Can a lawsuit ruin my future credit since I do not have one yet? Im 18 years old.?

I was involved in a (stupid) car accident about 8 months ago, and yesterday i received a letter from my former insurance company saying that the person who was involved sent them a settlement letter establishing that to extend the amount of money in my policy to cover the hospital bills from the person they represent. The "bump" happened as follow, the woman was in front of me and as approaching the intersection she stopped, we were both going to turn to the left once she stops the car I stop as well, being distracted from something inside the car i start letting go of the brakes and barely tap the her rear bumper.The police man didn't give me a ticket and the paramedics were laughing when arrived at the scene saying that she just wanted to get money out of me. Since she insisted on having pain on her neck she was transported to a nearby hospital where a doctor opined that 3% of her body was impaired. now she wants to get $15000 from me. Im an 18 year old doing everything to stay in school and working full time, my parents barely make enough to pay rent and our expenses. we are not poor but just middle class. and my questions are could she ruin my life by sending that letter to collection and destroying my credit without me even having one? would i be entitled to pay? is there any way for me to show that the bump is not worth $25000? what can i do please help me. Im freaking out!