This damage looks typical of what an o ring chain will do to a cb550. It's too wide.
If the seal or case is not leaking oil, it should be okay. Inspect for cracks, though.
Clean the area well, let dry, and spray a light coat of K2R onto the area. Let dry and wait several hours. The powder will wick oil out of any cracks, showing their location. I've heard spray foot powder works, too.
I did not replace the seal on mine as the scarring was not that severe. I did put some of that black plasti-dip stuff over the scar on the seal. And, I have found RTV in that location on other CB550s. I'm not certain either is necessary.
Cheers,