Which Insurance Do You Recommend For My Rental?

Renting a campervan in Iceland and taking a road trip around the island is the ultimate adventure. The Northern Lights, glaciers like Langjökull, and waterfalls like Skógafoss and Seljalandsfoss are just the beginning. But there are also some practical concerns, like which insurance is recommended for your campervan rental. There are several types of recommended campervan rental insurance for Iceland, each with a specific purpose. We’ll touch briefly on each type (CDW/SCDW, SAAP, GP, and TP insurance) to show their differences and why they're important for your Iceland campervan rental. Legally mandated CDW (Collision Damage Waiver) coverage comes standard on all rental vehicles in Iceland, but the others are necessary as well. Let's dive into the different types of insurance and what they cover.

Do I Really Need Rental Insurance in Iceland?

Now, I know what you’re thinking. “I don’t need insurance, I’m a good driver” or “Rental insurance is just an upsell for suckers to make the companies more money. I’m no fool!” I know you think these things because I think them too. We all do. To be perfectly honest, I never get rental insurance when I travel abroad. Living on the edge, I know. So far, everything has worked out just fine.

But here’s the thing...Iceland, as you may have heard, is different. It’s a small, volcanic island so far north that it touches the Arctic Circle. The weather and climate are temperamental and extreme, road conditions can be quite icy and slick, and we’ve even been known to experience the occasional sandstorm or two. Yes, sandstorms like in the desert. All that volcanic ash and sand floating around gets kicked up and whipped into a frenzy by our crazy wind. It covers your camper, and it’s not a pretty sight. Not to mention the slushy, icy pebbles and gravel flying at you from oncoming drivers or from manically driving just a little too fast on unpaved mountain roads, or F-roads.

Once you start imagining a bunch of tourists behind the wheel, helplessly sliding on black ice or being blown around by Icelandic wind, you get the picture of why the country’s government made collision insurance a requirement for rental cars. Insurance coverage here is almost entirely unrelated to your skill as a driver and has very little to do with you. Icelandic elements are harsh, and rental insurance actually exists to protect you (and your wallet) if you find yourself in the worst-case scenario. Unfortunately, that's all too common here and catches many off guard during their Iceland vacation. And nothing ruins a holiday faster than an accident!

Campervan Rental in Iceland - Recommended Insurance

So briefly, these are the types of campervan or motorhome rental insurance that I recommend for Iceland and the coverage they provide. It should help you better understand whay you're facing when driving in Iceland.

CDW/SCDW (Collision Damage Waiver/Super Collision Damage Waiver)

These two types of coverage are essentially the same thing. They reduce your deductible in the case of an accident. As its name suggests, Super Collision Damage Waiver is just an amped up version of the Collision Damage Waiver insurance. Whether you get into a crash, smash into a glacier (please don’t) or accidentally run into a sheep (yes, this happens), the dents, scratches, and damage to your car have a lower deductible with SCDW coverage than with CDW. Please note: all campervan rental companies in Iceland provide CDW coverage in their quote, so you’re already paying for it in the price of your rental. With some companies, you’ll need to spend extra if you want SCDW insurance, so keep this in mind when comparison shopping. Always be sure to ask which insurance is included in your quote as buying coverage might make it more expensive than initially thought.

And I was just kidding about the glaciers and sheep; collision insurance generally only covers accidents involving other vehicles. Read your Rental Agreement and Terms & Conditions carefully.

SAAP (Sand and Ash Protection) Insurance

This is another type of campervan rental insurance in Iceland that I highly recommend. It’s especially a must if you are traveling along the South Coast, where we’ve had a lot of recent volcanic activity. One of the things many people don’t realize about our small, stormy island is just how windy it gets. Couple this with the fact that volcanoes like Eyjafjallajökull are still active and erupting. These fiery mountains spew sand and ash into the air that eventually settles on the ground. High winds and lots of loose, flying particles could damage your car, scratch the body and windshield, or just cover your vehicle entirely. Mix it with Iceland's wet, rainy conditions and you could be faced with a mud-covered camper.

GP (Gravel Protection) Insurance

I 100% recommend this type of insurance if you are planning on visiting the Highlands of Iceland or traveling on any F-roads (mountain roads). These backroads are unpaved, and therefore the underside of your car and your tires will pay the price and likely suffer damage. Traveling too close behind a vehicle or passing a quickly-moving, car, camper or motorhome on an unpaved section of the Ring Road can also result in damage to your campervan from gravel and flying stones. And if you plan on taking any detours off the Ring Road, like the Golden Circle route, Dettifoss waterfall, Snaefellsnes peninsula, etc. you'll also be dealing with lots of gravel roads and dirt roads.

Optional Insurance for Your Iceland Campervan Rental

TP (Theft Protection) Insurance

Theft protection is really the only type of insurance that I don’t recommend. Crime in Iceland is really low thanks to us being a safe, prosperous country where people don’t want for much. We’re honest, trustworthy, and don’t really need to take things that don’t belong to us. This includes your camper. I’m not saying to leave the keys in the engine during a Bónus supermarket run or anything like that. But in general, you don’t have to worry about some rogue Icelanders breaking into your vehicle and taking it for a joy ride or selling its parts on the black market. That’s not really our thing. We’re much more likely to loan you a camper than to steal one. Of course, vehicles belonging to tourists have been stolen in Iceland, but those incidents are few and far between.

Campervan Rental in Iceland: Which Insurance Do You Recommend?

When you pick up the keys to your home on four wheels from the agent at the rental desk at Keflavik International Airport or in downtown Reykjavik, rest easy knowing that our vehicles come with all insurance included, minus Sand and Ash Protection. We know that not everyone is headed to South Iceland, which is the island's most popular zone and where most of the sandstorms and ash storms occur.

For your Iceland campervan trip, I definitely recommend SCDW insurance and SAAP insurance for most travelers. GP insurance is also a must if you plan on exploring the Highlands, traveling on F-roads or protecting your rental from other drivers and yourself on side roads. TP insurance is not necessary, but every rental company that I know of already includes it, along with CDW. Check to see if your campervan rental company offers some sort of all-inclusive, platinum or premium insurance package. There are some that offer a reduced rate when you bundle the rental insurance. Some will even have packages with a zero deductible for all types of insurance. It all really depends on your needs, budget, and itinerary. If you have any further questions about recommended insurance or just general inquiries about campervan rental in Iceland, feel free to reach out and contact us. We’d love to hear from you.