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I'm about to take part in a Ski Tour across Iceland in a few weeks time, I've just noticed by travel insurance doesn't include Search & Rescue costs, here in the UK mountain search and rescue is provided free of charge, by volunteers and military.

Does anyone know what the situation is in Iceland?

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Looks like a bit of Googling found the answer I was after... I'm not 100% sure this is definative, but it does suggest that search and rescue is free.

http://www.vagabondjourney.com/travelogue/iceland-search-and-rescue/

Can anyone else confirm this?

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According to the article by Iceland Review (mentioned in a comment to Simon Hodgson by Paul Lydon), presently (summer 2015) there is no regular charge for search and rescue in Iceland. In exceptional cases, where people have to be rescued from closed roades or were not in real danger, they are charged.

Due to a huge increase of S&R calls the teams mostly made up of local volunteers are overloaded and cost increases. This lead to a discussion to generally charge for S&R deployments. It is unclear whether and if so when this change will come into effect.

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