All-inclusive car rental in Reykjavik

Iceland’s capital is the start of almost every road trip: the Golden Circle, the south-coast waterfalls and the Ring Road all begin here. The city itself is compact and walkable, so the car earns its keep the moment you head out of town.

Most rentals are collected at Keflavik Airport (KEF), about 45 minutes away, though downtown Reykjavik pick-up is also possible. A Cardamar all-inclusive booking includes zero-excess cover - genuinely useful on Iceland’s gravel and ash-prone roads.

Good to know before you drive in Reykjavik

Pick-up	Keflavik Airport (KEF), ~45 min - or downtown Reykjavik
Drives on	Right-hand side
Best day trips	Golden Circle, south coast, Snæfellsnes
Roads	Paved near the city; gravel and F-roads beyond
Toll roads	None near Reykjavik

Day trips from Reykjavik

The classic first loop is the Golden Circle - Þingvellir, the Geysir hot springs and the Gullfoss waterfall - an easy paved day from the city. The south coast (Seljalandsfoss, Skógafoss and the black beach at Reynisfjara) and the Snæfellsnes peninsula are longer but equally drivable on tarmac.

A car turns these from coach-tour stops into a flexible day at your own pace; just watch the weather and fill up before longer legs.

Picking up your car for Reykjavik

Almost all rentals are collected at Keflavik Airport (KEF), about 45 minutes west on the paved Route 41; some suppliers also offer downtown Reykjavik pick-up. Completing online check-in beforehand speeds up the desk after a long flight.

Bring your driving licence, passport or ID and the lead driver’s card. With an all-inclusive Cardamar booking your insurance and zero excess are settled before you land - and on Iceland’s gravel that is worth more than almost anywhere.

Zero excess in practice: gravel, glass and ash

The most common Iceland claim is not a crash but a chipped windscreen from flying gravel, or paintwork sand-blasted on a windy south-coast day. On a basic rate those fall under separate gravel (GP) and sand-and-ash (SAAP) cover with a high excess; with an all-inclusive Cardamar booking your liability is zero.

That is exactly why zero excess is worth more in Iceland than almost anywhere - the everyday damage is built into the landscape.

All-inclusive vs. a cheap basic rate plus counter insurance

Two cars on the same lot in Reykjavik can advertise very different prices. The gap is almost always insurance: an all-inclusive rate settles it up front, while a "basic" rate leaves you to buy excess cover at the desk. Here is what each really means.

	All-inclusive (Cardamar)	Basic rate + counter insurance
Damage & theft excess	✓€0 – fully covered	✕High excess (often €800–2,000) blocked on your card
When you insure	✓Before you travel, at a fixed price	✕At the desk, under time pressure, price varies
Tyres, glass & undercarriage	✓Included	✕Usually excluded or charged extra
Deposit / card hold	✓None or low at most stations	✕Large hold blocked for the whole trip
Cancellation	✓Free cancellation	✕Often non-refundable
What you pay in total	✓Known the moment you book	✕Can climb sharply at the counter

A basic rate can look cheaper online, but once you add proper excess cover at the desk it usually costs more than an all-inclusive booking - with none of the certainty.