Last update: February 7, 2024
Renting a car in Iceland is expensive. Below are our best ideas for how to save a substantial amount of money when you rent a car with Blue Car Rental in Iceland. (Blue is our recommended car company in Iceland, and we personally rent from them when we visit Iceland!) These tips will help for a trip to Iceland anytime in 2024 (or beyond!)
Save 5% with our exclusive Blue Car Rental discount link
The first part of your Iceland car rental savings is easy. Just use our affiliate link for renting a car with Blue Car Rental.
Let’s work through an example to see the savings adding up. First, here’s the price for a 1 week rental in June 2024 without any discount:
Note that you’re already seeing a Discount in the Discount field; this is a multi-day rental discount that Blue provides automatically.
Using the link above, here’s the same rental with the 5% discount:
Notice that the discount field gets larger. (Also note that the total savings are actually much more than 5% … Blue automatically adds on discounts for multi-day rentals.)
In late 2023, Blue made it easier to see if you’re getting our 5% additional discount. If you see the percent logo, you’re saving extra money because of us!
Choose “Pay Now” at Blue Car Rental instead of “Pay on Arrival”
Here’s the key point: No matter which option you choose, your reservation is still fully refundable! (Be sure to read the fine print: You need to cancel more than 24 hours before your pickup date to receive a refund on your booking.)
If you choose to pay now, Blue takes the money from your credit card right away. If you choose “Pay on Arrival” they won’t take your money out until your rental starts.
But even if you pay now, you can cancel your reservation, and you’ll receive a full refund within a few days. I guess there is a risk that Blue goes out of business and you would become a creditor if you Pay Now and they keep your money? But Blue is one of the largest and most well-known rental car companies in Iceland, and so this seems unlikely.
Choosing to Pay Now saves you an additional 4-6% or so; this percentage seems to vary and I don’t really know why.
Rent an electric car at Blue Car Rental
So far, we’ve saved 9% or with the 5% discount from us, and an additional 4% by paying now. But I promised 20%. Let’s keep going!
Renting an EV would still save you a significant amount of money on fuel. Iceland has some of the most expensive gas / diesel prices in the world, and some of the cheapest electricity.
Current prices for gas in Iceland are about 290 Icelandic Krona per liter of gas. That’s about $7.95 US per gallon. Suppose you do a Ring Road trip and drive 1,100 miles. (Ring Road is 821 miles long.) At 25 miles per gallon, that’s 44 gallons of gas, or $346. But electric charging may only cost you around $82.50. Let’s round that up to $100, since faster chargers will cost more.
That savings of $246 is easily a 20% or more savings on your rental car cost.
There are currently 4 electric car models you can rent with Blue: A Tesla Model 3, a Tesla Model Y, an Opel Corsa Electric, and a Kia Niro electric (which may now be an upgraded Kia EV6.) In my experience trying different EVs in Iceland, my Tesla Model 3 charged faster than a Kia EV6 at the slower AC charging stations.
You will have to do a bit of extra planning to make sure you can charge you car. Here’s a map of the On Power charging stations, which are often the least expensive.
You’ll want a variety of apps to help you find charging stations and pay for them: On Power, Isorka, and eOne.
Other ways to save money on your Iceland car rental with Blue Car Rental
To be fair, if you aren’t renting a car in Iceland for 2024, and you don’t want to rent an electric vehicle, I’ve only saved you 9% so far.
Without an EV, you can also save money in a couple of different ways:
Longer rental periods. The longer you rent the car for, the cheaper it gets per day. Technically this isn’t saving you money on an absolute basis, but the cost per day is about 40% cheaper for the 7th day vs. the first 2 days. Here’s a sample graph of the cost (in Icelandic krona) per day for a rental we looked at:
Third party insurance. Blue has the option to add Zero liability insurance for 3,800 or 4,900 ISK per day (based on whether the car is 2 wheel drive or 4 wheel drive.) That’s $28 – $36 US per day.
But Blue already builds in a good level of base insurance, which is technicality a liability waiver. Their SCDW insurance, which is included in the base rental price, limits your liability in most cases to 90,000 or 120,000 ISK ($655 – $874.) For a 10 day rental, you could be paying $280 when your liability is already limited to $655.
This isn’t as obvious a win as the other ideas here. The Zero liability insurance also includes Sand and Ash protection, which isn’t included in the base CDW.
You could also consider third-part liability coverage from a company like RoamRight.
Summary: Saving money on your Iceland car rental
Our affiliate link will save you 5%. Paying now saves you even more. Add it up, and you’re saving at least 9% on your car rental in Iceland. Add in the savings from an EV, or a longer rental, or optimizing your insurance, and you’re on your way to saving 20% or much more on your car rental in Iceland!
Let us know what you think- comment below or send us an e-mail!
Iceland Step by Step 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 only recommend products we personally like, use, and recommend to friends. In fact, we’re heading to Iceland in October and paying for an EV rental from Blue with our own money. (We’re paying full price, just using the discounts mentioned on this page!)