You first need to get a link for the picture. Go to Storage and Public Documents as shown below.

 

Click Upload and browse to the picture.

 

Double click on the new entry and copy the first link as shown below. You can use CNTL-C to copy.

 

Adding the picture to a template:

Go to File –>Config–>Templates .

 

Select New template –>Email Template. You can also edit an existing template if you want to. For this example, we are creating a new email template.

 

Click on the Picture button.

 

Use CNTL P to paste the link which you have copied earlier and click on Insert Image.

 

You can resize the image by dragging the corners of the image.