Iceland travel insurance

Places to go and things to do in Iceland

See the Northern Lights

Iceland is one of the best places in the world to see the Northern Lights (or ‘aurora borealis’). You’ll need to visit between autumn and early spring, and there are never any guarantees. But, if you’re able to see them, you’re in for an experience like no other.

To give yourself the best chance of experiencing the Northern Lights, you can book specific tours which will take you to the optimal locations. 10pm – 1am is the best window, but according to the Iceland tourism board, the key thing is to be patient.

Go to a geothermal spa

The volcanic geography of Iceland means that it has an abundance of natural hot springs. The world-famous Blue Lagoon is a striking example: a huge lake set within a lava field. ‘Common bacteria’ doesn’t do well in the 37 – 39 degree water, so they don’t need to use cleaning additives like chlorine.

n recent years, an increasing number of these spas have popped up across Iceland, so you can find other natural bathing spots off the beaten track. It’s a great way to connect with nature and rest your bones after some hiking.

The Golden Circle

If you want to pack a lot into one day, the Golden Circle route is ideal. It takes in three of Iceland’s most famous sights: the Geysir geothermal area, Gullfoss waterfall and the Thingvellir National Park.

This loop is easy to do from Reykjavík and gives you a mix of geysers, waterfalls and sweeping valleys. The official definition of a geyser is ‘a hydrodynamic and thermodynamically unstable hot spring’. An easier way to think of it is a natural eruption of water from the earth. A stunning site not found in many places worldwide.

Reykjavík

Reykjavík isn’t your usual capital city. Sure, it has everything you want from a capital: great food, great nightlife, beautiful architecture and a rich history. But just like everywhere else in Iceland, you still feel very close to nature.

You can get a boat from the harbour to go whale watching or head to a waterfall on horseback from just south of the city. When you get hungry, you can grab something easy at the Grandi Matholl, like traditional Icelandic fish and chips.

Thingvellir

Many visitors will spend a bit of time in Thingvelllir as part of the Golden Circle route, but you might want to spend longer there. It’s a particularly interesting spot for two distinct reasons.

Firstly, this national park is where the North American and Eurasian tectonic plates meet. Or, more accurately, where they’re drifting apart. You can see the cracks, ridges and canyons that have been formed through continental drift and even walk between the tectonic plates.

Secondly, the park is the oldest Parliament site in the world, with a democratic Viking parliament first being held here in 930 CE. The valley continued to host political events across the following millennia and when Iceland declared its independence in 1944, it did so at Thingvellir.

How much do things cost in Iceland?

Iceland is on the more expensive side of European holiday destinations. However, the country has so much natural beauty that you can have an amazing trip while still being budget conscious.

Iceland’s currency is Icelandic króna (ISK). Our currency converter shows you how it currently compares to GBP. It’s updated daily, so you can refer back to it as you get closer to your trip.

Here are some examples of average costs in Iceland. The data is collected by Numbeo and is accurate as of March 2026:

• Three-course meal for two (no drinks): Approx 15,000 kr (£89.47)
• Regular cappuccino: Approx 737.10 kr (£4.39)
• Combo meal at McDonald’s (or equivalent fast-food restaurant): Approx 2,775 kr (£16.55)

Post Office can help you get your travel money sorted before your trip. With our prepaid multi-currency travel card you can order a set amount of krona to use throughout your trip without any conversion fees. If you need to top up the card, you can do so easily through an app or online.

If you prefer to travel with cash, we can help with that too. You can exchange money over the counter at your local Post Office branch, or order krona online. We’ll deliver the cash to your address, or to your local branch. Find more information in our travel money tips.

Do you need holiday insurance for Iceland?

Travel insurance is highly recommended for Iceland. No one wants problems when they’re on holiday, but what’s worse is being hit financially due to unexpected issues.

There are various ways in which you could find yourself substantially out of pocket while on holiday, or after you come home. You could find yourself having to pay for medical costs if you’re ill or injured, even if you have a Global Health Insurance Card (GHIC). If your belongings are lost or stolen, including your money and passport, you’ll have to cover the cost of replacing them yourself.

And what if you’re not even able to make the trip, or have to cut it short due an emergency, such as bereavement or redundancy? You might lose everything you had spent on flights and accommodation without even leaving the country.

It’s easy to see how costs can quickly rise when you travel. Travel insurance gives you that peace of mind that if certain things go wrong, you can at least claim the costs back up to the limits of the policy.

What's covered with a travel insurance policy for Iceland?

Post Office Travel Insurance can help you when things don't go to plan. It can cover:

• Emergency medical costs: We can help pay for your treatment, for both illness and injury, and help you get back home. Our policies also include 24/7 outpatient support,¹ for trips taken abroad, meaning you can talk to a medical expert, in your own language, whenever you need them
• Missed or delayed flights: With certain levels of cover if your international transport is late or you miss it for reasons outlined in your policy, we’ll help cover the cost. You'll find the limits to this cover in your policy
• Lost, stolen or damaged belongings: This includes your suitcase, passport and money. Check the cover limits and make sure you report any loss to the police within 48 hours. We'll need to see a police report and receipts of the items you’ve lost to process your claim
• Personal accidents and legal costs: We can help with legal fees and personal accident claims, up to the policy limits, if you run into trouble on your Iceland holiday
• Cancelling or cutting your trip short: If you need to cancel your trip or come home early for a reason listed in your policy, we’ll pay you back for unused travel and hotel bookings up to the policy limits

You can choose our economy, standard or premier cover levels depending on how much protection you want.

