In finance, the time value (TV) (extrinsic or instrumental value) of an Option (finance) is the premium a rational investor would pay over its current exercise value (Intrinsic value (finance)), based on the probability it will increase in value before expiry. For an American option this value is always greater than zero in a fair market, thus an option is always worth more than its current exercise value.
Bibliography
“Option Time Value.” 2022. Wikipedia, January. https://en.wikipedia.org/w/index.php?title=Option_time_value&oldid=1067040888.