To check if you are on the server or on a client simply use the “Switch Has Authority” node. If it has authority is the server or the host player, otherwise is a client.
The way you are applying the damage seems correct at first glance. But it depends on your own game system. Just remember to remove the health on the server and not on the clients, since its a replicated variable. You can read all about it here: Networking Content Examples | Unreal Engine Documentation