Best Car Rental in Iceland: Our Honest Lava Car Review

Finding the best car rental in Iceland can be overwhelming, especially with so many companies claiming to offer the best prices, vehicles, and insurance options.

After researching dozens of rental companies and driving more than 1,651 km (1,025 miles) around Iceland on a 12-day Ring Road trip, we found one company that stood out from the rest: Lava Car Rental.

For our trip, we rented a 4WD Suzuki Vitara and put it to the test on paved roads, gravel roads, mountain passes, and everything in between.

In this review, I’ll share our honest experience with Lava Car Rental, including the booking process, pickup experience, vehicle quality, insurance options, and whether I think it’s the best car rental in Iceland for a Ring Road adventure.

Why We Chose Lava Car Rental

We originally chose Lava Car Rental because they were a highly-rated, local car rental company. We also found their prices competitive, their vehicles newer than many competitors, and the pickup process simple and stress-free.

We really liked that Lava is a locally owned Icelandic company. Whenever possible, I prefer supporting local businesses, and in my experience they often provide a more personal level of service and a much better understanding of the destination than large international chains.

That said, no rental company is perfect, so here’s a quick look at the pros and cons of renting from Lava Car Rental.

Our 12-Day Iceland Road Trip at a Glance

Before diving into our experience with Lava Car Rental, I think it’s important to understand the type of trip we used the vehicle for. This wasn’t a short trip, we spent 12 days driving around Iceland and visited nearly every region of the country.

If you’re planning a similar trip, be sure to check out my 12-Day Iceland Ring Road Itinerary where I share our exact route, overnight stops, favorite attractions, and travel tips.

Vehicle: Suzuki Vitara 4WD Hybrid
Trip Length: 12 Days
Distance Driven: 1,651 km (1,025 miles)
Time of Year: June
Route: Golden Circle → South Coast → East Iceland → North Iceland → Reykjavík

During our trip, we drove on paved highways, gravel roads, winding mountain passes, coastal roads through the Eastfjords, and remote stretches of road in East and North Iceland. Because of that, we felt like we got a very realistic picture of what it’s like to rent a car and drive it around Iceland for an extended period of time.

Our Honest Lava Car Rental Review: Is it the Best Car Rental in Iceland?

Based on our trip around the Ring Road, here are a few specifics regarding our experience with Lava Car Rental.

Pickup Experience at Keflavík Airport

Before our trip, Lava Car Rental sent a detailed email with pickup instructions, which made the process much less stressful. One thing to be aware of is that Lava’s office is located off-site, so you’ll need to take a shuttle from Keflavík Airport.

I’ll admit that after an overnight flight and arriving in Iceland at 6:00 AM, the idea of finding a shuttle felt a little daunting. However, the process ended up being super easy.

The free shuttle operates between 5:00 AM and 6:00 PM, around every 20-30 minutes. For arrivals outside those hours, Lava also provides after-hours pickup instructions (see details here).

Driving a Suzuki Vitara around Iceland

Lava Car Rental offers a wide variety of different vehicle types, including 4×4 SUVs, camper vans, and even electric cars.

However, for our 12-day Iceland Ring Road trip, we chose a Suzuki Vitara 4WD Hybrid. Since we were traveling as a couple and planned to drive around the entire country, we wanted something that was comfortable, fuel-efficient, and capable of handling Iceland’s changing road conditions.

Overall, we were extremely happy with the Suzuki Vitara and thought it was the perfect choice for us.

Size & Luggage Space

The Suzuki Vitara was the perfect size for two people. We had plenty of room for our luggage, backpacks, camera gear, and groceries without feeling cramped. If you’re traveling as a couple, I think it’s an ideal choice.

For families or groups of four, I would recommend upgrading to a larger SUV, especially if everyone is bringing full-sized suitcases.

Driving Comfort

We spent a lot of time in the car over the course of our trip, including several longer driving days between regions. Overall, the car was super comfortable to ride in. Here is a quick list of the things we liked.

What We Liked About the Suzuki Vitara:

✅ Stable in Windy Conditions – The vehicle felt very stable, even on windy days, which are common throughout Iceland.

✅ Large Touchscreen Display – The large screen made it easy to follow Google Maps directions while driving.

✅ Apple CarPlay Compatibility – We had no issues connecting our phones and were able to use Google Maps and Spotify seamlessly.

✅ Plenty of Charging Options – There was enough charging space for both of our phones, which was especially helpful on longer driving days.

