I had a question about this the other day when a friend tried to download her pictures from the cameras memory card onto the computer. She received a message that the image already existed, and would she like to overwrite it?
There are two ways this can happen. First, if you are trying do download a picture you have already downloaded, the program will give you this warning. Understandable.
The other possibility is that you have taken 9999 images, numbered IMG_0001 to IMG_9999, and your camera has "recycled" the number series. So IMG_0001 from 2008 is about to be replaced with IMG_0001 from 2009. Fine? I don't think so.
I use a number series that gives every picture a unique number. The number is created with a prefix of year + month + serial number. For example 0910_00100 is picture number 100 taken in October 2009.
I reset the number series the first time I download each month.
Here is how I set up the number series on my Canon program.