It is something you could report someone for.

The section that could be applied from the Prohibited Activities page:

It is prohibited to make offensive expressions such as those listed in the following examples. If a report has been filed and the prohibited activity is confirmed, a penalty will be issued.

Please note that Square Enix may issue a penalty at its discretion even if a report has not been filed but the act was found being conducted in public areas such as Say and Shout, search comments, Party Finder, and online video or streaming services.
* Please note that these are just a few examples. Be polite to others and try not to make them feel uncomfortable.

Examples
The following behaviors are prohibited:

Using insulting words such as "stupid," "idiot," "die," "crazy," "garbage," or "trash" to offend others. In addition, even if you do not use direct words, blaming and attacking others, such as "It's [player name]'s fault that we wiped" or "You really make a lot of mistakes," or rephrasing insulting words into any other form is also prohibited. If a report has been filed and the prohibited activity is confirmed, a penalty will be issued.

Insulting another person's personal taste, such as "your glamour is terrible, you should quit the game," or "the way you talk disgusts me." If a report has been filed and the prohibited activity is confirmed, a penalty will be issued.

Insulting others with statements that are unrelated to the subject of the discussion, such as "no wonder you can't do this, look at how you dress your character." If a report has been filed and the prohibited activity is confirmed, a penalty will be issued.


Whether or not you report something is your choice, but know that insults are generally reportable, even if they're just "you look stupid lol". Don't let anyone else influence your decision to report someone if you feel they were in the wrong. Even if it's not against ToS, that's up to the GMs to decide, not forum users.