It is called collision detection, it is part of the functionality of a video game along with many other functions like the physics calculations for object motion and image rendering. Like everything else the video game does, collision detection takes some computing time, the more accurately the program performs collision detection the less processing time is available for the other processes, so game designers compromise on how well the game achieves collision detection, reducing how much they do while making sure it doesn’t affect game play. For example if you walked up to a wall with a sniper rifle the muzzle would be the other side of the wall so you could fire while behind cover this shouldn’t work so they would adapt the detection for the sniper rifle so you can’t “cheat” in this way.
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