As I recall, in Worms they used two images; The "pretty" terrain with colour, and a mask terrain that is pure black and white. Hit detection is always done on the mask.
If you actually want the terrain to collapse like it did in Tank Wars, you'll need to iterate over each column of your image and have it search for gaps between the terrain and the bottom of the playing field. If any gaps are detected, shift the terrain above the gap down to the lowest point possible in your column.
A simple example of this could be done with an array where 1 represents solid terrain and 0 represents empty space. In this case, I've set up the left side of the array as ground level, to element [0]
would be on the ground:
[1,1,1,1,1,1,0,0,0,0]
Lets assume the terrain is struck from the side and a hole is made:
[1,1,0,0,1,1,0,0,0,0]
You're now left with a floating piece of terrain above another piece of terrain. To make the floating terrain collapse, iterate over the array, keeping track of the first position you find a 0 (empty space). Then, as you continue to iterate, upon discovering a 1 (terrain) simply shift the 1 to where the 0 was. Repeat the process by iterating from that the old 0 position + 1.
[1,1,1,0,0,1,0,0,0,0]
[1,1,1,1,0,0,0,0,0,0]
This is the basic approach, not the most efficient one. It would be much faster to move all indexes of terrain above the gap down at the same time, for example.
EDIT:
As the first comment states, a sort on the list is even easier. I'm keeping my original response intact since it helps explains the actual principle behind the collapsing terrain.