✅ Helpful Iceland Driving Tips – Lava included a small dashboard sticker with important driving and safety reminders specific to Iceland. I don’t think I’ve seen a rental company do this before, but its really convenient to have emergency numbers and info on hand. It also listed where to check road and weather conditions (Safetravel.IS and Road.IS).

✅ Comfortable Heated Seats – One of my favorite features! Even in June, we encountered snow in East Iceland, needles to say the heated seats were definitely an added bonus!

✅ Portable Wi-Fi Available – We rented a Wi-Fi hotspot from Lava Car Rental, which worked well for navigation and staying connected around the country.
💡 Pro Tip: Even with the portable Wi-Fi, I’d recommend downloading an offline Google Map before your trip for any remote areas you plan to visit. Always good to have a backup navigation.

Gravel Roads & Mountain Passes

While most of our route followed paved roads, we also drove on some gravel roads and mountain passes throughout East and North Iceland. The Vitara handled these conditions without any issues which definitely was a sigh of relief when venturing through the Eastfjords.

Although we didn’t drive any F-roads, I was glad we chose a 4WD vehicle. It definitely felt more comfortable, especially since we are used to driving SUVs at home.

Fuel Economy

Fuel prices in Iceland can be expensive, so having a hybrid vehicle helps. Despite covering more than 1,651 km (1,025 miles), fuel costs were fairly reasonable and we even got a small discount from Lava Car Rental to use at the gas stations.

Would We Rent It Again?

Absolutely. For an Iceland Ring Road trip, I think the Suzuki Vitara is the perfect SUV. It offers a great balance between comfort, fuel efficiency, luggage space, and capability. It was large enough to handle everything we needed while still being easy to drive and park throughout Iceland.

Our Experience with Lava Car Rental Insurance

One thing that stood out to me when booking with Lava Car Rental was how comprehensive their insurance options were. Iceland is one of those destinations where rental car insurance is worth paying attention to.

Between unpredictable weather, strong winds, gravel roads, and remote driving conditions, having good rental car insurance is a must-have in Iceland.

Insurance Included with Lava Car Rental

Every Lava Car Rental includes the following basic insurance protections, and then you have the option to add an additional full coverage waiver (which I recommend doing).

✅ Third-Party Liability Insurance (TPL) – Covers damage or injury caused to other people or property.
✅ Collision Damage Waiver (CDW) – Covers damage to the rental vehicle and provides basic protection for drivers and passengers.
✅ Super Collision Damage Waiver (SCDW) – Reduces your financial liability if the vehicle is damaged.
✅ Theft Protection (TP) – Covers theft of the rental vehicle.
✅ Gravel Protection (GP) – Covers damage caused by gravel or rocks hitting the windshield, headlights, mirrors, or vehicle body.

What Does the Full Protection Package Add?

For our trip, we upgraded to Lava Car Rental’s Full Protection Package, which reduced our liability to 0 ISK for covered damages and added:

✅ Sand & Ash Protection (SAAP) – Covers damage caused by Iceland’s sand and ash storms, which can damage paint, windows, lights, and plastic trim.
✅ Tire Protection (TIP) – Covers damage to tires and wheels.
✅ 0 ISK Liability Excess – Eliminates your out-of-pocket liability for damages covered under CDW/SCDW, Theft Protection, Gravel Protection, Sand & Ash Protection, and Tire Protection.

Is Full Coverage Insurance Worth It in Iceland?

For our 12-day Ring Road trip, the answer was yes.

Thankfully, we never needed to use the insurance, but it really is a peace of mind thing when renting a car. Especially in a country like Iceland where there can be gravel roads, hazardous weather, etc. it is just better to go with a full coverage insurance option.

No matter what car rental or insurance option you decide to do, make sure you fully read the terms to see what is and what is not covered. You can see more about Lava Car Rental insurance policies here.

So, Is Lava Car the Best Rental Car in Iceland?

Yes, I think so!

After driving 1,651 km (1,025 miles) around Iceland’s Ring Road, I can confidently recommend Lava Car Rental to anyone planning an Iceland road trip. Our experience was smooth from start to finish.

The Suzuki Vitara was comfortable, reliable, and handled everything from paved highways to gravel roads and mountain passes with ease. We also appreciated the comprehensive insurance options, competitive pricing, helpful driving resources, and the ability to rent a portable Wi-Fi device.

Perhaps most importantly, the staff at Lava Car Rental was so friendly and genuinely helpful. It made both picking up and returning the car a great experience.

If you’re looking for the best car rental in Iceland for a Ring Road trip, Lava Car Rental would absolutely be my first choice. We will definitely rent from them again on our next visit to Iceland.