferences.

Whether you prioritize affordability, environmental impact, off-road capability, or extra space for your family or friends, Blue Car Rental proudly meets a wide range of travel needs. This vehicle diversity ensures that every traveler can find the perfect fit for their itinerary—enhancing comfort, safety, style, and enjoyment throughout their Icelandic adventure.

White Toyota Land Cruiser 250 in Iceland.

History of Blue Car Rental

Blue Car Rental was established in 2010, rapidly growing to become Iceland's largest locally-owned car rental brand. The founders recognized the need for a reliable, customer-centric car rental option specifically tailored to Icelandic travel conditions. With a commitment to transparency, service excellence, and innovation, Blue Car Rental swiftly positioned itself as a leader in the Icelandic market, known for consistently delivering high-quality services and customer satisfaction. You can learn more about the company’s background and mission on the Blue Car Rental About Us page.

Local Expertise of Blue Car Rental

Being a locally-owned and operated company, Blue Car Rental offers unparalleled expertise regarding Iceland’s unique road and weather conditions. Staff at Blue Car Rental possess deep local knowledge, allowing them to provide personalized recommendations and valuable travel advice tailored specifically to customer itineraries. This authentic guidance helps travelers effectively navigate Iceland's challenging terrains, maximizing their enjoyment and safety throughout their journey.

Driving in Iceland: Essential Tips

Driving in Iceland requires preparation and awareness of local conditions. Blue Car Rental advises travelers to familiarize themselves with Iceland's varied road types—including paved highways, gravel roads, and remote F-roads—each presenting unique challenges. Regularly checking weather conditions and road status via reliable resources like road.is is essential for safe travel. Additional considerations include wildlife encounters, single-lane bridges, and variable weather conditions. Blue Car Rental supports travelers with comprehensive safety information, ensuring preparedness and confidence throughout their trip.

Employees at Blue Car Rental's service centre.

Environmental Responsibility and Sustainability

Blue Car Rental is committed to environmental sustainability, providing electric and hybrid vehicle options to reduce carbon footprints. Travelers are encouraged to adopt responsible tourism practices, such as adhering to marked trails, proper waste disposal, and minimizing impact on Iceland’s pristine environments. These initiatives highlight Blue Car Rental’s dedication to preserving Iceland's natural beauty for future generations.

Planning Your Trip with Blue Car Rental

Efficient trip planning ensures a seamless experience. Blue Car Rental offers an intuitive online booking system, streamlined check-in processes, and continuous support throughout the rental period. Travelers can confidently plan their journey knowing Blue Car Rental’s expert team is available to provide personalized advice, addressing any questions or concerns promptly.

Unique Features of Blue Car Rental

Blue Car Rental differentiates itself through a unique combination of transparency, extensive insurance options, efficient service, and exemplary customer support. Its in-depth local understanding translates into highly customized services tailored specifically to Icelandic conditions. These distinct features reassure customers, significantly enhancing their travel experience and fostering high levels of satisfaction and loyalty. Many travelers repeatedly choose Blue Car Rental and actively recommend it to friends and family due to these standout attributes.

DC plane wreck at Sólheimasandur black sand beach.

Real Customer Stories and Testimonials

Numerous travelers have enthusiastically shared their positive experiences with Blue Car Rental. Detailed testimonials frequently emphasize seamless booking processes, dependable vehicles, outstanding customer service, and reassuring insurance coverage. Specific accounts describe successful winter trips, family vacations, and adventurous explorations across Iceland, consistently highlighting how Blue Car Rental significantly improved their travel experiences. These real customer stories serve as strong endorsements, reinforcing Blue Car Rental’s exceptional reputation.See more about why customers love Blue Car Rental.

Understanding Icelandic Weather Conditions

Iceland's weather is famously unpredictable, with conditions often changing rapidly within a single day. Travelers should expect variations including sudden rainfall, strong winds, snow, and sunshine—all potentially occurring in quick succession. The summer months (June to August) typically offer milder weather with extended daylight, making it an ideal period for extensive driving and sightseeing. Conversely, winter brings shorter daylight hours and potential challenges such as snowstorms and icy roads, requiring extra caution and suitable vehicle choices, such as 4x4 rentals. The best travel tip is to check out the forecast daily. 

Navigating Road Conditions in Iceland

Road conditions in Iceland vary greatly depending on the area and season. Major highways like the Ring Road (Route 1) are generally well-maintained and paved, while rural routes and secondary roads can be gravel-covered and narrow. Iceland's famed F-roads, accessing remote highland areas, are rugged and unpaved, accessible only by robust 4x4 vehicles and typically open only during the summer months. Travelers are advised to regularly check official road condition websites such as road.is to ensure safe and informed travels.

It’s also important to have some idea about traffic laws in Iceland. Here you can get a full understanding of road rules in Iceland

Kirkjufell mountain and Land Rover rental.

Why Renting a Car is the Best Travel Option in Iceland

Renting a car provides unmatched flexibility, convenience, and freedom for exploring Iceland. Public transportation options are limited and do not cover many popular attractions, especially remote natural sites. Organized tours, while convenient, offer less flexibility. Renting a car from Blue Car Rental allows travelers to set their own pace, explore hidden gems off the beaten path, and tailor their itinerary to their preferences, ensuring a uniquely personalized Icelandic experience.

Importance of Having Rental Car Insurance in Iceland

Iceland's challenging terrain, unpredictable weather, and remote locations make comprehensive rental car insurance essential. Repair costs in Iceland can be significantly high, as can excess amounts in case of incidents. Blue Car Rental highly recommends opting for full coverage insurance directly from your rental company. This coverage provides protection against costly repairs and other common driving-related damages, ensuring peace of mind throughout your travels. Moreover, it's crucial for renters to thoroughly understand the insurance terms provided, helping avoid any confusion or unforeseen expenses during your Icelandic adventure.

