This Car Rental is my most trusted rental company in Iceland. They are a family run business with great cars, great prices, awesome service and they're right at the airport so there is no hassle when checking in or out. There is also a location in Reykjavik if for some reason you are not arriving through Keflavik Airport. The link below has a 5% discount applied to it. No code needed :)

A rental car shuttle bus comes to the arrivals door every 15-20 minutes and this Car Rental is the second stop. It's only a 3 minute walk but I'm sure you won't want to walk with all your luggage.

If you're coming in the summertime and plan to go into the highlands or drive on the mountain roads (F-roads) you MUST have a 4x4. If you plan to just stay around the ring road then a regular 2x2 car is all you'll need.

If you're coming in the winter time you might feel more comfortable in a 4x4 but Iceland does a very good job of clearing and salting the roads so you will also be okay in a regular car. It is all your personal preference.

All cars come equipped with winter tires from the months of Oct-April so you'll be just fine. That means there are little spikes in the tires to help you grip the road better if it is icey. They are a lifesaver!