Admincp > User ranks > add new user ranks > then select usergroup and tell it where the image is located, either on your server or on an image host then save
You know that vBulletin's user manual explains all this VERY clearly with nice screenshots and everything.
Dare I suggest you go read the manual? The online version can be viewed (and downloaded if you prefer) from Jelsoft's website for free! You don't even need to register.
It has a nifty search option too that gets you to what you need really quickly. I'd highly recommend it.