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You might have to pay the Icelandair flight cancellation fee or not will depend on the condition under which you are cancelling the flight. Before you cancel your flight you should understand the Icelandair cancellation policy given below:
1- If the Icelandair flight cancelled within the 24 hours of the flight booking time and also the flight was originally booked at least before 7 days of the flight departure providing the customer has a United States address and payment was done in dollars, you will not be charged for the cancellation fee and the full amount will be refunded in your bank account in the original form of payment.
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2- If you have the booking which includes cancellation insurance and meeting the insurance rules and cancelled flight any time before the scheduled departure of the flight, you might get the full refund of the unused portion of the booking.
3- If you are cancelling the flight after 24 hours there will be a cancellation fee or no refund generated depending upon the rules of fare type you have.
You need the flight booking number or the E-ticket number in order to get the flight cancelled. You can get the ticket details from the confirmation email or the SMS you received at the time of booking the flight.
If the cancelled flight was booked through the credit or debit card, the refund will be generated within 7 working days and if the payment was made cash or using another payment method it might take up to 20 days for the refund to be credited in your account.
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