Don't panic, the clearance is by design. That's a high pressure ring to control shock load to prevent damage to the piston seal from high pressure shock loads such as abruptly stopping swing. It works the same way the rings work on an engine piston. The "clearance gap" allow oil to pass between ring and piston groove, then the oil goes "under" the ring. Since the oil pressure has forced the ring against the other side of the ring groove, the oil now under the ring can't escape. This pressure forces the ring to "expand outward" tightly against the cylinder barrel, which keeps all this high pressure oil from encountering the piston seal which is on the back side of the iron ring seal, saving the piston seal from high pressure shock load.