Of course it could also be literal, but it seldom is. Normally "yellow-bellied" is used to describe someone who is cowardly.

The term "yellow-belly" is a colloquial expression that is often used as a slang term to describe someone who is considered cowardly or lacking courage. It is derived from the idea that a person with a "yellow belly" is so afraid that their belly turns yellow. However, it's important to note that context is crucial in understanding the intended meaning of the term. In some cases, it might be used in a more lighthearted or joking manner among friends, and the implication of cowardice might not be as strong. In other instances, it could be used more seriously to criticize someone's lack of bravery. To determine whether the term is used in a direct or indirect meaning, consider the surrounding words, the tone of the text, and the relationship between the people involved. If it's used in a teasing or bantering context, it might be more indirect or playful. If it's part of a serious critique, it's likely being used in a more direct and critical sense.

reminds a joke "why is the crocodile wider than green?"