Charged for rental car damage in Iceland? How to dispute it

At pickup: collect the evidence

Damage disputes are among the most common car rental complaints in Europe: more than one in five of the car rental cases the European Consumer Centres handled in 2023 involved alleged damage (ECC-Net). The key question is usually whether the damage was there before you drove off, so consumer centers advise checking the car carefully, having every existing mark noted in the handover record, and taking photos or a short video of the whole car, inside too (European Consumer Centre Germany, in German).

• Walk around the car with the staff member and point out every scratch, dent and chip. Before you sign, check that each one is written in the condition report or marked on its damage diagram, and keep your copy.
• Film a slow walkaround video, then take photos: every panel, both bumpers and their lower edges, the windshield and other glass, lights and mirrors, all four wheels and tires, and the roof if you can see it.
• Look low: crouch to photograph the sills, the lower bumpers and, where you can, the underbody.
• Photograph the inside: seats, floor mats, the dashboard showing the odometer and fuel gauge, and the spare wheel or repair kit.
• Keep the files as they are: don't edit or crop them, back them up, and keep them until any card hold is released and no claim is open.
• Spot something after you've left? Tell the company in writing straight away, with photos.

At return: a joint inspection, photos and a receipt

Under many rental contracts you stay responsible for the car until the company takes it back, so consumer centers advise returning it during opening hours, inspecting it with a staff member and getting written confirmation of its condition (European Consumer Centre Italy, in Italian; European Consumer Centre Spain, in Spanish).

• Return during opening hours if you can, and leave enough time before your flight for a joint inspection.
• Ask for a receipt or a signed return report that records the car's condition, the fuel level and the time. If the company keeps the original, photograph it.
• Repeat your photos and video in the return bay: every panel, the glass, wheels, interior, odometer and fuel gauge.
• Out-of-hours or key-box return? Film and photograph the car where you leave it, even in the dark: switch on the car's lights, use your phone's flashlight and film slowly and close up. Consumer centers warn that after an out-of-hours return it can be harder to show when damage happened (European Consumer Centre Germany).
• Keep everything: the contract, condition reports, receipts, emails, photos and videos, until the card hold is released and no claim is open.

Asked to sign a damage form? Read it first. Depending on its wording, a damage form can be a record that you were shown the damage, or an admission that you caused it. Sign only what you understand and agree with, and keep a copy (European Consumer Centre Italy, in Italian). Our advice if you disagree: say so there and then, photograph the damage in question and confirm your disagreement in writing the same day, for example by email.

If you are charged: ask for the evidence and dispute it in writing

A damage claim can come at the desk or days later by email, and some companies charge it to the card you left with them weeks or even months after the rental (European Consumer Centre Italy, in Italian). Before you pay or agree to anything:

1. Ask for the itemized basis in writing: photos of the damage, the repair estimate or invoice, and how the amount was calculated.
2. Compare it with your evidence: the condition report, your pickup photos and video, and any files the company sent you.
3. Read the rental terms you accepted: what your cover includes, the exclusions, the excess, any administration fee, and what the terms say about disputes.
4. Dispute it in writing, promptly, by email to the company: attach your evidence, explain why you disagree and say what you want, for example the charge canceled or reduced. Keep a copy of everything. Every route below expects you to have tried the company first.
5. Ask about an independent assessment: a repair shop that is not part of the rental company assesses the damage and its cost. Some companies offer one in their terms (we do, see below); otherwise you can ask a repair shop for your own quote.

Booked through a booking site, or bought separate excess insurance? Your contract is normally with the rental company, not the intermediary (European Consumer Centre Spain), so the dispute is with the company. If a booking site, an insurer or your card's insurance is to reimburse you, ask the rental company for the itemized documents that provider will need.

Where to take it next, by where you live

If the company doesn't resolve it, these routes are open. The board, the consumer centers and your bank all want to see that you tried the company first, so send them your correspondence.

To report a company or unfair terms in car rental agreements, there is also Samgöngustofa, the Icelandic Transport Authority (below).

Iceland's Consumer Complaints Board (Kærunefnd), step by step

The Consumer Complaints Board (Kærunefnd vöru- og þjónustukaupa; its English pages call it the “Complaints Board for Goods and Services”) rules on disputes between consumers and sellers of goods and services. You don't need to live in Iceland or speak Icelandic: you must have rented as a consumer, not for business, and have tried to settle with the company first (instructions for consumers; jurisdiction).

1. Complain to the rental company first, in writing, and keep its replies.
2. File online in the board's portal, kvth.thjonustugatt.is, under “New complaint”. Without an Icelandic ID number (kennitala), you sign in with your email address and a one-time password (sign-in in English). You can also send your complaint by email to kvth@kvth.is or by post to Borgartún 29, 105 Reykjavík.
3. Write in Icelandic or English: your details and the company's, the rental agreement, the amount paid or charged, the key dates, what happened, and what you claim, with your reasons.
4. Attach all your evidence: the contract and terms, condition reports, photos and video, the estimate or invoice, card statements and every email. The board usually doesn't gather documents itself and decides on what both sides submit.
5. Pay the ISK 5,000 fee before you send the complaint. It is refunded if your claim is accepted in whole or in part, if you and the company settle after you file and tell the board (kvth@kvth.is or the portal), or if the board dismisses the case without ruling on it; not if you withdraw (Regulation No. 1177/2019, article 13, in Icelandic).
6. The company is invited to reply, you can comment on its reply, and it can answer once more. Everything happens in writing: the board doesn't call witnesses or the parties to give evidence.
7. Wait for the ruling: about 9–11 months, the board estimates on its case-procedure page (its FAQ says 7–10) (case procedure).

Earlier rulings are public: the board publishes them with personal details removed (board rulings).

European Consumer Centres: free help if you live in the EU or Norway

The European Consumer Centres Network (ECC-Net) has a center in every EU country, Iceland and Norway. If you live in one of these countries and have a dispute with a business in another, the center in your country helps you free of charge: contact it, not the one in Iceland (European Commission; ECC-Net). The centers can't make a company pay: they have no enforcement powers.

The centers expect you to have complained to the company in writing first and to send that correspondence; France's center, for example, asks you to wait three weeks for the company's reply (CEC France, in French).

Chargeback, the courts and Samgöngustofa

Card chargeback. If you paid by credit or debit card, the bank that issued your card may be able to reverse a disputed charge under the card network's rules. Ask your bank, not Visa or Mastercard, as soon as you can, and send it the contract, the company's claim, your evidence and your written dispute: banks always ask for documents. Whether a chargeback is possible depends on your card and your bank (European Consumer Centre Germany).

The courts. Going to court is the last resort. The board's rulings can't be appealed to another authority, but either side can take the dispute to court (FAQ). Read the rental terms' clause on which law and which courts apply, and get legal advice first; Ísland.is lists free legal advice services in Iceland.

Samgöngustofa, the Icelandic Transport Authority, licenses car rentals and supervises them, including the rule that renters must not be subjected to unlawful, unfair or unreasonable terms (Regulation No. 840/2015, articles 8 and 12, in Icelandic). The Icelandic Tourist Board directs complaints about illegal, unfair or unreasonable terms in car rental agreements there: samgongustofa@samgongustofa.is (Icelandic Tourist Board).

Common damage types and what usually decides them

Whatever the damage, two things usually decide a charge: what the rental terms you accepted say about that kind of damage (covered, excluded, or covered only by an add-on?) and the evidence (was it on the pickup record, and what does the repair cost?). Read the exclusions before you set off, and choose your cover for your route.

How we handle damage at Ring Road Cars

Questions about rental car damage disputes in Iceland