Last update: September 1, 2023
We’ve partnered with Blue to provide our readers a 5% discount on their rental. Read below to see why we recommend you rent from Blue. Then see the discount details here: Blue Car Rental discount.
I don’t know how many car rental companies there are in Iceland– 100? It’s tough to tell, since some of them are just agents and don’t have their own fleet of vehicles. Choosing one is really hard; there are a lot of horror stories out there.
After dozens of hours of research, we decided to rent from Blue Car Rental. Now, there are other companies out there that will most likely provide you with a positive experience. But here are the reasons we have been impressed with Blue (and some minor quibbles); you can use this to judge them against other options.
- Will the company guarantee you a new rental car? When I rent a car in the United States, this isn’t really a consideration– I just assume I’ll be getting a car that’s less than 3 years old. But in Iceland, you could be getting a 10 year old car; the slightly cheaper price may not be worth it. If you look at the list of all of Blue’s cars (click on “Our cars” from their main page, they list one older model 4X4, which they will only rent in the summer. Just about every other car is from model year 2021, 2022, or 2023. (Note below the first car is listed as a “used model.” This may be the best you’d get at other car rental companies in Iceland!
- How much insurance is included? Almost all rental car companies in Iceland include basic CDW insurance. (Note that this included insurance may void your credit card insurance; we recommend third party excess insurance as a cheap extra.) Every rental with Blue includes much more insurance than any other rental company:
SCDW just means your out of pocket maximum will be lower. The maximum is about $650 for 2 wheel drive cars (90,000 krona) and about $850 (120,000 krona) for 4 wheel drive cars. Most other companies set the CDW limit to $2,000 or more, and charge you $10 a day or more to lower that level. TP is theft protection. Honestly, I’ve never heard of a rental car being stolen in Iceland? But Blue gives you the coverage for free.GP is gravel protection. If your car suffers minor damage from gravel thrown up by other cars, you don’t owe anything. Again, other companies can charge $10 or $15 a day for this. Blue also now offers a “zero worry” insurance add-on if you want to lower the liability limit to zero. But the “free” insurance is so good that you may not want to add this! - How much do child car seats cost? Blue provides booster seats for kids free of charge. And safety car seats for younger kids cost a fixed fee of 4000 krona, or about $33. For a short rental, that car seat cost could be expensive. But for a longer rental, which I think is more common, this can be cheaper than a per day fee.
-
- How is their customer service? Blue has been responsive to all of my e-mails, which I appreciate. But how do they respond to a customer with an issue? Lucky for you readers, we did have an issue, because I didn’t take my own advice. And they took care of it. If you have a big family, as we do, remember that many 7 or 8 passenger vehicles will have almost no trunk / storage space behind the third row of seats. I knew this, and ordered a roof rack for our Land Cruiser. But even with that, there was no way we were all fitting in the car with our luggage. Blue found me a car that worked for us– and it’s not an easy feat to change the vehicle type for a 45 day rental on the spot. Here was what they found for us:
It was nearly brand new and served us very well as we explored the country.
- Are studded snow tires included? Okay, we didn’t have snow tires on our summer rental. But if you rent in the winter, Blue guarantees studded snow tires. It’s right on the home page:
By law, they have to give you regular snow tires. But guaranteeing the studs gives you an extra layer of safety. Blue doesn’t have to do this, but it’s nice to know they do; it makes me think they strive to make sure their customers have a positive experience.
Blue Car rental just keeps getting better
I used to have a list of the things I didn’t like about blue. That list is quickly turning into a list of “problems that Blue has now solved.” Take a look:
- The infant car set we received in 2016 was old, and didn’t meet the latest ISOFIX safety standards. (ISOFIX is similar to LATCH in the United States. I assume this isn’t just because of my complaint, but in early 2019 Blue purchased new car seats that are the excellent Britax brand. Blue told us the models are “Britax First Class, Britax First Class Plus, Britax Eclipse and Britax Evolva and Discovery”
- Blue used to charge you a 2500 krona (about $20) fee to pick you up at Keflavik Airport. I guess Blue didn’t solve this one, but there is now a free airport shuttle service! It’s only about a 4 minute walk to their office, and I prefer the walk. (They say 3, but I’m adding a minute to walk over with kids and luggage.) Blue has a nice map that shows you how to walk to their office from the airport (and you still may find this old video of the walking instructions useful!)
- During the summer of 2019, I had to wait about half an hour to pick up my car. But new for 2021, Blue has created a zero wait-time option for picking up your car. You can handle all of the check-in paperwork online before you leave on your trip, and then you’ll be able to get your car immediately. You’ll receive an e-mail about a week before your trip with the online check in instructions.
- You are still responsible for damage. This is specific to Iceland, not to Blue at all. But you may be used to rental car returns where they don’t really even look for damage. Damage to the car is much more likely in Iceland, and they will do a thorough inspection when you return the car. Make sure you note any damage when you pick up the car; it seems prudent to take some photos or a video. Like any other car rental company in Iceland, Blue will charge you for damage not covered by the insurance.
