A board, strategically propped against the pot helps shade the roots. Allow airflow to the base, tho. Keeping it off the ground/concrete helps, too.
Doubtful a catterpillar would result in this kind of damage...looks more like a root thing to me. But I'd remove them, just the same, lol.
Harvest times are subjective, but it does depend on what you are looking for in your smoke. Earlier harvest (cloudy trichomes) generally equates to a lighter effect. (still able to get up to get your own munchies) Longer flower times (till trichomes turn a bit rusty-looking) generally give more of a "holy crap I'm too stoned to move" effect.

Couple more questions...

Can you slip it out of the pot and look at the condition of the roots? Would look for being rootbound, see if there's healthy white growing tips on the roots, and check for more bugs.
Were you spraying the tops with anything? If so...do you know the ph of the spray?