Add trip disruption cover to insure your holiday against volcanic activity

Iceland is one of the most volcanic countries on earth. Eruptions that cause disturbance to everyday life are rare, but not entirely uncommon. You might remember the eruption of Eyjafjallajökull in 2010 which closed airspace in countries across Europe.

If you add trip disruption cover to your Post Office Travel Insurance policy, you’re protected if your flights are cancelled due to volcanic activity. You can also recover costs of accommodation you haven’t used or activities you had booked which you can no longer do due to an eruption. There are limits to this. You can find full details in the policy wording.

What doesn’t travel insurance cover for Iceland trips?

We aim to be as transparent as possible about what your insurance covers, as well as things that can invalidate your policy. You might not be covered if:

• You don’t tell us about a pre-existing medical condition when taking out your policy
• You do high-risk sports that are exempt. You can find the full list in the policy (don’t worry, horse-riding is covered)
• You’re under the influence of alcohol or drugs when an incident occurs
• You break local laws or ignore official advice
• You miss flights or connections due to personal error (things like oversleeping aren’t covered)

Always read your policy carefully so you know exactly what’s covered.

If I have a GHIC do I need travel insurance for Iceland?

Yes, if you have a GHIC you should still get travel insurance to give yourself greater cover against medical costs.

A Global Health Insurance Card (GHIC) gives you access to emergency necessary treatment while in Iceland. But, as the Foreign Office states, a GHIC (formally EHIC) is not a substitute for travel insurance. For example, a GHIC won’t cover:

• Repatriation (flying you back to the UK)
• Use of private healthcare or private clinics

These costs can be the most expensive of all medical treatments, costing tens if not hundreds of thousands.

It’s worth getting a GHIC as it’s free and you can easily apply online. But be sure to get travel insurance as well to help cover the highest costs that a GHIC won’t help you with. F

or times when you want to speak to a doctor but it’s not a critical situation, Post Office Travel Insurance offers Medical Assistance Plus. This gives you access to an English-speaking doctor 24/7 via outpatient support for trips taken abroad¹.

Legal and cultural difference in Iceland

There are differences between the UK and Iceland that you should be aware of. If you break the law, even if you don’t realise you’re doing it, you could invalidate your insurance policy.

Here are a few things to bear in mind:

• It’s illegal to vape in restaurants, bars, public buildings and on public transport. You can be fined for doing this
• Drink driving limits are lower in Iceland than in the UK. It’s best practice to not drink any alcohol if you’re driving
• Riding an e-scooter after consuming alcohol is illegal in Iceland. It’s viewed in the same way as driving a car after consuming alcohol. Fines and charges can apply
• Speed limits are generally lower than the UK. The weather can change very quickly in Iceland, so slow and steady is the way to go
• Don’t be tempted to import any whale products from Iceland to the UK. You could get a fine of £5,000 or a prison sentence

Getting around Iceland

Iceland is less than half the size of the UK, so exploring it is manageable. You’ll need to stick to the roads or waterways as there’s no train network in Iceland.

Here are some options for getting around:

Car: Many people hire a car to explore Iceland’s stunning landscape. Rentals are straightforward, but it’s worth adding additional protection against gravel, sand and ash. This debris can be thrown up by weather events in Iceland but it’s often not included in insurance policies.

Campervan: A great way to see Iceland in the summer, combining your travel and accommodation costs. There are many campsites across the country and there are lots of rental companies to choose from. Campsites and facilities often close in winter, so this type of trip is best in summer.

Bus: Buses are a budget-friendly way to explore, connecting towns and cities as well as popular hiking spots.

Boats and ferries: Take a ferry to one of Iceland’s uninhabited islands like Viðey, or go puffin-spotting by visiting Heimaey. Ferries are a great way to see more of Iceland’s dramatic terrain.

Visas and entry requirements

You don’t need a visa to enter Iceland unless you're staying for longer than 90 days. Make sure your passport's expiry date is later than three months after you plan to leave.

If you’re planning on going to any of the other 28 countries in the Schengen zone after Iceland, the 90-day limit still applies. The limit is for the entire area, not just Iceland.

If you’re planning on being in Iceland for longer than 90 days, contact the Icelandic Directorate of Immigration. It will be able to advise what visa or permit you need.

In October 2025 the EU rolled out a new Entry/Exit System (EES) which may require you to register your fingerprint or have your photo taken. There are no costs associated with this and you don’t need to prepare anything before you touch down in Iceland.

Checklist for Iceland

• Get travel insurance for Iceland which covers everything you want to do on your trip
• Make sure your passport is in date
• Prepare your travel money, either by getting cash or a travel money card
• Print off a copy of your insurance policy so you know what to do if you need it