1786 in IcelandEvents in the year 1786 in Iceland.Incumbents Monarch: Christian VII Governor of Iceland: Hans Christoph Diederich Victor von LevetzowEvents November 17 – Six locations are granted municipal rights. This year is regarded as the founding of Reykjavík. Teaching began at Hólavallarskóli in Reykjavík.Births September 4 – Þórður Sveinbjörnsson, politician December 30 – Bjarni Thorarensen, poet and official