Iceland is one of the most active volcanic regions in the world, with eruptions occurring on average roughly every two - three years. In the 20th century there were almost 40 volcanic eruptions in and around Iceland.
So, what is a hotspot?
The word itself should give you some idea…
It has nothing to do with your cell phone or internet connection.
Hotspots can be found, for example, in Hawaii, Galapagos, Easter Islands and Yellowstone. These hotspots are partly responsible for forming the land as we know it.
The roots of these hotspots are mantle plumes that go deep into the earth´s mantle. The mantle plume hypothesis

 states that portions of the mantle are hotter than average, thus melting the mantle. A mantle plume or hotspot is a hot, narrow upwelling of molten material from the earth´s mantle. And we know that the mantle plume under Iceland goes more than 600 kilo meters down into the earth´s mantle.
The origin of the Iceland hotspot began with the breakup of the supercontinent Pangaea. As the Eurasian plate and the North American plate began to diverge, magma from underneath the crust rose up through the open rift. This repeated activity of magma rising and cooling created the island of Iceland. 
Now, let´s imagine if the hot spot underneath Iceland would disappear. Iceland would slowly drift apart and sink into the sea! Because the two plates underneath Iceland are drifting apart, about 2cm each year and if the hot spot would be “turned off”, there would not be any eruptions in Iceland and no material to fill up the gap when the plates drift apart. Eventually Iceland would be split in two and would then disappear into the sea on each side of the Greenland-Iceland ridge and Iceland-Faroe Island ridge.
In Iceland, the mantle plume (the hotspot) is located underneath Vatnajökull glacier, at Bárðarbunga. The plume is believed to be aroud 100 km in diameter. And it is known as the heart of Iceland.