What type of material is good wrap around the CAI for insulation from heat?

 

Thermo-Tec header wrap? It's a cloth like wrap.
Won't be the prettiest. They also have a spray that you use
to make the end result kind of like a cast (the break your arm kind of cast).

 

The easiest thing to do would be to put a thin aluminum heat shield of some sort between the intake and the engine. I beleive the K&N short ram has a setup much like that. Also, there's a place called Thermal Tech or something that will permanently heat-shield whatever you'd like.