The battery should not be loose, it should have whatever protective cap it came with attached.

The basic problem is that lithium-ion batteries have all their contacts close together and they have a sufficiently low internal resistance that shorting those contacts is a bad thing.

That's why unprotected lithium-ion batteries are completely prohibited as checked luggage and in general they should always be capped if they aren't in something meant for them.

While I've never carried a battery of that size anywhere other than in my laptop I normally fly with extra lithium-ion batteries. They simply are tossed in my camera bag with their caps in place. An x-ray guy in PVG got puzzled once, whether it was that or the box of AAs I don't know. I showed the security guy all the batteries, he was happy.