Top 20 Popular Destinations to Explore by Rental Car in Iceland

Exploring Iceland by rental car provides access to many stunning sights, off-the-beaten-path locations, and natural wonders that make every mile behind the wheel worth it. Whether you're following the popular tourist trails or carving out your own path, these 20 destinations represent the best of what Iceland has to offer—with flexibility only a rental car can provide.

  1. Golden Circle: A must-see route that includes Thingvellir National Park, where you can walk between tectonic plates; Geysir, the geothermal area that gave all others its name; and the roaring Gullfoss Waterfall. It’s a short loop from Reykjavík, ideal for your first road trip day.
  2. South Coast: Packed with iconic waterfalls like Seljalandsfoss (which you can walk behind) and Skógafoss, plus the charming village of Vík and dramatic Dyrhólaey cliffs. The region’s landscapes change with the weather and season, offering new views year-round.
  3. Blue Lagoon: This famous geothermal spa is just 20 minutes from Keflavík Airport, making it a perfect first or last stop. Soak in warm, mineral-rich waters surrounded by black lava fields.
  4. Snæfellsnes Peninsula: Known as "Iceland in miniature" for its variety—lava fields, fishing villages, black sand beaches, glaciers, and coastal cliffs all within a day’s drive.
  5. Jökulsárlón Glacier Lagoon: An unforgettable stop where icebergs drift through a glacial lake before washing ashore at nearby Diamond Beach.
  6. Diamond Beach: Named for the glittering ice chunks scattered across its black sands. Bring your camera.
  7. Reykjavík: The capital is a cultural hub with great dining, museums, nightlife, and a walkable downtown. A rental car makes it easy to access surrounding nature while staying in the city.
  8. Akureyri: Northern Iceland’s largest town. Don't miss its botanical gardens, scenic harbor, and vibrant cafés. From here, drive to nearby sights like Godafoss Waterfall and Lake Mývatn.
  9. Westfjords: Iceland's most remote and least visited region offers dramatic fjords, red sand beaches, and the thunderous Dynjandi waterfall. A high-clearance or 4x4 vehicle is recommended.
  10. Lake Mývatn: An otherworldly area filled with geothermal activity, pseudocraters, and rich birdlife. The Mývatn Nature Baths are a quieter alternative to the Blue Lagoon.
  11. Vatnajökull National Park: Spanning glaciers, volcanoes, and lush valleys, it’s home to glacier hikes, ice caves, and Europe’s largest ice cap.
  12. Reynisfjara Beach: A dramatic coastline with basalt columns, sea stacks, and pounding surf. Be cautious of sneaker waves.
  13. Landmannalaugar: Accessible by F-roads in summer, this geothermal area in the Highlands boasts rainbow-colored mountains and hot springs. Perfect for hiking and photography.
  14. Húsavík: A picturesque harbor town and one of the best places in the world to spot whales. Summer tours often see humpbacks and even blue whales.
  15. Eastfjords: Quiet fjords, tiny fishing villages, puffin colonies, and the majestic cliffs of Borgarfjörður Eystri. Less touristy, more peaceful.
  16. Kirkjufell Mountain: One of Iceland’s most photographed landmarks. Visit at sunrise or sunset for spectacular light over the nearby waterfall.
  17. Hverir Geothermal Area: Near Lake Mývatn, it features bubbling mud pots, fumaroles, and a Mars-like landscape.
  18. Thórsmörk Valley: A hiker’s paradise nestled between glaciers. Access requires a 4x4, but rewards with epic scenery and numerous trails.
  19. Hvítserkur Rock Formation: Off the beaten path in northern Iceland, this 15-meter basalt monolith resembles a dragon drinking from the sea.
  20. Seljavallalaug Pool: One of Iceland’s oldest outdoor pools, tucked into a mountain valley and fed by a warm spring. Reachable by a short hike from the Ring Road.

Each of these destinations offers something unique—from geological wonders to cultural gems—and they’re all accessible by rental car. Whether you're here for a few days or several weeks, having your own vehicle ensures you can explore Iceland’s diverse beauty at your own pace and comfort. You can find more information about these places and more useful travel tip on our blog

Conclusion

Choosing Blue Car Rental guarantees an exceptional Icelandic travel experience—one that prioritizes safety, convenience, and unforgettable exploration. Travelers consistently value the company’s dedication to reliability, transparent pricing, and robust insurance offerings. With its Zero Worries Policy, Blue Car Rental sets a new standard in customer protection, offering peace of mind that covers everything from gravel damage to emergency assistance.

Its convenient office locations at Keflavík Airport and Reykjavik, combined with fast online check-in and no hidden fees, make the start and end of your trip as smooth as the ride itself. Add to that the wide range of vehicles—including eco-conscious electric and hybrid options—and you have a rental partner ready for every kind of journey, whether it’s a scenic Golden Circle loop or an off-the-grid adventure through the Highlands.

Moreover, Blue Car Rental’s local knowledge and sustainability focus ensure that every recommendation, every route, and every service is designed with your safety, comfort, and Iceland’s preservation in mind. For travelers seeking more than just a vehicle—for those who want a trusted travel companion—Blue Car Rental remains Iceland’s leading choice, delivering the freedom to explore and the confidence to enjoy the journey, mile after mile. Book now!

FAQ

What makes Blue Car Rental the best car rental in Iceland?


Can I rent a car in Iceland without a credit card?


Is full insurance really necessary for a rental car in Iceland?


Where can I pick up my Blue Car Rental vehicle in Iceland?


Does Blue Car Rental have a loyalty program?