Can you be more specific? Which contact photos are blurry? The thumbnails in your contacts or the photo on your call screen when making a call? or both?
Usually the problem is the resolution of the photo itself. With your modern phones having 720 and 1080p cameras on them for taking photos and videos, they look great. But also don't handle low resolution photos and vids very well.
I would try getting higher res photos and use them. Also if you ARE using high res photos, try not to crop them too much. The more you crop them the lower the final res will be. Hope this helps you out.