Featured images are shown by default on the homepage, blog page, categories and search results. If you don’t have a featured image then you will see a placeholder. You also have the option in the Customizer to display the featured image at the top of of your posts and pages.
To add a featured image use the ‘Featured Image’ function in the right hand column of the post/page editor:
When your posts display on the homepage the featured image will have an overlay that shows the post title. You can add a second line to the overlay by adding Alt Text to the image. To do this go to the media library and select the image you want to edit. You will now see options on the right to add Alt Text:
You can add a Title, Caption and Description if you want but these aren’t used for the featured image.
To show the featured image at the top of your posts and pages go to Dashboard > Appearance > Customize > Featured Images