Why would putting a lid on pot which is cooking reduce heat loss?

A lid on a pot reduces heat loss by trapping the hot air inside the pot. When the pot is uncovered, the hot air rises and is replaced by cooler air, which is then heated and rises. This creates a convection current that carries heat away from the pot. When the pot is covered, the hot air is trapped inside and cannot rise, so the heat is not lost. In addition, a lid helps to prevent evaporation, which can also lead to heat loss.