Re: How important is that fin??
Not all I/O's have the trim tab. The vast majority I've seen do not have it (at least on merc alpha/bravo drives) With power steering, the tab isn't really needed anymore and is just extra drag.
I notice from the photo you posted that you're missing the gearcase trim tab. It's supposed to mount above the prop on that circular area. While not essential, without it I bet you're boat is hard to turn to port when underway.
And yes, enough of the skeg is gone that it would be a good idea to repair it.
Not all I/O's have the trim tab. The vast majority I've seen do not have it (at least on merc alpha/bravo drives) With power steering, the tab isn't really needed anymore and is just extra drag.