I’ve noticed that taking photos under heavy sunlight I have a circle of light just like how it is in the picture. Updated to 12.0.1 and have no lens protector. Is this a defect?
That’s simply lens flare and is quite common in photography, especially when the sun is less than a 45 degree angle or so to the camera lens. Since there is no shade on the phone, it’s very easy to encounter lens flare on the iPhone. To avoid it, when composing your photos, try to keep the sun more behind you rather than in line with the camera lens.
EDIT:
As mentioned above, shading with your hand can be a great solution.