Insert a picture on a shield/poster of a character

For that type of image, I would make the "shield" transparent. That requires using a .PNG, like what you attached. Then whatever you place behind the image will show through just that part. 

Here's a copy of your .PNG with the shield transparent:

Here it is with a picture behind it:

I just did a quick edit in SnagIt, so the area around the hands might not be perfect. But it's often worth the time to make a good copy with the desired area transparent, because it can be reused. (I have a number of .PNGs with blank areas ready to fill. 😄)

For best results, you would export the character and edit it in another application. I use Krita (free) a lot for this kind of work. You can mask the white poster then clip any image you wish to place there, cutting around the hands.

For a quick and dirty approach in SL, click on the Recolor option under Format when the character is selected.  Use Set Transparent Color, and click on the white panel. This will clear that color from the image. It may also clear more than you want. Try clicking on different locations to get the best results.

Then you can simply crop another image and place it below the character, perhaps  with a white rectangle as a background. This gives the illusion of a clipped image. Example attached.