Driving in Iceland: the rules, the roads and the mistakes that cost money

What the police enforce and what the rental contract holds you to.

• Drive on the right. Headlights on at all times, day and night, all year; it is the law and the most common ticket for visitors.
• Speed limits: 90 km/h on paved rural roads, 80 on gravel, 50 in towns, 30 in residential streets and near schools. Cameras are frequent and fines start around $150 and climb fast; 30 km/h over is about $500.
• Seatbelts for everyone, child seats to 135 cm or 36 kg. The rental company supplies seats for a fee.
• Blood alcohol limit 0.02 percent, in practice zero. One beer is a ticket and the loss of the licence.
• No off-road driving, anywhere, ever: not on sand, moss, snow or a track that is not a road. Fines run to thousands of dollars and the damage lasts decades.
• Phones hands-free only. Stopping on the road for a photo is illegal and the cause of the typical South Coast accident; use the pull-outs.
• Minimum driving age for rental 20 (23 to 25 for 4x4s and campers, depending on the company); a licence in Latin script is enough, no international permit needed.

Route 1, the Ring Road, is paved for all but a few kilometres and runs 1,332 km around the island. Almost everything people want to see is on it or on a paved spur. The rest is gravel, and the highlands are F-roads.

• Gravel (malarvegur): slow to 60 before the sign, not after; loose gravel on a bend is the classic roll-over. Keep right on blind crests and slow for oncoming cars to avoid stone chips.
• Single-lane bridges (einbreið brú): the car closer to the bridge goes first; slow, look, and never stop on one. The Ring Road still has dozens, mostly in the south-east.
• Blind hills (blindhæð): the road may be single-track over the crest; keep right and slow down.
• Tunnels: several are single-lane with passing bays; the side with the bays gives way. The Vaðlaheiði tunnel near Akureyri is the one toll in the country, paid online within 24 hours.
• F-roads: 4x4 only by law, closed until June or July, river crossings with no bridge. The F-road pages cover each one.
• Mountain passes on the Ring Road (Hellisheiði, Holtavörðuheiði, Öxnadalsheiði, Möðrudalsöræfi, Fagridalur) close in winter storms; the road conditions page shows each one.

Wind does more damage to rental cars than ice. Above 20 m/s a car door opened into it bends back on its hinges, which is a $1,500 repair that no insurance covers; above 25 m/s driving a high-sided vehicle is dangerous and the sands of the South Coast become a sandblaster.

• Park nose to the wind. Open doors one at a time with a hand on each; have passengers do the same.
• Sandstorms on Mýrdalssandur and Skeiðarársandur strip paint and pit windscreens; the rental companies warn by text, and sand and ash damage has its own insurance (SAAP).
• Winter: winter tyres are mandatory from 1 November to 14 April and the rental company fits them; studded tyres are the norm. Ice on bridges and in shade when the rest of the road is wet; the road authority grades every section.
• The weather page on this site grades the next seven days by region; the road page grades every section today. Both before every drive from October to April.

Icelandic rentals come with a basic collision damage waiver and a large excess, typically $2,000 to $3,500. Everything else is optional and the options are where visitors lose money.

• Gravel protection (GP): covers chips and cracks from stones thrown by other cars, the single most common damage. Take it.
• Sand and ash protection (SAAP): covers sandblasting on the south coast; take it from Vík to Höfn in any season, and anywhere in a storm.
• Super collision waiver (SCDW or zero excess): cuts the excess to a few hundred dollars. Worth it in winter; in summer, check whether your credit card covers rental collision in Iceland first (many exclude it).
• Never covered, by any policy: water damage from a river crossing, damage from driving on a closed or F-road in a 2WD, wind damage to doors, undercarriage damage from off-road driving, tyres and windscreen under some policies. Read the exclusions, they are the whole story.
• Photograph every panel at pick-up and return, and the odometer and fuel gauge. Disputes are settled by the photos.

The small things that interrupt a day.

• Fuel is about $2.30 a litre, diesel slightly less. Most pumps are unattended and need a card with a PIN; some accept only chip-and-PIN. Fill up whenever you pass a station in the east and the Westfjords, where the gaps are 100 km or more.
• The discount brands are Orkan, ÓB and Costco (members, Reykjavík only); N1 and Olís are full-service and dearer. Pre-paid fuel cards from N1 or Olís avoid the PIN problem.
• Parking is paid in Reykjavík (zones P1 to P4), at Þingvellir, Seljalandsfoss, Skógafoss, Reynisfjara, Jökulsárlón and most national-park sites, usually by app (Parka, EasyPark) or a camera that reads the plate. Fines arrive at the rental company and are passed on with a fee.
• Sheep: from May to September they graze the verges and cross without warning; a lamb crossing means its mother follows. A sheep you hit is paid for by you to the farmer.
• Electric cars: chargers are at most towns and every 50 to 100 km on the Ring Road (ON, Ísorka, N1 apps); a winter range of 250 km is enough with a plan.
• Emergency: 112, the SafeTravel app for alerts, and the 1777 line for road information.

In order of how often the rental companies see them.

• A door bent by the wind. Nose to the wind, one door at a time.
• Gravel chips to the windscreen without gravel protection.
• Driving too fast onto gravel and leaving the road on the first bend.
• A 2WD on an F-road, or any car through a river: insurance void, car written off.
• Stopping on the road or on a bridge for a photo.
• Speeding tickets from cameras, received months later with the rental company’s handling fee on top.
• A winter plan with no spare day, so a closed pass means a missed flight.