The "insulation or sound deadening material" isn't there to protect the positive battery teminal (or the cables / wires connected to it). However, it is an issue that the plastic cover that should protect the + terminal, is missing. So, the + terminal etc is in danger of being accidentally earthed...
If I understand correctly, the "insulation or sound deadening material" in question doesn't in any way cover / protect the battery etc, but covers and shields (in some way and degree...?) the intake end of the induction tube, i.e the start of the induction tract leading to the air filter and beyond.
My guesses:
It might be intended to restrict the quantity of air entering the induction tract from the main part of the engine bay, perhaps helping to lower inducted air temperature? If so then I doubt it would be very effective, the material doesn't seal off the induction tube very well from the main part of the bay, so I suspect that any such affect would be minimal at best.
It might be intended to reduce induction noise reaching the cabin, i.e. in effect a baffle / barrier between the start of the induction tract and the cabin, potentially absorbing and / or deflecting at least some sound. Again I doubt it would make much of a difference, but maybe measurable with a dB meter from inside the cabin...?
It might just be that someone at Alfa thought the engine bay looked neater with the end of the induction tube hidden...
My car no longer has it. Ages ago I took it off for some reason and just never got around to refitting it, didn't look important enough to bother with, and no ill effects experienced with its' absence.
Regards,
John.
PS
I just discovered that if when trying to type 'it' an extra 't' is accidentally placed at the start of the word, then a site autocensor steps in and asterixises the resultant mispelling (to protect us all, I assume). So absurdly prudish, you'd think this was an American website...