Looks like I’m out of quibbles. Overall, Blue will rent you a newer model car at a reasonable price. It may not be the cheapest option in Iceland, but it’s not that far off. And you’ll have extra insurance built in, a new car, and a very high likelihood of a pleasant experience.
Iceland With Kids may earn a referral fee if you book through a partner’s link. However, reviews are based solely on my personal experience. Partners never approve or endorse my editorial content.
We are heading to Iceland for a stopover with our kids in July (2.5 and 5 years, both under 40 lbs and needing car seats…), so was very happy to find your blog, especially the info on car seats. I was wondering if you have any opinions about renting a car in the middle of the night and driving straight to Reykjavik (to our Airbnb apartment)? How are the roads, and is this a crazy idea in the dark? We are arriving at midnight and leaving again at midnight after 48 hours (coming from North America, so hopefully we will still be fairly alert!). We don’t want to waste too much time dealing with shuttle buses or finding car seats on the fly with taxis, and want to keep the whole 48 hours as hassle-free as possible. We’d really like to get out of Reykjavik, at least on day 2, and see some scenery, and maybe go to the Blue Lagoon on our way to the airport. We were thinking renting a car would be a good idea at least for one day. Any recommendations for transportation logistics, or even itineraries for such a short trip? And thanks for your helpful blog!
Hi Carrie,
It’s hard to believe, but it’s still going to be light at midnight in July! Well, it might be getting kind of dusky if you’re there at the very end of July, but otherwise you’ll have plenty of light. The roads will be perfectly fine in the summer, and I think heading right to Reykjavik and going to sleep when you get to your rental place is the way to go.
If it works with your schedule and budget, you may just want to keep the car for the whole time? Some companies, including Blue, have a 2 day minimum rental. Then you can just return it back at the airport. I’d consider getting out of Reykjavik on the first day, and exploring the Golden Circle or the South Coast. If you’re out late exploring, you could even stick with your home time zone, and just stay up until 2 AM every night. Remember, it will be light!
Then on day 2, you can spend a little time in Reykjavik. Maybe check out the Reykjanes Geopark and the Blue Lagoon before heading back to the airport. The Geopark is on the same peninsula as the airport.
I assume you’re just staying in Reykjavik both nights? Be sure to book the Blue Lagoon as soon as you know your schedule, so you can get your preferred time.
Have fun!
I hadn’t thought too much about it but of course it will still be fairly light – that is a relief. These sound like some great spots to visit – the Geopark looks beautiful. Thanks again for your help and the site!
We just returned from Iceland and used Blue Car Rental and had a very good experience. They were very quick & efficient on both ends – pick up and return. They are a stop on the shuttle bus that goes around the airport so it was very easy to get to them. They actually take American Express now. Thanks for the recommendations – your site was very helpful!
Thank you so much for this article! I was so uncomfortable about the rental car situation; read this and ended up cancelling my reservation with another company to book with Blue. They were super responsive and gave me a discount code so that I could finish the booking I’d started online. I can’t tell you how much this is helping my anxiety right now!
Hello! I’m just back from Iceland and used your posts in my planning to help me decide about car rental & insurance. We went with Blue and they were great. Pro tip: don’t bother with the rental car shuttle from the airport to Blue unless you have a crazy amount of luggage. It’s much faster to walk. We were given a Toyota Aygo which was the cutest, zippiest car. In my reservation, I had opted for everything but the total liability waiver. At the counter, I added my 20 y.o. son as a driver, and took the total liability waiver. I don’t remember how much the initial rental was, but adding my son & the liability waiver for four days was $80 and change – very reasonable. I am glad we went for the waiver – when I dropped it off and the guy went out to inspect, I didn’t worry at all (though it was all good). I didn’t bother with taking pictures when I picked up, because I had the waiver and because they marked the (very minor) pre-existing scratches and dings on the rental form. The Aygo is very small, but there was a sticker on the dash that said it was OK for F roads! I was pretty suprised. We didn’t do any F-roads, but we did drive on a few dirt and gravel roads – the roughest place we drove the car was the rocky parking lot for the Sólheimajökull glacier on the south coast. Because underside damage was NOT covered by any insurance, I would have been very hesitant to drive anything rougher than that.
The car keys came with a discount tag for Olis and their related unattended gas stations, called O-something (I can’t remember the name). I think we paid roughly 60 USD total for the gas we got.
We really had a wonderful time. The south coast has to be seen to be believed. I would also HIGHLY recommend Kleifarvatn Lake and the Seltun Geothermal areas which are not far from Reykjavik. They are very close together and we saw both the evening of our first day there. We had both of them to ourselves and the lake is really stunning. (We also saw some idiot who had been off-roading on the beach, and he was stuck. HA! Karma.)
Hi Kayla,
Thanks so much for your comment! I’m glad you had a great time.
I’m also surprised to hear that the little Aygo can go on F roads! I’m glad you didn’t try it. 🙂 Did you have any issues fitting you luggage in it?
Thanks again!