Hello. I think this may be a user-wide 6.1 issue, meaning everyone with an iPhone 5 and iOS 6.1 (at least) are susceptible to this bug/crash.
Normally when I edit my contacts and give that contact a photo, I would copy the thumbnail (little square) from the camera roll album, without actually opening the full-size photo. After doing this, I would go into Contacts > Edit and longpress over the "add photo" and putting "paste" would drop the thumbnail into the contact. Reason behind this was so that when I get a call from any contact, I get a small thumbnail photo as opposed to their big face/large photo appearing on my phone (I just find this more refined). It worked fine in the past, as I often am adding new photos to my contacts.
Today however I tried the same and discovered that I am experiencing a fully-reproducible crash... go ahead and try it. Go to your camera roll, copy any of your thumbnail photos (don't open the photo), then go to Contacts (or Phone) app, Edit, and paste it over the "add photo" (or existing photo). This will instantly cause the Contacts/Phone app to crash, without saving any data you have edited within that contact by that time. It's very frustrating because it means I can't edit my contact pictures at all by this method, no matter where the photo originates from or what contact/type of contact I'm editing. (FYI: All contacts of mine sync through iCloud)
I have tried power cycling the iPhone (turn off/on), rebooting (holding sleep+home), and jettisoning all my apps. Nothing fixes the issue, so I have come to the conclusion that it must be an iOS 6.1 bug, at least on the iPhone 5. If anyone has any solutions, recommendations, or has also experienced this... please help.