The Yellow Rectangle denotes the area which underneath contains foam/styrofaom/thermopol type material. It is tapered at the top and the central portion contains the un-tapered material. The outer portion of the insulation as you can see is a carpeted sort of material. Both the materials have been illustrated in the above post. The materials being used are very well tested for sound dampening, water-resistance and heat absorption. The foam can be purchased with lesser width as well. In the picture is just a sample.
The lower portion as depicted in this rectangle contains no foam and only the liner (illustrated in the above post) is held to the actual trunk lid with clips.
The hinges in this picture are covered with factory made garnish. Circular foam MAY be able to do the job instead but then the foam/liner insulation will not be moulded to cover half the hinges as shown. So any ideas will be more than welcome before I go ahead with this one.