Make sure that you are connected to a Wi-Fi Network
Make sure that your iPhone is charged more than 50%.
Make sure that you have at least 6GB of free storage space on your iPhone.
You do not have enough free space on your iPhone as shown in the error message in your screen shot. This update cannot be installed because it requires at least 1.31 GB of available storage during installation. You can make more storage available by deleting items in iPhone Storage, or connect your iPhone to a computer to install the update.