I recently had my battery fail on me and need to get a new one. While I was removing the battery terminal clamps I noticed there was a lot of corrosion. After I cleaned off the corrosion, I also noticed that one of the rings of the battery terminal clamps is missing some material. Please see the image below. You can see that there are two metal rings and the bottom one has a piece of metal missing. Does this indicate that the clamp must be replaced? Or is it safe to just clean it up and attach to the new battery. How does one generally know when it is time to replace the clamp itself?
In a word: Absolutely
The lack of material means a lack of electron flow. You won't get the proper charge of the battery, the right amount of power out of it come starting time, nor the full buffering effect a battery provides to the electrical system. It is a lose/lose/lose situation here. Replace it. It doesn't have to be exactly the same type. In fact, I'd get one which is a solid one. It will last longer and will resist corrosion.