Insurance Terms and Conditions Budget car rental Iceland

1. To whom does the policy apply

 1.1 The policy applies to all renters 18 years old and over for passenger cars, 23 years for jeeps, 25 years old and over for minibuses. The renter must have been in possession of a driving licence for a minimum of 1 year. In the case of registration of an additional driver(s) this person’s driving licence must also be shown.

1.2 Additional driver(s) must be registered with AVIS / Budget at the start of the rental. It is only those persons who are listed in the rental contract that are allowed to drive the rental vehicle. The policy does not apply if the vehicle is driven by other persons than those who are listed in the rental contract.

1.3 If the maximum number of passengers for which the vehicle on the contract is registered is exceeded, the policy does not cover the excess passengers.


2. Where and when does the policy apply

2.1 The policy applies in Iceland.

2.2 If the journey is extended due to unforeseen and pressing reasons which are beyond the control of the Insured, the policy will be in force for 1 extra day.


3. Coverage of the policy

3.1 The policy includes the coverage stated in the specification in the rental contract.

3.2 Third Party Liability
The policy includes third party liability for injury to persons and damage to property caused by the vehicle. Accident insurance for the driver is also included. The policy is mandatory pursuant to Icelandic laws and Regulations and its validity is legally binding. 

3.3 Voluntary coverage

3.3.1 Collision insurance (Collision Damage Waiver) CDW
CDW reduces the renter’s costs in the case of damage to the vehicle to include only a mandatory excess amount of ISK 195.000, as long as the damage is not the result of theft, burglary or instances listed in articles 4.3 - 4.15. For 4wd jeeps and larger cars the excess amount is ISK 360.000.
When CDW is not taken out, the renter is fully responsible for damage. Liability can amount up to the full value of the vehicle.

3.3.2 Super CDW
Super CDW can be taken out at the place of rental and reduces the mandatory amount of excess to ISK 0 in the case of damage, as long as this is not the result of theft, burglary or instances listed in articles 4.3 - 4.15. For 4wd jeeps and larger cars the amount of excess is ISK 0.
When Super CDW is taken out, damage to front windshield is covered with an excess of ISK 0.

3.3.3 Theft Protection (TP)
The policy reduces the renter’s costs resulting from theft or burglary of the vehicle to only include an excess amount ISK 195.000. For 4wd jeeps and larger cars the excess amount is ISK 360.000. The insurance does not cover the personal property of the renter or passenger(s) in the rental vehicle resulting from theft or burglary.
When TP is not taken out, liability can amount up to the full value of the vehicle resulting from theft. The customer him- or herself is responsible for reporting theft and burglary to the Police.

3.3.4 Sand and ash insurance (SAP)
The policy covers damage to vehicles as a result of sandstorm and ash. The policy covers damage to paint, glass, lights, plastic parts, tyres and rims. Excess amount is ISK 195.000 but for 4wd jeeps and lager cars the excess amount is ISK 360.000.  


4. General liability-limiting conditions for the policy

4.1 The insurance company is not liable for an insurance event which the insured has caused while driving the motor vehicle in a self-induced state of intoxication by alcohol or other intoxicating or anaesthetising substances. The same applies in an insurance event that is caused by another person while driving in such condition, if the insured has assisted in the use of the motor vehicle even though he or she knew or should have understood that the driver was under the influence of alcohol or other intoxicating or anaesthetising substances.

4.2 Limitation of liability in the case of violation of the safety regulations

a) The driver of the motor vehicle shall hold a valid driving licence for the type of vehicle in question.
b) The doors and boot of the motor vehicle shall be locked when the driver leaves the motor vehicle. All keys to the motor vehicle shall be stored in such a manner that unauthorised persons do not gain access to them.
c) Goods that are with the motor vehicle shall be appropriately secured so that they do not cause damage.
d) The motor vehicle shall not be used for participation in or training for speed racing or speed tests.

4.3 In case of damages not covered by Collision damage waiver (CDW) insurance, the Renter is responsible for all costs according to Lessor´s price list or cost estimate.


The Collision damage waiver (CDW) insurance does not cover:

4.4 Damage owing to war, revolution, civil unrest or rioting.

4.5 Damage inflicted by animals.

4.6 Holes burned into seats, carpets, mats or other parts of the interior.

4.7 Damage affecting only wheels, tires, suspension, batteries, glass (except for windscreens when additional insurance is purchased), radio receivers or loss by theft of parts of the vehicle and damage resulting therefrom.

4.8 Damage caused by driving on rough road, such as damage to the vehicle’s transmission, drive, or other components in or attached to the chassis; damage to the chassis resulting from the vehicle bottoming on rough roads as a result of ridges left by road graders; stones lodged in the road surface or at the edge of the roadway. The same applies to damage resulting from loose rocks hitting the vehicle or the bottom of the vehicle whilst being driven.

4.9 Damage resulting from driving in places where the vehicle is not permitted to be driven, such as tracks, rough trails, in snowdrifts, on ice, across un-bridged rivers or streams, on beaches, on causeways accessible only at low tide or in other off-road areas.

4.10 Damage caused by sand, gravel, ash, pumice, or other earth material being blown onto the vehicle;
Additional insurance, lowering the excess amount for such damages is offered by the Lessor for an additional fee.

4.11 Water damage to the vehicle.

4.12 Damage caused by sea spray/seawater if the vehicle is transported by sea.

4.13 In other respects, reference is made to the general terms and conditions for CDW insurance.

4.14 Damage resulting from gross negligence entails that the right to compensation lapses.

4.15 If the Lessor needs to collect the vehicle, or have it collected, owing to a collision or an accident, the Renter shall bear all costs thereof pursuant to the tariff of the Lessor at each time.


The insurer is Tryg Forsikring - Enterprise number 989 563 521. Adress: Folke Bernadottes vei 50, Postboks 7070, 5020 Bergen, Norway.

ALP hf only acts as an insurance intermediate.

If you have the opinion that the insurance company has made a mistake in cases concerning this insurance contract or in settlement of claims, you can lodge a complaint with:

The Norwegian Financial Services Complaints Board
PO Box 53 Skøyen, 0212 Oslo, Norway