You can use flat head screws and can avoid the plastic washer, and place the screw sufficiently away from the terminals. Or use flat plastic screws. You will have to glue the optics on LED anyway.
You have placed the LED wrongly in your('s ?) pic, place it such that the grove doesnt come under LED.
Anderson's advice is one that works too, I have seen it in one of the topics on the forum here.
Or you could buy just the transparent lens and glue it, instead with the white sleeve on it.