It depends on the severity of the insult that was thrown.
We're going to punish a player, that has just told another player they will 'Kill their family and burn them alive'.
If it's friendly banter, such as; 'You're a turd' - I don't believe they should be punished for that.
It's 2021, this is the internet. If you cannot handle insults (that aren't harsh), I suggest you go play Roblox.